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Title: Bitcoin is a bubble. Post by: gongcheng on June 07, 2011, 02:22:36 AM From the financial point of view, it is easy to suspect that bitcoin is a bubble.
Most of us believe in the price on Mt Gox. But the price is not reliable. We can see that there are only around 50k BTCs traded by several hundreds users on Mt Gox every day. Therefore the price can be control very easily. Suppose I have 50k BTCs, I can register around 100 accounts on Mt Gox and distribute all my Bitcoins into these accounts and then I trade with myself from one account to other, every trade with a higher price. By this operations, I can easily drive up the price to whatever I want to drive. After more people get into the trade, I will sell the BTCs gradually to avoid the collapse of the price. You can see this analysis really make sense, because by doing so I can earn about 50k*18=900k, that's around 1 million us dollars according to the price today. Anybody agree or disagree with me? Can you give your argument? Title: Re: Is Bitcoin a bubble? Post by: DATA COMMANDER on June 07, 2011, 02:24:57 AM You could try that, but it would be a huge risk since you'd be spending more than 1% on each trade.
Title: Re: Is Bitcoin a bubble? Post by: gigitrix on June 07, 2011, 02:27:03 AM Anything that performs well and then badly is retroactively referred to as a bubble. It can only be a bubble if it pops, which no evidence points towards it doing any time soon.
Title: Re: Is Bitcoin a bubble? Post by: DATA COMMANDER on June 07, 2011, 02:29:13 AM Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this.
Title: Re: Is Bitcoin a bubble? Post by: broker11 on June 07, 2011, 02:32:52 AM A bigger Mt Gox problem may be that it is the one dominant place to convert to BTC.
If it is taken down there would be a real problem bringing more dollars into BTC. Title: Re: Is Bitcoin a bubble? Post by: gongcheng on June 07, 2011, 02:36:04 AM You could try that, but it would be a huge risk since you'd be spending more than 1% on each trade. This is not a problem, because in the beginning I started with nothing, only 50k BTCs which worth nothing. Title: Re: Is Bitcoin a bubble? Post by: gongcheng on June 07, 2011, 02:38:49 AM Anything that performs well and then badly is retroactively referred to as a bubble. It can only be a bubble if it pops, which no evidence points towards it doing any time soon. You have not point out is there anything with my argument. Title: Re: Is Bitcoin a bubble? Post by: gongcheng on June 07, 2011, 02:40:53 AM Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this. you can send me a few bitcents by this address: 167WiVPxF6FP6WBfPShRQzj9QrvFNJ8AZX because here is quit a few examples about economic bubbles: http://en.wikipedia.org/wiki/Economic_bubble Title: Re: Is Bitcoin a bubble? Post by: DATA COMMANDER on June 07, 2011, 02:47:18 AM Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this. you can send me a few bitcents by this address: 167WiVPxF6FP6WBfPShRQzj9QrvFNJ8AZX because here is quit a few examples about economic bubbles: http://en.wikipedia.org/wiki/Economic_bubble No, the whole point is to find a list of things that were called bubbles at the time, whether or not they actually turned out to be bubbles. Title: Re: Is Bitcoin a bubble? Post by: unk on June 07, 2011, 02:55:23 AM more fundamentally, whenever there's just one exchange (or a group of colluding ones), there's always the possibility that the exchange itself is a ponzi scheme. i'm not accusing the operators of mt. gox of that, of course, but there's little way anyone would know if that's what they wanted to do.
i'm half tempted to make a large sale and transfer just to satisfy my inner empiricist and prove to myself that it would be possible to withdraw a large sum of dollars. (i don't believe i can recall anyone in the forum claiming to have pulled out $100,000 having deposited only bitcoins.) if you imagine the whole bitcoin economy from the perspective of a cautious outsider, rather than one of us who feels he has some sense of the history and personalities involved, a fear that the whole thing is an illusion would be quite a legitimate one. as to the question about bubbles, i don't have statistical evidence to back it up, but overall very few things have been called 'bubbles', and most have turned out to be bubbles. it's hard, indeed, to think of counterexamples. (there are relatively few examples of stable, rapid, exponential price growth overall in the first place, and not all of them are called bubbles. people didn't say microsoft was a bubble at the time, for example. in fairness, surely some did, but that wasn't the tenor of the news or the public discussion.) Title: Re: Is Bitcoin a bubble? Post by: unk on June 07, 2011, 02:57:29 AM (by the way, where's kiba's cartoon? am i admitting either my denseness or lack of touch with what today's internet culture considers funny if i say that i never really understood it? i always felt like it was perhaps missing the final frame.)
Title: Re: Is Bitcoin a bubble? Post by: gongcheng on June 07, 2011, 02:59:35 AM Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this. you can send me a few bitcents by this address: 167WiVPxF6FP6WBfPShRQzj9QrvFNJ8AZX because here is quit a few examples about economic bubbles: http://en.wikipedia.org/wiki/Economic_bubble No, the whole point is to find a list of things that were called bubbles at the time, whether or not they actually turned out to be bubbles. I believe that all the bubbles listed in the list were called a bubble by some wise guy during their time. For example, Peter Schiff has predicted that the price of American real estate is a bubble and when it collapse it will lead to world wide economic crisis. In fact it is not difficult at all to find a bubble. However, it is difficult to convince others that it is a bubble because people have invested money into the bubble and unwilling to believe it is a bubble. Title: Re: Is Bitcoin a bubble? Post by: DATA COMMANDER on June 07, 2011, 03:01:19 AM Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this. you can send me a few bitcents by this address: 167WiVPxF6FP6WBfPShRQzj9QrvFNJ8AZX because here is quit a few examples about economic bubbles: http://en.wikipedia.org/wiki/Economic_bubble No, the whole point is to find a list of things that were called bubbles at the time, whether or not they actually turned out to be bubbles. I believe that all the bubbles listed in the list were called a bubble by some wise guy during their time. For example, Peter Schiff has predicted that the price of American real estate is a bubble and when it collapse it will lead to world wide economic crisis. In fact it is not difficult at all to find a bubble. However, it is difficult to convince others that it is a bubble because people have invested money into the bubble and unwilling to believe it is a bubble. *shakes head* Not going to explain it again. Title: Re: Is Bitcoin a bubble? Post by: acamus on June 07, 2011, 03:02:45 AM (by the way, where's kiba's cartoon? am i admitting either my denseness or lack of touch with what today's internet culture considers funny if i say that i never got really understood it? i always felt like it was perhaps missing the final frame.) I'll just leave this here http://bitcoinweekly.com/articles/comic-reaction-after-dramatic-rise-of-bitcoin-s-value Title: Re: Is Bitcoin a bubble? Post by: DATA COMMANDER on June 07, 2011, 03:08:28 AM (by the way, where's kiba's cartoon? am i admitting either my denseness or lack of touch with what today's internet culture considers funny if i say that i never got really understood it? i always felt like it was perhaps missing the final frame.) It's...not funny. But in a strange way, it's becoming funny, just because he keeps posting it and it so obviously lacks a punchline. Meta-humor? Title: Re: Is Bitcoin a bubble? Post by: gongcheng on June 07, 2011, 03:13:13 AM In fact it doesn't matter to me, because I invested only a little money on Bitcoin. Even it is a bubble, I won't lose a lot of money.
I just want to warn those who want to invest a lot of money onto Bitcoin. Title: Re: Is Bitcoin a bubble? Post by: billyjoeallen on June 07, 2011, 03:14:51 AM Dollars A.K.A. FRNs are in a bubble. I checked the price of gold on Bloomberg and then I did a Google trends search on QE3 (next round of money printing A.K.A. intentional currency debasement) and it looks like the equity markets are already pricing in another round of Federal Reserve legal counterfeiting. The other nations of the world will follow suit in the next round of the endless race to devalue their own currency more. It's a race to the bottom.
Then the fun really begins. Capital controls. The only way to move your money across international boundaries will be Bitcoin or stuffing cash in your shoes. Title: Re: Is Bitcoin a bubble? Post by: stic.man on June 07, 2011, 03:15:47 AM In fact it doesn't matter to me, because I invested only a little money on Bitcoin. Even it is a bubble, I won't lose a lot of money. I just want to warn those who want to invest a lot of money onto Bitcoin. yeah, warn people that could help your investment and this system grow, real intelligent Title: Re: Is Bitcoin a bubble? Post by: gongcheng on June 07, 2011, 03:45:59 AM In fact it doesn't matter to me, because I invested only a little money on Bitcoin. Even it is a bubble, I won't lose a lot of money. I just want to warn those who want to invest a lot of money onto Bitcoin. yeah, warn people that could help your investment and this system grow, real intelligent I just want warn that there is a risk of bubble. So don't invest too much money. Otherwise you will lose a lot of money when the bubble collapse. Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 07, 2011, 11:09:02 AM Nobody agree with me?
Title: Re: Bitcoin is a bubble. Post by: rebuilder on June 07, 2011, 11:22:56 AM I don't agree it's a bubble, nor am I saying it's not. No way to know. I agree Bitcoin, if seen as an investment, is high-risk and think it's very prudent to keep reminding people of this.
Title: Re: Is Bitcoin a bubble? Post by: BubbleBoy on June 07, 2011, 12:07:21 PM Anything that performs well and then badly is retroactively referred to as a bubble. It can only be a bubble if it pops, which no evidence points towards it doing any time soon. That's untrue. A commodity that's rallying without a plausible change in fundamentals is a bubble, and it can be identified as such by anyone qualified to analyse the fundamentals; most of the time this means disproving the cause claimed by the bulls ("paradigm shift", "technological marvel", "unique opportunity", "limited supply" etc.) So the question is: who you trust qualified to inspect the fundamentals ? In the case of Bitcoin that's a complex task that touches on contentious and long standing problems in the field of economics, sociology and psychology: What gives money value ? Is inflation good for the society ? How about deflation ? Should monetary policy be used as a tool to regulate the business cycle ? Is such a thing even possible ? The answers to those questions are for most people a matter closer to faith than reason, as such it's hard to put your finger on the Bitcoin bubble with mathematical precision. Yet, that does not preclude the insightful one to identify the bubble before it pops, and steer clear of it, or ride it. Title: Re: Bitcoin is a bubble. Post by: jancsika on June 07, 2011, 10:41:43 PM That kiba cartoon just seems like reality. Which is probably why you're not getting any articulate responses to your question.
Are there twice as many sites taking bitcoin as there were a week ago? Has some huge company like Google said they'll be putting money into developing more user-friendly Bitcoin infrastructure? Is there a plan for a decentralized exchange involving more than just having people sending in their bank account numbers and PINs and having runners in masks sneaking around to ATMs at night? Has the U.S. government set up a site that gives a sizable credit to online merchants who pay their taxes in Bitcoin next year? Did alpaca socks turn out to cure herpes? What earth shattering event did I miss that explains a $20 bitcoin? Title: Re: Bitcoin is a bubble. Post by: jancsika on June 07, 2011, 10:44:28 PM (Well, I guess I shouldn't exaggerate-- $19.98001 Bitcoin.)
Title: Re: Is Bitcoin a bubble? Post by: DATA COMMANDER on June 07, 2011, 10:48:14 PM Anything that performs well and then badly is retroactively referred to as a bubble. It can only be a bubble if it pops, which no evidence points towards it doing any time soon. That's untrue. A commodity that's rallying without a plausible change in fundamentals is a bubble, and it can be identified as such by anyone qualified to analyse the fundamentals; most of the time this means disproving the cause claimed by the bulls ("paradigm shift", "technological marvel", "unique opportunity", "limited supply" etc.) So the question is: who you trust qualified to inspect the fundamentals ? In the case of Bitcoin that's a complex task that touches on contentious and long standing problems in the field of economics, sociology and psychology: What gives money value ? Is inflation good for the society ? How about deflation ? Should monetary policy be used as a tool to regulate the business cycle ? Is such a thing even possible ? The answers to those questions are for most people a matter closer to faith than reason, as such it's hard to put your finger on the Bitcoin bubble with mathematical precision. Yet, that does not preclude the insightful one to identify the bubble before it pops, and steer clear of it, or ride it. Translation: Don't be a realist. Don't think for yourself. There are authorities who are kind enough to do your thinking for you. They know everything, and they can predict the future. You are not qualified even to reserve judgment: just ask the nearest authority what your opinion should be. No thanks. Title: Re: Bitcoin is a bubble. Post by: Freakin on June 07, 2011, 11:13:46 PM Nobody agree with me? I completely agree with you. There is certainly risk of a bubble. Don't invest anything in bitcoin that you can't afford to lose. Title: Re: Bitcoin is a bubble. Post by: bitcoinBull on June 07, 2011, 11:42:30 PM I'll explain my perspective not for the sake of the market (which is obviously doesn't need my promotional efforts), but for the sake of the skeptics.
The earth-shattering, paradigm-shifting event that is sending the price of bitcoin sky high is (wait for it..): the adoption of bitcoin. Bitcoin. decentralized, p2p, secure, digital tokens. Once you have bitcoins, no authority can seize them from you. They are yours forever (barring any undiscovered vulnerabilities, of course, and you still have to protect yourself from theft). Paradigm-shifting. This is not Just Another Virtual Currency backed by some dot com that you can't redeem for dollars. So it has nothing to do with what goods you can buy. Because with bitcoins, you can buy dollars. $1 dollar three months ago. $22 dollars today. And with dollars you can buy goods. EDIT: P.S. Network difficulty is the primary fundamental backing bitcoin: http://bitcoin.sipa.be/ (http://bitcoin.sipa.be/) Title: Re: Bitcoin is a bubble. Post by: Bit_Happy on June 07, 2011, 11:47:24 PM Nobody agree with me? About MtGox cheating? Probably not, Bitcoins are getting a lot of media coverage and people are panic-buying, IMO. Title: Re: Bitcoin is a bubble. Post by: Dobrodav on June 08, 2011, 03:44:47 AM Hmm ? It is obvious. I am always looked at a people, that call us to take a credit to buy a bitcoins, like to a crazy shims.
Bitcoin is experiment. He has some known weak sides, and nobody knows, how much unknown. Witnessing start of first decentralized crypto currency is breath taken, - like at start of first star traveler. But nobody can guarantee, that this first start, will succeed. Anyway, that experiment will provide us with lot of data. Nobody, if he is in mind, will not advice you to risk more, than you can afford to loose, in that experiment. Title: Re: Bitcoin is a bubble. Post by: evoorhees on June 08, 2011, 03:50:52 AM What earth shattering event did I miss that explains a $20 bitcoin? You assume that the market price a week ago was the "correct" price. Consider that a "correction" can also happen in the up direction, can it not? =) Title: Re: Bitcoin is a bubble. Post by: imperi on June 08, 2011, 04:04:32 AM The "event" is the dozens of news stories in the media, especially the drugs story, which leads people to believe that maybe this isn't just some silly game geeks are playing with themselves.
Title: Re: Bitcoin is a bubble. Post by: Dobrodav on June 08, 2011, 04:06:54 AM Geeks playing just to get some weed ? heh.
Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 08, 2011, 04:07:34 AM I'll collect all bubble and manipulation links to this thread.
price maninpulation http://forum.bitcoin.org/index.php?topic=13221.0 Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 08, 2011, 04:45:27 AM So are we all guilty of a Pump & Dump?
http://forum.bitcoin.org/index.php?topic=12553.0 The $1000 Bitcoin, yes it's worth at least that. http://forum.bitcoin.org/index.php?topic=8248.0 Is the recent fast increase of bitcoin value a bubble waiting to burst? http://forum.bitcoin.org/index.php?topic=6879.0 Speculating on future prices http://forum.bitcoin.org/index.php?topic=12650.0 Anyone else here went through the Dot Com bubble in 1999? It is the same thing. http://forum.bitcoin.org/index.php?topic=13243.0 How to survive a bubble http://forum.bitcoin.org/index.php?topic=6332.0 Title: Re: Bitcoin is a bubble. Post by: Insti on June 08, 2011, 05:03:06 AM Nobody agree with me? Lots of people agree with you. They all start their own threads which are almost exactly the same as this one. (I don't agree with you.) Title: Re: Bitcoin is a bubble. Post by: charliesheen on June 08, 2011, 05:14:26 AM A bitcoin bubble has popped every week for the last month.
Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 08, 2011, 05:38:52 AM bubble imminent
http://forum.bitcoin.org/index.php?topic=3396.0 Article: the Bitcoin Bubble http://forum.bitcoin.org/index.php?topic=6659.0 http://ploum.net/post/bitcoin-bubble How is the current market state NOT a bubble? http://forum.bitcoin.org/index.php?topic=8196.0 Bitcoin price increases are just getting started http://forum.bitcoin.org/?topic=7985.0 Is MtGox inflating the bubble? http://forum.bitcoin.org/index.php?topic=13214.0 Title: Re: Bitcoin is a bubble. Post by: Grant on June 08, 2011, 05:41:30 AM bubble imminent http://forum.bitcoin.org/index.php?topic=3396.0 Article: the Bitcoin Bubble http://forum.bitcoin.org/index.php?topic=6659.0 http://ploum.net/post/bitcoin-bubble How is the current market state NOT a bubble? http://forum.bitcoin.org/index.php?topic=8196.0 Bitcoin price increases are just getting started http://forum.bitcoin.org/?topic=7985.0 Is MtGox inflating the bubble? http://forum.bitcoin.org/index.php?topic=13214.0 Dude sell us some puts https://bitoption.org/?closedate=2011-07-28 That's the best way to increase credibility of your posts. Title: Re: Bitcoin is a bubble. Post by: jed on June 08, 2011, 11:57:45 AM unk: there are a lot of people that have withdrawn this much from mtgox. Ask the big miners if you want someone other than me to confirm that.
I'd say the reason for the price rise is pretty simple; a lot more people into bitcoin and a lot easier ways to get money into mtgox. So I think it is only a bubble if the userbase is a bubble. Title: Re: Is Bitcoin a bubble? Post by: chiropteran on June 08, 2011, 12:28:00 PM That's untrue. A commodity that's rallying without a plausible change in fundamentals is a bubble, and it can be identified as such by anyone qualified to analyse the fundamentals; most of the time this means disproving the cause claimed by the bulls ("paradigm shift", "technological marvel", "unique opportunity", "limited supply" etc.) Is going from being a niche hacker-project to mainstream news not a paradigm shift? Someone else mentioned Microsoft. I think this is a very similar situation. Microsoft's value went up dramatically as computers changed from being a device used only by a small minority to basically everyone. It makes sense to me that bitcoin value will go up as they go from being a niche product to mainstream. Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 09, 2011, 01:55:32 AM [FAQ] Is BitCoin a Ponzi or pyramid scheme? (Newbie-Friendly)
http://forum.bitcoin.org/index.php?topic=7815.0 Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 09, 2011, 02:23:28 AM Bubble and crashes
http://forum.bitcoin.org/index.php?topic=249.0 Bitcoin gonna burst? http://forum.bitcoin.org/index.php?topic=12414.0 Geeks and Wallstreet http://forum.bitcoin.org/index.php?topic=13502.0 Title: Re: Bitcoin is a bubble. Post by: Grant on June 09, 2011, 02:29:59 AM Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 12, 2011, 02:43:42 AM Now it seems the case of skyrocketing price is what I predicted.
Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 12, 2011, 12:57:52 PM What shall I say, the bubble is blowing again or people start to buy?
Title: Re: Is Bitcoin a bubble? Post by: Gandlaf on June 12, 2011, 01:17:27 PM Someone should research everything that's been called a bubble when it started and figure out how many of those things actually turned out to be bubbles. I'd kick in a few bitcents if someone put a bounty on this. I doubt there´s an exact, indisputable way of determine what is and what is not a bubble(except in hindsight). But this might be a good start in terms of what indicators are concerned: http://www.ritholtz.com/blog/2011/06/how-to-spot-a-bubble-in-real-time/ (http://www.ritholtz.com/blog/2011/06/how-to-spot-a-bubble-in-real-time/) Title: Re: Bitcoin is a bubble. Post by: SlaveInDebt on June 12, 2011, 01:39:04 PM Here we go again...
http://img.thesun.co.uk/multimedia/archive/00860/Bubbles1-682_860161a.jpg Title: Re: Bitcoin is a bubble. Post by: gongcheng on June 16, 2011, 10:03:32 AM http://forum.bitcoin.org/index.php?topic=17787.msg226502#msg226502
Title: Re: Bitcoin is a bubble. Post by: MikesMechanix on June 16, 2011, 01:19:36 PM Suppose I have 50k BTCs, I can register around 100 accounts on Mt Gox and distribute all my Bitcoins into these accounts and then I trade with myself from one account to other, every trade with a higher price. By this operations, I can easily drive up the price to whatever I want to drive. You seem to completely ignore the fact that you'd have to buy the others' coins as well. Title: Re: Bitcoin is a bubble. Post by: Klestin on June 16, 2011, 01:32:59 PM You seem to completely ignore the fact that you'd have to buy the others' coins as well. Yes, in fact there's no need to start with coins - just buy out the for sale coins until you reach your target price. The cash outlay is the same either way. Of course raising the price doesn't make you a profit - to make a profit you'll have to keep the price higher than the average you paid while you sell them all. That's always the hard part. :)Title: Re: Bitcoin is a bubble. Post by: jdpy19 on January 13, 2021, 02:20:41 PM Yes, bitcoin is a bubble.
Bitcoin's bubble will pop. Not once, but many times; over tens of years, leading to bigger bubbles. Hope you still have your coins. Title: Re: Bitcoin is a bubble. Post by: JimboToronto on January 13, 2021, 04:21:01 PM |
