Bitcoin Forum

Exponential growth in value! Get in while you can! Aaagh - 20% increase while I was waiting for the wire transfer to arrive!
Heard it before? Sure you have. So - will the bubble burst? Or is bitcoin just different? The exeption from the rule? The only true God this time?

The same happened to me. I would have bought on Monday, but still don't have my money in the exchange due to slow bank transfer. :)

As for will the bubble burst, I would say almost certainly yes, as most speculative investment bubbles do. The problem is knowing when that correction will come, and how big will it be. For example it could come say at $200, and you'd still make a lot of money buying in now. That's the fun part of investing, or I should say speculation.

I am personally waiting right now, we will see if that was the right choice or not.

Good points! As a matter of fact, loosing investment opportunity due to slow wire transfers is itself a good illustration of the need for a currency like bitcoin. How is it possible for banks to use 3-4 days on a transfer. Do the travel personally bringing the money over to Japan?? (no, that would have been faster)
 

Yes, I felt that way when I first started buying a long time ago...

If it continues, then the bubble will pop. But until recently it has been growing linearly and not exponentially...

I've been buying gold and silver for years and have heard of them being in a bubble many times. They go up and down, but go up overall. I think bitcoins will also have ups and downs. I'm sure there will be some that think a bubble has popped when the price adjusts down, before the next up, but it's down it's the best time to buy!

It will burst but not to rock bottom levels

It's been pretty crazy watching it climb this past month.

The price should be going up as long as ppl have confidence in market.

I'm not so sure the term "bubble" is a good one.

Since Bitcoin is so many things - currency, commodity, payment system, protocol, internet money -  you can't make direct comparisons with say; the real estate market or the gold and silver markets.

IMO Bitcoin has several of the qualities of an Internet startup company with new/revolutionary technology. And some startups just keep gaining value until they are multi-billion dollar companies...

The fact that valuation is rising fast does not necessarily imply that there is a bubble.

If you think we're in a bubble, you shouldn't be buying.

To me its not a bubble, price is just catching up BTCs value.

I would also guess part of the reason for the big rise in value is the small "crash" on March 12th. My theory is that this kind of negative event actually create a psychologically positive outcome.

I.e. many people were sort of expecting, and a bit afraid, that some kind of bug may be discovered in Bitcoin which compromises it. Then when it occured, but wasn't as bad as many had feared, it kind of felt positive and reassuring. Also looking at the chart, the price didn't fall incredibly far, which suggests there were many people buying when others were selling, and it had a lot of 'support' regardless.

Personally I think this might have more to do with the recent rise than the Cyprus situation.

If so many refer to it as a bubble, it is not a bubble. Once everyone and the shoeshine boy refers to it as a "new paradigm" and "permanently high plateau" then maybe it is a bubble. For this to happen BTCs gotta be above 1mil$ a pop.

June 2011 was obviously, with hindsight, a bubble.

This looks a bit bubbleish, but may or may not be. Actually, I don't feel this rise is a bubble in the sense of BTC being overvalued. But a short-term downward correction is quite likely to occur (severity of which unknown) before the rocket relaunches. To replicate the 2011 bubble proportionally, we'd have to be seeing $1000+ prices in the near future, though.

It's not a bubble, it's the price adjusting to reflect the increase in demand. If demand decreases... say for example the influx of new websites accepting Bitcoin slows or reverses, the silk road shuts down, or some government(s) outlaw or restrict the use of BTC, the price will decrease accordingly. There is exponentially less speculation involved with the recent price increases than there was in previous years. Bitcoin is stabilizing as a useable currency. Even the Silk Road dying wouldn't hurt too badly at this point.

I'm not saying it's never going to drop below the 60s again, but long term it will only keep increasing as adaptation becomes more widespread.

I'll just add this:

1. New technology adoption is typically growing exponentially.
2. BTC value is linearly proportional to Bitcoin adoption.
 

Why should we care? Oh, wait. You're playing games with switching back and forth between currencies? Good luck with that.
If you just use it as a currency, as intended, this is a non issue. If you fancy yourself a speculator then prepare to periodically loose your shirt.  

But to seriously answer your question, if it is a bubble then it will pop. That is what all bubbles do.

I don't think it is a bubble. If we value the bitcoin economy in 500 mill $, that is nothing compared to the international transactions of money or forex. Just in the case bitcoin in 5 years gets a 10% of the international transactions of money due to it's inherent advantages over let's say mastercard, we would be talking of a bitcoin economy 10.000 times bigger and that in just 5 years would mean bitcoin valuation still has to climb a lot of numbers. Not a bubble on my opinion.

Cheers,

You are so right

If you believe in the bitcoin as a future currency you shouldnt care if its a bubble

My two cents, take with grain of salt -- I do not see anything on the horizon that could burst this bubble (if it is a bubble) anytime soon. There are too many people still getting introduced to BTC for new buyers to dry up. It would take a seriously detrimental piece of bad news to crash BTC and the good news will continue.

My take is that this run-up is part of a second Hype Cycle. At some point we will sell-off ($100, $200, ??). One key to BTC success is Joe Consumer. Joe Consumer, for the most part, has no need for BTC. The market is pricing in a great deal of future acceptance - so much that it will certainly be letdown when Joe Consumer doesn't widely adopt BTC as quickly as many would have hoped. Speculation will succumb to correction. If/when BTC does come back down it will still be higher than the lows of the past because there is an underlying magic to the genius concept of BTC.

And then this cycle will likely repeat at a higher level, perhaps. Unless, of course, the idea of BTC as an alternative asset never quites catches on completely. Really, BTC has two threads of success -- consumer adoption and the potential as an alternative asset -- and they feed on each other.

These hype cycles are normal for groundbreaking technologies. The solar industry ebbed and flowed over decades in a similar fashion. Full adoption was always right around the corner. Things always take longer to gel and there is almost always letdown in the meantime.

To believe in BTC, one has to value the network effect and popularity that makes BTC tradable as a virtual commodity/currency. Yes, BTC provides other benefits but those benefits can be found in other virtual commodity/currencies (LTC, PPC, etc.). It is this network effect that makes BTC the Coca-Cola of virtual currency. IMO there is value in this.....the only reason gold has value is because we all believe it does.

oh by the way, i have been checking almost non stop twitter for "bitcoin" and always appear a tweet from "The economist" saying that the graph looks like a bubble. Seems there are many players out there that are quite worried of bitcoin.

Ha ha - I love the concept of Bitcoin AND I am a speculator - tried to buy when it was down in $5 - but my bank could only transfer yen to jp - and I kinda forgot the idea for 8 months. So much for laziness!

I read about digital currency with facination in my studying time (the same time Gopher browser was the only decent browser)  LOL
I lost so much money on speculation before - but what the hack, this time its for a good idea also! I get a new shirt.

In the long run a $60 bitcoin might not be a bubble at all.  More and more businesses might accept it, drug money might be poured into.  Money from hedge funds might drive up the price just like investment firms are driving up housing prices in place hit hard by the real estate bubble.

However a glitch here, a bug there and a virus there can send prices tumbling. 

Perhaps a bit coin might be priced where gold is in the near future.

All bubbles eventually burst.  They usually revert back to wherever the bubble started and at about the same time interval that the bubble grew.  Pretty symmetrical.

Demand is increasing rapidly.. hash rate is increasing rapidly.. and yet the market cap is still relatively small, and a very, very small percentage of the population is in the game. I would not call the current valuation a "bubble" at all.

If BTC were a public company, most people wouldn't even consider investing. That's because a $600M market cap is miniscule in size, and would be likely to offer substantial risk. Of course this type of comparison isn't totally fair, since BTC is much more than just something to invest in -- it is a currency with unique and highly-desirable properties. There will certainly be some corrections along the way, but I do think the chances of a massive sell-off down to single digits is just out of the question (barring some unforeseen catastrophe). Could we see $30s or $40s again? Absolutely. There will be volatility. However, long-term prospects look very rosey, indeed.

I agree. However, there are many good small cap stocks that have sub $600MM market caps.

People are buying into the potential of "a currency with unique and highly-desirable properties"; it has not yet been widely adopted so it has not yet become a useable currency for most people. I think merchants will adopt it much more quickly than consumers because BTC is becoming du jour.

If BTC achieves what it is designed to achieve, the long-term outlook is beyond amazing.....it's unprecedented.

The bubble isn't in BTC at all.  It's in fiat currencies.  Helicopters have been dropping paper all over the world for years now.  This is the bubble.  As paper purchasing power continues to erode, BTC holds/gains value against paper.  Since there is no underlying paper market (derivatives) in BTC (unlike gold), it cannot be manipulated and suppressed.  As everything else goes to shit, BTC remains the shining beacon of light.  And demand will continue for many years to come.  Sooner or later, noone will be able buy a whole BTC.  Only a fraction.  And the early adopters will be wholly rewarded for assuming most of the risks. 

Facebook, a fad website with a $100B market value?  Bubble.

As you would know from experience; "buy the dip."  8)

I agree with bitsil. It's the fiat currencies that are losing value in relation to bitcoin.

Um... that might be taking it a bit far to say that the fiat currencies are crashing against Bitcoin, but right now BTC seems more solid than anything Fiat by far.

All bubbles burst. Know the signs... I would say we're in the "Enthusiasm" or "Greed" stages.

http://www.bigtrends.com/wp-content/uploads/2012/01/Bubble-Phases.png

To be fair, you could say the same about the New York Stock Exchange right now.

I don't think that the bubble will burst because of all the new users and business but if it burst it won't go under 30 dollars.

These cycles are part of the inherent flaws of capitalism; nothing is immune. The thing that will unmask this temporary over-exuberance, if that is indeed what is going on, is the fact that Bitcoin will take much longer for the consumer to adopt than everyone is anticipating. With such a small market cap, the new merchants that are accepting BTC won't see much additional business. Can it exist only as primarily a speculatory alternative asset if it is not being widely used for its primary purpose? If so, for how long.....

Because BTC is a longer term play, it will probably be subject to several of these up-down cycles (probably doubtful to get washed out like after the first cycle, barring the unforeseen). It's so unique in that it has characteristics of so many different types of assets. It's part tech stock (an incredible tech story), part currency, part commodity....it's even like a piece of fine art in the sense that the technology can be perfectly copied and replicated (LTC, PPC, etc) but only the original holds high value.

The network effect and popularity are ultimately giving BTC this value.....it has brand appeal, which is also quite interesting. A rose by any other name....

We're still in the smart money phase of your chart.  The fact that I can buy more than 1 BTC is evidence.  Only 10M in circulation.  These little blips are nothing.  Accumulate and wait.  Buy some goods and services now and then on the way up, spread the joy.  Positively contribute to the community.  What happens when 1 out of 10 people in the worlds largest 10 cities, want in on bitcoin?  25M people chasing 10M bitcoins.  Just to get into the community.  Do you think the price of one btc will be $50/per?  Do you think the bitcoin economy will be $500m?  Try something like 100B, or 200x what it is today.  Can't know for sure.  What if, what if, what if.  1 out of 10 people in the world's top 100 cities?  1 Trillion economy.  2000x what it is today.  Amazing to think about.

Talk of a bubble this early on is absurd.

  

If BFL turns out to be vaporware, the bubble will burst like no other

I had this thought too. I'm holding/watching the market right now - and I'm a big believer in buy-and-hold strategy when it comes to honest money like gold or bitcoin.

I dont think we will see the area below $50 again.

Do you read the news? Did you know the bitcoin reward was halved in December?
Did you know that bitpay is getting a lot of money from venture capitalists?
Did you know the government has created guidelines for bitcoin?
Did you know Cyprus is in the toilet? And so is Spain, New Zealand, Greece, Argentina, and others...?
Did you know about ASIC and the higher difficulty rates we will be experiencing soon?
There's no bubble, welcome to the real value of bitcoin, and this is just the beginning.

At this point it just seems like panic buying

One of the best analyses presented on this so far.

If you think this is going to act anything like the stock market, think again. I have been investing actively in the stock and options markets for over 20 years. I have never seen anything like what Bitcoin is doing. The forces acting on it and the nature of how it is bought and sold are entirely different and totally astounding. Some serious players are getting down with Bitcoin right now. I am constantly talking the back channels. The big money managers are going to be taking over the place soon, and that's when you will see the serious money. It's chump change right now.

Maybe it's just we have got a lot of working class miners out there that are not really experienced in finance. Not sure. But it seems to me that the market has been owned by amateurs up until now. These price multiples you are seeing are like raw ribeye in front of Lions. I'm lecturing some investors this month, with millions of dollars mobilized and they are ready to dump out of USD pegged plays. They want me to show them how it works and how to buy in. And I'm just one solitary fella. Every one I have told about the bitcoin market has pretty much gone bananas.

We are seeing an evolutionary progression from a nerd-owned system (no offense, im quite a nerd too) to a pro-owned and "everyman" owned system.

I highly exhort you to think about Bitcoin differently than what you may already think you know. It's not a stock. It's not a bond. It is entirely new and different, drastically different than anything that has come before.

 

The question clearly presupposes a bubble but we should not jump to this conclusion on the basis of a rapid price change alone. A bubble is when prices cannot be supported by fundamentals. The ultimate question is what is the fundamental value of Bitcoins? This will depend ultimately on what share of global transactions are made with Bitcoins. I don't know the answer to that, but as long as the integrity of the currency proves itself (still an "if"), its market potential could be much greater. Having said that, when there is panic momentum buying of Bitcoins, without regard to fundamentals, it is very reasonable to see the latecomers panic out again should prices begin to fall, exacerbating a decline. So regardless, Bitcoins are likely to continue to experience huge volatility, and a sensible approach would be fade intense episodes of buying or selling in the market.

While BTCINVESTOR is absolutely right that bitcoin is not stock, the way the market plays out with periods of panic buying and selling could still apply. I'm as much as, or almost as much as a bull as BTCINVESTOR but I know the bears will come out to play from time to time. This is not something to be feared, it is an opportunity to be revered. :)

Bitcoin.

Smart money was 2010/2011

http://www.bitcoinx.com/charts1/chart_large_lin.png

Exactly. One can't stay parabolic forever. At some point, there will be a correction (very normal).....but IMO there is more room to run for the time being ($150+). A lot of the new money coming into this.....Probably a mix of hot-money (with little tech savvy) and perhaps high-risk fund money, as others have insinuated. In the fund management world, I assure you that only very high-risk money (small %'s of VC type funds) will be flowing into this......your typical hedge fund will not be investing in this in the near future. I seriously doubt event-driven funds even know what BTC is, and 95% of private equity is way way too conservative to invest directly into BTC. VCs will be much more interested in investing in start-ups associated with BTC. And we are farther from BTC as an 'everyman system' than everyone is thinking.

Sorry for the double-negative, but there can't not be over-exuberance with BTC. The potential is too big for people not to get too too excited in the short-term. This rise, which will likely continue, will end up pricing perfection. Nothing is perfect or guaranteed. But hey, If the network effect can give FB a $100B market cap, perhaps the network effect can give BTC something similar......I am a believer, but a realist in that nothing goes up forever and some point we will get way way over-extended (where, who knows?). That's just the nature of the game.....

And as far as professional money getting involved in this, I would be looking for lone day traders at Goldman Sachs et. al. to be getting involved in speculation before large funds pour money into this market. The funds are savvy and realize that the market cap of BTC could not handle large capital inflows.....they are smart money, and doubtful they would want to ride a wave of speculation without getting in at the bottom floor.

VCs have meetings all the time regarding new technology. That does not mean that directly after the meeting, they will pour huge $$ directly into BTC. These meetings serve to enlighten them on the technology so they can invest in other BTC start-ups. There are some smaller shops that shoot for the moon who may get interested, but you will not have groups like Sequoia Capital investing directly into BTC. They would be investing in a BTC start-up......

Max Keiser believes in a $100k BTC soon :P

He also said "$500 silver if you want it" it got to $50

I wonder if one factor with the current bubble is the difficulty in cashing out because of withdraw limits at exchanges. There are still a lot of early adopters/investors sitting on a ton of coins that are very difficult to actually sell. For example, MTGox has a $10,000 USD monthly withdraw limit. If you wanted to sell $1million USD worth of bitcoins it would take 8 years to withdraw it. I'm thinking this could be preventing a sell-off and once those limitations are removed, I expect a major correction. I honestly wouldn't be surprised to see it hit $15/BTC at some point once these sorts of restrictions are removed. Right now I suspect many are only selling as much BTC as they can withdraw which artificially limits the supply since I suspect there might be a lot of people dying to sell right now.

/$0.02

There is a way of increasing the withdrawal limit on MtGox. You have to go through another round of verification in order to raise your account status from verified to trusted.

This is no bubble!!!!
Based on this exponential growth pattern i predict the following

June price $375 per BTC
September 1875 per BTC
December $9375 per BTC
by 2020 1 BTC will be worth $6.9849193e+22 or approx 10 billion times earth's current GDP.

Keep buying people

 ;D

Do you know what the max withdraw for trusted accounts is?

yes, the bubble will burst soon. The Ben Bernanke's bubble...

Or a hacker could create separate branch node thingy and create his own version of bitcoins from it

Unlike other markets, I am not scared of a bears or spooked speculators. If the price goes down to 1 usd per BTC
I will simply buy more of them, unless there is a new reason why BTC cannot be used as an online currency.

Bubbles are not unique to the stock market.  Look up the Tulip bubble.

I think it will slow down on weekend befor it gets to the final 100$ in march  ;D

Some pretty interesting responses.

Measuring the volatility for the next couple of years will be fascinating.

With the current supply and demand factors at play, specifically the last couple weeks moving into the next couple weeks,  (new interest, speculation players, European Economics and of course, Avalon ASIC Batch #3) cannot be ignored when guesstimating what the short term value of BTC will be.

It's fascinating the consider (IMHO) that $100/btc by 03/31/13 seems realistic and even probable.

Thats why I dont buy bitcoins now, you know someone has to pay this bubble.

Isn't the value of something always depending on offer and demand? Right now there is a lot more offer than demand which is a problem, and could lead to a crash. If everyone realizes that they have huge piles of coins and no way to transfer them to goods or other currencies, that could drive the price down. The way to ensure BTC's future is to see many more companies start accepting payment in BTC.

Right now there is a lot more demand than supply.

Do you think this is because people are holding onto their BTC?

I picture those with large btc wallets holding onto them waiting for the time to sell, which is always tomorrow with BTC's value increasing. IMO, that is a likely reason supply is low.

btc has many things going for it

• It is established, trusted and accepted on the internet
  It is the easiest way to access black market activity anonymously, such as weapons, drugs, Botnets, adult content
  IT makes it legal to gamble online in the us (and probly others) This is a big plus
  It is deflationary, meant that it is designed to keep rising,
  just as the USD once was backed by gold, btc is backed by electricity costs

One thing holding it back, is the fact that you cant use credit card or paypal to buy it

I'm interested in what you mean by BTC being backed by electricity costs? I understand that mining uses power, how does power (and its cost) back it?

There are ways to buy btc with a credit card.

One doesn't need Mt Gox to sell $1M in btc.  One just needs to find a buyer.  Meet in person to exchange, or wire money to escrow.  8 years to sell through Mt Gox?  Let's use our imagination just a wee bit.   

And I seriously doubt that Mt Gox monthly limits are what's limiting sellers right now.  You don't sell in masse into price appreciation.  The herd sells on the way down.  Who's had time to even think about selling in the last 4 days.  It's shot straight up.  This said, I'd really like to see a move back to the $50 range, so I can exchange fiat for btc at a much more favorable rate. 

I guess it will keep fluctuating until it is a widely accepted currency, hopefully it wont take too many more years to be accepted but who knows. I would like a bitcoin bank card to be able to withdraw cash instantly, anyone know if this is being developed? Cheers.

Some of it is. You cought me!

I'v been following bitcoin for years. Not like I have the past few months. But Is something I always checked up on. There are many ppl like me who seen the recent changed and realize even if this is a bubble, long term its going up.

If you compere the network hashrate and the BTC/USD, the charts are relatively the same.

Long as people don't abandon bitcoin for trade, we are looking at a new era of monetary systems. Much how the internet changed technology. or fighter jets revolutionized air-warfare.

For 21-28yr olds with 12+ hours a day on a computer, if you arnt getting what u can into bitcoins. I don't know wtf is wrong with your logic. We are due for a correction, Avalon has created a bubble but I think its not going to be noticed or fall d/t the world financial stage and other factors.

Regardless of a possible burst bubble (which I highly doubt!), I've made quite a bit of money in the run-up. What is very possible though, is a is what we see often in bull markets, and that would be a correction. Market corrections can be between 5-20%. What I'm seeing too, is the USD strengthening against major currencies because of the steam the economy is picking up. This can negatively impact BTC-USD trading. But like I said, at the moment I'd value the BTC at >$60USD at the very least. Interest in the market is picking up, block rewards are 25btc instead of 50, and economic conditions are favorable for investment -- increasing demand! I've got $80 limit sells, and $57.50 stop loss. i invested originally at $14.00-14.50.  I'm good. ahha

Well, basically we hope for it to be a bubble, right? because buying BTC at $70 feels so wrong.
Friends of mine joked about another earthquake in japan might have an influence on the price because mt.gox is located there. That is an interesting question, I think.
Still, I actually don't see how the price could drop back to a new rock bottom. as soon as it'd be down to $30-$40 we all would buy like crazy, right?
tbh I was astonished to see what little effect the recent chainfork - the worst case scenario of bitcoin - had on the price.
It seems that bitcoins are trusted in. they're here to stay and people understand that. so yeah, in the long term prices will go up. But I hope for a price drop without people in good old japan being harmed ;)

tl;dr: we hope its a bubble, but its probably not.

interesting point!

I have a feeling that if it does burst it will not drop below $20... If it does burst you will see me buying coins like crazy!

My opinion; once BTC plateaus for more than a week or so it will end up dropping when investors think the value has stalled and they will get anxious to cash in before the drop happens.

The other day I read an article that compared bitcoin with gold. I think it will take a while for the price of bitcoin to get stable, and I guess it will be a bumpy ride. But i don't think the bubble will burst completely.

The price has just been increasing the last few weeks.  Wish I had joined earlier.  The more people who flock to bitcoin and use it consistently will only make it that much more solid.  Sure it might be a bubble, get hacked terribly or have something else monkey wrench it.  But for me I decided I just wanted to be a part of this cool development.  I will have the street credit to be able to say I was an early adopter.  If this thing really really succeeds, then the fact I saw it, got involved, will be worth far more to me than any of the miniscule money I can invest right now.  What I do invest will be for the long haul.  This really sounds like it could become the next big thing.  Too bad I am 2 years or so late.

Just like Twitter took off when 'normal' people started using it and advertising their Twitter handles, Bitcoin will really take off when you can buy from 'normal' stores like Amazon, Target, Walmart, etc..

Yes it's a bubble the will keep growing.   It's by design.  I think that FRC has a more flexible algorithm that encourages spending versus hoarding.  Also lost bitcoins can't ever be reclaimed.  The coins outstanding are going to keep decreasing, thus causing more scarcity and a higher price.

So there is not reason to spend BTC by this logic, thats why I call it bubble. Many believe they will get rich this way, but in real world this happens very rarely.

There are at least two problems with Bitcoin:
- max 10 transaction / second  = cannot compete with current payment methods
- easy to do laundering / support terrorist = probably will be banned in future by goverments

Yes it is a bubble that will crash but it is difficult to predict the long term price, so in five years who knows?

Funny you say that, when I sent the wire it was around 50, when I could trade it was 71..  stinks..

The dollar bubble will really burst when bitcoin hits Apple parity ($424 bil market cap or about $20,000 per bitcoin).

Finland could help by officially adopting bitcoin...

Or Iceland. Cheap electricity there and they could do with a bit of a cash injection, I'm sure.

+1 for _Not_a_Bubble_.

Bitcoin is too much to too many people. It is climbing now because it is getting picked up in the following allocations:

• 49% Speculators/Hoarders/Liberty Lovers (People buying to hold)
• 1% Arbitragers
• 20% Monetary refugees (Think Cyprus, but the whole Eurozone and argentina right now. These are long but not very long holding)
• 10% Users who just want to see Bitcoin flourish (so will buy and spend repeatedly)
• 20% System D (http://themonetaryfuture.blogspot.com/2012/03/could-bitcoin-become-currency-of-system.html)... Which is the 2nd largest Economy on earth, next to the USA. (Of course they will have a slow adoption rate.)

So since 49% speculation isn't enough to crash the market, and especially since we do indeed have arbitragers helping keep the chart less volatile, I'm convinced that we are never going to see a full correction to the huge gains we've made in the last month or two.

Perhaps we could lose 25% or something though on some bad news... But no way, no how, are we going back to under $40 until the US Gov makes Bitcoin illegal.

Where do you get your percentages from?

From what i'm reading here and there, the ASIC's coming along will make it harder to mine BTC, which will push folks into mining LTC.. if any substance to this at all, then I suspect that the next bubble might be in LTC ?

( now, thats 5 posts and more than 4 hours, let me out of newbie hell, please ?  ::) )

Is this the new bottom? Price drop today from 72$ to 62$

I dont hope so :D

when the news gets out about the cash withdrawal restrictions and reduced hours coming to US banks... Soaaaaaar!!!

I made a bet just for those who feel strongly about THE BUBBLE! :)

Bitcoin will drop below $55 anytime before June 1st, 2013 (http://betsofbitco.in/item?id=1428)

Well, seems you have a good chance to win this bet as it seems right now.
Also the OP question seems to be answered: the bubble is bursting right now.

And it's still not bottomed out yet I'm afraid...

Nope. But is was predictable. Kinda funny reading through the thread now. I think price drop will halt at $20-$50 which for me feels like an reasonable value. Bad news for everyone who thought that buying btc for $150 was a good idea.

at $61 now

It bursted!

POP, hisssssss....

the bubble wont burst yet, ppl will pump and dump for a long time i guess

make sense, the last bubble looked the same except there was one zero missing at the end of all numbers. so maybe in 1.5 years we'll see the bubble bursting at 2500 usd falling back to 600 usd?

It went up way too fast. 2.5 weeks from 65ish to 260. That's highly unstable not to mention I have a feeling that a lot of the buying and selling was automated.

It's not a bubble, a pyramid or a ponzi.  I'm so tired of the detractors who oversimplify this. The pundits in the media clearly do not understand the system. Almost across the board they miss the significance to the system of mining. They think mining is some mysterious crypto puzzle by which bitcoins are magically minted. If you miss the fact that the idea of mining is to secure the network and create the blockchain then sure it looks like a scam or a bubble.

Bubbles are based on consumer ignorance and desire chasing a want for something to an extreme that defies logic. Demand for that thing spirals so far out that everyone drops what they are doing do make more of that thing because the profits are insane. Eventually, either the needs are all filled or the herd wakes up and demand falls. At this point the thing that makes it a bubble isn't the fall in demand it's the fact that 75% of your economy is now tied up in manufacturing the thing for which there is no longer a demand.

ASIC's are a potential (and likely) bubble due to the ignorance of the average person clamoring to get one at any cost. Fortunately for bitcoin, this only raises the perceived value of bitcoin. If some sheep buys an ASIC miner for 30k, he's going to expect a bitcoin mined with his rig to be worth something in relation to his investment.

People will eventually wake up and realize that bitcoin's primary strength is the fact that I can send money from Florida to anywhere in the world essentially for free. It's next largest strength is the ability for a merchant to make a non cash transaction without paying 4-14% to a processor. The secondary strength is where it will most likely find long-term adoption by the herd.

This was a panic plain and simple, not a bubble!

Thanks for reviving this thread.
I was trying to find this pic.
CAPITULATION phase?

Going from only my recollection, BTC is following this path to a 'T' (if that is the proper term)

Interessting picture, but the mean is still difficult to define especially Bitcoins are something that newer existed before. Bitcoins are currently under evaluated, even it looks currently like the price was corrected by the market.

It will settle soon. www bubble took much longer to develop and burst. Bitcoins is a sped up bubble.

I'd say denial or bulltrap area now..

The cause of the meteoric rise may have been media publicity, but the only thing stopping this from being mainstream is a legitimate exchange on US soil. Say what you want but people just don't trust sending their money to the "36th bank and lack of trust of Slovenia". Enter stage right coinsetter.com and merchants will jump on board. Once the merchants know they have a reliable, instant method of converting bitcoins back to fiat they will line up to start taking them.

Personally I think it will recover alot

  It seems the current problem with BTC and what's driving the price down is a loss of faith by the public in general in the currency which is due to the inability the brokerages have shown in being able to handle a huge amount of trade.
   They've discovered that it's not water tight and everyone but the hardened speculators want out before the thing goes back to 13.85 where it started this climb back in February.
   It's a pity that these 'one man band' operations have created a titanium needle for their bursting of the 'bubble' since it could have been strong enough to withstand the sudden global surge of investment capital that it was raising when it 'blasted off' in value two weeks ago,
   The major brokers were so swamped they couldn't handle people's requests for funds and this was perceived as as failure. probably true given the Ddos attacks on Mt.Gox and probably the same on nearly every other exchange worth mentioning, all of which showed themselves as just a bunch of amateurs.
   'Mt.Gox has utterly proven itself a mountain that doesn't really exist even in cyber space, they couldn't get the rocks piled up quick enough to stand above their circumstances. The first part of this statement is ironic, since the subconscious psychological image presented by the term 'Mt.Gox' implies that it has the nature of a summit, an impenetrable stronghold and some sort of fortress composed of a mountain (implied to be 'golden' from the first two letters of the word 'gold' and the letter 'x' added to denote an exchange. How very far from the truth this now looks.
   The future place that BTC will inevitably hold in the global economy can only be achieved when the so-called major players in BTC brokerage can prove they're technically up to speed and as safe as an actual physical oz of 99.999 gold when 10 billion dollars appears in their bank accounts from  buy order investors and in a day they can process 20,000 new account orders and still get a lunch break.
   Obviously, these days are not here yet and it leaves me to ponder this question, did the well conceived, concerted Ddos effort to quash the exchanges abilities to cater to the needs of new buyers occur in order to deliberately devalue the BTC and cause it to slide out of public favor and, was the source of these attacks not so much 'rogue' forces attempting to deliberately manipulate markets to make for themselves a shady profit, but some high level hacking by those administrations within the G8 who saw the potential for the BTC as a new alternate currency over which they had no real power?
   Perhaps inside the TOR network might be the safest place to put the next 'Mt.Gox'? That is, if the major banks of the world (in partnership with the G8 and under a contract with clauses where the ownership of BTC is regulated to include full and open disclosure to those governing bodies of the identities of those who are purchasing BTC and also with the inclusion of equally mandatory, conditional requirement to allow the tracking of the detailed market movements of every BTC)
   I wonder if they aren't already arming their IT departments amd the world's largest supercomputer to assist in vending the BTC as the future 'media ordained' 'safe' brokers and take full advantage for themselves of this inevitable slide away from the world's ever crumbling hard currencies?

Pop!

Read the news man coinsetter.com The legit exchange is on it's way will be here in no time.

At what value would you place the mean?

Seeing ppl at work stopping to actually work and speaking only about bitcoin...... i just hope the market will stabilize soon :) productivity will rais and will be able to use bitcoin again in more calm way :)

I'm sure this has been said before, but the amazing thing here is that we are still in the infancy of cybercurrencies and as bitcoin gets harder to mine, and more attention stokes demand, the price will ultimately go up. yes, there's a lot of volatility now, but that's just because the market is still in it's infancy.

Hang onto your BTC for 5+ years and you'll make a killing. My opinion.

I must thank the bank for their crappy service saving me from the the bear slide!

I expect there to be ups and downs until the currency gains broader acceptance amongst merchants. It will take a few years to develop, but I say hold on to those BTCs and accumulate as many as you can! I wouldn't be surprised to see BTCs hit 1k or even 10k at some point in the future.

The bubble will burst. Not because this isn't a feasible idea, but because greed based on speculation alone will keep the trust level at a very low level.

I bought 2000BTC back in May 2012, part sold all the way up to $200, where I sold the remainder. Netted me a decent return hehe.

just joined to say that - im off now to house-hunt (seriously!)

oh, and to get the notaried/apostilled docs off to mt gox so they can give me my fcking money!!!


bye all.

Just wait until Spain and Italy go the way of Cyprus, there will continue to be more bubbles and bursts.  There are people who will actually need to send their money out of their country without their government knowing it.

I think the next bubble might be in XRP ( ripples ), they seem to have doubled in price in the last few weeks

I think there is still enough enthusiasm and support for Bitcoin that it will continue to do well for quite a while yet. The price is back up to where it was a few weeks ago and seems to be holding steady, so I think the worst is over for now. Whether Bitcoin will last longterm is of course unknown to anybody, but I see no reason it won't keep chugging along in the short-term.

The price drop over the last couple of days was nothing compared to what happened earlier in bitcoin's history when it went from 30-ish to around 2. If bitcoin can survive a 93.33% price drop, it can survive going from 260 to 55...

The price rise of Ripple relative to bitcoin may have been caused by recent news that they closed the round of angel VC. It hasn't really gone up much (yet) versus USD. What are the prospects of Ripple going forward? That's the $64 million question.

Interesting thoughts - thanks! You are touching what I believe is bitcoin's major threat. The 'money-masters' of today will always be able  to crash the system, manipulate it or take ownership of it. It is predicted in this brilliant article: http://www.naturalnews.com/039850_bitcoin_bubble_crash_globalists.html

So how to hedge against that? I worry for bitcoin's weakness to withstand attacks from central bankers and large financials as JPM and GMS. And they will attack, I predict, each time the volume rises enough to appear threatening to the system. One way out of it can be if many different cryptocurrencies flourish, so that the point of attack becomes more obscure. I really wish hope some smart people can figure out a solution to this problem.

I have three problems with investing in bitcoins. Maybe someone can sooth my concerns.

1) I understand that bitcoins are limited in number. However anybody can make an alternative cryptocurrency (like litecoin). At the moment bitcoin is the most liquid as it is supported by all exchanges (like mtgox). However once mtgox supports litecoin it will become just as liquid. As it has the same functionality why wouldnt speculators pour into the "cheaper" litecoins once they can be easily bought over mtgox. Also why wouldnt miners start mining more litecoins, when it becomes more profitable than bitcoins. Lastly once the price is bid up, why wouldnt stores also accept litecoins.
Therefore a potentially unlimited number of cryptocurrency could be competing for available purchasing power. I understand the concept of first to market, however once litecoins or other good cryptocurrencies become as easily tradeable (over metgox) as bitcoin wont speculators speculate on them becoming as valuable as bitcoin. Why would the first to market concept and networking effect stop this dynamic.

2) Once bitcoin becomes a generally accepted medium of exchange, wont governments make it illegal to trade bitcoins with prison sentences waiting for anyone who tries. Wont this cause bitcoin to collapse in value.

3) There is always the possiblity that a better, more innovative cryptocurrency comes to market leaving my bitcoins worthless.

Diclosure: I own a substantial position in silver miners and like gold as well as silver. I am a follower of austrian school of economics. I hate fiat currencies and maybe want to buy some bitcoins in case they overtake gold as a medium of exchange. However I still have the concerns mentioned above.

First of all, see my post right before yours, which deals with the issues you have.

1. As I say in my post - more crypto currencies would reduce risk manipulation and sabotage. There will always be speculation.

2. May happen, but I think it may be difficult, unpopular and possibly against the law.

3. If a better cryptocurrency gains terrain, it will be a slow process, but sure, bitcoin may not stay on top forever. I changed some of my bitcoins into litecoins, because I believe the little brother has som interesting advantages.

Personally I'm of the mind that, even if something's a bubble, you might as well take advantage of it while you can. Got something you want? Better order now.

+1

If its a bubble then it certainly has not yet reached its maximum. The down fall lately of 200$ or so is already recovering and in a few days maybe weeks everything will be reach a new highest level - I think.