Bitcoin Forum

1) Black markets

Many people claim the shutdown of SR and the following quick recovery of the price is proving that the black market cannot be very significant in terms of bitcoin demand.

It is indeed a good signal for the public, emotionally detaching bitcoin from illegal things.

In reality, i know the volume of black market activity has not decreased. There are 2 marketplaces which have absorbed vendors and customers from SR.
I guess the shutdown of SR made the black market even bigger.

So, in the eyes of the public the evil side of bitcoin has gone, but the demand for bitcoins for blackmarket activities has definitely not decreased.
We still do not know how much this contributes to the price, do we?



2) The miners

They have invested and they are keen to regain their investment. This is the most solid factor in my opinion.
They have to invest even more over time be able to do that.



3) Business models using BTC

Can anyone estimate the real volume they generate?
I find it hard to estimate how serious this factor really is, as it is very easy to send BTC from one wallet to another thus being able to create any numbers you like and showing them off as your "cashflow"

What I'm trying to say is without some form of control we don't even know how much volume/demand the legal BTC businesses are generating.
Fraud/reporting false numbers seems to be much easier with BTC.


4) The speculators/investors

you know who you are and what you do ;)



So.. we do not know how much the black market contributes.
We also do not know how much the legal businesses contribute. (I guess it's less than the illegal ones do)

I just compiled my thoughts on the topic here. Trying to be curious, not bearish or bullish.

Please share your opinions on what's backing up the price right now.

 :)

I think it's pretty obvious to quite a few experienced traders out there. Like ALL financial assets, its market is "made" by someone. All big holders of any asset type are strongly motivated to do this.... and bitcoin shows no sign of being any different. So the big question is.... what is the market maker's game plan?

When bitcoin is actually adopted in a significant way, as a store of value, means of transacting etc etc etc.

I guess every economy in the world is backing bitcoin.

so lets work on :

3) Business models using BTC

Is BTC new world order currency?

Bitcoin is the fastest and cheapest means to do international value transfer.  In a time when governments are restricting people's ability to transact, an uncensorable transfer mechanism is quite valuable, even before it beats the banks on fees and speed.

Just hype and speculation.

So same as any other currency.

I believe a big proportion of price is just hype or you can say "idea itself".

Fiat has government regulating it

[/quote]
Fiat has government regulating it
[/quote]

"Regulating"

That wasn't the question.  The question was what's backing the price?  Bitcoin is regulated by the protocol so it's regulated too.

where's #5? you missed the US gvt investing and NSA and CIA mainframes mining bitcoin to pay us debt.  :)

But who cares? The source code is open so it doesn't even matter if Satoshi = NSA/CIA/Rothschild/Bilderberger/Zionist/etc. Oh the irony. ;D

What's backing any other currency? The dollar is no longer backed by gold, and what was gold backed by anyway?

A currency is only as valuable as the value people place in it ie: Confidence, and also utility. Bitcoin's got a lot of people who are confident in its future, using it to buy / sell things, and trading / investing in it, so there's your price.

As is currently being demonstrated by MTGox and its banks.

Well here is some interesting info:
https://bitcointalk.org/index.php?topic=311328.msg3346240#msg3346240 (https://bitcointalk.org/index.php?topic=311328.msg3346240#msg3346240)

Also i can buy anything i want, but only for a bitcoin at the atm to i need to provide my fingerprint. WTF
http://www.youtube.com/watch?v=PFqBtvLVRpY&feature=youtu.be (http://www.youtube.com/watch?v=PFqBtvLVRpY&feature=youtu.be)

Its only the beginning, its a step by step process and at times ahead your blockchain data locks like a spider-web with all your transactions visible for everyone for ever. Cash on the other hand is truly anonymous and will be illegal as soon as possible.

It is backed by its advantages as an online currency.

Some of the properties inherent in bitcoin and lacking from all the alternatives (except perhaps other cryptocoins) are the basis for the believe that it will be a currency of importance in the future.

This therefore creates demand and the price is then determined via the usual demand/supply mechanisms.

- You can send it virtually instantly to anyone across the planet without needing a third party service (but miners)
- Transactions are transparant and final
- The supply is fixed. Nobody can 'regulate' it for us in their own best interest.
- It can't be counterfeited
- It is essentially impossible to steal if your wallets are encrypted well.
- You can safely store it in many locations simultaneously
- It takes up no space

etc. These things have been discussed ad tedium.

 You forget the most important factor : Paper printer FED & ECB

Warran Buffet might be the one backing the price,who knows :)

Right now at this very moment the fiat price of 1BTC is rallying, and i highly suspect it's because of the number of speuclators entering. I think most people would think that it's a 'bubble' or a bubble is taking place however we have to take note that if more and more people know about BTC and decides to adopt it, the value of 1BTC will continually rise to ranges like 1k-10k without any real limitations.

Is there any published information or reports on whether the majority of bitcoins are concentrated in the hands of a small number of accounts?

Also, I don't understand how the miners could potentially be a part of price manipulation other than possibly hoarding the currency, which would seem to make it so that they cannot recover their investments any time soon.

Some good points..though I expected more disassembly of my "analysis"

Don't get me wrong I have invested a bit but it feels more like gambling than investing.



Bitcoin: Tulips of the 21st century?

Maybe this helps:
https://bitcointalk.org/index.php?topic=321265.0 (https://bitcointalk.org/index.php?topic=321265.0)

and if interest some known facts:
https://bitcointalk.org/index.php?topic=311328.msg3346240#msg3346240 (https://bitcointalk.org/index.php?topic=311328.msg3346240#msg3346240)

BTC is backed up by the only thing that ever backs up a price:

demand.

 ;)

It's clearly a bubble. $20-30 price rises every day are not sustainable. It is going to pop and a lot of people will loose money.

Only if they buy high sell cheap.... they can always wait for it to stabilize back above the price they entered. Could happen.

I hope not. I think New World Order currency will be a chip embedded in your flesh which controls how much credit you are allowed. ie Fiat and debt based just like now, except with different branding. They might need to partially back with gold or something for a little while to get confidence restored.

Unless you are one of the elite in which case gold is the money, always has been and always will be.

I agree about the bubble, but you might look at it the other way, some people will profit nicely

Only those who buy high and sell cheap loose money  ;)

The May 2011 bubble went from 2 to 31 back to 2. Then there was 1.5 years of relative price stablility in the the 5-15 range that ended in Jan 2013 printing a value of 13.50. The next bubble was from there to 266 briefly. The resulting crash saw a low of 65 on July 1 and then relative price stability between 100-150 for awhile. Now BTC has printed an ATH at 272.52 just last night and if you think this is a bubble I would disagree, barring a catastrohpic failure or the like the next bubble will be in the 500 range with subsequent price stability around 300 for a few months.

I think you should read this (http://www.aeonmagazine.com/living-together/so-you-want-to-invent-your-own-currency/). If that gets throug to your control center, read David Graeber - Debt: the First 5000 Years.

Another ridiculous comment! I didnt think there would be more

tulip bulbs are backing the price

You forgot the ASIC manufacturers investing in BTC.