Bitcoin Forum

The Wallstreet Whales are coming..

FIG is forming a Bitcoin MegaFund larger than SecondMarket

http://finance.fortune.cnn.com/2013/12/31/fortress-is-forming-a-bitcoin-fund/
 (http://finance.fortune.cnn.com/2013/12/31/fortress-is-forming-a-bitcoin-fund/)

This is just the start.

$2000 / BTC We will see you sooner than we expected  :)

I thought it was some trollbox rumour.

Its not, the link is from fortune.

It still essentially amounts to the same thing ;)

Fortune = Trollbox  ???

I saw this on Zerohedge.  Yes I would guess there will be lots of new money coming into BTC.  If we can make it through the negative China news then it will take off later this  year!

China is "done" and we don`t depend on China.
Now,at 800 US $. we see the real Price of BTC (ex-China)

This is also interesting
http://finance.fortune.cnn.com/2013/12/27/michele-burns-circle/

I also read that one.
As far as I know wall street won't be buying BTC directly but will invest in companies supporting or adapting to bitcoin.

I bet my bottom Bitcoin they will get their hands on some Bitcoins though... just not mine!  ;D

I wouldn't call FIG (http://finance.yahoo.com/q/is?s=FIG&annual) a WS whale...

also https://web.archive.org/web/20090114105234/http://www.theglobeandmail.com/servlet/story/RTGAM.20090112.wvanoc0112/BNStory/National/home (https://web.archive.org/web/20090114105234/http://www.theglobeandmail.com/servlet/story/RTGAM.20090112.wvanoc0112/BNStory/National/home)

~$58 billion AUM is pretty big.  Whether "whale" applies, who knows, but they have a big reputation. More so than Second Market. :-)

is this the same tradefortress guy

http://en.wikipedia.org/wiki/Fortress_Investment_Group (http://en.wikipedia.org/wiki/Fortress_Investment_Group)

Fortune talks book

Trollbox talks book

The only difference is the numbers might be bigger

Bingo.

China is "done"?  So, like, no Chinese people will ever invest in Bitcoin again?  Lol.

Offcourse they could come back,I would like it.
But the impact they had in November is over.

So what is the purpose of these Bitcoin funds? Right now probably only 10% of the Bitcoins mined are actively being traded or used as currency and the rest are being held as a form of investment. So here are these two large trusts holding 200k-300k coins? eliminating them from ever being used as what Bitcoins were design for, which is currency. I am pretty sure these trusts are going to get larger and hold larger reserves of Bitcoins. What is the purpose of these trusts holding onto a large reserve of Bitcoins other than placing a value on them. I understand if Bitcoins can be actively used as a form of currency and be used to purchase goods and services, but if the majority of the coins that are traded are owned by trust funds and the value of Bitcoins are dictated by these funds, which means they are associated hand in hand with traditional currency it simply defeats the purpose of Bitcoins.      

FUD

Yes, I think so too. I believe the fund would buy-in existing companies, or provide capital for startups like an venture capital funds.  May not boost bitcoin prices directly, but if we see licensed exchanges and more online stores because of this, it would be encouraging news

Fortress might already have bought their first bitcoins:

http://www.reddit.com/r/Bitcoin/comments/1u4fc6/record_number_of_bitcoin_days_destroyed_and_10/ (http://www.reddit.com/r/Bitcoin/comments/1u4fc6/record_number_of_bitcoin_days_destroyed_and_10/)

Wild speculation.

Wall Street won't be investing directly????  There is a pending ETF that says otherwise.

Yes, but it makes a lot of sense imho.

I'll believe it when I see it. 

That's fine with the rest of us.

Just sit over there in the corner with the millions of others that have doubted bitcoin news for the last 5 years. You'll have lots of company.

I've been waiting awhile for the Winkelvii to get to market.

Fortress' owner owns Bitcoins.  He's just talking it up.

The Winkles are setting up a retail fund - a completely different set of hoops to jump through.

Second Market and Fortress are effectively Street insiders front running the twins.

We here have a very rare (for a random public individual) chance to front run the Street. Our time to accumulate is nearly over. When your cold storage is full, just sit tight and get on with life.

In a few years time, when you happen to see the mass market papers telling people to buy into the proven Winklevoss fund - then slowly start selling.

+1

Whatever you do realise this point. And then decide whether or not you want to sell your coins to these new, big, ugly sharks who are starting to circle. There's never been a better time to hodl in my opinion!  :D

This is the most salient point about bitcoin that most people miss.  This opportunity just doesn't come along every day.  Maybe only once a lifetime.

A similar profit-making event was buying common domain names in the late 1980s, early 1990s.
http://en.wikipedia.org/wiki/List_of_the_oldest_currently_registered_Internet_domain_names

Few people thought of it then.

Do we have confirmation that the Fortress fund will only be open to Qualified Investors, similar to the Second Market offering?  I haven't seen many clear details. 

Is it not possible that someone with better connections/experience (not necessarily Fortress) could try to beat the Winklevosses to get an ETF running?

I did! Unfortunately I was 14 at the time and had little business sense.

With Bitcoin, I vowed not to let the opportunity pass me by again.

Actually, plenty of people thought about it - I remember emails going round suggesting it as an easy way to make money off wealthy corps or individuals who would eventually have to pay your price. It took one phone call to have it confirmed that IP law wouldn't stand for "passing off". Most settled out of court, but it was a bit of joke really to think that McDonalds' lawyers would advise paying off Joe Basementdweller rather than enjoy some easy fees. The ones that did get money were those who could show that they had a fair entitlement to use the domain, or had a great generic shout like "sex.com". Later, the Man made sure with the Anticybersquatting Act

http://en.wikipedia.org/wiki/Anticybersquatting_Consumer_Protection_Act

Generic names were the way to go. "if.com" was purchased by Intelligent Finance for $1m from its early owner.

Unfortunately, I was 18-20 and broke then.  I knew that buying common domain names was a "land grab".  But I didn't do it for some reason.

The purpose is to push up the value of bitcoins to a very high amount. Early adopters with bitcoins will then spend satoshis which will hopefully be worth $0.10 or whatever amount you think.

Get comfortable with the idea of large open ended trusts holding bitcoins. They won't want to destroy the value of bitcoins either. They will protect the value of bitcoins because it will be their lifeblood.

I don't disagree but why would a whale telegraph their intentions. It doesn't make sense.   Why encourage front running?

The pending ETF is for the bitcoin trust I presume. I'm no expert but the trust is just a share of the Winklevoss twins fixed bitcoins account. No bitcoins will be traded directly by wallstreet nor will bitcoins be bought or mined. They are just valuing the bitcoin wallet of the Winklevoss twins through shares. Yes this will influence the price of bitcoins but I think it's effect might be overrated.

I believe many bitcoin companies will soon start issueing shares or get taken over by companies already on wallstreet putting more money in the development of bitcoin infrastructure. This will make bitcoin more widespread and usable pushing up the price.

My 2 cents.

That is the outcome of an deflative currency, that has concentrated wealth and an unregulated market system. There is just too much room for greed and greed will eat the system from inside out till people will lose faith into that system. The future is not in bitcoin, the future is in the idea that bitcoin gave about the monetary system being able to go private, so the success of an particular system would be judged by free-competition, not by state law.

So once again then. Greed is what keeps the system running. The network is only as strong as the hashing behind it and nobody would invest in expensive rigs without expecting to profit from it. Greed is necessary for bitcoin. Greed is Good.

I agree that greed is what also gave BTC it's power. Without greed there wouldn't be all those people whose only interest in bitcoin is to buy low and sell high. But this is part of the exact reason why bitcoin will fail - the community that mostly consists of greedy and single-minded people won't be progressive enough to succeed.
The currency that will attract people by it's complexity of cash inflow and the effectiveness in transaction technology, will dominate bitcoin with it's more advanced technological aspects. Bitcoin started a great idea and greed helped to propagate that idea, but this won't go far because the system built on greed will eventually eat itself inside out.

In that sense, all Government, Business, Banks, Churches, Religion, etc is all greedy.

No, it isn't greed.

It is finding usefulness in life, people find Bitcoin a more useful tool to keep and manage value.

That is what makes Bitcoin work.

Nothing is free.

Ait. You are a miner. You lose money mining. Why did you spend $100000 on equipment and triple your electric bill? Why did you choose to do that?

This doesn't say anything. What do you mean in practical terms?

Which? Doge? Lite?

According to which holy book? Nothing like this has ever been attempted before, what do you base that statement on?

people still think silver is hitting $200 'very soon'

there IS a saturation level to the amount of money that flow into bitcoin's price.
some are counting on the demise of the dollar, but if that happens any new currency will likely pay nice interest as this ZIRP debt spiral is over with.

so I wouldn't wait until the dollar is completely dying to move most wealth out of bitcoin, since any reset will have a currency paying interest and people will flock their wealth there for returns.

To me the success of MtGox is the best proof of the quality of the bitcoin community. Bitcoin.org still promotes it as the main exchange and the volumes are high. Although MtGox is highly flawed at best, but it's more probable that their "flaws" are deliberate and a method to manipulate the market. The community should shun places like that and people should just stop using it. But still, a very big part of community is using this exchange.
Also I rarely see people who are interested in the bigger picture of cryptos and who see that the bitcoin software isn't very advanced with it's 10 minute confirmation time, double spending, 51% attack problems and the excess usage of computer hardware. I see that most of the community truly believes that BTC will last for decades and will cost tens of thousands in the future.
It's hard for me to understand how can they believe this. If the idea of an privatized monetary system really proves itself, then what stops companies like google to amass an army of talented software engineers to create a crypto that is faster, more secure and more user-friendly then bitcoin? I think that it is silly to think that Bitcoin will be able to compete with future coins. it's like saying 14 years ago that Napster is the future of music distribution.
Delusions like that are mostly shared by people who are looking for get-rich-quick schemes, that sound pretty and look easy. We can mostly see those kind of people in self-motivational classes or involved in pyramid schemes, always looking for an easy way to get rich without actually doing anything that matters.

I don't think that there is a coin yet, that has a future longer then couple of years.

Not an holy book, but common logic. Bitcoin shouldn't be so attractive as an investment that leads to hoarding. When hoarding is attractive in an unregulated market, then a rule applies, those who have more, those can earn more at the expense of those who have less. This will lead to bigger wealth distribution issues then fiat ever had with global banking. Without fair distribution there is no trust of the majority and without trust there is no value in the specific currency. Deflative currencies could be theoretically created, but with strongly regulated markets that take care of fair distribution and excess hoarding. But I wouldn't recommend anyone to go down this road...
And also, with Proof-of-Work, the investment money goes to miners. The arms race of mining is just silly, because the resources spent doesn't outweigh the security gained. The security solution would make some sense when mining wouldn't be pooled together into single points, that can be compromised just as well with 1TH/s or 2TH/s of network power. The inflow of new money should be A LOT more complex then it is now. Proof-of-Stake is more advanced but even that won't make it in modern economics. The future is in something that we haven't seen yet.

Bitcoin is about the network, not just "it's a good idea but we can make something better."

Sure, you can always make something better, but once a network is in place and enough people are using something, the network effect takes over and it has it's own momentum.

Look at automobiles. We've been wanting to get off of gas and oil since 1972 but nothing has really changed much - why? People are used to the system that was agreed upon many years ago when Henry Ford was still around. The "system" can last a LONG time, although the cars change and radically improve.

Some people would also say that cable internet could be much better and we have the technology to do something far better at this point. Yes it's true, but there's no incentive as of now to totally overhaul the system.

However, the monetary system DOES have a need for change. It's quite obvious. And people want the change, and are willing (as we all are) to risk our savings on this new idea. If you have billions or trillions of dollars invested in the bitcoin system, what's going to be the incentive to get everyone to move over to another system? The network will get stronger by the year as more people are involved.

Also, you miss the point that bitcoin can be improved. We aren't even on version 1 yet. So the clunky bitcoin system of today may not at all look like the sleek and shiny bitcoin system of a few years from now. Certainly the more people use bitcoin, the more needs there will be for services which are based around the bitcoin system, like the automobile. The whole thing feeds itself. 

Bitcoin is meant to be an financial tool, not social media where the communication network of regular people creates success. Financial tools are mostly controlled by people who won't stay in competition when they use outdated tools just because they are used to it. In another words, it doesn't mater that User1 likes to talk to User2 about "bitcoin to the moon" and how his couple of thousand dollars worth of investment is doing.


Actually we haven't gotten off fossil fuels because we don't know how to extract energy this effectively with anything else. What is important is the ratio of energy needed to extract more energy. Nuclear, solar, wind power aren't serious enough alternatives because a lot more energy has to be used on creating conditions on extracting energy with these methods. Digging for fossil fuels still needs less energy then anything else, and that is why the world is mostly dependent on fossil fuels. The system hasn't changed because people aren't able to change it, not because they are just used to it. The main goal of scientific projects like CERN's LHC is to find new ways to extract energy. So people do try hard, but  sadly, still no success.


Cable internet could be improved and it is in fact constantly improving. Broadband speed is constantly increasing in parallel to the services released that make use of that bandwidth. Telecommunication is progressing fast, so it's a weird example to bring up when talking about stagnating things.


Yes, it has to be changed. But it is childish to think that something this simplistic and flawed as bitcoin can actually replace it. The thing is that monetary systems have to go private, so free-competition will decide the success of different systems. The problem with the current monetary system is that free-competition doesn't apply and state law determines the system that people have to use. Without competition, the incentive for quality improvement is very low, so the quality of the current system(s) is also low.


I know that bitcoin can be improved, but studying the history of improvements, I think that progression is very slow. So slow that when a serious organization decides to use it's skills and resources to create their own alternative, then BTC won't have a chance. And I also understand that core financial properties, like the system that runs the inflow of new money (what I consider overly simplistic and flawed), won't ever be changed with bitcoin.

State law defines the currency in which you have to pay taxes, however it does not define what currency you are allowed to use.  At least not yet.

I can't see any "serious" organization able to create a competitive coin to Btc at the moment.  The banks? Government?  All too centralized.

The core financial properties of bitcoin looks okay to me, apart from the public ledger being public.  If Bitcoin is so overly simplistic and flawed, I suggest you build your own coin and let the free markets decide which coin it wants to use, right?  ;)

That's the beauty of it all, if you don't like it then don't use it.  Go use something else you think is better.  Go to another forum and promote your own coin.  No point being all superior and saying Bitcoin is bad and will crash etc...

AFAIK, you have one week left before your crash predictions are proven totally imaginary.

not sure if you got the memo.. but huobi has like 51% market share of the volume traded... and they are Chinese.. so uh.. Just thought I'd point that out lol, not that gox isn't leading the price.

Bitcoin is distributed consensus. The financial aspect of bitcoin is just the first system to attract infrastructure beyond mining. It's difficult to imagine a private company (such as Google) amassing hoards of other independent individuals and companies to run nodes and build services for their centralized crypto. The fact that bitcoin is at its heart a distributed consensus protocol that solves the Byzantine General's problem is too often overlooked. Money is not THE point of bitcoin. It is ONE point of bitcoin.

As far as competing with alt coins. Consider the network effect. TCP/IP is still the backbone of the internet today even though the protocol itself is not flexible. Systems and languages were/ are built on top of it. This is what is happening/ will happen with bitcoin.

Yes, you can also use multiple currencies, but Legal Tender regulations regarding taxes, debts and public charges are enough to enforce people and businesses to use the the legal currency. In theory, you could refuse legal tender in US for sales, but you probably would be out of business pretty soon.

I can't see any serious organizations getting into the crypto game either. I think that there are two possible reasons: a) Development is being done out of public sight ... b) The idea of private monetary systems is still too unstable and raw and further studies need to be done to compose a solid vision of the development process.

The core financial properties mostly look okay to those whose main interest in bitcoin is to gain wealth by buying low and selling high. The increasing deflation of bitcoin seems very ok to those whose goal is speculation.
I think that it is a nice suggestion that I should build my own coin. But sadly I don't have the time or resources to even compete with bitcoin, not to mention the probable upcoming coins that bitcoin won't be able to compete with.

Well, this is not exactly the first time when I was told to leave if I refuse to sing the same song of Bitcoin's Never-ending Success. But no, I wont leave, because I still consider the topic interesting and there are also people in the community who have interesting thoughts and who are not cheer-leading with religious fanaticism.
When the majority of the community tries to drive those away who think different or who criticize the mainstream knowledge, then the community can't be considered very progressive.

It may come as a shock but predictions are imaginary. Predictions, or in this case speculations, can't be perceived with empirical proof and are theoretical in nature.
Also, one of my main points was that the Bitcoin market is highly manipulated and the wealth is highly concentrated, what makes the market highly unpredictable. I don't know how deep are he pockets of those in control or if their reach goes far enough to present false market data at the exchanges. Factors like that are important when speculating the future price at the bitcoin market. My speculations were done for entertainment, by considering the history of previous manipulation methods used, not for serious financial analysis. The unpredictable nature has led me to believe that I probably won't invest back before a similar situation emerges then we saw at the end of October where bigger plans of pumps are set in motion. And it wouldn't irritate me if the price will rise during this period, because to me it is the same as to get upset from observing the roulette table and cursing at yourself "Only if I would have put my money on red, I could have won...". Gambling is still gambling, even if you would have won..

---

When private companies like Google amass the software engineering talent needed to create a crypto that has clear quality advantages over bitcoin, then all the investors and supporters would come without google needing to amass them. Even Google brand value is important enough that if they would release a Googlecoin that is actually just another software clone of bitcoin, even then most of the money in bitcoin would quickly flow to the new googlecoin. Those who believe in bitcoin like it was their religion, tend to forget that serious investors are not like them and don't have any loyalty to bitcoin like they do. All their funds will quickly flow to the coin that has the best marketing potential.

It is out of place to compare Bitcoin to TCP/IP. TCP/IP was successful because it didn't have any important flaws in it's core, that should've been addressed. Not to mention that changing the internet protocol, without conflicting the existing system is a very hard task. But for value to flow from one crypto to another, just takes a week of transfers. And there really isn't a lot of development of important software that are built on the bitcoin protocol. Most important things that are build on top of bitcoin are the support services, but those support services are not dependent of bitcoin and can switch cryptos quickly when it is profitable to do so.

I'm not criticizing bitcoin as an gambling platform. I think that it is fun to gamble at the bitcoin market with reasonable size bets. I was criticizing bitcoin more for the inability to be anything more then gambling.

Well it may come as a shock again, but you can actually criticize without being able to create an alternative. Places like edmunds.com don't actually have to create cars to review the low quality of an certain car.
Your rhetoric was slightly amusing, but I think that this is where our conversation stops. You keep up your buying/hodling/cheering and I'll continue to weaken the illusions of never-ending growth.

Nobody has said this. It's going to top out eventually at which point the price will be stable.

no one is talking about never ending growth. the fact that you attribute a price of 10 dollars reasonable but 10 thousand unreasonable just shows how ridiculous your logic is and what a troll you are. stop talking bitcoin value terms,i know thats what gets everyone hard here but it is irrelevant. is the cryptographic asset class worth 10 billion? I think 1 trillion is a low ball estimate, especially due to the incoming haircuts and aggressive tax prosecution. gold is worth 5 trillion and it does nothing but sit in a vault. stfu and stop spreading fud

+1

bitcoin's functionality is sound, but price discovery is infant.

there is a serious quandary with arbitrage in that bitcoin trades locally sorta like gasoline prices but can be sent around the world instantly but gasoline can't.  So one-way arbs is a plague that will keep disrupting price discovery (since bots like to react to other exchanges even though the price can only affect one-way)

there is no BIS for bitcoin exchanges that can settle money between them..  I doubt one would be permitted (AML laws, etc)

I think the next innovation will have to be some of the early adopters to pool some of their vast btc and create a fund that is much larger than the exchanges with a wide spread..something bigger and more stoic than coinbase for example where they will be invested in the overall fund and also receive fees so as not to think they are selling all their btc too cheaply

just a thought...  seems the next step is needed here.

+many

Also how could any future currency be just created up from the dust, given set "ok to everyone" value at the start and distributed to everyone equally so no one would need to be sad:(
My thoughts are that this is going pretty much as intended but its not just exponential, its also accelerating. And coming next weeks are maybe going to be something mind blowing, we'll see.

Ha ha ha ha ha.

There were and are SO many flaws in TCP/IP.  Every heard of DDOS attacks?   SYN floods?  ACK spoofing?  IP spoofing?  MAC spoofing?  Running out of TCP/IP addresses?  Please.

Bitcoin has FAR less problems in its core than TCP/IP.