Bitcoin Forum

http://www.scmp.com/comment/insight-opinion/article/1404497/bitcoin-bubble-wont-last-without-beijings-approval

Well the article is a complete crock of shit.  However, I think the sentiment laid out here may lay the groundwork for the Chinese government's official position on Bitcoin.  "It is designed to rob the Chinese people and thus is banned."  Or something to this effect.

I'll copy my reply that went to another topic, but I think it suits here also:

It made me wonder on why did China change their stance when they were pro-bitcoin at November?
In my theory, the Chinese govt. thought at first that BTC could be a threat to dollar as an global currency. They thought that BTC could actually be a monetary system what is free from leeches of the western financial world. So, they thought that promoting BTC is actually good for China and therefor the piece covering/promoting bitcoin was shown on an chinese national news program that is known for government propaganda. And remember that the news piece was the actual start of this new rise that started in October.
Now, why did they suddenly change their stance at the start of December? I think that the reason was that they gave further studies into the nature of bitcoin and it's market system. They probably discovered the "public secret" that most of the BTC are actually owned by the same people who profit most on the success of the dollar. They discovered that most of the bitcoin is owned and the market system is run by groups from wall street. Then they saw that with promoting BTC in China, they are actually helping wall street players to rake up money from the Chinese people.
I think that they are now investing into building a new crypto that could actually fulfill the goals that they thought possible at first.

I think it's too vague to evaluate, really.  How can we know things that happen behind closed doors.

There is some validity in Bitcoin being a ponzi scheme, but the same criticisms are easily applicable to Fiat currency, Fiat currency possibly being the greatest Ponzi scheme's of our time.

The Ponzi aspects of Bitcoin do not bother me, as we all make Ponzi-like decisions every time we buy a stock that pays no dividend and has diluted voting power, or put 100 dollars into our 401k.

Every Bitcoin bubble has left a few more permanent adopters in its wake. When we get to a true ecosystem built on top of Bitcoin then Bitcoin will always have a base value, forever. I don't think we are past that point yet. In three years yes, but in that time we may see competition push Bitcoin to the footnotes of history.

Time will tell this story, if only we had a looking glass into the future.

 

   A ponzi scheme pays out huge returns only because more people get involved in it. When it stops growing, the people running the ponzi scheme usually disappear with the money because they can no longer pay what the returns they promised. Ponzi schemes require fraud.

Bitcoin offers real utility in efficiency gains to the global economy that in the case of widespread adoption would be measured in the hundreds of billions of dollars at present exchange rates.

Bitcoin is a protocol that exists and is administered by the users. It is transparent.

Sadly, humans often fear what they don't understand. They react with aggression towards what they fear. People don't really get bitcoin, but they can smell that it is going to cause a revolution that is going to completely shift the social landscape of the planet. They lash out.

   We just have to tell these people that even if bitcoin erodes the borders of national states causing an equalization in income that lowers the income and lifestyle of people in the countries ruled by white people who got rich through colonialism and slavery (Europe, US, Australia, South Africa, so on), the per capita income of the whole planet will go up considerably and result in a much better mood in the whole of humanity that will leave even those who lost on the increased freedom of commerce better off because they will be happier and less afraid.

That's why Pyramid scheme is the better description of BTC, all of the ways you list that it is not a Ponzi (decentralized, transparent) are factors that generally define a Pryamid scheme.

I think the most important takeaway from this article is that China government is heavily leaning towards an all-out Bitcoin ban.  Look at some of the wording in there.  This isn't some kid's blog, this is a real Chinese news source which is likely monitored and heavily influenced by government. 

"Bitcoin is a bubble that foreigners cooked up and, by all appearances, is designed to rob the credulous Chinese masses. When the bubble bursts, the Chinese government won't be able to arrest these foreigners and get the money back. The bubble is not under Chinese government control. Hence, it cannot be tolerated."

They're basically saying that Bitcoin is bad, and the government is banning it.  In this article, it's a foregone conclusion.

Remember all the good news out of china, and that positive piece that aired on a government sponsored channel? You just know some nasty corrupt motherf**king pig of an official over there got rich off of this. Pump and dump on an international scale.

So they arrest people for creating bubbles? Who did they arrest for the MASSIVE housing bubble?

bitcoin protocol gives improved efficiency, ultimately less entropic than cash, or central banks, politics or Fiat. Accordingly Bitcoin can not be stopped anymore than you can change the laws of thermodynamics.

This is probably one of the worst articles I've ever read.  Well , almost read it all cause I almost stopped at the first paragraph.

"Bitcoin is a Ponzi scheme masquerading as a futuristic currency. It was a small bubble until it found China last year. But when the Chinese government launched its crackdown, it was the beginning of the end. Its recent revival is merely the last gasp. No retail Ponzi scheme can last without the credulous and speculative masses in China."

And then , out of pure curiosity I wanted to read it all and managed to get half way , but it started to sound like some communist propaganda so no , this is one thing I won't waste another second with.

He somehow managed to avoid all of the legitimate reasons I can think of for being bearish on Bitcoin.  However, it still may be a significant article because it expresses what I think will become the Chinese gov't official stance on Bitcoin, as dumb as it may be.

Bitcoin is a reverse ponzi.

FUD before upcoming Chinese newyear to get the prices as low as possible?

Looking at all the events in hindsight I think something different happened:

1) Yes, initially there was a lot of Pro-Bitcoin CCTV coverage, but I think that the government had no clue what Bitcoin was or they simply didn't care. Some journalists at CCTV were simply interpreting Bitcoin is something cool and it does not have a political agenda (at least it was interpreted in that way), so as long some air time is filled with something it is ok.

2) Suddenly, people got interested in Bitcoin because of these CCTV coverages and started buying a _lot_. Companies were also interpreting the CCTV news as government approval so they started promoting Bitcoin as well. The Chinese central bank (PBoC) has been quite angry that the dollar is regarded as world reserve currency (just look at how they promote IMF Special Drawing Rights, but without luck) so in some sense the positive Bitcoin coverage on CCTV could be interpreted that it had government approval.

3) However, it turns out that PBoC and Gov had no clue what Bitcoin was, but when they found out they were scared to death, because it enables Chinese people to circumvent the harsh capital controls. Hence, their stance on Bitcoin. To cool things down they didn't outlaw Bitcoin directly, but wanted to have things under control by restricting banks and financial institutions dealing with Bitcoin.

In hindsight this makes sense. Although, I think that Bitcoin is far superior than IMF Special Drawing Rights, but I think the Chinese gov would actually prefer IMF SDRs. The reason is that IMF SDRs are only used by governments and never by the people themselves. Therefore, it makes it much easier to impose capital control and Chinese gov loves control.

So to conclude: Chinese gov is probably aware that Bitcoin could be used to overthrow USD as world reserve currency, but it would also lose its own ability on capital control over its own currency (RMB). Currently, that is viewed as a bigger threat. However, if Chinese gov thinks that easing on capital control won't harm the power of the Chinese government, then I expect that they'll fully support Bitcoin and it would quite quickly declare it as world reserve currency. Whether that will happen or not is still an open question.

Not a chance.

It's not a crock of shit.

It is a journalist who is skilled in manoeuvring his tongue around his governments asshole in order to please his masters at the newspaper and further his own career.

It is a take on the official line of the Chinese Government.

Bitcoin is fucked in China. This means a massive sell-off is on the horizon......

......and I bet some of the low-ball crash buyers will be individuals who are well placed within the Chinese establishment.

Pump n Dump on international scale 'The Wall Street Whales' will weep. Sub $100 bitcoin is coming around the mountain.

Anyone interested in btc SHOULD CARE.

If they want to avoid people investing in a ponzi they can go around that. Make it possible for chinese merchants to accept payments in btc for items ordered from overseas. And at the same time impossible for locals to buy btc at chinese exchanges.

Can you expand on this thought? How do you view BTC as a Pyramid scheme? I can see some similarities, but I still wouldn't call it a Pyramid scheme.

Here's how I see it:

Elements of a Pyramid Scheme Source (http://www.sec.gov/answers/ponzi.htm)

Typical "hook"
Earn high profits by making one payment and finding others to become distributors of a product. The scheme typically does not involve a genuine product. The purported product may not exist or it may be "sold" only to other people who also become distributors.

I guess you could argue that the top of the BTC pyramid would be the early adopters, and by selling to others would be 'recruiting' the lower levels in. However, I would argue that BTC has intrinsic value (it is a good medium of exchange and is a store of value), and therefore is a 'genuine product/commodity/currency'

Payments
Must pay a one-time or recurring participation fee and recruit new distributors to receive payments.

See first point.

Interaction with original promoter
Sometimes none. New participants may enter the pyramid scheme at different levels.

I can see the connection here; we have no idea who the original creator of BTC really is.

How the scheme works
Funds from new participants are used to pay recruiting commissions to earlier participants.

See first point.

Collapse
Fast. An exponential increase in the number of participants is required at each level.

This is where it seems like a stretch. Bitcoin has been hanging on for some time now. Would BTC adoption rate have to be exponential in order to sustain itself?

Ultimately, BTC has value in terms of its utility. This is what makes it clear that it is not a Pyramid scheme, to me.

I read the first 5 words and concluded it was written by some guy that knows absolutely nothing about bitcoin.

Or some kid too wrapped up in his own delusions to know what or who he's fuckin with. This so -called article is nothing but a pathetic attempt at trying to project wannabe-wishes of those chinos who think anyone really gives a shit about what they say.

Yes, article is not only poorly written - it's frankly pathetic. Almost like reading through a middle schooler's daily dairies or something.

As mentioned in another post..

If you feel strongly about the article, feel free to critique the author's work directly on his Facebook page:
https://www.facebook.com/andy.xie.economist?fref=ts

A lot of people are waiting for this opportunity. We don't need China as much as we think.


I doubt we will ever see sub $500 again.

Heard all this before the December crashes, but we have indeed seen sub $500 coins. Even without some Huobi inspired catastrophe, I could see Bitcoin trending down to low $600s, but with an 'event', crashing to much lower.

Without a catastrophe, why do you think it will trend down? Since adoption is growing all around the world, surely it will trend up?

Going back to the article in question, it seem to be a lot more "anti" than previous articles.... if we assume that it was state sponsored/sanctioned, then we have to speculate that the tide is indeed turning for the worse.
Whilst i don't believe that china will be a deal breaker, i have to admit that it would have been in the best interests of the bitcoin community if China had got behind it, or even tolerated it's existence within their borders.

As I said, we don't need china for bitcoin. If you observed the trends, you can clearly see that this current bubble was an ahead-of schedule anomaly.

If the chinese quit, bitcoin will return to its original schedule, and reach each bubble slower. That's all. There's little stopping its rise unless serious regulations are placed by larger and more powerful governments.

Regulation is a necessary evil for mass adoption.......whether people like it or not



(sub-note) at the exchanges... as this is all they can control

That is right. Unfortunately, too many day dreamers and kids on this forum bitching about the US government has yet to realize this completely. Where was all the necessary hate towards the PRC? They were the ones to first really beat down on bitcoin.

The big factor is not regulation - it's an actual shutdown due to extremely strict regulations. Some regulations will help bitcoin by providing stable and safer way for general public to get into it.

In conclusion, chinos can go fuck themselves. Crypto will continue, and will not need their 'help'.

An almost rational reply.......totally spoilt by a racist comment.....come on HP...no one will take you seriously if you continue this path.
Most "chinos" i know disagree with their government policies that same way that many americans and europeans do.... please don't judge a nation based on the policy dictated to them by the few....

Actually, the Chinese government was concerned that some Chinese people might get wealthy without being in their loyalty network, under control.  They want to choke off bitcoin in order to keep the Chinese people as slaves.

But....The Chinese have the resources (whether it be in Gold or USD) to buy vast amounts of BTC and have some measure of control... considering the "semi-pro" US response to BTC i would have thought that they would try to buy it up in order to control... as they are doing with gold reserves.... this would offer them some future-proofing just in case.....

Andreas sums up the issue rather eloquently.

http://www.youtube.com/watch?v=6kfYQhdUNXg&list=PLbSdnuFOLV4nMiQG9gvPBX_VQUf6E4COM#t=125

Forget Andreas, I declare Honeypothead as the new voice of bitcoin

Speculators in China seem really irrational, and people who don't understand cryptocurrencies may think Bitcoin is yet another fad. That is the sentiment that the article seems to attempt to capitalize on, and a casual speculator in China may believe it and act on it. While Bitcoin could currently be in a bubble, cryptocurrencies are not a passing fad. They solve hard problems, regardless of whether Bitcoin is currently in a speculative bubble. And Bitcoin has first-mover advantage. So the premise of the article is bogus and so is the conclusion.

That being said, without the involvement of China the value of Bitcoin will be lower than if China is involved. Also, whatever the central government of China decides, other countries' governments may follow their lead. And maybe another cryptocurrency will beat Bitcoin.

China takes BTC to $1200+

"WE LOVE CHINA!! ARGENTINA WILL LEAD THE NEXT ONE TO $10,000 MEBE!?!??"

Bubble bursts = FUCK CHINA! CHINA DOESN'T NEED BITCOIN WE WILL CONTINUE ON WITHOUT THEM. CHINA DOESN'T UNDERSTAND HOW AMAZING BITCOIN IS ITS THEIR LOSS IF THEY SELL. WHATEVER CHINA, SELL, ILL HODL!!!!!!!!!!!!!!










All you hodl fuckers grind my gears.

This is what I was worrying about when prices passed $1000. As long as it stays near that value then its all well and good. If it falls all they way back down to $100 then it will be a major blow to bitcoin as an idea and commodity. Too many people will lose their shirts and they won't forget it. When the bubbles went up to $260 then they damage caused by crashes were minimal. If we have this tsunami of a crash then bitcoin will be leaving behind a horde of angry losers who will turn their back on bitcoin. For how many major bubbles can we last before we've alienated everybody who was interested in bitcoins?

If the prices fall to pre oct. levels then I hope it never jumps up to ridiculous amounts in a short amount of time again. A steady rise as businesses adopt it then fine.

Then again maybe my subconscious is hoping it falls so I can get cheap coins.

   I think the naming of the android bitcoin wallet "Mycellium" is very appropriate. If you were to map the bitcoin network nodes, it might look a lot like networks of mycellium. And these "bubbles" are similar in their growth patterns to mushrooms. There are these phases where the mycellium saturate a new growth medium, or strata of population, and then explode, releasing millions of spores in the next wave of people who find out about bitcoin...

At this point, haven't we already heard from Beijing that they don't approve?  And yet BTC price seems reasonably stable.  Is this thread just too old?  (Yet the discussion continues ...)

http://i877.photobucket.com/albums/ab336/Brdleysmth/horseshit.png (http://media.photobucket.com/user/Brdleysmth/media/horseshit.png.html)

My $.02.

;)

So let's assume our mystery official bought a bunch of bitcoin when s/he first heard about it, then talked it up/endorsed it in China, the price rose massively, s/he sold out, then shorted, then came out with the banking ban and got coverage with the above tone started.  Price went down, and whoever it is covered the short and now has an acre of money.

The cool thing about that game is it can be played several times.  China in -- price goes up. China out -- price goes down.

If our mystery official wants to go back to the pump, s/he's buying up coins now.  S/He'll wait at least six months to keep the cognitive dissonance to a dull roar, then go to work on getting the banking ban overturned and start to talk it up again.