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Title: The money is not disappearing Post by: Dan The Man on October 19, 2011, 03:29:35 PM A lot of people are talking about how the falling bitcoin prices is making money evaporate, as though Bitcoin is somehow eating up life savings. The only thing that is evaporating is electricity and overheated GPUs, everything else is just changing hands. If you draw an imaginary boundary around all of the people playing the bitcoin exchange game and consider all of the real dollars that they have put into it, there is no sinkhole where dollars are disappearing into. It's just they have redistributed there wealth between the players. It's like playing poker at your buddies house, you came to the table, made a bet, and someone lost and someone won. The people who bought at $30 lost, and the people who sold at $30 won.
Similarly, there was no money tree when the price was ramping up. If you made money, that was late adopters putting cash into your hands. A purely speculative commodity trading environment (which is pretty much what Bitcoin is if you get rid of mining and the constant flux in how many people are playing) is just another type of poker. You are gambling on the actions of other individuals who in turn are gambling on the actions of you and everyone else. In a sense it's more pure than poker because if there is no fundamental value then the game is purely psychological. There is some data to be studied in looking at how many people are joining in based on media attention and whatnot. But I think that the sheep are the minority, and most players are out to make personal profit. Also, why can't I post anywhere else yet. I've been stuck in this stupid forum for too long. Title: Re: The money is not disappearing Post by: RodeoX on October 19, 2011, 03:56:47 PM Agreed. No one likes to talk about the losers when the market is up or the winners when it goes down. But they are both always there.
also, about the forum restrictions: https://bitcointalk.org/index.php?topic=15958.0 Title: Re: The money is not disappearing Post by: kiyote on October 19, 2011, 04:53:29 PM Looking at all the graphs and numbers for the past couple of days, I think that the bubble period was an exception, rather than a rule. We seem to have fallen back to the point where bitcoin value would be if it had grown linearly and the difficulty to produce a new has is dropping back down to a reasonable level for new miners.
BitCoin was probably not ready for that level yet, but it doesn't mean it still can't grow there. Title: Re: The money is not disappearing Post by: Dan The Man on October 19, 2011, 05:14:38 PM There are a few other things I would like to point out. First, if you want to see a skyrocketing bubble, just flip the bitcoin exchange rate around. USD is going through the roof. There's a lot of Bitcoin to be made buying and selling USD.
Second, the market is volatile because the wealth is still diffusing from a high concentration to lower concentration. Notice that the price always staircases up as the small players buy in and then plummits when a major player sells. That's the way it's got to be if you want to move money from the 1% to the 99%. People want to profit from BTC. That requires BTC to be exchanged for something else at least once. Money will tend to move from the few to the many because the player base has increased so much. It's kind of analogous to Fick's Law (scientist, not an economist). The early distribution created a high concentration, low entropy state that was unstable. Value is like potential energy, the owner wants to make the biggest jump down so as to maximize their profit. With a bit of work I think I can make a real theory out of this. Do economists apply the concept of entropy to the movement of money? Title: Re: The money is not disappearing Post by: giarc on October 19, 2011, 09:45:24 PM I think although the total value of money has not decreased, the value within the bitcoin economy has as the people who sold and left took their money with them and their buy transactions no longer add value to the total pool of bitcoins. Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving could well damage its future prospects as these are the people who believed in it as a medium of exchange.
This is just one of the risks I see it doesn't mean I don't think it will succeed, just that I still think its far from a sure thing. Title: Re: The money is not disappearing Post by: MoonShadow on October 19, 2011, 09:49:30 PM Looking at all the graphs and numbers for the past couple of days, I think that the bubble period was an exception, rather than a rule. We seem to have fallen back to the point where bitcoin value would be if it had grown linearly and the difficulty to produce a new has is dropping back down to a reasonable level for new miners. BitCoin was probably not ready for that level yet, but it doesn't mean it still can't grow there. In hindsight, I agree with this assessment. It sure didn't feel like it on the way up, though. I, for one, could not tell that it was in a bubble above $10 until it was well over $20. These things are not clear except in retrospect. Title: Re: The money is not disappearing Post by: MoonShadow on October 19, 2011, 09:51:39 PM Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving could well damage its future prospects as these are the people who believed in it as a medium of exchange. I challenge you to find one person who held bitcoins a year ago who has sold out and left the community behind. Accused fraudsters excepted, of course. And no, Satoshi has not sold out. Title: Re: The money is not disappearing Post by: giarc on October 19, 2011, 10:12:22 PM Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving could well damage its future prospects as these are the people who believed in it as a medium of exchange. I challenge you to find one person who held bitcoins a year ago who has sold out and left the community behind. Accused fraudsters excepted, of course. And no, Satoshi has not sold out. How would it be possible to prove, the whole system is designed to make it easy to hide who owns what. The idea that you are suggesting people who invested thousands are all gonna have enough faith in bitcoins for every one of them to stay fully exposed to bitrcoin is crazy. During busts there are always people who decide the risk inherent is higher than they can handle and so decide to leave, if there weren't the price wouldn't fall. Being in the community isn't enough to support a currency you need holders, good wishes are commn place its people taking on risk in the currency that matters. I'm not saying this will destroy bitcoin although it might do it damage in the medium term as it takes people time to rebuild confidence in the stability of a currency, exchange rate changes do matter as people rarely can buy and spend their bitcoins instantly. Title: Re: The money is not disappearing Post by: BitterTea on October 19, 2011, 10:31:23 PM Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving could well damage its future prospects as these are the people who believed in it as a medium of exchange. The idea that you are suggesting people who invested thousands are all gonna have enough faith in bitcoins for every one of them to stay fully exposed to bitrcoin is crazy. giarc uses shift goal posts... It's not very effective! it takes people time to rebuild confidence in the stability of a currency, exchange rate changes do matter as people rarely can buy and spend their bitcoins instantly. Bitcoin was never designed to and may never be stable in exchange against fiat currencies. Title: Re: The money is not disappearing Post by: giarc on October 19, 2011, 10:44:14 PM giarc uses shift goal posts... It's not very effective! Actually you moved the goal posts when you asked me to point to "one person" who left bitcoin and the community I was just refuting your argument and showing that by your target of "one person" I am correct. If you don't like that please choose more carefully when you propose something that the person your arguing with is supposed to show. Also later I describe how a fall in price suggests a flow of capital out of bitcoins, this therefore means that by logic a large percentage of the funds are moving out of the system. Title: Re: The money is not disappearing Post by: MoonShadow on October 19, 2011, 10:48:05 PM Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving could well damage its future prospects as these are the people who believed in it as a medium of exchange. I challenge you to find one person who held bitcoins a year ago who has sold out and left the community behind. Accused fraudsters excepted, of course. And no, Satoshi has not sold out. How would it be possible to prove, the whole system is designed to make it easy to hide who owns what. Which is exactly the point I was trying to make. You don't have any evidence that any "original investors who felt most strongly" are actually leaving the community in any fashion whatever. You're simply making an assumption based upon projection of your own perspectives. That's an opinion, not a fact, as you implied. Title: Re: The money is not disappearing Post by: BitterTea on October 19, 2011, 10:48:20 PM Actually you moved the goal posts when you asked me to point to "a single person" who left bitcoin and the community I was just refuting your argument and showing that by your target of "a single person" I am correct. I couldn't have moved them, that was my first reply in the thread. You did in fact shift the goal posts, in two ways: many of the original investors who felt most strongly became people who invested thousands - you're talking about two different groups of people are leaving became [not]stay fully exposed - you're talking about two different actions Title: Re: The money is not disappearing Post by: MoonShadow on October 19, 2011, 10:50:47 PM giarc uses shift goal posts... It's not very effective! Actually you moved the goal posts when you asked me to point to "one person" who left bitcoin and the community I was just refuting your argument and showing that by your target of "one person" I am correct. First, I did that. Second, you have done nothing of the sort. It may, or may not be, a rational assumption to state that there in an investor that has left the game. But to state that assumption as anything more than your own belief is an obvious falsehood. Quote Also later I describe how a fall in price suggests a flow of capital out of bitcoins, this therefore means that by logic a large percentage of the funds are moving out of the system. That is not equivalant to the assumption that actual investors are leaving bitcoin. Title: Re: The money is not disappearing Post by: giarc on October 19, 2011, 10:53:56 PM Actually you moved the goal posts when you asked me to point to "a single person" who left bitcoin and the community I was just refuting your argument and showing that by your target of "a single person" I am correct. I couldn't have moved them, that was my first reply in the thread. You did in fact shift the goal posts, in two ways: many of the original investors who felt most strongly became people who invested thousands - you're talking about two different groups of people are leaving became [not]stay fully exposed - you're talking about two different actions I count believing strongly as investing strongly in terms of dollars, anything else is very hard to measure. As large amounts of people are selling they must be less invested in the currency and as of such are leaving in the way that matters... with their capital. Title: Re: The money is not disappearing Post by: BitterTea on October 19, 2011, 10:55:35 PM I count believing strongly as investing strongly in terms of dollars, anything else is very hard to measure. As large amounts of people are selling they must be less invested in the currency and as of such are leaving in the way that matters... with their capital. "I'm right, therefore I'm right (I said it so it must be true)!" Title: Re: The money is not disappearing Post by: giarc on October 19, 2011, 10:57:00 PM Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving could well damage its future prospects as these are the people who believed in it as a medium of exchange. I challenge you to find one person who held bitcoins a year ago who has sold out and left the community behind. Accused fraudsters excepted, of course. And no, Satoshi has not sold out. How would it be possible to prove, the whole system is designed to make it easy to hide who owns what. Which is exactly the point I was trying to make. You don't have any evidence that any "original investors who felt most strongly" are actually leaving the community in any fashion whatever. You're simply making an assumption based upon projection of your own perspectives. That's an opinion, not a fact, as you implied. It is impossible to be sure, but if a large amount of capital is leaving the system it implies a large amount of people are leaving and as those most exposed could reasonably be assumed to be those who most believe in it then it would be a fair to say that it is likely many of this group are leaving. I never said it could be proven for definite just that it was likely. Title: Re: The money is not disappearing Post by: MoonShadow on October 19, 2011, 10:58:11 PM Actually you moved the goal posts when you asked me to point to "a single person" who left bitcoin and the community I was just refuting your argument and showing that by your target of "a single person" I am correct. I couldn't have moved them, that was my first reply in the thread. You did in fact shift the goal posts, in two ways: many of the original investors who felt most strongly became people who invested thousands - you're talking about two different groups of people are leaving became [not]stay fully exposed - you're talking about two different actions I count believing strongly as investing strongly in terms of dollars, anything else is very hard to measure. As large amounts of people are selling they must be less invested in the currency and as of such are leaving in the way that matters... with their capital. Thank you for your honesty. I, for one, don't believe that reality gives much credence to what you (or I) might believe; but at least we know where you stand. I won't be considering you for any investment advice, BTW. Title: Re: The money is not disappearing Post by: giarc on October 19, 2011, 10:59:05 PM I count believing strongly as investing strongly in terms of dollars, anything else is very hard to measure. As large amounts of people are selling they must be less invested in the currency and as of such are leaving in the way that matters... with their capital. "I'm right, therefore I'm right (I said it so it must be true)!" feel free to suggest another useful measure and then we would have a reasonable argument, but my hypothesis is just that a hypothesis, it needs better data. I never said it was definite just that it seems reasonable based on the data available. Title: Re: The money is not disappearing Post by: MoonShadow on October 19, 2011, 11:01:11 PM Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving could well damage its future prospects as these are the people who believed in it as a medium of exchange. I challenge you to find one person who held bitcoins a year ago who has sold out and left the community behind. Accused fraudsters excepted, of course. And no, Satoshi has not sold out. How would it be possible to prove, the whole system is designed to make it easy to hide who owns what. Which is exactly the point I was trying to make. You don't have any evidence that any "original investors who felt most strongly" are actually leaving the community in any fashion whatever. You're simply making an assumption based upon projection of your own perspectives. That's an opinion, not a fact, as you implied. It is impossible to be sure, but if a large amount of capital is leaving the system it implies a large amount of people are leaving and as those most exposed could reasonably be assumed to be those who most believe in it then it would be a fair to say that it is likely many of this group are leaving. I never said it could be proven for definite just that it was likely. Taken from your own post... Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving FYI, most people would consider the above excerpt to be an assertion by the author that the words following "Also the fact" to be a fact, not an assertion of likelyhood. Title: Re: The money is not disappearing Post by: giarc on October 19, 2011, 11:03:37 PM Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving could well damage its future prospects as these are the people who believed in it as a medium of exchange. I challenge you to find one person who held bitcoins a year ago who has sold out and left the community behind. Accused fraudsters excepted, of course. And no, Satoshi has not sold out. How would it be possible to prove, the whole system is designed to make it easy to hide who owns what. Which is exactly the point I was trying to make. You don't have any evidence that any "original investors who felt most strongly" are actually leaving the community in any fashion whatever. You're simply making an assumption based upon projection of your own perspectives. That's an opinion, not a fact, as you implied. It is impossible to be sure, but if a large amount of capital is leaving the system it implies a large amount of people are leaving and as those most exposed could reasonably be assumed to be those who most believe in it then it would be a fair to say that it is likely many of this group are leaving. I never said it could be proven for definite just that it was likely. Taken from your own post... Also the fact the currency is falling in value and many of the original investors who felt most strongly are leaving FYI, most people would consider the above excerpt to be an assertion by the author that the words following "Also the fact" to be a fact, not an assertion of likelyhood. Title: Re: The money is not disappearing Post by: MoonShadow on October 19, 2011, 11:05:22 PM I count believing strongly as investing strongly in terms of dollars, anything else is very hard to measure. As large amounts of people are selling they must be less invested in the currency and as of such are leaving in the way that matters... with their capital. "I'm right, therefore I'm right (I said it so it must be true)!" feel free to suggest another useful measure and then we would have a reasonable argument, but my hypothesis is just that a hypothesis, it needs better data. I never said it was definite just that it seems reasonable based on the data available. As I have twice pointed out, you stated it as a fact, which implies that you have sufficent data to support that postion. I then pointed out that it's impossible for you to have such data, an actual fact that you do not contest. So now you claim that it's a "likely" conclusion and a "hypothesis". My own hypothesis is that you are either a troll, or a child who cannot accept when he has made an error in logic. I suggest that you enlighten me as to which is true, before I make an arbitrary decision as to how I shall proceed. Title: Re: The money is not disappearing Post by: rplg on October 20, 2011, 10:30:21 PM A lot of people are talking about how the falling bitcoin prices is making money evaporate, as though Bitcoin is somehow eating up life savings. The only thing that is evaporating is electricity and overheated GPUs, everything else is just changing hands. If you draw an imaginary boundary around all of the people playing the bitcoin exchange game and consider all of the real dollars that they have put into it, there is no sinkhole where dollars are disappearing into. It's just they have redistributed there wealth between the players. It's like playing poker at your buddies house, you came to the table, made a bet, and someone lost and someone won. The people who bought at $30 lost, and the people who sold at $30 won. There might be some positive things with the price drop. People holding thousands, if not tens or hundreds of thousand bitcoins, can definitely make the price go up. Until they found their 1000% profit is enough and start selling, and the price starts dropping. I guess that is what happened by the end of July, accompanied by the mtgox password leak, mybitcoin going down and losing coins, and that polish exchange accidently deleting 17k BTC.Similarly, there was no money tree when the price was ramping up. If you made money, that was late adopters putting cash into your hands. A purely speculative commodity trading environment (which is pretty much what Bitcoin is if you get rid of mining and the constant flux in how many people are playing) is just another type of poker. You are gambling on the actions of other individuals who in turn are gambling on the actions of you and everyone else. In a sense it's more pure than poker because if there is no fundamental value then the game is purely psychological. There is some data to be studied in looking at how many people are joining in based on media attention and whatnot. But I think that the sheep are the minority, and most players are out to make personal profit. Also, why can't I post anywhere else yet. I've been stuck in this stupid forum for too long. This raises the question, how many private keys are lost? Either way I am not concerned of the price, I simply do not consider bitcoin an investment. I can keep $100 on a reliable exchange, and buy bitcoins when I need them. Merchants can set up a system to auto adjust prices and instantly transfer to an exchange to sell the coins, to make sure they don't lose on the fluctuation. Luckily I can make use of free SEPA transfers. I hope more options become available so people are only subject to a 0.5% conversion fee at the exchanges. Title: Re: The money is not disappearing Post by: RandyFolds on October 21, 2011, 12:14:38 AM People holding thousands, if not tens or hundreds of thousand bitcoins, can definitely make the price go up. Until they found their 1000% profit is enough and start selling, and the price starts dropping. I guess that is what happened by the end of July, accompanied by the mtgox password leak, mybitcoin going down and losing coins, and that polish exchange accidently deleting 17k BTC. mybitcoin skipped town with everyone's holdings and those polish 'lost' coins were more than likely stolen. Title: Re: The money is not disappearing Post by: burlington on October 21, 2011, 11:42:30 AM My first post here and one of warning. Intersango don't seem to be processing my deposits over the last few days and aren't replying to any communications. So my money has definitely disappeared, right now anyway. Perhaps people want to be wary of them for now. Maybe the price collapse over the last week or so has hit them hard.... Either way, I'd advise caution for now :(
Title: Re: The money is not disappearing Post by: Bitcoin2CDKey on October 21, 2011, 11:43:44 AM #1 agree
Title: Re: The money is not disappearing Post by: burlington on October 21, 2011, 09:53:09 PM Yeah, confirmed. Intersango having banking problems. Won't be seeing my money for an unknown period of time. Maybe someone with full status might want to warn others not to deposit with them until it's sorted because they won't be able to convert their money or get it back until they get new banking facilities and records of deposits to their old account. Really pissed off with this....
Title: Re: The money is not disappearing Post by: calmindifference on October 21, 2011, 11:08:41 PM Yeah, confirmed. Intersango having banking problems. Won't be seeing my money for an unknown period of time. Maybe someone with full status might want to warn others not to deposit with them until it's sorted because they won't be able to convert their money or get it back until they get new banking facilities and records of deposits to their old account. Really pissed off with this.... Really shocking in this day and age that you can transfer money to a closed bank account and it just ends up falling into the abyss Title: Re: The money is not disappearing Post by: repentance on October 21, 2011, 11:18:24 PM Yeah, confirmed. Intersango having banking problems. Won't be seeing my money for an unknown period of time. Maybe someone with full status might want to warn others not to deposit with them until it's sorted because they won't be able to convert their money or get it back until they get new banking facilities and records of deposits to their old account. Really pissed off with this.... If you can give me a link to information about their banking problems or post an email from them about this issue, I can post it on one of the main forums. Title: Intersango banking problems Post by: yogi on October 22, 2011, 02:19:09 PM Here is the notice on their website:-
Notice Transfers made to our HSBC account on or after the 19th which have not been linked to your account will be delayed. HSBC has unexpectedly closed our account. They did so without any warning. We are working on alternative banking options, but of course are having trouble quickly opening a new account. Transfer made into the account after our records stop but before the account was actually closed will be delayed until we can obtain the records. Title: Re: The money is not disappearing Post by: kiyote on October 22, 2011, 03:53:13 PM Looking at all the graphs and numbers for the past couple of days, I think that the bubble period was an exception, rather than a rule. We seem to have fallen back to the point where bitcoin value would be if it had grown linearly and the difficulty to produce a new has is dropping back down to a reasonable level for new miners. BitCoin was probably not ready for that level yet, but it doesn't mean it still can't grow there. In hindsight, I agree with this assessment. It sure didn't feel like it on the way up, though. I, for one, could not tell that it was in a bubble above $10 until it was well over $20. These things are not clear except in retrospect. Bubbles are always hard to see when you're in them, even if it's blatantly obvious when you're out of them. Take a look at the tech bubble, or, even worse, the housing bubble. Now that it's over, everyone is all like, "I have to pay a million dollar mortgage on what!? Title: Re: The money is not disappearing Post by: burlington on October 27, 2011, 11:24:43 AM Intersango still haven't cleared their backlog (ie; my money) so their problems continue ??? On a positive side, the btc market has had a sort of a double bounce off approx £1.71. Maybe this indicates a decent resistance point and the bottom of the price collapse and a good time to buy? Where I live, property speculators are buying again big time on the reckoning that the burst has gone as low as it will. Wealth warning: I know sweet f.a. about currency speculation ::)
Title: Re: The money is not disappearing Post by: kiyote on October 27, 2011, 09:28:57 PM Intersango still haven't cleared their backlog (ie; my money) so their problems continue ??? On a positive side, the btc market has had a sort of a double bounce off approx £1.71. Maybe this indicates a decent resistance point and the bottom of the price collapse and a good time to buy? Where I live, property speculators are buying again big time on the reckoning that the burst has gone as low as it will. Wealth warning: I know sweet f.a. about currency speculation ::) I'm starting to see the same thing in Chicago. Investors are moving in quickly to snatch up foreclosed houses, but the economy is still bad enough that there's still a glut of houses the banks need to get rid of. Even in the last six months, the housing prices have dropped further. Not saying that the same has happened to bitcoins, but markets are hard to predict with certainty. |