Bitcoin Forum

http://altcoinpress.com/wp-content/uploads/2014/12/bitcoin_bluescreen-728x441.jpg

There’s a perfectly good reason why the markets didn’t “take off” this week when Microsoft revealed that it would begin allowing customers to fund their accounts using bitcoin. The massive tech giant’s integration is sure to bring new and substantial selling pressure to the digital currency.

Seasoned bitcoin traders treated the news like a frozen Windows machine displaying a giant blue screen of death. In the moments following the announcement, traders went into buying mode, but it didn’t take long for the experienced speculators to understand the enormous auto-selling that the integration would bring.

http://altcoinpress.com/wp-content/uploads/2014/12/microsoft_bitcoin_chart.png

Microsoft has no intention of speculating on bitcoin’s long-term value. Instead, they will be using Bitpay to systematically exchange their bitcoin revenue for US Dollars. This means an increasing number of bitcoins will be dumped onto the markets in the coming weeks, creating a downward selling pressure spiral.

And Microsoft’s new bitcoin customers are unlikely to turn around and buy more bitcoins to replace those spent on digital purchases. After all, it make no sense to run out and buy more bitcoins to facilitate purchases that can be made with traditional fiat. There is little reason to take the additional, and often awkward step, other than perhaps for novelty or speculation.

What the community must realize is that for every Microsoft adding bitcoin as a payment option, they need an Exxon or a General Electric announcing that their employees will now have the option of receiving wages in bitcoin. Better yet, anytime a company adds bitcoin as a payment option, why not offer employees the same option for compensation. This would allow the company to funnel some of their new bitcoin revenue back into payroll, rather than auto selling for US Dollars.
Call to Action

We need more focus now on the wage side of integration. Otherwise, this current one-way trend will become impracticable and unsustainable. And it won’t be long before these types of major announcements become a reason to short the market, rather than a reason to celebrate.

Full Story: http://altcoinpress.com/2014/12/why-the-bitcoin-markets-didnt-rally-on-the-microsoft-news/

Not everyone has fiat at exchanges to buy coins at the drop of a hat when news like this hits. It will take time for people who have never bought before to learn through this new medium and actually set up an account and buy coins.

True. But as long as people are forced to buy bitcoins in order to spend bitcoins the system will remain broken.

We need to reduce the need for this type of exchange. And the payroll side of the equation offers the solution.

I think that there might be something more fundamental at play here.  The market learns very quickly and the Paypal announcement a few months ago, which many were expecting/hoping for months prior, resulted in a very short rise that was quickly sold into.  The excitement lasted for a day.

I think the disappointment in the activity resulting from the Paypal announcement carried over into the Microsoft so nobody really cared.  Or maybe that is only part of it...suffice to say, I didn't care save for the fact that I viewed it as another stone on the pathway...

microsoft receive millions of dollars a week, if you were above average intelligence you would realise that microsoft does actually invest some of its funds in different things. and as such i think microsoft's small percentage of current bitcoin transactions, they wold be more likely to hoard the coins for investments. after all microsoft points costs nothing to make and so there are no costs to recover to truly require exchanging bitcoin into dollar.

if i was receiving $10mill a week in dollar purchases of microsoft points, and then maybe $20k in bitcoin.. id hold onto that $20k a week in bitcoin and treat it as a 0.2% cashflow loss and a 0.2% investment gain.

as for the market hype.. well that was just a spasm reaction to news (speculation). untill we start to see microsoft advertise it, where by non-bitcoin fanboys are then intreged by bitcoin and jump on the bitcoin band wagon (which takes weeks) we wont see true movements that are based on market reactions to demand, as oppose to sheeple emotions (which last only about an hour)

If Microsoft intended to keep the bitcoins, they would have no need for Bitpay.

Bitpay is the mechanism by which they (and the vast majority of its other customers) dump their freshly received BTC.

the next halving cannot come soon enough for me....

overstock use coinbase......................................

yet overstock hoards coins..........

need i say more?

If Microsoft decides to begin hoarding Bitcoin, I will post a picture of myself here, in the buff, with your username painted across my chest.

Microsoft will start playing with bitcoin one way or the other. It's just a question of time.

Pretty sure Microsoft will sink a substantial amount of funds promoting btc and educating the public.

OP logic is flawed since the bitcoins that are sold need to be bought first.

What will happen:
More people get to learn about bitcoin and possibly an increase in volume and market cap, which is something good!

Also, people can no longer see bitcoin as a scam these days since the most legitimate businesses in the world are starting to support the bitcoin technology.

This is all good.

From speculative purposes all I can say is people on here seem to make the worst decisions. Better quit trading and investing if you have no idea what you are doing.

Unless there is a store that specifically sells certain product that can only be bought with bitcoin, it won't matter much in the end. People are not going to pay using btc when they can do the same with fiat. Also price rally could be shortlived because microsoft have already stated their approach is more towards testing the water.

They probably will not do this. People that have bitcoin that wish to spend it on MSFT games likely follow bitcoin related news and know that MSFT accepts bitcoin.

IMO this is really just a way for Microsoft to increase their overall revenue

Hah nice explaination on the picture, OP.
But well it wasn't caused by that and it's really weird that we didn't skyrocket, maybe all the traders dump on news and newbies bought so it came out as almost no rise.

Way to go Bitcoin we attracted another dumper, and I had expected so much more from Microsoft too.

So what is it going to take to get the Bitcoin developers to step in and do something more productive then the unbroken protocol. Theres nothing like sitting back and watching your dream die because you cant get past your stubbornness and pride long enough to create a real demand for your coin. Nothing like cutting your nose and all of our noses off to spite your face.

More people are likely to get into bitcoin as a result, the trend searches show bitcoin up 40% in last week on google.  Eventually companies could consider removing payment processors like bitpay and buy or pay wages to suppliers/employees direct.

Bitpay/Coinbase are going to want to keep the USD exchange rate as high as possible to keep the miners providing a secure network.  If the USD price drops their business is over.

maybe they are thinking and intending to implement bitcoin into some future apps in their os.
it seems unlikey they did this just to have another way of accepting fiat.
my thinking is there is something else that is not readily apparent to their sudden adoption of bitcoin.

I wonder if the speculators have just determined a fair price of about $350? Speculation is trying to guess future value and generally it rallies past the best price then crashes down to a sensible valuation.  Maybe $350 is about right for the scale and use cases that are part of the present BTC economy.
As far as MS not hoarding their coins, well I hope not. They would be exposing MS investors to the volatility of the naked BTC market and would be acting in a financially irresponsible way. Bitcoin is the best currency and payment network, but a very risky speculative instrument. MS did not get rich placing casino bets, they got rich cashing your checks and BTC is just another extension of that model.

This is only the first step, acceptance by Microsoft.  This isn't the end of their dealings with Bitcoin.

Once they roll out internationally, I'm sure they'll figure out other uses besides the inexpensive app or game in their marketplace.

From Sonny Singh of Bitpay:


Phase 1 will not include hoarding obviously.

Once we get global, and have Bitcoin as a payment option for other MS goods or services(enterprises? server and OS licenses? integrated into Skype or Office365?), you can expect them to hoard like a muThF3ker!

Probably not this says it all... ::)   

apples and oranges

This type of price 'stability' is inevitable for the reasons we all know and are posted here.

At this stage we need a new territory to catch the fever and start buying to counter our countries march's selling - rather than further integrating into territories that are already becoming BTC friendly and aware (USA and EU).
 
Dont get me wrong, I'm all for BTC getting more companies like MS on board even if they just dump them via Bitpay (it will lead to more buyers in USA and EU anyway), but id rather see some kind of discussion or plan or effort towards getting new countries like Argentina or Saudi Arabia to start getting into things. Places which would create more buy than sell pressure.

Its a good time to do it, as we have big companies on board now giving it more legitimacy so the new territories should be easier to get on board. If we wait too long for them to start buying, then the amount of marchants dumping will have increased again and the buy and sell pressure will be equal again...

I confused myself a little i think :P

Bitcoin is only accepted in the Windows Store, and only for American customers. It's not going to bring bitcoin to the masses...
I've setted up a Google News alert on "candy crush accepts bitcoin"  :D

There was no indication that it would rally whatsoever. Useless thread.

Well said, I wish I could have that opportunity to give my employee's salaries as BTC. If somebody in this forum has that chance, he/she should try it to make some awareness about usableness of BTC ;)

speculation and use are mutually exclusive. Bitcoin might rally to 4000 on no news whatsoever. And those threads trying to explain that move will be as useless as this one trying to describe the lack of a move...

I second this, but you do have to notice that prices have been shifting less and less upon the release of good news that would have probably moved the market a good 3-5% at least (maybe more) last year... 

The same thing goes for bad news as well though...  The market has been pretty flat regardless of the type of news...

This OP completely ignores the reason why a company that sells digital products and services online would use Bitcoin. It simply expands the market to those who do not have credit cards, debit cards,  bank accounts etc. This is the vast majority of the world's population. Microsoft being a US company would start accepting Bitcoin in its home market, but rest assured the real opportunity here is in the international markets. As for the impact on the price it is simple. A customer wishing to purchase a Microsoft product or service needs to first purchase XBT hold XBT for some time (even if it is only an hour or so) before purchasing the product or service from Microsoft. Only then will Microsoft have a chance to sell the XBT. Given the size of Microsoft if even a small fraction of its customers use XBT for purchases, this small time the XBT are held alone will cause the XBT/USD rate to skyrocket. There no need for the customer or Microsoft to hoard any XBT.

I have seen a person in Canada spend 50 CAD on a prepaid credit card in order to purchase a 25 CAD service online. Why because one cannot use cash online. This is the real market for crypto currency including XBT. It is not the person with an 800 FICO score collecting free travel by using her credit card.

Microsoft is using bitpay to process transactions which means they are converting their bitcoin to fiat immediately. There is no real reason for microsoft (or any other company) to hoard bitcoin until we start to see businesses that deal with other business start to accept bitcoin (eg see B2B transactions)

No one that I know bought Bitcoin to spend them at fucking Microsoft. :P

Plus it isn't new news that Microsoft liked Bitcoin.

Just another Bitpay customer *wooo hoo*  (It is a good thing obviously and great job Bitpay!)

Exactly. If enough of the world's unbanked start paying for MSFT services in bitcoins the small amount of unspent change that one person may hold at any one time would, collectively taken as a whole, have the same effect as hoarding.

Absolutely agree with this opinion.
Too much expectations from this "sensational" news - another (big though) company will get payments by third party vendor (that uses BTC) and get $$ ...

And again just a lot of people, who ramble stuff, they don't know anything about:
1. Bitpay does not mean, that ALL the bitcoin get converted into fiat instantly.
2. Putting some millions into Bitcoin is nothing for Microsoft: NOTHING. Like every big company they had R&D-projects, over years, that failed in the end and burned some Millions.
3. Just because, they are just accepting Bitcoin from the US and for a small group of products, doesn't mean it will stay that way FOREVER.

I am bookmarking your statement. As soon as we learn which percentage of Bitcoin they are keeping(I am pretty sure, it is the question of "how much?" not "if") I expect that picture.