Bitcoin Forum

Bitcoin has lost more than 80% of its  value this year! A lot of investors are worried about their losses, some has given up and some are confident of a great future and returns , with how bitcoin can change their lives..

Today I came across this Nakamoto institute article and I want to share my views and add to it..

http://nakamotoinstitute.org/mempool/im-hoarding-bitcoins-and-no-you-cant-have-any/ (http://nakamotoinstitute.org/mempool/im-hoarding-bitcoins-and-no-you-cant-have-any/)

Who gained and who lost during these times?

Bitcoin comes under Distributed capitalism, which means we all have a role to play in bitcoin's success,

 but a lot of people figure it very wrongly that bitcoin success depends on people actively spending all their bitcoin, buying them and then actively spend it all away , spread the word so that people come into the bitcoin world and bitcoin succeds as currency...

But it seems this model does not work for bitcoin to go mainstream

bitcoin related companies had huge venture capital investment, merchant adoption and news stories running everyday, but they all simply failed to help bitcoin even sustain the price and only contributed to bitcoin losing more than 80% of its value.

bitcoin only gained 1000x when these were not there!

What is really success for bitcoin?

An ideal success for bitcoin will be something around a million dollars per bitcoin, where the market cap is in trillions so that bitcoin will compete with petro dollar and become of use in high volume Forex trading..This is ideal success..

but we will never reach there with spending bitcoins but only by hodling or hoarding bitcoins..

who are those who promote spending and why you should ignore them?

They are mostly these merchant service processing companies and their clients and centralized bitcoin banks who like to see daily volume so that they make lot of money by cutting a part of your payment, getting bitcoins from you and then selling it for dollars. by this they are creating  a selling pressure and thereby constantly make bitcoin price go down..it is clear they dont give a shit about bitcoin, or else why would they sell it for dollars, if they don't have the confidence..

Their companies are valued in millions and they are millionaires and they only will care about the growth of their company's market cap and not bitcoins market cap.

How do these people influence your mind?

These people have received millions of dollars to make people spend bitcoins, therefore they do all sorts of psychological manipulation to make you spend bitcoins..they make you feel bad if you hodl your bitcoin without spending by telling you that you are greedy, selfish, and that hodling bitcoin is bad if you do so..

after some years their companies will be valued in billions, they will become billionaires! but bitcoin will be caught in a price of 200-300$ forever and your life does not change!

But How does Hoarding bitcoins make it go to moon?

Yes! when a lot of people decide not to spend bitcoins the selling pressure goes down and bitcoin price will rise to moon and with any commodity that increases in price when it is hoarded!

bitcoin is often compared to internet early stage! now think how did dot com bubble happen and trillions were poured into internet? becuase people believed their investment would make them millionaires! that is what made internet a success!

similar trend is also seen in bitcoin! lot of interest in bitcoin whenever the price is increasing and no interest when the price is decreasing..
The google trend for bitcoin is an excellent proof of this phenomenon.

http://www.etoro.com/blog/wp-content/uploads/2014/11/chart_Bitcoin-e1415026856377.jpg


So if you want bitcoin to succeed! just hold your bitcoins! dont spend them around! you may feel sad and bad if the 200$  you spent could be worth 1000$ tomorrow and that you threw them away cheaply!

Hold! Hoard your crypto GOLD!

I was one of the silly newbs that bought in late 2013 near the ATH. Despite the constant price dropping, I've been buying every paycheck for over a year now and hodling as much as I can. The amount of support, infrastructure and validation from companies like Overstock and Microsoft out-weighs the price performance. I've lost some to trading and gambling, but for the most I have just been building up a stash. It's only a matter of time before demand goes up again. The occasional visit to the bitoinrichlist.com is a good reminder that there aren't even 250k addresses with >1 BTC. We all know everyone has more than one address, so it would be safe to believe there are much less than 250,000 people with >1 BTC. Sure some people could have 0.3 on four different addresses but I think it's more likely that people who split their balance up among multiple addresses have larger holdings.

In reality that could never happen and yes, hoarding does reduce supply in the market and will inadvertently brings up value of the coin. More over this would reduce the volatility we're seeing right now because everybody wants to hold on to the coins hoping that one day they will be able to sell at higher value. Again, this is the ideal scenario we want to see but despite all that, it will never happen because the community will never reach a consensus. People are more focused on quick selling and buying for short term gains.

Let the dumb newbs play the game... smart money is in the future... Hodl

No, no, NO! As a strong bullish long-term Bitcoin believer, I completely disagree  >:(

Even if you consider your bitcoins as long term investment, rather than spending money - what do you think will help raising the value of your precious bitcoins more:

• 1. Hodling your bitcoins and spending USD, thus only stimulating the USD economy
  
  or
  
  

• 2. Spending your bitcoins, thus stimulating the BTC economy, and immediately buying back new bitcoins (on exchange or circle or whatever), thus increasing demand for Bitcoin on the market.

Notice that the end result is the same: you essentially purchased some stuff, lost some USD, and kept your BTC. But with option nr. 2, you're actively helping to raise the Bitcoin price level on two ends: Bitcoin economy AND market demand. I really don't understand why even the most fanatic Bitcoin owners don't seem to get this :-\

Especially if you're a Bitcoin fan, believer, enthusiast, investor, or hodler, SPEND THEM! (And immediately refill your stash of bitcoins by buying new ones with fiat)

By just sitting on your coins, instead of using them, Bitcoin won't grow! Spend them, and buy back at the same time.

If everyone is hoarding then whats the point of the damn thing. Its just a speculative instrument and nothing else.

OP just went full retarded, never go full retarded.
I second that.

I got to be rich to do that..buy an xbox with usd for 300$ or else buy with btc for 600$(to buy equal btc again)

spend only when it gained a lot of value

"spend only when it gained a lot of value"

On what? There won't be any kind of bitcoin economy. Investors and entrepreneurs would have to be mad to do anything productive with bitcoin with people like you running the show.

Bitcoin is a convenient way to transfer money, if every one hoard their coins , the value of bitcoin is gone.

only hoarding would be a bad idea. if you want to help btc, you should spent it.

and you can save and spent BTC at the same time.  ::)

This is an old article I read long time ago. A lot has happened since the article was originally written...

why spend Bitcoin now when it will be worth $10,000 per coin in a few years?

Why will it be worth $10k in a few years? Especially if nobody is actually using it for anything?

I guess you are really bad at math. So, I give you an example.
Let's assume you bought 10 BTC for USD 1000 each last year.

Now, you want to buy an Xbox.
Scenario 1:
You buy it with fiat.
You spend 300 USD.
(-10.000)+(-300)=-10.300 [USD]
10 = 10 BTC

Scenario 2:
You buy with BTC and replenish. Assume 1 BTC=300 USD
(-10.000)+(-300)=-10.300 [USD]
10-1+1=10 BTC

Have you lost any money in Scenario 2? No
But you have stimulated BTC-economy.
Have you put selling pressure on the BTC-market? No. The merchant has sold 1 BTC, but you have bought 1 BTC, which nullifies:
(-1)+1=0

This is the mentality that will stunt this concept, unfortunately. Good on all of those people who spend a couple now and then. You've got your work cut out for you trying to get an economy going.

Hoarding and holding too much is against the concept of bitcoin as a "currency". It may increase it's value, yes, but without some bitcoins rotating around the economy, who would want to use it in the first place? A small number of coins rotating might increase the price, but it also slows down the adoption rate, which is another factor towards bitcoin's success.

But that's the thing, BTC is not just a currency. Therefore, thinking of it as something more valuable than a normal currency is pretty reasonable.

I have faith in the future. Bitcoin is still in its infancy. Big things await.

At least miners should use bitcoins to pay their daily cost

Spendulus says .... spend AND HODL.

another motivational post of a desperate bagholder. these evil companies trying to do something useful with bitcoin are getting rich while his bag's value decreases on a weekly basis. that's just not fair. the bag was supposed to sit there and quadrimillionuple in value every 5 seconds. :'(

Long term users like me who want to actually use Bitcoin genuinely don't give a shit about the price, sure it's nice when it rises but in the end it doesn't take away from it's functionality as lots of people like to claim, that's not how a currency operates, as log as it is a decentralised medium of exchange then it will suit me just fine.

This whole thread is so depressing. I've never had less faith in bitcoin than after reading it.

"An ideal success for bitcoin will be something around a million dollars per bitcoin, where the market cap is in trillions so that bitcoin will compete with petro dollar and become of use in high volume Forex trading..This is ideal success.."

Whatever you are smoking...

I think the games up. Bitcoin may be dead as a genuine alternative monetary system.

Keep HODLING boys.

I don't know how many times I've chimed in to hodl. But if everyone just was hodling, bitcoin would fail.
I'm hodling because I don't have money for both. I use my credit card for purchases, bank account to pay back the credit card, and any extra is in BTC.

The value in BTC is the payment system, not the quality of the bitcoin itself. Only by usage and general adoption will it go up in value. To get there it has to be used.

I think the ideal situation (which I would adopt once my credit card is paid off) is to have two BTC on your phone, use and replace it for transactions, and the rest in cold storage. But keep the market flowing.

+1 for holding. It's much more important than spending right now.

OP there has to be use of bitcoin for it to be a success. What would happen if everyone holds? transaction volume goes to shit which gives btc bad headlines.

Did you take hardfork and subsequent split into at least 3 coins in account which all would want to claim to be the real thing?

What makes you so sure the coins you are hoarding are real bitcoins a year from now?

Why would anyone want to buy them for more than a few dollars?

"+1 for holding. It's much more important than spending right now."

Important for what exactly.

+1

OP is 100% correct. Bitcoin works as a payment network, sure, but it's really not the best payment network from a practical point of view. What Bitcoin is best at is being a kind of vault for the storage-of-value that has never been seen before. You can keep your millions in your fucking head!

Bitcoins are secured by math and yet so many of you want to use it like a glorified Visa/MasterCard/Amex.

I used to look at a metric called Cost per transaction which is the daily mining revenue over the number of transactions that day. When the Cyprus bubble hit this metric went way up which only proved to me that the value in Bitcoin isn't in payments. You would expect with further use that that number will go down so it can "compete" with Visa, etc. Instead that movement showed that this beautiful thing is a store-of-value first, and a payment network second.

Hold.

To the people advising buy and hold at this point : YOU MAKE ME FUCKING SICK - physically fucking ill ... a distribution of wealth 100X worse than that of the billionaires vs the worlds billions of poor people , whale high frequency traders operating on low / zero fees with prefferential deals with exchanges , exchanges engaged in insider trading at zero fees , automated trading programs engaged in 24/7 predatory trading , millions of stolen btc out of a supply of less than 14 million being continaully dumped on the market creating non stop crushing sell orders at the expense of everyone , massive mining farms owned by asic chip manufacturers operating off of power plants converting sludge crude into electricity into btc into actual money gains , and a losing market that has lost 80+% of value since the illegal massive worse than ponzi fraud of mtgox used a billion non-existent dollars to jack the market up , plus hundreds of other exchange closures thefts hacks and frauds , and you actually have the fucking greed illness to tell people to buy and HOLD !?!?!? And why ? Obvious Answer - so idiots dump money into the sham and don't take it back out which adds to buy pressure and reduces the insane sell pressure that already exists so YOU can desperately attempt to cash out for a couple percent better at the potential expense of destroying the financial well being of others / continue your daily non-stop high frequency trading profits at the expense of anyone who dumps money into bitcoin ... it's beyond sick ... it's offensive ... if hell exists ... you won your ticket ...

The conversion rate of BTC to currency has no relation to the utility of BTC for electronic payments. 

HODL does not imply electing to do a transaction with currency when it would overall be cheaper with bitcoin.

That would be HODL at all costs.

That ill feeling comes from not owning as many BTC as you'd like. I don't see how God would send those of us who are supporting internet freedom money by holding, to hell.

I don't agree with 12345mm, but holding bitcoins is not supporting it. Using bitcoins is supporting it.

That may be the point of many responses here, but it is not the point of the OP. If you want to scream, "Create more sending transactions!" from the mountain top, then by all means create a new thread and see where it goes.

Holding bitcoin is supporting it in quite a few ways, perhaps using it is more supportive yes.  Those holders unless going through some investment trust have had to get involved in the bitcoin world.

The correct spelling is "Hold", like in your post.
HODL (currently in the thread title) is what people type when they want to look like a mindless lemming parroting what others say.

If holding bitcoins supports it, then spending the held bitcoins hurts it. Since nobody holds bitcoins forever (unless they lose or destroy them), the net benefit of holding is 0.

As crazy as it may seem, they actually type it that way on purpose because HODL is a very common (and popular for some reason) typo of hold.  Remember, these are the same people that say "This is gentlemen!" which is also grammatically incorrect. (Yes, I know it's a famous quote that was also known for a typo.)

Obviously to a lot of people bitcoin is just a gimmick to use to make a quick buck through (sorry, a "store of value"). It makes me doubly sure that "a store of value" is all it ever will be.

Not if you are hodling.  Hodling is the super-nuclear-enhanced-reincarnation of the third bastard offspring of the Godzilla's rendering of the HOLD concept. 

You, sir, compare an ox cart ("Hold") to the Startrek warp drive.  ("Hodl")

lol such grandure irony and truth from this thread

The same ones yelling to the heavens 'HODL' (basically ever other thread on here) and hoarding along the way are doing nothing but destroying the value and economy of the very currency they want to 'get rich quick' off of.  Haha.  What a conundrum.  It shows they truly couldn't give a rats ass about the actual technology itself, and will dump and gtfo as soon as there's signs of some quick cash. 

Sad to say, but daily market shorters are pretty much the only thing keeping bitcoin buoyant at this time.  The amount of people spending it daily in real life applications pales in comparison to those holding hoping for a giant payday.  The system has become exactly what Satoshi feared but most likely suspected it would inevitably become: a psychological game of greed.

Yep.

would not know well what will happen in the future, hopefully as 2009 and into 2013. and I will hold

This sums it up pretty good.

But it depends where you spend. If you're spending at a place that instantly converts the bitcoin back into fiat, then you actually didn't help bitcoin much by buying with it. You just got it sold into US dollars and more US dollars used.

So I would recommend 1.) HODLing as the OP says, or 2.) spending at places that hold the bitcoin and don't instantly sell it.

Encouraging others to HODL =

I am already overinvested and cannot buy anymore, plz buy up the price for me so that i can unload my bags to you anywhere near my breakeven point!

Haha, that's quite true. I'm a permabull (bitcoin enthusiast) for sure, and not embarrassed to admit it.  However it's also true that encouraging others to SODL = I have already sold and am looking to buy moar lower so please  dump the price.

The price does need to go up in order for it to be more useful in general. There is a lot of wealth in the world and bitcoin needs to be worth orders of magnitude more than it is now in order to be able to be used to account for a portion of it. The price does matter but surviving low prices is what bitcoin has done best so far.

Some will hold, some will sell, some will scream hodl!1!! and others will beat their fingers into nubs that it is dying or already dead. It doesn't matter. Most early adopters (protip-this is still early adoption) won't get overly rich as everyone has their price to sell along with the pressures of their immediate needs and unlimited desires.

I disagree. Even if you spend it at places who convert to EUR or USD, as long as you also buy back the same amount of bitcoins you spend, you're not increasing selling pressure. And you help Bitcoin by increasing volume of Bitcoin consumer sales.

As one of the organizers of Arnhem Bitcoincity (http://cointelegraph.com/news/113410/arnhem-bitcoincity-enrolls-50th-merchant-to-accept-bitcoin), I have spoken quite some merchants who are saying: right now I still convert to euros, because I pay my costs and staff in euros. But I notice how I can spend bitcoins at more and more places. So, I will soon accept bitcoins and keep them, so I can spend them directly, and the whole conversion with euros won't be necessary anymore.

This whole thing with merchants converging to fiat is a migration phase. As soon as there is a significant amount of places where they can spend their bitcoins, they'll get aware of the advantage of Bitcoin - not just accepting them (as a service to their customers or means of getting media exposure) but also for actually using it themselves.

Again: spending bitcoins and buying back the same amount is always better than just hodling your coins and spending fiat. EVEN at places that convert to fiat.

And one more thing: some people seem to think that the opposite of hodling, is spending. Not true. The opposite of hodling is dumping your coins on the exchange market.

If you spend bitcoins (as in, actually use them) and buy back the same amount right away, you're essentially still hodling AND promoting / stimulating Bitcoin at the same time.

The more you use Bitcoin, the more recognition it will get, and the bigger this thing will become. Sitting silently on your stash is not helping Bitcoin the slightest bit.

no one knows how you can say that ? and its risk little more then any other currency when japan got tusami still its currency value did not drop 80% as i said it risk more then any other currency its up to you if you wanna hold then hold

Because by spending Bitcoin now (and buying back the same amount of coins right away), you actually help Bitcoin growing, thus actively helping the price level going to $10K.

for that u need to have a lot of money

No you don't. When you buy something, use Bitcoin instead of cash, credit card, or debit card. Then use the money you didn't spend to buy more bitcoins.

You will always have the same amount of bitcoins, so you are still holding/hoarding/hodling, and you using bitcoins and pushing up the value.

The point, my dear smallfolk friend, is patience.

Unfortunately, hoarding is a game of chicken. If everyone hoards, then the price will crash when they finally sell and the patient people will lose everything.

Be it as it may, bitcoin price can only rise if there is demand for the coin. And demand means hoarding.

WHAT???? This makes no sense to me. Assume BTC was 10.000 and is now 300???? what?

If you buy an Xbox for 300 USD then you are down 300
If you buy an Xbox with 1BTC (worth 300 USD) and then buy 1BTC (at 300USD) then you are down 600.

FUCKING IDIOT

Im holding, as a non developer and non whale there isnt much else that can be done.

you can't be serious

So you've decided that Bitcoin should be a store of value and not a medium of exchange? Ok, that's fine.

As it stands now, it seems you'd prefer a small group of people (those who are involved with Bitcoin today) hold it only. Not using it prevents new people from becoming introduced to it...it'll remain an insignificant technology novelty. However if it becomes as convenient and common as credit cards or email you'll gain the interest (and use) of the critical mass needed to make bitcoin a legitimate payment option.

You're not wrong in determining that if BTC is a medium of exchange the price volatility will diminish and the price won't rise as easily. You're not wrong that BTC could have great use as store of value. But you ignore the idea of how adoption increases if there's no way to convince the public that Bitcoin has relevance in today's economy. It's medium of exchange attributes prove that relevance. And we rely on that relevance to get the masses to adopt the idea.

You mean "much MORE" than 250,000 people with >1 BTC, because people have multiple addresses with less than BTC but added together they total more than 1 BTC.

Even then, im sure people that own 1 BTC is a minority and this will be increasingly happening if the price goes back up and stabilizes.

lol
Come on, are you serious?
Check your math. It is really basic.

Some people has been commentating on the fact they see using BTC for mundane stuff like everyday groceries and whatnot a total waste. I agree. What do I gain? If I was a BTC whale then yes, but if you are another brick in the wall like 99% of us, every satoshi counts into building a decent stack of BTC in hopes it is a success and it gains purchasing power in the future.

I tend to believe more this kind of thinking. Btc's greatest value is as a vault for storage of money away from the dirty hands and eyes of government. Whatever currency people use for transactions, you can buy it with btc and then spend. And you can do that anywhere in the world.

HODL

There is a difference between holding and hoarding. Demand comes from holding for any period of time, not just hoarding.

I agree, hoard Bitcoin and price will go up ..

But only until you sell it. Then the price will go down.

But when that period ends and you put your coins for sale you no longer have demand, it just turned into new supply. Thus leaving hoarding as the most pure form of demand.

so basically decrease supply and price goes up?  i think i read that somewhere in school.  duh

Let me spell it out for you.

Suppose you want to buy an Xbox which is 300 USD.

You have 300 USD in your bank account, and 5 BTC in your wallet.

Scenario 1: you pay the Xbox with dollars. You now have: 1 Xbox, 0 USD, and 5 BTC.

Scenario 2: you pay the Xbox with bitcoins, and you buy back the same amount of bitcoins (i.e. 300 USD worth) on an exchange right away. You now have: 1 Xbox, 0 USD, and 5 BTC.

See the difference in the end result? Now, which scenario do you think will help Bitcoin grow more.

Note that in either scenario, it doesn't matter how cheap or expensive you originally bought the bitcoins. It ONLY matters that you are now spending 300 USD worth of bitcoins (at today's rate) and buying back the exact same amount of bitcoins right away (which will cost you 300 USD, give or take 0.1% exchange fees maybe).

Thank you.
I thought my explanation was retard safe, but I underestimated the retard level of some people in here.

Interesting...
thanks!
 8)

Holding/hoarding would then antagonize bitoin's idea as an actual currency. I agree with some of the posts here: if you only hold bitcoin and spend USD in the mean time, you're only helping to stimulate fiat currency; if you actually use bitcoin and apply it's use in everyday life, you're actually helping to stimulate bitcoin. Sure, holding could cause scarcity to bring bitcoin's price to the moon, but then it wouldn't hold much value as a trading commodity or currency.

i think is important for bitcoin that as many as possible buys more bitcoins.
also spend less bitcoins than you purchase. try to cumulate your wallet.

i think the price can go up to 1usd/bit (=1.000.000usd/btc).

I think you mean 1000USD/bit, 1 bit = 0.001 last time i checked.

1 bit = 0.001 milliBitcoin = 0.000001 BTC or one millionth of a bitcoin.

How so? You can contribute to hoarding and still buy goods and services with bitcoin. As long as the seller acknowledges bitcoin as good a currency as any other and doesn't rush to exchange it at market price for a fiat currency then the coins are effectively hoarded (by him), even though you just spent them.
In other words, hoarding does not mean "I'm gonna buy as many bitcoins as I can, move them to cold storage and never touch them again" but rather "Why on Earth would I ever want to exchange my bitcoins for shitty USD?".

Regarding currency "stimulation" I don't believe it is that important in this case. It certainly is in the case of fiat money (to the governments, that is) because the higher the money velocity the more they collect through coercive taxation. No such thing applies to bitcoin.


Hoarding explained in 3 easy rules
1. Do exchange your USD for BTC.
2. Do NOT exchange your BTC for USD.
3. Only spend your BTC on sellers you believe follow rule 2.



http://themisescircle.org/wp-content/uploads/2013/02/bitcoinfeedbackloops.jpg
Further reading: http://themisescircle.org/blog/2013/02/19/end-the-fed-hoard-bitcoins/

The only way I see that brings value to bitcoin is you exchange the coin within the community itself that is if your spend your bitcoin to pay to another person that will pass on to another without that going back to exchangers to leave it in the open market for sale to fiat. That will certainly bring up the price due  to scarcity because there will be less supply in the open market

Disagree with number 3. It's better to just ALWAYS pay with Bitcoin wherever you can, as it helps stimulating the Bitcoin economy and usability. Even if the merchant happens to convert it to EUR or USD. However, whenever you spend bitcoins, immediately buy back the same amount of bitcoins through an exchange. This way, you: 1. effectively keep your stash of bitcoins, and 2. you compensate the market supply/demand in case the merchant happens to convert his bitcoins to fiat.

Remember, Bitcoin is still in its infancy. We can't expect mainstream merchants to keep bitcoins, since they typically cannot pay their expenses and staff in bitcoins either. By ignoring merchants who don't keep bitcoins, you're sticking your head in the sand. By paying them in bitcoins, even if they convert it to EUR or USD, we help them getting into the migration phase. Once they notice how they can spend bitcoins everywhere, their urge to convert to fiat will diminish, and we'll grow towards a 100% Bitcoin situation.

It has been mentioned before: hoarding / hodling and spending bitcoins go hand in hand very well.