Bitcoin Forum

This is just a theory, so bear with me (constructive criticism is welcome)

And this theory asserts that Bitcoin dumps like what we've seen recently (i.e. today and right after the rejection of the Winklevoss ETF by the SEC) contribute to more even Bitcoin distribution over time and will help stabilize prices in the future (read make Bitcoin growth more consistent). What real world facts is this theory based on? We know that initially there were only a few users (so-called early adopters) who held the majority of coins, so they could easily move the price by dumping their stashes (at least, some part thereof). In the case of the lack of major news (either positive or negative), the price is pretty stable right now. So the only viable explanation for all of a sudden price crashes is most likely someone dumping huge amounts of coins (maybe, the bros themselves). This causes the price to plunge (even if momentarily). It is almost certain as well that the coins dumped are bought by a lot of independent traders, and therefore the wealth distribution is set to level out eventually. That's basically why dumps are important since they are caused via massive sell-offs by a relatively small number of large Bitcoin holders and get absorbed by the market

It is kind of important what you mentioned but it is also important that bitcoin gets a dump because it helps the smaller investors a lot as they normally wait for price to deduce and ya after a dump till date they growth in price has been stable. And after all bitcoin is like a stock itself so dump is something which will surely occur.

After reading your post I've voted "Yes, they are". You have a good point, I have never thought about this issue that way. If you are right, and hopefully you are, the dumps work to the benefit of Bitcoin because it is dumped by a few and adopted by many.

Right now I can witness the confirmation of your theory on a Bitcoin exchanger I use: many people are buying BTC for the amounts from $10 to $30, and I'm pretty sure big part of them are buying their first Bitcoins now.

But this theory is still not without its weak points

For example, while it is certainly true (well, at least, I think so) that unexpected, out of the blue dumps are caused by cryptowhales liquidating their stashes, but what about pumps? It could be said that pumps are in fact offsetting the leveling out effect of dumps. And while dumps contribute to more even wealth distribution, pumps certainly work in the opposite direction, i.e. contribute to wealth centralization (accumulation) in fewer hands. That challenge in its turn could be somewhat refuted by claiming that pumps necessarily cause price hikes and thus their effect would be less pronounced since with higher prices you would just need more fiat to accumulate the same amount of bitcoins. Further, dumps are more profitable overall, so they should be preferred in case of the price rising. For example, the twins bought 100M dollar worth of bitcoins at the price of, say, 600 dollars per coin, but to buy the same amount of bitcoins today they would need twice as much cash. Therefore, with the same stack of dollars they could buy only half as many bitcoins today, and that would work against Bitcoin wealth centralization at higher prices. The bottom line is that higher prices make wealth centralization less likely at large

I believe a periodic dump is good for both traders and users of any crypto be it bitcoin or any other coin.
It allows more people to get hold of coin which is not possible because of high rates.

Dumps are not important., but profit taking is. Dumps do not necessarily decentralize ownership of bitcoins, because in most cases it is dumpers themselves that end up buying the coins back after it has being undervalued.

that is a very good point. but there is a big if involved and that is if others buy cheap bitcoins not sell after the dump and join the dumpers and then buy back more expensive coins.

lets say a whale dumps 500BTC at $1230 and creates panic, there will always be panic sellers and chain reaction without exception but if other traders know this and start buying instead of selling themselves that is when the whale is either forced to dump another 500BTC to force the panic or buy back his first 500BTC at $1250. meaning he buys 492BTC and if this continues happening each time there will be no whales.

I don't really see how profit taking is opposite to dumping

Since you seem to be opposing them. Care to explain? Further, it is not just the dumpers themselves who are buying back the coins that they have sold earlier at higher prices because otherwise buying back would be meaningless. If they were the only ones buying back their own coins, they would likely end up with losses since it makes sense to buy back if you assume to sell later at higher prices. But this is only possible if you are not the only one who is buying at lows. In other words, you would be able to buy back only a part of what you sold before, and thus dumps still necessarily contribute to leveling out Bitcoin wealth distribution. On the other hand, you still have to explain that folks that bought your coins at highs will be willing to sell these coins at all (back to you) even if the price went down. Either way, you are set to end up with less coins every turn of a pump and dump cycle

That's exactly my point

At the end of each cycle, the dumpster will have less coins (and more fiat), therefore dumps are useful. Apart from that, as I said in my previous post, there should not just be panic sellers (there will always be some), there should be a sufficient number of them. But since the price of Bitcoin is consistently going up at the end of each pump and dump cycle, there will never be enough panic sellers to offset the redistribution of coins (otherwise, price wouldn't be growing). In this way, higher prices play against the dumpsters since they inevitably lose their coins over time (accumulating cash instead)

well if it's like this it looks like the pattern of the holder of bitcoin will change because after the dump occurred so many people have bitcoin for buying and selling process, which there are many to be reduced eventually so no equalization holder bitcoin, so the benefits of the dump it is also important to maintain continuity of bitcoin, so the market fixed path

In a way we cannot deny that dumps are important to small time and independent bitcoin holders. Dumps are the best way of taking over bitcoins from the huge whales and will make bitcoin be evenly distributed to all members in bitcoin community. If there will be no big whales in the bitcoin industry there will be no more pumps in the future and bitcoins price will be as stable as gold.

Even if all 21M bitcoins were evenly distributed between all people, the prices wouldn't be as stable as the gold price

Since most people would just dump all their bitcoins for fiat immediately, and we would end up with a relatively small group of people (like now), some of which would have more coins than the rest of the pack. That will be enough to provide volatility higher than that of gold. We will always have a sort of Brownian motion (or random walk) around the base price even in the most extreme case of however even Bitcoin distribution

http://i045.radikal.ru/1703/fb/81fae6a88803.gif

Though such distribution would be still impossible in real life

I'm not saying that dumps are important, maybe sometimes we need it. Because in the world of trading as I can see and observed, traders act most of the time if there is pump happening and when dump is happening too traders had a chance to buy again a cheap coins for them to wait for a chance to sell.

I wouldn't mind the occasional dump. For many poorer people like me, it's really the only way to buy affordable bits. Sure some of the richer guys are also probably gonna benefit from gobbling up all those cheaper coins (some can even accuse them of triggering it to buy more coins) but at least more people get to grab some extra for themselves. I'm not well versed with the economics of stuff but I'd definitely buy during dumps rather than when it's on a rally.

Of course dumps are important, traders make trade from the swinging price, bitcoin need a balance dump and pump so the  price is stable, without dumping the transaction flow of bitcoin can be stagnant and dumping also makes the bitcoin price become cheaper so we have the opportunity to buy some coin and make some profit

good point.
and from what i can see, i can tell that we are moving towards that too. if you compare the dumps and how price reacts things are changing, the volatility is not the same as say 3 years ago. whales are also way more careful with their dumps and manipulations and that shows they have lost money or at least can no longer acheive the same goals as before.

I am not sure whether or not a dump would necessarily be important or contribute at all to the Bitcoin environment. I mean let's face it we all hate dumps.

When you wake up like today and you see the Bitcoin price during that $1,000 value again you wondered yourself what the hell happened? What happened was really pure speculation. Traders live off the price inconsistencies between time and time.

But I really don't see a reason why a dump would make Bitcoin more stable over time. Yes the market reaction is reducing dramatically but the Bitcoin price level is still yet to be more stable than most small countries currencies. And we've got so many dumps that I can't even count them all.

Right now, the Bitcoin market has achieved sufficient scale to prevent market manipulations.
In other alt markets, lot of dumps are carried out by whales to depress the market and then pick up coins at a low rate. This is less likely to happen with bitcoins, though.

If we are to really face it, not all people are greedy or impatient, and for me (and I guess many others as well) such dumps turn out to be an excellent opportunity to buy in and buy back what they sold at the highs. Just don't believe the bullshit that price is going to rise indefinitely


Did you read the opening post?

Dumps, especially dumps caused by big whales liquidating their stashes (i.e. not linked to events and news having a pervasive and all-embracing negative effect) lead to more even Bitcon distribution. In other words, with every dump there will be less and less whales, which makes Bitcoin less prone to abrupt and sharp plunges overall. Even if someone starts massively buying up bitcoins (like what the Winklevoss dudes did in their time), this will raise the price, and when they eventually choose to dump all their coins the price will still remain higher that their entry point. So the end result will still be more even distribution, which is a good thing on its own

I do agree that market needs some dumps for more spread.  This is what helps Bitcoin to be stable, by bringing in more hands that will support the network and economy.  Few people cannot sustain the system for very long time so they need much more people involved in it.  With this, there will be more fund to flow in the economy and more people advertising Bitcoin to invite new comer to the Bitcoin ecosystem.

Traders do thrive in these sort of situations and they really like to see huge movements so that they can make the best possible profit in these sort of market but the problem comes when you are small time trader and when you enter the coin at a wrong time and if the market is going down you will end up losing a lot of money in it unless you have the courage to hold for a longer time and most of them sell when they see the market going down,it is the same with stock as well as the digital market.

As the proverb goes, it's not all beer and skittles

It should be evident to anyone that there is no rose without a thorn, and as fast as the prices may climb they may crash even faster. But if things go massively awry, in the end you will lose only as much, i.e. as many dollars as you have put into Bitcoin. On the other hand, you don't necessarily need so much courage as to wait out the bad times. Small time traders should have courage to put stop losses here and there in the first place, and not be too greedy overall trying to squeeze tiny profits of smaller price movements. Though I don't really know whom exactly you refer to by these, i.e. day traders (as well as scalpers) or just wannabe traders

The decrease of bitcoin is especially important for traders and investors . Due to the bitcoin dump more and more are investing because investors await that bitcoin become cheap rates for them to buy. That why fump of bitcoin are so important.

That seems to be a misguided opinion

In fact, I'm rather inclined to think in the opposite direction. With most folks going to withhold their coins and given the limited supply of new coins, the Bitcoin market tends to be more prone to manipulation. In other words, there is not much growth in scale, and you seem to be confusing growth in prices with growth in "scale". I guess this is a mistake and your stance doesn't match well what happens in reality. In real life, higher prices at the basically the same amount of something traded (in this case, bitcoins) make markets thinner overall which facilitates manipulation, not prevents it (and this is irrespective of how many whales are there)

I am not denying usefulness of a occasional dumps, they are like acting like a safety valve to overbought and bloated markets.
After dump the air is cleared and allows new blood to buy bitcoin - because entry point is much more acceptable.
But our final goal is to raise market cap of bitcoin to prevent price volatility and harsh pump&dump acts. We are not there yet.


 

Indeed, since the price of bitcoin mainly depends on the traders itself. They are the reasons for the pump and dump of this coin. Although the news plays some role in its price ( good news means pump in price, and vice versa). I think it is minimal.

Now, because there are big traders who can manipulate its price (whether pump or dump it) and will make a chain reaction.

Usually they use this pump and dump strategy to generate a huge profit from buying and selling at a right time and by trolling newbie traders by means of panic selling and buying at the wrong time.

So, expect its price to reach $1300 again in the future or even surpass it.

Today trading market histories are completely based on dumps and pumps, the same rule applies to bitcoin also. When bitcoin is dumped, there are big chances that bitcoin will be distributed to many new users. In this way, the bitcoin market cap will increase and its credibility also increases and there are big chances when people are holding bitcoin the price bitcoin will surely increase.

Rising market cap will in fact contribute to price volatility rather than prevent it

Since market cap just mechanically reflects the Bitcoin price (given that the supply of new coins is constant). I have been telling this literally for years already, and the current events (the price pumps and dumps as of recent) pretty well confirm the theory behind my claims. And it is not about the volatility increasing in absolute terms (as many may erroneously come to think), it is about rising volatility even in relative terms (i.e. when the price swings are termed in percentages to the value of price itself). In short, the price rise under fixed or diminishing supply of new coins inevitably causes so-called market thinning which is essentially synonymous with volatility

Bitcoin dump and then pump are so very important for the traders as it keeps their interest intact and make it favorable for themselves by getting profits on buy low and sell high and repeating the cycle over and over again.

The cycle always repeated as fluctuations give chance for new adopters and traders to purchase cheaper coins.
People attracted to bitcoin because the advantages offered and its price keep increasing over time, so we could get profits from bargain and hold it for long term investment. But, at least we know that the price will increase and set a new level of price right? And so far $1000 is the floor I guess.

it depends, what you said it's true, but if dump are casued by big whales that manipulate for the sole purpose to buy back more coins, it would reckt the possible distribution that you are talking about

and whales are greed they always buy more when they sell, no matter how many coins they started with, after all trading is about getting more not giving them to the other

I strongly advise you to read the whole thread

It is only one page and a few posts beyond that. The issues you raise in your post have already been addressed before somewhere in the first page. Since you obviously won't read (write before read approach) and you certainly won't alone, I shortly explain it again why your issues will remain mostly theoretical. First, whales won't be the only ones buying at lows and, second, not all people buying from them at highs will be selling to them at lows. In any case, if the price goes up over time, whales will be necessarily losing coins and accumulating fiat instead. For a more detailed explanation, read the friendly thread after all

Youre assuming that the top in the rich list of Bitcoin are offloading their coins. I think whats really happening is the super rich wallets in BTC are not moving their coins. So whats really happening is a thinner and wider distribution of the few coins in circulation, remember BTC is divisible up to 8 decimal places. It might like the real world where the top 1% controls most of the wealth.

is very important because it makes a bitcoin ownership circulation, which ultimately makes bitcoin ownership of equity, I think this is a positive thing and reasonable in the world cryuptocurrency

That might well be the case

But if this is the case, that means that those Bitcoin holders which previously didn't cut it as whales (i.e. they couldn't move price much with their stashes before) now have become ones. What it basically comes down to is the capability of these new whales to affect prices, i.e. folks can move price with less coins (that's why they can be considered as new whales in the first place). If so, the current price crash is no more than a spike in volatility since market thinning should necessarily work in both directions. In other words, it can be moved up just as easily as it can be moved down. So we should just wait and see how the price would behave in the coming days

Dumps happen for some reason and those reason are the points where bitcoins can improve .. sort of like we learn from our mistakes. We see a dump happening because a big investor or a group of investor dumps his coins and gets the market low, now that good happen with that is more people catch those headlines and hence get into bitcoins, certainly helping the community grow and so the price of bitcoins, in long term though.

How easy it is to manipulate prices depends on 2 things - the depth of the market and the price. Compared to altcoins, both of these are high for Bitcoin. You just have to look at the daily volumes traded to see if it is difficult or easy for a whale to move the market.

As far as I know, dumps are also important in trading in the market. These happen when there are groups or a person dumps his coin, or rather happen when there are panic selling place in. And, some are grab this opportunity to buy a coin which is low price so they can sold at a high price to earn profit.

dump is been find due to demand and supply has been reduced. We know the price is volatile always in bitcoin. You can utilize the dump and you can some bitcoin and hold it for future purposes. Impacts are for traders involves with big trade volumes.

It is not a question of kind

It is a question of degree (I hope I won't have to explain the difference). Bitcoin markets have been manipulated in the past. If you disagree with that, then there is nothing to talk about. If you agree, then with higher prices, markets are set to become less deep (i.e. thinner). This is a logical necessity if you please, given that the supply of coins is constant. Since the supply is constant (or can be considered as constant), you would necessarily arrive at a conclusion that higher prices mean thinner markets because at higher prices there will be less demand (all other things being obviously equal). But that pretty much means that markets would be more easily manipulated since less coins are needed to move the price in either direction

Not a bad idea.
I would add to that that dumps are important because they show the coin is "living".
If we had no dump what so ever how would we make the difference between a succesful coin (no dump cause no one want to let their coin on the market) and a shitty one (no dump cause no one gives a shit about buying it). Dumps regulate the price on the short term and stabilize it on the long term!

Not all dumps are born equal

With a shitty coin, no more dump can only happen when it gets sold for just 1 satoshi in whatever amounts. That essentially means that there are no buyers for that coin altogether since you can't place a bid at a zero price. All shitty coins end up there, and if it doesn't make the final dump, it means that it is not complete shit yet. Obviously, Bitcoin dumps as of late have nothing to do with such final countdowns. I never forget to repeat that the market always fools the majority of traders, and you can be pretty sure that the current consensus on the direction that the price is going to take will be proved wrong once again

Small dumps which are followed by BUY orders are always healthy.
I believe noone really wants immobile bitcoin market right now, in this phase of development. Still too early.

Read at least the first page of the thread

You are not the first who is asking this question (and not even the second), I've answered it twice already. Dumpsters would be able to buy more bitcoins only if the following conditions were met. First of all, they should be the only ones buying at lows but today there are no more fools around (in large quantities, at least), and whenever the price goes down a hundred (or two hundred dollars), there is strong support from ordinary traders not wanting to lose the opportunity to buy cheap coins. Further, people who sold at highs are no longer panicking when the price goes down, so whom these dumpsters will be buying from? They can only sell their coins but there is no way back, at least, not at full throttle

When we are talking about dumps one thing comes to my mind which the price would go down to the bottom but considering on price decrease i could say its important specially on traders which they could really make money out of those movements on the price. Its actually hard to identify on when to sell out or to buy because we wont know if its the new bottom or not.

It is good to see dumps every now and then if you are planning to enter when there is a small dump other than that i do not think it is a good thing.Traders really like to see a volatile market but the recent downfall is because of the forking debate and nothing else and at the moment the price is below $1000 and i am not sure what is the resistance at this point.

Dumps are partially useful in this sense but often the reason that there is large amounts of Bitcoin to dump is because someone has bought a lot of Bitcoin at a lower point and decided that it was time to offload it.

Often there will be a lot of whales who just buy a lot of Bitcoin at a lower price themselves, which prevents dumps from going into the hands of larger groups of users, especially when newbies panic sell into the hands of them as well.

Yeah that's the importance of investors do dump. For if the investor does not do a dump then he obtained profits will not be as fast as when its price rises. Many investors in the bitcoin which has a very good role in the price of the bitcoin and most of them did want to seek advantage. Bitcoin is a digital currency that is good for profit, the dump is a good way for it.If the absence of a dump then all trading transactions in the bitcoin unlike now
 

At best, it will be one group of whales selling to another group of whales

So it is all six of one and half a dozen of the other. Also, as I said before, the price itself consistently going up from cycle to cycle prevents Bitcoin from being accumulated in one hands. It could be claimed of course that the price goes up exclusively because someone is buying Bitcoin but this is essentially the same process as dumping coins, obviously in reverse order. And it would be mirrored perfectly but for the price bottom consistently going up as well (i.e. higher lows). Could the price collapse below 700 dollars per coin nowadays? If only for a very brief moment, I suspect

For me dumps are important for the other traders got the chance to buy more when its cheap so when the coins got pump they can sell it in a higher price. Most traders like to grab the chance that others are into panice selling so they can sell it and can earn profit. Thus, pumps are also important in trading industry.!

Could be. That was a nice idea.
I always thought the dumps are just for profits of those who hold a large amount of bitcoin then they would buy back making a big pump again. Now, I got something to think of thanks for this idea.
But the problem is, they are like risking a lot of bitcoin just for the market flow? If I have that huge amount I might get too scared that I would get it back at a higher price if demands gets bigger. (just a thought)
They could still do this for now but what if suddenly they cant buy any bitcoin and all are owned by holders.

This has been discussed before

In fact, there is even a whole theory describing such a case, it is called a Bitcoin Big Rip theory. It basically claims that if there are no more sellers (i.e. their number consistently diminishes) the price will eventually lose any meaning since Bitcoin will be ripped apart by huge volatility compared in value with the price itself. And this theory seems to hold. Now, with the prices over 1,000 dollars per coin, we see huge volatilities already (literally dozens of percentages within very short periods of time) which is what this theory specifically predicts

that is an assumption, you can't say that whales are not the one who would buy more, in fact they are as they are the one that are manipulating the value, you assumption is based on the fact that the price was dumped not by them, which is not my point

whales will never lose any coins if they are the direct maker of the pump and dump, we need to differentiate a market that is manipulated and causing a panic selling, and a genuine sell off

i'm sure that the other users weren't accounting this, so would be pointless to read everyone, usually i only read the OP because there is too much spam on bitocintalk

i think from dump we mean a little correction that the market will take and so the price will come down for a little time and then the price will again start increasing.

You don't need to read every poster, my posts will suffice

Other posters are still mostly posting bullshit, so you can safely skip their writings altogether. Regarding whales and whether they will be the only ones (this is what I said specifically) buying all in, this is 100% false assumption. I'm buying too, though I'm not a whale by any metric. I was selling up to the very top and started buying at the price around 1,100 dollars per coin (and stronger at below the 1,000 dollar mark), and I suspect that I'm not the only one doing that among those who don't really consider themselves as whales. In fact, quite a few people have been waiting patiently for a deep correction

Dumps are important because in trading that is the right time to buy an altcoin then wait for a time to pump the bitcoin price because in that way you can benefit the dumpness of bitcoin where you can earn more money  but make sure that you only buy those high in volume because there are some altcoin has the slow swinging movement.

I agree with you - every dump has positive moments in itself. It's a good time to check the coin for strength. And also this is a good time to make purchases of coins for the future

I think is can be the other way, just look at the Judas candle after the ETF decision announcement, whales may be playing with the market and looking to cause panic sell buy triggering this act of dumping on the market for them to buy at cheaper

Of course that's why you need to take responsibility for your decisions. What if you sold and it further went down, wouldn't you have bought more bitcoins back at the lower rate? Since we will all do the same why criticize the whales? I think dumps are healthy like the OP puts it to test the strength of the coin and I think Bitcoin has stood the test of time.

It seems you have not visited several exchanges today :). After 1 satoshi there is always another market for shitcoin that can be dump to less than 1 satoshi and that would be in Litecoin market Or Dogecoin market or other altcoin market.  Though it is not in Bitcoin but still it can be dump lower than 1 satoshi.  Just look at Mooncoin for example.  It is lower than 1 satoshi in price but still trading at Litecoin Market.

Well noted with thanks, I think I will need a lesson in trading cryptocurrencies 101. I'm planning to get into active trading of bitcoins in this second half of the year so thanks for sharing and any other ideas will be appreciated. If dumping is good then I'm beginning to suspect that all those Chinese are traders too and they deliberately dump in order to make gains through trading.

Well that how the game being played here, you need to play with them if you want to stay in the game. Trading is fun if you know what you are doing, it is not just all about luck and this market that can be manipulated you need to keep yourself abreast on the real situation that is happening.

Dumps increase volitility.

One might say volitility is what traders rely on to produce profits.

BTC's price fluctuating up and down is easier to trade and profit from than a flat line with small percentage movements.

More dumps could translate to more volitility(and possibly more volume), which in turn translates to btc and altcoins being more attractive to trade for investors.

This could be a good thing, which could imply dumps are good in terms of being volitility inducing.

yes  dumps can let others  have chances to buy some coin , let more people join bitcoin

i don,t think it is  bad

A shitcoin will just end up worth nothing

1 satoshi is the lowest price that shitcoin holders can ask to sell it for (in Bitcoin), but that doesn't mean that it is worth anything at all. As I said, it is worthless, i.e. worth nothing, zero, zip, zilch, nada. So it will be the lowest possible price against any more or less decent coin (how such one shit coin could stand against another shit is a different matter, though, but it will be a waste of time anyway). That said, I don't closely follow altcoins nowadays, I have just seen a myriad of these shitcoins at Yobit exchange with empty Bid sides of the orderbook

http://s019.radikal.ru/i640/1703/75/8569e486a326.jpg

That's pretty much sums it up

If that happens more then maybe BTC could be considered making and supporting an unhealthy market? If there are more and more whales born in the system that could move the price up and down, the more people should avoid this type of market.

That would certainly ruin a real economy based on Bitcoin as a means of payment

But since there is no such economy in the first place, there is nothing to ruin in the second. In respect to purely financial markets and Bitcoin more specifically, new whales are born as fast as they are destroyed (just like virtual particles in physics) since this process works in reverse as good as it works forward. Price volatility is good for traders and they are effectively working against it, thereby limiting price fluctuations. In other words, trees don't grow to the sky, birds can't fly to the stars and Bitcoin price cannot skyrocket to the moon. There is certainly a limit to the price growth since this growth will necessarily get offset by the spike in volatility over time, i.e. with Bitcoin the volatility is increasing faster than the price

How can more whales be created as fast as they are destroyed? If you could show proof that its happening and also make us see how its happening, that would be appreciated by a lot of us whos willing to learn. And how could that happen in a system where whales mostly buy and hold BTC?

How come you also said that theres no such economy in BTC. A lot of people will disagree with you.

I don't know about you but seems to me like more people dump more people support the buy walls, have you noticed we've come from a $200M daily volume to a $600M 24Hrs and will soon reach $1B I know that could mean old hodlers might be dumping and are cashing out but it is a good sign let the big bag holders dump their stash it'll help to balance the scales of distribution, every day passes and more people from around the world are entering into bitcoin. remember that no matter what will going to happen HF or not our coins are safe we just need to keep supporting the Core, but why Core? because Satoshi himself could very well be steering the development of Core version you never know.

In fact, it is not me who should first prove that whales are actually created in the first place

Since it was your point, not mine, after all. It was your assumption that dumps might happen due to many new folks becoming new whales because of the prices skyrocketing. I agree with such a possibility (since this is what I'm essentially saying myself, i.e. that higher prices contribute to even higher volatility) but as I suspect, the burden of proof is still lying on you. And after you provide evidence for that assumption, we can discuss this issue further (if you feel inclined to, of course)

Well you haven't said that your observation is limited to Bitcoin Market only :).  But there is a market beyond Bitcoin among cryptocurreny and that is altcoin to altcoin market.  And getting your logic, ETH - Litecoin trade is worthless?  or ETH = Monero pairs is worthless or Dash = other altcoin pairs is worthless .  Seems a broken logic to me  ??? .  As long as one of the pair have worth in Bitcoin  and or dollar, it will never be worthless.

I don't know if I buy the logic that dumps have to result in wealth equalization for the reasons stated. It takes as a given things which I don't think are a given. While one explanation for price crashes is large traders dumping a large amount of coins, I don't find that a given, though it might be the side that's the more likely explanation. But assuming it's true, I think the buyers during a crash are just as likely to be large traders as the sellers are, so this is the main reason I don't find that crashes mean a more equal coin distribution.

Additionally, I do believe the most recent price crash was a bit of market manipulation by large traders. As an anecdote, the rate to borrow margin on poloniex went from the typical .02 to .03 percent daily rate, to typically .25 to .45 percent, and I had one offer accepted as high as .77 percent. This suggests to me that traders were buying up as much margin as they could to trade the volatility, which I believe they created for that purpose. With how fast the price was dropping, it looked to be all shorting action with that margin. But this is also a theory.

I don't quite understand what you refer to

Just in case, I didn't say that all altcoins are shitcoins, and that was not my point altogether. On the other hand, I specifically mentioned the case of one shit coin "trading" against another such coin, so you can't possibly claim that I was referring to just Bitcoin market exclusively. What I meant to say is that if two shit coins massively hit the floor (i.e. they have the lowest ask price set at 1 satoshi and there cannot possibly be buyers), there can still be a difference in their shitness, so to speak. They can still trade against each other in a somewhat meaningful way, i.e. one coin may be purportedly less shitty than the other. But in reality this trading is meaningless since you are still basically choosing between sorts of shit and just wasting your time

Dump is very important in assets trading as this create opportunity for the assets to strengthen itself. For USD trading in forex because of pump and dump there are many established support and resistance level and traders analysis USA economic progress or recession through that. Bitcoin straight will be determined by it recovery process during dump and also by dumb we would know if bitcoin economic is in recession or in progress.

Im confused. You said this in another post:

[/quote]

So I wanted for you to show us an example of how that happens in the market because it is an interesting concept.


I dont think I said this and if I said something you might have misunderstood me or maybe you may even have made a mistake in thinking that was me. But please quote the post you are talking about then we can discuss it more. There must be a little misunderstanding. Its hard when youre not talking to someone face to face.

being traded doesn't mean they are valuable (or worth something) it is a temporary situation on a dying market.
these coins are pump and dumps you are naming 2 of the bigger ones which makes no difference. but he is talking in general and about shitcoins. and i would argue that the screenshot he posted is misleading because those coins aren't even worth 1 satoshi because NOBODY BUYS THEM.
in fact they are listed on other exchanges and being traded with other altcoins. for example one of them is worth 0.00001 Doge you can imagine what the value in bitcoin is!
and all those "bigger" coins are big only because they have big whales controlling them but under the hood, there is no difference between them and those shitcoins that are small.

That's the problem I think (you, not understanding the thing I am pointing out) and maybe we have to leave it that way, I do get what you mean though.  I am just saying that Cryptocurrency does not exist in bitcoin - altcoin pair in trading alone (that's the main point) whether it is useless or not is another side of story, the only question is, does they exist, of course yes.  So that goes down to the point that trading altcoin is not limited and does not stop when its value falls below one satoshi, as long as there is demand for it.



I do agree with you but being valuable or not is another side of story and maybe need another thread for discussion since how much a thing worth depends on the personal evaluation of each individual,  I am just pointing out that there is trading below 1 satoshi value.

Why are you trying to ascribe to me what I didn't say?

I posted a snapshot and if you follow from there, the only reliable conclusion that you can arrive at is that this coin has no buyers at all which pretty quickly comes down to concluding that is not worth anything in general. It can in fact be still traded against other altcoins and allegedly have some value but given only what you see at this snapshot, there is no reason to think that it has any value at all. Basically, you are making an irrelevant point, the case of which I specifically mentioned in my first post regarding this issue (and it kinda seems that exactly my mentioning this nuance made you pop up)

Just accept the fact that there is trading below 1 satoshi value and you'll get it :D and I bet you do.  I would think there is some misunderstanding between us regarding the issue since I guess you are right, if we hold on the sample you use.  but there goes  Brewmaster replies for it. 

with regards to the snapshot, I have to agree with you, considering that it is the only trading pair for that altcoin.  Since trading of that coin is limited to 1 satoshi only.

and about the relevance, there is since a coin can be dump into oblivion way below than 1 satoshi, that is why I said there is another trading pair than Bitcoin - altcoin since you stated

why are you even arguing about altcoin dumps? that is an entirely different story with a completely different reason than the dumps that happen in bitcoin. and reading the topic and opening post i see it is all about bitcoin not altcoins.

any bitcoin dump is simply a manipulation unless there is a valid reason for quitting bitcoin and that reason has not yet happened.
any altcoin dump has that valid reason. traders are quitting that altcoin to take their money out and put it in another thing to make more of it and then another and so on.

back to the topic, i agree with OP that these dumps in bitcoin are important and can potentially be a good thing that we can all use as regular users that are not whales. when they dump their stash becomes open to public, so far public panics most of the time and they buy back more because price goes down and they become bigger whales but as the buy support grows their power diminishes.

I guess it is not a good practice to twist your point as it best suits your needs whatever they might be. At first, you commented on my post where I gave an example of a shitcoin which has no more buyers, and in that very (https://bitcointalk.org/index.php?topic=1830772.msg18258280#msg18258280) post I specifically addressed this issue ("how such one shit coin could stand against another shit [coin] is a different matter, though, but it will be a waste of time anyway"). It should be straightforward that I referred to dumps in respect to Bitcoin. So should I repeat it again that trading a shit coin against another shit coin is a waste of time for the majority of traders? I'm not denying such a possibility (which should be obvious as well from my posts), I'm basically asserting that it doesn't make sense if only from a purely academic or theoretical interest. But if you are in exclusively for profits, that's pretty much it (i.e. waste of time)

In short, do you yourself trade shit coins which are priced at less than 1 satoshi?

yeah I guess you are right sorry to derail the topic, I do agree with OP too,whether it is a manipulation or not, a dip in price  does really help  other people to get in and make Bitcoin community more stronger.  The problem with the manipulated dump is that whales know it and will intentionally crash the price to accumulate more.  It is the possibility we cannot neglect.  Though with it comes new comers that buys in and start supporting Bitcoin too.


I was thinking of cryptocurrency in general and not specifically Bitcoin alone. So, I guess there comes the misunderstanding  :)


I do, traders trade where there is profit (I am not counting myself as one of them but I do trade), emotion neglected :)

add on: waste of time or not depends on the person's perspective.  Why are you trading? Profit? If it is fulfilled it is not a waste of time.

So are you actually buying these shit coins?

For example, with doges or just selling them to get out of your position and save some dough? Could you post a chart (or a link to such). Not that I doubt your words (this is your business, after all), I'm rather curious to see how well coins fare in their "afterlife", so to speak. I would be interested to look at a price chart for a coin which is left for dead in Bitcoin terms but is still being traded against some other more or less decent coin (like, say, Dogecoin or Litecoin)

Told you i do not consider myself as heavy traders as others,  I can give you some, but rather looking at the exchange chart would make a better statement than my trading chart. LTC - Doge pairs (https://c-cex.com/?lpm=ltc&p=doge-ltc);  Doge - Mooncoin (https://bleutrade.com/exchange/MOON/DOGE) chart  this will give you a more solid information.

i think dumps are important to controlled the price that will not jump too high because once the price is getting too higher from the last price, then many traders can not buy and i think its about balancing in the price. some people is make the price up to reach new price and the other people is handling to control and make sure the price is not too high at this time.

Dogecoin is a decent coin which is still well above 1 doge per 1 satoshi price

Though its future is rather dim if not outright grim. In fact, I had earned decent profits by trading dogecoins a couple years ago. Regarding the other coin in your post, Mooncoin, it is worth looking at the orderbook totals for both asks and bids. Asks total to 10,691,927,002,071.645 dogecoins, i.e. so many mooncoins (in dogecoin terms) people are wanting to exchange for dogecoins (just in case, this is over 10T dogecoins which is above the total number of dogecoins coins ever issued) while the bid side totals only 2,227,202.601 dogecoins (a little over 2M dogecoins), i.e. so many dogecoins people want to exchange for mooncoins (which is well below 1 bitcoin if I'm not mistaken). That basically proves my point, i.e. buying mooncoin is a waste of time and money

Well poloniex had build an amazing cash machine with the lending and margin, and yes i had saw too the rates getting insane when bitcoin had dumped into the 900 dollars, 0,15% were the rate i found, and i knew it would reverse the dump because buy walls were strong.
For people be interested into invest the coin need high volatilaty 5-20% its amazing rates, thats why forex has soo many costumers and huge investment, if you lucky enought you will make easy money.

Yes i agree with you, Well its because I'm also a small scale investor. And it really helps a lot.

I don't really think that it was ordinary traders who initiated the panic selling

But they did actually contribute to the volatility since that's what basically margin trading does in general. When people see the prices start to fall dramatically, they will quite naturally try to squeeze as much profit from the price movement as possible, including borrowing bitcoins for shoring them. Thus you will see interest rates spike. But since they are selling the borrowed coins they will inadvertently contribute to prices going even lower. So this is not an anecdote but a harsh reality of margin trading. But this is also dangerous as hell since it leads to markets being severely oversold, and those who borrow the last will suffer heavy losses in the end because when the price rebounds, they will have to close their short positions and likely on margin calls (i.e. exchange closing them)

Dumps are some kind of Bitcoin price correction but I don't think we can create them intentionaly. They are depending on the rules and situation on the Bitcoin market. Of course they help small users to get some more coins so for that they are convenient but I wouldn't say they are created for that purpose.

I thought it was your post after all:


I guess this is what you said exactly ("more and more whales born in the system"). Again, I don't deny that it might be the case since, in fact, this is what I think myself. More specifically, that with the price surging the market is necessarily thinning and thus folks with the same amount of coins can move the price stronger, or (which is the same) the less amount of coins is needed to move the price by the same value. But my agreement with this point of view doesn't magically make me obliged to prove it. As I said, the burden of proof is still on you, i.e. if there are really more whales born in the system or not, since it was your assumption in the first place, not mine

But if it was not you posting from your account but someone else, then I feel sorry

IMO dumps are important only for some bitcoin user that have big capital so they can get bitcoin with cheap prices even though in fact dump and pump are same important for bitcoin users.

Mooncoin is a POW coins and is still being mined, developers i think is still active and this is more than 2 years coin.  If you are to hoard mooncoin when buying it since it has not much of use I do agree that it is a waste of time and money but if a person is in for a profit taking advantage of the fluctuation then it is actually a good choice if the person have little budget.  It was actively trading in cryptsy before I had my profit from trading it in LTC Market.

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I think you have missed the point of getting into bitcoin in cheaper price.  Dump is not only important to those who have big capital but to all who are wanting to buy Bitcoin.  Just imagine if you have $2000 fund to buy bitcoin, and the current price when you are thinking to buy is at $1300  then the next day it goes down to $950, you can actually feel the difference on how much you can buy  BTC.  Instead of having less than 2 BTC, because of the dump, you are able to buy more than 2 BTC.  Same applies to those who have smaller fund.

You don't get it

I don't know how much Mooncoin was worth 2 years at launch or soon thereafter, but if the whole orderbook (the Bid side obviously) has less than 1 bitcoin in total, basically, you can't earn anything. I just checked the prices and 2.2M dogecoins roughly equals 0.5 BTC, and this is the size of all demand for this coin at that exchange presently. Now think how much you could earn even if the price of this coin doesn't go down. I guess using faucets would give you more profits and safely at that (and you wouldn't need a budget for that altogether)

The demand (buy wall) does not mean the volume though I failed to check that day volume.  I won't argue with your point of view since you want to see it that way and further derail the thread.  I think you really need to experience it to understand how things goes with such kind of trading.  Theory often times change when applied into practice since not all factors are constant :).

Pump and dump are important games on the cryptocurrency. No dump and no pump, no pump and no dump. Every thing will be having the opposite things such as the word of pump. it was having the opposite thing the word of dump. Dump is really important to keep the market is being stable. No one are wanna lose his money just to pump pump and pump.

Indeed, it doesn't mean. It just says that there is no volume since the liquidity in the market effectively provides the upper edge for the volume range. In other words, if there is no liquidity there cannot possibly be volume (you can see that at the price chart to judge for yourself), but the reverse is not always true, i.e. there can be liquidity but there may still not be volume. Obviously, this doesn't help your point of view in the least. Other than that, I don't really see how you can confuse theory with practice since I'm talking exclusively from a trader's point of view. That is, as practical as it could ever get. And you may not want to tell me what is going to derail the thread

It is my thread, after all, and it is up to me to decide what derails the thread and what not

Yup stability. You're right there. Having a continous pump in crypto prices would make any market or altcoin unstable as there won't be any balance. I think these dumps are very important especially for traders as this gives us opportunities to make more earnings.

Its a misunderstanding. I read that you said more whales are born as they are destroyed. I quoted your post and followed it up with a question and asking for proof or an explanation why you think so.

And dont you ever accuse me of letting other people use my account.

I think I explained it pretty well

If you didn't quite understand it, here's another explanation. Volatility by definition means that the price moves in both directions. If the price does move in only one direction (for example, rising without rest), such price change can hardly be considered as volatility. Volatility is like a coin, it always has two sides and I have yet to see a genuine Möbius coin (and I obviously don't mean a shit (https://bitcointalk.org/index.php?topic=774762.0) coin which has taken this name). Given that, we necessarily should conclude that if the price rise gives birth to new whales, then the price decline should destroy them (conceptually)

You can never control what the people will do when the price is like that now. Right now, the price is stabilizing around $900-$1200, probably around that range. You can see that when the time that it reached the all time high, it lowered down in price again because of the dumps. Since the range is like that, it became the standard price of bitcoin and probably go up again because people would start to hold it hoping to sell in a higher price $1200+. That's why I think dumps are a great thing.

I think we have a different definition of "stable". Not many stocks go up and down as much as Bitcoin. The same for currencies.

I have a different theory: pump & dump is used to manipulate the market. The ones doing it are referred to as "whales". From my experience, they use a pump to increase the value of their Bitcoins, while inreasing demand. When the order book is filled with enough people willing to pay a high enough price, they dump their coins.
When panic sells start, they buy back their coins. In the end, the whale holds more dollars and more Bitcoins.
That's also why the term "weak hands" is used for people who panic sell once the price goes down.

It's nice to notice Bitcoin's price usually goes up slowly, and drops quickly. Also, drops go in stages: while dropping it usually goes up a bit again, only to drop more. I think this is meant to increase the price again before the whale sells more coins.
Looking at price graphs, I feel like Bitcoin "wants" to go up in price, but it's being held back by dumps.

In stock trading, "the common man" like you and me on average buy and sell at the wrong moments compared to the professional traders.
While pump & dump strategies are illegal on the stock market, Bitcoin is unregulated, which makes is a perfect playground for whales.

There is a thread that analizes MtGox-data, but unfortunately I can't find it back. It showed the large majority of users owns only a very small amount of Bitcoins, while only a few people own a lot. Basically, that's the same as the real world: the top 1% owns more than the bottom 50%. I doubt that's going to change any time soon in Bitcoin.

I don't think so: some actors still own more Bitcoin than exchanges trade per day. If they sell all, they influence the market.

I guess you shouldn't take my words out of context, ferstein?


Further,


It seems that you haven't read the whole thread (or even the first page of it) since I addressed that question right (https://bitcointalk.org/index.php?topic=1830772.msg18222161#msg18222161) there, in the first page. Dumps are good specifically because they work against dumpsters themselves (or market manipulators). It is simply no longer profitable for them to dump their coins since today they won't be able to buy them back. These dudes are set to end up with less and less bitcoins after every pump and dump cycle. Two primary reasons are behind that. First, not all top buyers are going to sell their coins at lows (panic sell-offs today became very superficial) and, second, dumpsters won't be the only ones buying at lows

Plenty of ordinary folks are waiting nowadays for these sell-offs to buy at lows

In my own opinion dumps are important where to make an good profit when the altcoins are decreasing you need to buy once you already buy then wait for the price to be increase this is the main reason why the coins are being dumped and then pumped in the end.

$900-$1200 is pretty high range and it will really nice to get profit if you trade on nice timing, more over if there is fluctuative situation in a some range of time. I am sure this will really easy to get more profit. In a mean time people will just hold on until they have enough bitcoin and enough profit that they want

But if there is no dump, I think we still can get profit but we will get it slowly not as fast as there is dump but we will keep on buying on higher price as always

Dump are good so we really know how long can we trust bitcoin, some are selling and that's okay because it will not be wasted as smart people will buy that. The pump and dump is a normal gambler for big investors and since they are in control what we can do now is just play with them.
We must know what's inside their mind so we will be able to make a right decision on the timing of selling and buying.

Exactly once, someone who understands the language of trading will definitely know about the price of bitcoin. Dump and pump is the way that most widely performed by most of the people doing the trading, for the way they are using much more profit. Because the dump and pump give effect which is quite effective and quite a good thing to do. But just the same, to be able to get a good profit. We have to be clever in analyzing the market, otherwise it will all end in loss
 

I think I get it now. When you mean whales, do you mean whales in fiat value and not whales in the amount of BTC they have? If thats what you meant then I agree with what you said and theres no more explanations needed. I thought you meant more whales with the amount of BTC they are holding in their wallets.

That would also mean that if there will be more whales, then would therefore mean the present whales will become mega whales.

Something to that tune

Though I didn't mean whales as measured in terms of either fiat or bitcoin. By whales I mean the traders or Bitcoin holders who can significantly affect the Bitcoin price. If Bitcoin price rises the fiat equivalent of the stashes held by them obviously rises too but it is ultimately inconsequential since even if the fiat assessment of their funds remains constant that doesn't in the least mean that their influence should necessarily remain the same. For example, there may be just less demand and supply with the price staying essentially the same (i.e. the fiat value of these traders' funds doesn't change either) but their influence will nevertheless increase (and vice versa)

Thats a very interesting theory I will look more into it. That could prove useful in knowing what the current climate of the market will be especially these days of uncertainty.

Do you think that the situation may change for the better or become more stable and understandable? I do not think so. Look at what is happening in the financial market and how the world economy is. People are almost driven into slavery to financial structures and this is done with their citizens, their own government. So I do not believe in the best circumstances in the world.

I do not believe that either. All people now depend on the government and on the maternity currency. They are forced to pay big taxes and commissions. Crypto currency can change people's lives for the better. That's why it needs to be popularized

and specially for short period investors as hey can get good opportunities for making good amount of bitcoin fro trading if there is some fluctuation in the price of bitcoin .

This will also help bitcoin ecosystem to get refreshed stone to time so that making it healthy. But not everybody dumps their large volumes making it unstable economy. If all the small coop comes together and decide to do a big dump then it can really help. Also they should do it in timely manner so that the bitcoin will keep raising when purchased by many of us.

This theory is great, nice topic. Even we always want to pump the price of bitcoin it will fucos only in increasing of the save bitcoin. How about if they want to get a bitcoin so we need the low price to buy bitcoin to make a profit. Dump is a part of bitcoin market because of being not stable of the bitcoin price, this is the reason why bitcoin gives excitement to every one also in the investor.

Bitcoin market is a great idea, with the price, investor can use this as business. And because of this the demand and supply depends on our investor. So the dump and pump is based on investors who want to take a profit.

A good speculation.
I will agree with the independent users who sold there coins.
Looking at how large the price of bitcoin is they are the easy targets to make them sell their coins.
When you add up every person who did it. That can create a wave making bitcoin fall a little.
But still I see that there are people who are willing to risk and wait for another up.

yeah that's right. if they price continues to pump, there won't be any good time to replenish btcs since it would be too expensive and not worth it to buy anymore. better to just buy other altcoins and focus on trading with them instead while the price is consistently going up

This doesn't work any more

Altcoins today are pumped along with Bitcoin like there's no tomorrow for any of them. Therefore, if you run out of bitcoins and Bitcoin continues to get pumped, you will still have to buy any other decent coin which would be rising too. So it is all six of one and half a dozen of the other. The market obviously wants you to buy shit coins, there is always free place for you to hold the shitbag. You are always welcome to the shit club!

This point is something which made me think twice.
How can you say it is only via dumping that bitcoin will be spread to new people in smaller proportion and will make everyone price taker? It is already 8 years of bitcoin and I think there are barely (<1%) investors who have significant reserves of bitcoin.
Now suppose, price of bitcoin keeps roaring. New independent traders want to enter market to make profits with flow. They tried buying bitcoin at present price and raise demand. Demand increases, price increases. Dump philosophy hasn't come anywhere, we are already much equal.

It is because when dump occur those who are hesitant to get in or buy bitcoin will see that it is a chance to buy bitcoin at lower price.  They will definitely scoop some bitcoin and these people will then join the Bitcoin community.  Not all investors will buy at a rising price.  Most of them are waiting for either correction or dump to get in so they can rake more profit.

In my assessment about this things, dumps is very significant in trading world. Because, it the gateway for the small capitalist who'd like to invest in the altcoin who become drop the price value. That's why many of the traders get their profit of bitcoin because of dump and pump.  :D

ofcourse it is very significant in trading world. Trading wouldnt be profitable to others if there is no dump to the altcoins ,even in btc. Dumps are very important to traders because if a dump happen that is the time they will buy some coins and sell it when it pumps

And what about those believers who are eagerly waiting for price crash? If bitcoin gonna fall by $500-700 within few days, mind me it will bring some opposite results as giants will try to accumulate more btc because they know btc will rise sooner or later.
It is healthy for bitcoin economics that new buyer/sellers enter through inflatory prices.

We have already been there, many times (in relative terms)

If today's prices fall 700 dollars tomorrow, the Bitcoin price will be at over 1,600 dollars per coin, and I can assure you a lot of ordinary Bitcoin folks will be happy to pour more of their fiat savings into Bitcoin. The problem is that Bitcoin is highly unlikely to crash nowadays that much within so short a time without a true cause (i.e. due to sheer market speculation or manipulation), though this doesn't mean that it is completely impossible as such. If, nevertheless, this still happens due to some really threatening event, the giants you refer to will be the last to jump on the Bitcoin bandwagon in that case

I think dumps are the best chance for us to buy coins which we like with a cheap price than ever. And moreover, with a dumps, we can ensure that it is a preparation for a next pump

Of course this is a wonderful time to buy a lot of coins at a cheap price and wait for the rise to profit from the price increase.

Yeah we should really need to dump bitcoins in order to harvest what we’ve invested and struggled to hold for a long period of time. This should be done in order to give also a privilege to others to buy and law of supply and demand will really take effect in time, that’s why it needs to happen with our bitcoin price and new investors will buy and hold for another months. If the price will decrease during fluctuations it will result to make quick sellers to sell immediately, and those buyers waited for cheaper price will now make their moves to but bitcoins for profitable purpose of holding it in their wallet.

Dumping is not usually a good thing but its important because people need to take profits. dumping will give another opportunity for us to buy more bitcoins and accumulate even more bitcoins and gain even more profit.