Bitcoin Forum

It is rising as fast as it is only because transacting in it is terribly disincentivized (which is the complete opposite of what it claims). 
You can't spend it easily, and you can't change it back into fiat easily. Once people who bought in figure this out, what else is there to do but hold it?
And this kicks off the recursive bubble process:

People don't want to spend it because they'll lose out on market gains.  When I say 'spend' i am also referring to buying fiat with it, not just goods.

No spending = supply bottleneck #1, causing it to become harder to buy, making it in higher demand, reducing incentive to spend it even further, bottlenecking supply further still, raising value, etc.  Inflate the balloon.

Not only do people not want to spend it, it is exceedingly difficult do when you do. I am not talking a handful of token "look at me hop on the bitcoin fadwagon, gibe me free press coverage nao thx" pizzas and subway sandwiches and VPN accounts here, i am talking real consumer economy-driving spending. 

And wait till mom and pop average figure out how hard it is (if not impossible) to get any hard cash funds out of any exchange (i am looking at you, Mt.Gox, with your 7 day email response times), particularly US$, and most acutely when they *need* it back for holiday shopping. Cue flood of evening news hit piece stories on the long faced sad sacks and bag holders who are astonished to find that they can't buy their family Christmas presents because their bitcoin 'bonanza' is useless as a means of practical day to day commerce.

I suspect that up to half of the apparent "popularity" of Bitcoin the past 4 weeks or so, is entirely due to the friction of moving funds in - and especially out -  of Bitcoin.   

And when the upper middle class to wealthy Chinese who only care about Bitcoin as a means to move RMB out of china into USD under the radar, find out just how much of a pain in the ass it is to turn it into USD, their support is going to disappear in a puff of panic.

I believe in the underlying concept of bitcoin but I am getting the feeling it is going to die from over exposure before it is ready to handle the attention.

no good reason? well, the senate has spoken about it. before then, it was up in the air whether we thought government was okay with it. so people speculated, thinking that more people would invest into BTC because you know.. it didn't seem like government was against it.

now we are hearing more and more companies are starting to accept it too.

are those reasons not good enough for you?

for me it wasnt hard to cash out bitcoins so far. you are just butthurt if you ask me or tried wrong exchanges. try to connect to your peer....

The senate didn't say anything they couldn't easily backtrack on later if it suits them.  It certainly was not an endorsement, only a rather bland concession that virtual currencies (not, specifically, bitcoin) should be watched, but not touched, for the time being.

Companies accepting Bitcoin is great but it means nothing long term.  There is nothing preventing them from taking down their bitcoin windows stickers when they feel like the extra volatility isn't worth the extra business any more.  And the media will eat this up:  "All across the country, more and more businesses are fed up with Bitcoin and pulling the plug"  

Bitcoin is just a value protocol. Right now in its raw form it is a bit like dos before windows. All the new bitcoin startups this year are for apps that will make bitcoin easier to use. (Some kind of buffering against price swings is in order). It will suck less, keep the faith.

Non-issue with payment processors like BitPay.  They can't lose to volatility if their payment processor converts to fiat.

You mean the one payment processor, Bitpay.  A company that is still living off VC money and thus can afford to burn investment cash to run a risky insurance hedge until it runs out.   Then what?

Uh, there's like at least a dozen...

So?   It's a pretty easy business to be in while BTC is rising parabolically.  When it stops, and they are all now losing money on every transaction they process (which there will be a sudden avalanche of due to everyone holding BTC trying to get out of it),  I don't see how they will last.   

dude, just stop trolling. too may trolls bait smart people with their nonsense -

bitpay doesn't have currency risk either they just sell of on exchanges at market orders (that's why their prices change it adjust to what they can buy and sell at plus their possible markup)

you failed at making shit up

A payment processor knows the price that they can get for a Bitcoin.  They charge the merchant that amount plus some small fee (the profit).  

Here's a flow chart:

Consumer --> Payment Processor (via merchant's deposit address) --> Bitcoin buyer

All of this happens in seconds.  The payment processor isn't exposed to risk of volatility unless they choose to be.

So then what's the point of the regular guy merchant being a client of bitpay, etc.  if the payment processor just transfers the volatility risk back on to them?   In my non-bitcoin life I deal with retail merchants every day, and in trying to sell them on the Bitcoin concept, these are genuine concerns that come up in discussion.

This does nothing to stabilize prices and accommodating the fluctuation would makes their lives a lot harder than necessary. For what return?

Well, the merchant can reduce the prices (i.e. consumer wins) because the payment processor is charging ~1% instead of ~3%.  Then, the merchant wins too because they increase their profit margin.  And, the payment processor wins because they take ~1% cut.  It's a win-win-win.

 And, nobody is exposed to risk of volatility.  Only the Bitcoin buyer at the end of the line is exposed to volatility...unless, you know, they do something silly like spend it.

What pain in the ass?  5-10% below market rate and you will have a line out the door with cash in hand. 

Hate to say it, but gotta agree with OP here. The bitcoin market is rather illiquid, so it can be difficult converting back to fiat at times, which no doubt factors into the bubble. Once you`re in, you can never get back out. Might as well ride the wave  :)

Yeah, indeed.  Illiquid in almost the same sense that the Brooklyn Bridge market is illiquid...

Another example that only makes sense today, in bubble growth land where sloppy or careless business practices are drowned in hype-fueled growth numbers.  When the price starts eventually falling you are going to give away a lot more wealth than 5-10% on every conversion back into USD, it might even fall 5% in the time it takes to process the transaction. Also, this 'solution' will accelerate the crash that will already be happening and which is itself what is driving all these people to your door so they can get out of their BTC, stat. 

Bitcoin is like spectrum à la FCC.  That stuff is real valuable, albeit more stable.

how is that, it's supper easy to spend, what can be a pain is the buying side still.

Yea, doesnt seem too hard. Um localbitcoins is the fastest!

Is the last rising of Bitcoin a sign of starting closed trading structures?

For example:

The daily volantlity is about 5.000 Bitcoins.

Some peopel build up a group, which own´s 10.000 Bitcoins.

Through that difference of Bitcoins they can make the price fall or rise, like they want...by selling or buying among themselves.
->The Bitcoins stay in a closed trading Structure.

Is that just a silly thought or theoretical possible?


Thx

You got to be broke! Or someone gave you money. Ride the trend brother! If you think a bubble is going to pop and you'll be broke you will. Or You think a bubble will pop so you don't invest and it doesn't pop---- you stay broke. Very Possible. What ever you believe your financial future will be, It will BE. Unless the Mind Changes the Bank account never will!!!! Opportunities are available for anyone that has an open mind to them. So if you were looking into bit coin when it was 10$ and below the universe was telling you to invest your mind just wasn't open to the thought. The exact thing is happening now on a larger scale. The universe is talking to people and trying to prevent utter chaos once the current financial system collapses. Depression 1929-1931 that was nothing. Back then people knew how to grow food. Today!!!!!!! It will be a blood bath. People will fly,boat or walk to stable counties with nothing on their back except bitcoins in the cloud. People holding onto material items will be robbed and held up fighting over simple objects. Do yourself a favor and just buy one! It may save your life!

What do you mean for no good reason?
Bitcoin is rising because more and more people are exposed to bitcoin.

Just like all the early adopters realized the potential and value of bitcoin years ago, now its time for much more people to do so.
And we are just in the beginning. Bitcoin is not even close to being mainstream or even go viral because it is still to geeky.

Yes with price moving like crazy there might be concerns about spending coins and exchanges are full of problems but things will settle down eventually.
How long that will take? Who knows...

It is a bit worrying about bitcoin but $1000 should be a strong resistance level

Cavirtex keeps Canadians fiat in a real bank.  We have access to this currency through a debit card issued.  Selling BTC for CDN is a breeze and accessing the CDN is as easy as accessing my current CDN.

The technology is there young grasshopper.  You just have to wait and stop using shit exchanges like mtgox.  Transferring your BTC to any other exchange or selling your BTC locally is also an option. You need to start thinking outside of the box.

BTCChina shoved $1000 is not strong resistance level at all

it's a psychological factor, and $1,000 USD is not the same as 1,000 yuan.

The reason is simple, the Secondmarket Bitcoin IPO is propping up.
Eventually this will lead to a dramatic flashcrash but not until the supply is dried up.

hahaha that's hilarious  :D Obviously a fake account!

Bah, humbug. Another person who thinks he knows what other people think, feel, do, and want, and can speak for the entire market.
I've never had a problem converting BTC to USD and back. Also, never had a problem finding BTC-accepting merchants. I know some people do, but I would never think to make a grand assumption about the entire market and about thousands and thousands of people who deal with BTC, because I simply don't have the data to support such an assumption. At the very least, I wouldn't simply make up data such as the number of payment processors. Saying bitpay is the only one is like saying Gox is the only exchange. Lurk moar and learn about the bitcoin market a bit first.

OP didn't even understand how payment processors work, and thinks there is only one (bitpay,) had to get schooled by previous posters. Either he is complete troll or just another asshat who thinks he "finally understands that the market is just one big scam and y'all are just too stupid to see it."

Next thread!

Until the software improves dramatically, and the FX markets mature enough so that market makers stabilize prices, point-of-sale applications are not very good uses of bitcoin.  They can become very good uses of bitcoin in the future, but not now.

Presently the great value-add propositions of bitcoin are disintermediation of money transmission, and use as a store of wealth.  It is these applications which will determine the bulk of bitcoin's monetary use over the immediate future.  They are sufficient to more than justify the current valuation.  While the price of bitcoin, being subject to social and market forces, may fluctuate dramatically, in the long-run the price will rise until it corresponds to the fundamental value.  Speculators would be well-advised to use the relationship between price and fundamental value to determine their long-term long/short bias.

What the OP is overlooking is the amount of infrastructure that is rapidly being developed to facilitate Bitcoin use.  There are significant investments into companies that are developing and refining services to fill the demand.  Many of these services are in their very early stages.  As the reliable services rise to the top because of their ease of use, Bitcoin will begin to fulfill it's potential.

Coins keep rising....

People hoard......

True float in the market is small...

Publicity of easy profits drive more cash into BTC as investment.....

Price rises......

Repeat.......




......until!

Pyramide collapse  ;D

In 20 years we can tell:

Either bitcoin was/is a full success or one of the biggest pyramide schemes ever.

Bitcoin is not a currency, it's a funny speculative bubble, plain and simple.

People want to know how much their cash will buy tomorrow or the next day, it`s far too volatile now to have any confidence in future valuations.

If you want a crypto currency much more interesting, take a look on new coins 2.0 like emunie.

Internet Fun Bux
Pound Spergling
Dunning Krugerands
Autism Kroners.

Bitcoin will be here if you want or not. Question is
a) will bitcoin become mainstream ?
b) bitcoin will become underground's/hacker's currency and will be using at black market.

And black market is almost as big as main stream. :-) (or even bigger in some countries)

Why still talking about what bitcoin is to become, it already is what it is a trading game for bored nerds and internet libertarians.

I can imagine, bankster will be on black list soon and "Ponzi scheme" (bitcon) much more popular.

Sure imagining things is pretty healthy.

EM is ultra-bull :-)
Edit: good for bitcoin?
Edit2: time to sell all yuor bitcoins

Hmm, I can't really remember what I meant by that.

The question is when will this loop stop?

As I can see, there is no way to stop this loop until the central banks tighten the money supply or bitcoin had some fundamental problem in its infrastructure

And even central bank tighten the money supply, people still can exchange bitcoins with physical goods and services, and they will happily offer a discount when paid in bitcoin

I know, SR is closed :-)

Or both.  Dollar, euro, pound manage to do both just fine.

Correction is coming.
Sooner than you think

I like corrections. I increase my bitcoins holdings.

b) Bitcoin already is underground.




 


 

It's rising in price because it's scarcity, like gold.  But it way more usefull than gold.

About conversion back to fiat.. 1st better spent your btc on something else than fiat.  If youre using mtgox.. too bad.. wrost place.

I've bought hundreds of things with btc, for me it's by far the more easy and the fastest methot to pay.

Im using CaVirtex for exchange btc/fiat fiat/btc.. its only few click.. very fast.. usually the money goes within 24h.. never had any problem.

Sorry, i just disagree with each and every point you raised..  using btc for 4 years now...

Let's where we will stand in five years.

This thread has reminded me how many stupid people are involved in bitcoin.  OP presents a reasonable argument, and there have a been a couple of reasonable points brought up as counter arguments (senate hearing etc).  Most, however, aggressively react because OP isn't an idiot who thinks btc will just endlessly rise forever.  This sort of moronic mentality is what leads to the financial crisis inherent in capitalism, as Marx said, capital cannot abide a limit.  The most common example is housing (08 GFC, 90's Asian crisis, Savings & Loans crisis etc) but it can be seen in numerous other instances such as tulipmania.  Bitcoin was created to overcome the failures of fiat money (and the associated institutions that dominate the capitalist system) and if you guys are too stupid to critically think for a second, bitcoin is gonna become the same as any other bubble commodity. 

Admittedly Im involved for speculative purposes, I love the potential that bitcoin possesses with regard to creating economic freedom through decentralization and institutional circumvention, but the overwhelming mentality surrounding btc on this forum gives me little hope.  I wanna profit and get out before the whales (who are behaving exactly the same if not are the same people who are responsible for the inherit corruption of fiat) bail, because this forum, in my mind, represents the bitcoin majority (not majority value holders, but numerical majority), who when all is said and done are gonna look exactly the same as the people standing in the street after 08 going "gee, who would have thought housing prices wouldn't just skyrocket forever", whilst the rich just keep getting richer.

If you don't need something you shouldn't buy something. STOP WASTING THE WORLDS RESOURCES.

And get richly rewarded.

Believe what you like and if you don't want to invest then don't.  I realize that $1,000 to $10,000 is much more difficult to imagine than .10 to $1 or $1 to $10, but it's exactly the same thing that bitcoin has already done over and over.  And so few people understand what bitcoin really could do compared to current financial systems, that most of us believe it has a long way to go.

We're fine.  If bitcoin goes to zero, then I'll lose what I put into it.  So what?  Should I put it in the stock market instead?

My brother is a reverse mortgage lender and talks to old people every day.  People whose entire retirement was wiped out in 2008 because their 401ks lost 70-90% of their value.  Over and over again.  Every.  Single.  Day.

Why do you feel the need to come in here and save us from ourselves?  We're grown adults and we understand the risk.

One word: Chinese.
And also there is a lot of international business in Hong Kong, which - if informed properly - could easily double the BTC market cap. It is like international wall street.

Well said.
I always watch where I talk about bitcoin, just because the community is full of people like that. These are the people who are visiting self-help classes that teach them how to be millionaires without any work. They are graving any new get-rich-quick scheme sthat presents itself to them and they will defend it with intense emotion. For those people, saying things like "BTC will crash soon", is like telling christians "Jesus is a myth". They will defend their dogmas till the end.
I think that the real value lies in cryptocurrencies in general and BTC contribution was mostly to show that decentralized and democratic financial system is actually possible. I think that the development of cryptos will get more complex and those people will be filtered off who can only come online to buy their bitcoin, so they could soon be rich. Cryptos will have an important part in the future and many people will become wealthy by working with cryptos. The amount of fools is just the faults of the current raw situation the cryptos are in. Most of these fools will lose their money anyway and will have no significant place in the future of cryptos.

Are only people who have absolutely no idea allowed in this thread? So many clueless people it's amazing :)

The illiquidity argument has to be the stupidest one so far, congratulations. The only time it's even remotely true is when you hold thousands of bitcoins, then yes, may be hard to cash out but due to all different reasons - and I don't believe any of the trolls here actually have anything remotely similar to that. In reality, anybody can get money in the bank in exchange for their bitcoins in as much time as it takes the slow banking system to send the money. If you can't figure it out, then I guess you still didn't figure out how to exchange bank bills for food.

Ok, now please continue discussing something you've never even seen :)

.Ahem.

When I cash out, I use gyft.com.  Sure it's not pure cash, but if my wife sees money coming into the bank account, then *she* might spend it.  Whereas a gift card is mine, allll mine!!   Especially amazon gift cards.  You can almost buy anything through amazon.  So yeah, it's super easy to cash-out in fiat, if you don't mind indirect methods. :)