Bitcoin Forum

Is it possible for us to work together to get the price back up to about 15-30?
Legally that is.

I think you're well meaning, but why would we want the price to be 15-30? There's no fundamentals to support that price. I (and others) would like to see $1 - $1.50 and slow growth from there, which includes real commerce and not just speculation.

-Jonathan

Does a shovel's color determine how well it works as a tool?  Nope.  Neither does the price of a Bitcoin.

yeah man go buy a couple thou and ill be right there to sell

I just liked it higher from a financial standpoint on my end. But why is that though? Why have it lower?

Legally or illegally, it's a tall order.  The only way you're going to get the price up in a hurry is by having access to at least a million dollars and buying up all the bids.

There have been various ideas floated before, such as asking sellers to retract their asks and 'force' bids upwards.  It never works.  If only one person doesn't cooperate and acts against the herd in their own interests then the entire manipulation fails.

The other question is, why does the value of a bitcoin have to go up?  It's just as useful at $3 as it is at $30.  If people are buying them up to speculate on the value rising in the future through sitting on their behinds and doing nothing, are they any better than the Wall Street 1%?

What's the difference between 10 bitcoins for $2.50 and 1 bitcoin for $25 when it comes to trading / speculating? You like it higher from a financial standpoint because you purchased bitcoin at $15, or because you're emotionally driven by a higher, more volatile price?

So instead of 1000 bitcoins at $15, now you hold/trade/speculate with 6000 bitcoins at $2.5 ...

-Jon

Sure, buy Bitcoins.  But why do you want it that high?

If it's to be able to sell Bitcoins, you're going to have a hard time convincing people that they should buy against market sentiment (IE, they lose money) so you can make a profit.

If it's because you think that Bitcoin will be perceived better if the people who bought high make their money back, feel free to bid it up, but understand that you're going to be losing money the whole time you do it.  It's a nice enough cause, but IMO a foolish one - I think the market is healthiest when supported by fundamentals, which I believe is currently well under a buck.



1) I do not want to reward the foolish speculators who have run the price up without any regard to economic reality.

2) I believe Bitcoin will be more stable when supported by fundamentals rather than price manipulation.

3) We collectively pay miners 7200 BTC per day to secure the network.  At $3, that's over $20,000 per day.  At $30, that's $200,000 per day.  That money has to come from somewhere - and if you're the one manipulating the market to keep it that high, you're the one who ends up paying for it.  Unless you have a really good reason why the price needs to be that high, that's wasted money.  (A price boom creates a mining boom, which creates a hashrate boom until mining profits reach about current levels; once it settles out most of that $200,000/day gets spent on electricity.)  The current level of economic activity does not justify that level of blockchain security.

^ THIS

$15 makes NO sense. The current hashing power is overkill, and a waste of electricity. Mining right now is a zero sum game. It's ridiculous to think that bitcoin has to be valued above $10 to have value.

People just need to buy about 80,000 BTC to get the price to 4 $. I would then consider this a technical breakout and then BTCUSD would likely rise much further. Ideally, also 5 $ is cleared soon thereafter.

We're all entitled to our own opinions. While you may be correct, a value of $50 will require 50 - 100x the current use by merchants. I guess we're  a ways away from stability, then.

-Jonathan

Higher prices don't create stability.  Market depth does.  $100k of market depth at $100 isn't any more stable than $100k of market depth at $1.

Bitcoin's instability in the early days of trading was due to price discovery in a brand new market with very shallow depths.  In the grand scheme, these are still the very early days, and we're still doing initial discovery.

It's just my opinion and hope that the market will eventually discover fundamentals.  :)

If you get more buyers the price goes up; if you get more sellers, the price goes down; if you get more buyers AND sellers, the market depth goes up regardless of the price.

I'm not sure how any of that relates to the known number of coins.  We know exactly how many shares there are of GOOG.  So what?

Commodities and stocks correlate to each other when they have broad use and relevancy to each other.  Gold, oil and USD have some well known correlations because people are trading huge volumes of each to a practical end.

Bitcoin would correlate to oil if people started buying oil in BTC.  That (and a hundred other similar things happening; you can't have one alone) would also correlate to a great deal of stability in BTC because that would be an enormous growth of the BTC economy.

That doesn't mean the price correlation CAUSES BTC to stabilize.  You're mixing up cause and effect.

So how much have you lost?

I'm wondering if it's possible for us to get the price down below $2.00 instead. Whoever dropped all those coins yesterday got us close, but it looks like we're climbing back up -- albeit slowly. Everyone is a little sketchy right now, and all it would take is a couple thousand BTC to drop us over $0.20. Looking at the live view, there's more pressure right now for the price to continue to drop, and I'd guess that we'll see a real test of the $2.04 low from last month some time in the next week. The real question is what will happen after we test the low value: do we go back to $3 again, or do we stick at $2 this time? I think I'll put my but-back-in price at under $2 this time, just to be safe. :-)

be careful not to get cut by the falling bitcoin knife

Holy bit, we're going into the Dark Ages. What the hell will happen to bitcoin? Will it go underground?

Gladly, no. Bitcoin is still just as epic as it ever was. Those who understand that are not going anywhere regardless of where the price goes. What will happen is that more miners and speculators quit and the people who remain will continue to develop Bitcoin further. It can also be summarized as early adoption part 2. Not that it'll be like it was for the first pioneers but it'll be close enough.

I don't really think the community has much use for people who think that the usefulness of Bitcoin is dependent on positive price development. With this I don't mean that a constantly crashing price isn't a bad thing, it definitely is. Bitcoin needs a real bottom and a new start. I don't care if it takes 2 months, 6 months or 2 years before the price starts going back up, what we need is a real bottom. Bitcoin needs it desperately and has needed for a while now.

Last time before I drop it:  A large volume of goods trading integrates Bitcoin into a larger economy.  This causes: 1) correlations; 2) stability.  It does not cause correlations which in turn cause stability.  The correlations are just the consequence of being part of a larger economy.



I agree with everything you say here.  I disagree that propping the price up helps liquidity.  Unless it's backed by large amounts of commerce (and therefore trade volume), it's just a high price in a thin market, and therefore subject to high volatility...  Even worse than a low price, since a propped up price drops whenever the fleeting interests of the price-proppers changes.

The high price is an effect, not a cause.  You have to create the root cause: commerce, which creates volume, which creates depth, which creates stability.  Note that "price" isn't in that chain: it's a sibling of volume, an effect of commerce; artificially recreating a correlated sibling effect (high price) does not magically recreate their common cause.

It's like saying that land with lots of wildflowers makes a good place to grow crops.  Sure, they correlate - because they have good soil, rain, and sunlight.  But planting flowers everywhere doesn't make the land good for farming.

You kind of implied it when you said "A higher price would mean generally lower volatility" in a thread about getting the price back up.  Sorry for the rant if that's not what you meant.  :)


Nor am I advocating an artificially suppressed price.  I just want it to fall naturally until commerce raises it again.


True, but the Bitcoin economy can be one or two orders of magnitude larger than it is now (along with 1-2 orders of market depth, and 1-2 orders of stability) without raising the price.

Again what you're saying isn't wrong.  It's just that you're implying that you want the price higher when really you want a large economy (which happens to cause a high price).

...but with such tiny market cap commerce probably will never come. Currently all bitcoins are less than 17 mil USD; and most of them aren't available on market at all. At this moment I cannot imagine that some real business will come to bitcoin world, unfortunately, because every single order can move a market. For example today's "huge drop" was only 150k$, which is *nothing* for real commerce!

I'm talking about some specific business which I'm working on. However, with price declining, I probably need to review my ideas, because this business need much higher market prices to not be price maker itself by its usd->btc->usd conversions.

The only problem with a low Bitcoin value is it makes the price more easily volatile, buy $200,000 of Bitcoins now and you can get 1% of all bitcoins in existence (or sell $100,000 worth to drop the value of bitcoins 20% in two minutes.) that amount of money wouldn't be so influential if the market cap of all BTC was $170 million instead of $17 million.

Yes, with such small Bitcoin value it's simply impossible to transfer some amounts. Currently Bitcoin is big enough to buy alpaca socks or play poker, but NOT big enough to be interesting enough for business as transaction network. Which is making me sad because I spent a lot time on preparing my business.

Edit: I'm writing this for all those guys which are happy for falling price, because "it will be chaper to buy coins". But there are some serious troubles with *such* low price.

That, not the price, is the problem IMO.  Too many people desperately clinging to their brick in the pyramid and hoping to get rich; not enough people creating commerce.  The price declining toward fundamentals is slowly correcting that problem.  We don't need "most" (or even double digit percentages) of the coins to be on the market, but the current miniscule fraction is unreasonably low.

I'll just leave it at that since my thoughts on Bitcoin's broken economics are (and belong) in other threads.


My business can't happen in BTC until there's liquidity for transactions of tens of thousands of USD, or better, enough value stability that I can just hold the BTC.

... But again, I need market depth.  High prices alone don't provide depth unless they're backed by commerce.

Sure it would.  In a thin market, someone with 0.1% of all BTC could crash it from $30 to $3 just as easily as from $3 to $0.30.

I want to see 5% market depths.  Then we can talk about needing more price...  But we won't need to, because the price will rise naturally.

... This is kind of inspiring me to create another price model based on market depth.

Many people has the ability to easily bring back the price to $15-$30 range.

You just gotta talk to the right person.

ya sure dump 1 million $ into the market.... watch it go up to 15$ and then back down to 3$ in less then 2 hours

Or, if you'd rather not endure the wait time to wire $1 million to MtGox you can go down to the bank, take out $1 million, and then light it on fire.

that would be illegal.

 

Damn, you're right.  Buy bitcoins instead then.  Same end result.  It just takes longer, that's all.

Huh? Why?

Its illegal to destroy legal tender. Burning $1 million would therefore be illegal. Kind of like how you can be charged for drilling a hole in a penny (as stupid as it sounds). You may think its your money but its really the governments

well you'd portly end up with a 300,000BTC wallet..... but ya that's kinda useless.....

agreed,

bitcoins new slogan should be.

"Don't want to go to jail for burning money? consider buying bitcoins!"

No it wouldn't.  Someone who was smart enough to be in the game (rather than just sitting on the sidelines spewing nonsense) would become $1M richer.

+1, yup that's the bottom line.

your either, stupid and go around spreading bitcoin hate. Or you play the game, have allot of fun, and maybe make some money.

Really good discussion in this thread. To slush I have to say that I wouldn't worry too much about low price and the chicken and egg problem. You're not the only one starting a Bitcoin business. I'm starting a company in 2 months.

The only way that we'll see a sustainable higher price for Bitcoin with less volatility is by starting companies that increase the commercial use of Bitcoin.

2012 will be the year Bitcoin begins. But only if enthusiasts continue the path of development. Now is not the time to start doubting oneself.

With only 1/7th of bitcoin actively traded, there's animosity between actual developers / entrepreneurs and hoarders. If only the Satoshi working group had considered the real world implications of a successful launch, and included a holding cost (demurrage) to thwart hoarding, we probably wouldn't be in this mess. I hope beyond hope that the the value falls another 80%, and that days destroyed starts decreasing rapidly, and soon, for at least another 20 - 30% of coins.

Many (including me) want early miners and speculators to liquidate the majority of their holdings. If that doesn't happen rather soon, bitcoin may never recover, and an alt currency chain could easily leave Bitcoin (and its early adopters who killed the golden goose) in the dust.

Bitcoin is not the end game. It is the first experiment in a new type of money. Keep your chin up, developers and entrepreneurs, even as the price continues to go down. Instead of being depressed about $0.80 bitcoin, be glad that many hoarded coins will (hopefully) come into circulation. As is, Bitcoin is a HORRIBLE investment, where far too many inactive bitcoins are capable of creating incredible volatility, and this will scare off any serious players. Perhaps that will (finally) change soon? Maybe not. Either way, cryptocurrency isn't dead by a long shot.

+1, I agree completely.

I was alluding to this when I said "broken economics", but I didn't want to derail the thread with my usual pitch.  Suffice to say, there are several people working on interesting ways to improve it, most likely in another cryptocurrency since the changes would be too controversial for Bitcoin.

I am waiting not for changes to how Bitcoin works, but tools to make it accessible to 99.999999% of the world population. We need very easy ways to transport Bitcoin offline (i.e. public/private key systems) and allow someone without a highschool education to redeem them on a smartphone without opening multiple online accounts with financial institutions. I think this will attract more banks to accept the idea of bitcoin when they can feel they can dupe Aunt May to then 'deposit' her Bitcoin in their bank. I know this may sound stupid, but evolution is about adaptability, not superiority.

$500

I bought at $6.8...  :(

Total investment was around $1,300.

And you absolutely lament not knowing enough when you were a newbie (Price was at $8) to buy HEAPS & then sell at $35/btc

AAAAAAAAAAAGHH!  ;D

Are you still holding?  Cause I see further drops on the horizon.  Absolutely nothing has changed thus far, so downtrend should continue with minor hiccups along the way. 

i support that.

stable growth from $1.50 sounds good to me. would also probably get a bunch of new people into BTC cause everybody be like "BUY NOW FOR GODS SAKE!"

Intentional destruction of US currency is a crime under federal law.  Luckily it only applies to physical currency otherwise every banker would be in jail right now.  I would consider subprime loans to people without income on homes worth less than the loan to be the closest thing to intentional destruction of money I have seen in a long time.

No its not that, if the fundamentals don't change we are heading for sub-penny prices.
I am not one of these pessimists who think they cannot change and bitcoin is doomed but something must happen along these following lines:

resources sold for bitcoin
decentralized exchange
more productive userbase
grassroots projects
existing merchants doing well

I see nothing of the sort yet.

+1

I agree with this 100%. To me Bitcoin is great from both technical and economic standpoint. I don't mind it if someone comes up with something even better and manages to create a clearly superior cryptocurrency, but that's not the main issue. Bitcoin is fine, what isn't fine is that it's still unknown to most people, it's difficult to understand, it's not easy enough for regular people and it doesn't have a good image/reputation. What also matters is the price development it has had for the last few months.

And most importantly, it is not offered as a payment method almost anywhere. Only very rare merchants accept Bitcoins. It's very hard to accidentally run into Bitcoin. That needs to change. This is not because early adopters are holding coins, they are holding because it is like this. There are limited possibilities of what you can do with coins so most people either hold, buy, sell or actively trade them. Spending them is a small part of the economy.

I'm hopeful that once we have more Bitcoin merchants and (much) more importantly, known merchants adding Bitcoin as a payment option, we will see those Bitcoins move much more actively that are not in circulation at the moment.

And again, technically and economically Bitcoin is quite fine. The model has a fixed money supply which means there will be no inherent inflation involved (eventually) and no deflation either with the exception of lost coins. This allows for a much saner economy which does not artificially pressure people to spend money instead of saving it. Which means that people will be more inclined to buy what they need and save more. That will not only save our planet but it will also help individuals to become more self-sufficient in their personal economies, leading to people thinking less about getting more money to spend (via loans) and thinking more about saving money for future needs.

You can argue that this will lead to a massive decline in investments because it's more attractive to just hold money, but that's actually not the case. Holding is fairly smart if Bitcoin has a massively growing userbase, because the value of Bitcoins will predictably rise significantly. But if you imagine Bitcoin in year 2030 with basically all of the money supply generated and a relatively stable userbase, then the value of one Bitcoin should be very stable. You neither lose nor gain money by holding Bitcoins. I can imagine a lot of investment options that are more lucrative than holding coins at that point. So people would still invest massively. The only difference is that right now you're basically forced to invest unless you want to lose money. With Bitcoin you don't have to invest to avoid losing money, but you will still want to if you want profit.

This is a bit off-topic and I don't even have a clue what kind of "radical changes" Revalin is proposing to Bitcoin, I'm just saying that if it has something to do with the model Bitcoin uses for the money supply, I can say in advance that I don't care of it. But if it's something else I'm interested and would like a link to a more appropriate thread.

Why do you think this is necessary for bitcoin success? Why do you think bitcoin's basic purpose - possibility to send wealth around the world instantly - enough? For me (and for many other people) bitcoin has huge value even without things you enumerated above. But - as I already said - bitcoin is not useful anymore even for sending wealth, because thanks to fear and uncertaininty on the market.

I only see that necessary for the bull markets success, not bitcoin and I am very confident that bitcoin will be around no matter what the price does.

It will always be worth *something*

Do you have any economic models for your list or they just your "feelings"?

Of course, I have cybernetically mapped the future development of mankind and just posting the results!  ;D

LOL
(actually it's my secret weapon, I've heard its called 'common sense')