Bitcoin Forum

Hi folks,

Two simple pertinent facts:

A. Bitcoin is gaining much wider acceptance at a rapid rate, and new Bitcoin companies overflowing with venture capital money are sprouting up daily
B. The price of Bitcoin is going down, not up

This can ONLY be explained by PRICE MANIPULATION on the part of one or more big exchanges like CoinBase, Bitstamp or BTC-E (the main culprits).  Remember how Mark Karpeles' trading bots at Mt Gox spiked the price to $1200+ in November of 2013?  Now the big exchanges are intentionally CRASHING the price so they can buy up CHEAPLY at rock bottom because they KNOW that the price is set for a massive boom due to increasing adoption worldwide.

How low will it go?  Only the price manipulators know that, but my guess is well below $400.

Invest at $350 would be my recommendation.

And, of course, enjoy the ride.

+5

Kudos, 

Another theory is that many may be selling bitcoin short following the trend, and we all know what happens when a price bounces and short sellers have to cover their position. 

Indeed. Back to the good old days!

http://newsbtc.com/wp-content/uploads/2014/08/bitcoin-roller-coaster-1.gif

Which exchange do you think is insolvent?

I'd buy at $300, but I'm very conservative in terms of risk so prices will likely rally long before my mark is hit. I suspect you're correct in that BTC will fall below $400 USD because the daily exchange rate has a lot of momentum that isn't visible within hourly trades due to arbitrage or the lack thereof.

I don't think there's a single entity manipulating the price, i.e. a large oldcoin dump. More or less the market = lemmings off a cliff. If an exchange were insolvent (and this were public knowledge) then we'd see a massive price drop in that exchange, and lesser drops in solvent exchanges, as happened with Mt. Gox.

miners dumping. will continue until next block halving in 2017.

Miners dumping and/or retailers dumping (by proxy). Don't buy shit with BTC until retailers stop dealing with payment processors that dump on the market. And never sell at a loss.

Don't be stupid. Merchants accepting BTC and converting it automatically to fiat. Ex BTC users not buying back in again, because they don't trust scam money anymore. Everyone just wants to get rid of it, miners, too. It's a long way down.

SELL NOW OR LOSE EVERYTHING

Worst advice ever. It's sometimes wiser to sell at a loss than to lose it all like many will now.

The Manipulator is back!!!

We are doomed.

https://bitcointalk.org/index.php?topic=52431.0

Duh Duh Duuuh! Nah. There are a lot of reasons folks are skittish right now. 99% of those reasons are FUD.

OkCoin and Houbi. Who else?
Harder question next...

Damn, you're terrible at trolling Sevvero. Atleast put more effort than a 10 yrs old.

Next difficulty 18% jump in 7 days.... yikes!

My guess is some of these Chinese mega-mining operations have been funded with high interest loans and are losing money. Other operations aren't as close to bankruptcy, so it would make sense for the more solvent operations to sell as low as possible to drive the competition out of business, buy them up for next to nothing and then stop selling. 

It's a bit like when Rupert Murdoch was selling the Times for 10p just to drive the other newspapers out of business, he had a bigger line of credit.

Aka The Angry Troll

At least the failllling persona was good for laugh, this one is painful.

Although they all seem to be part of the same gang.

I know that such things had happened many times in China, but nobody has managed, no one would dare to manage.

Price manipulation may be going on, but the price of a bitcoin is still high compared to the cost of mining it. When the hashrate curve flattens out again (as it has before), or at least when the "cost of mining a bitcoin" flattens out near (but less than) a bitcoin, we will have a correct bitcoin price. This will happen either if the bitcoin price goes low enough or the hash rate goes high enough. Since the current hash rate is still going up, we don't have a low enough bitcoin price yet.

Have you got any idea how much it costs to mine 1 BTC currently?

No, but he likes to open his mouth anyway to sound like hes smart.

Too bad, the dumbest usually sound the loudest.

Block halving is in 2016

http://bitcoinclock.com/ (http://bitcoinclock.com/)

Way to say that nice and loud there. The principle that bitcoin mining cost should determine the price of bitcoin was given by Satoshi in the white paper, and is reiterated many times in the early posts on this forum. Here's Hal Finney in 2010:

The institutional traders using HFT bots are indeed dictating the direction of the exchanges.
Some observations:

#1 Most large bitcoin block transactions are occurring outside of the exchanges through brokers. This is a way for large investors to accumulate bitcoins without spiking the price of bitcoin. They are like market makers insuring that the volatility in bitcoin remains steady as possible for the interest of their clients. Secondly, this insures that the miners will always have a large buyer. With a lower exchange spot price, brokers can negotiate even better prices. One interpretation is that a low price indicates heavy accumulation off the block transactions by large investors.

#2 Many of the major exchanges are unregulated. There is no way to prove or disprove any price collusion, but the lack of regulation leaves the door open to suggest it is possible. The bitcoin ecosystem is dominated by only a few major players creating an almost self-interlocking monopoly on all sides from production, investment and distribution of bitcoin. This isn't a conspiracy theory or a shill post. News at this point - either favorable or unfavorable for bitcoin is just noise for amateurs. The big boys aren't reacting to the news because they're creating it and the market.

#3 Bitcoin is going to stay around, and this isn't a bullish pump and dump signal. In the short term, bitcoin's price may bounce around more, but there are a number of factors that suggest bitcoin will have a very significant place in global finance for the long term.
 
*Skype. It is probably the most comparable parallel to bitcoin. Skype uses Voice over Internet Protocol (VoIP) and its global growth has accelerated like a classic model of Metcalfe's law. Bitcoin as a cryptographic protocol presents similar features as VoIP.

*PayPal. Bitcoin needs a major global payment system to educate, promote and legitimize bitcoin. PayPal is the company that can do that. They publicly endorsed and will experiment with it. At this point, incorporating bitcoin in their payment model is probably the best corporate strategy in order to remain the #1 payment systems in the world and keep possible competitors like Apple at bay. Whether Google or Amazon joins is another matter as they may go the way of tokenization. Bitcoin though has much greater implications beyond centralized produced tokens. If you look at a window horizon of 30 years rather than 3 years, bitcoin as a protocol will have a very strong chance of surviving. Open source, peer to peer, decentralized and built atop of the internet.

*Merchants. They will have a choice. Pay the credit cards fees around 2% or the significantly lower bitcoin fees. Perhaps attract a younger demographic as well as one that has grown up on tablets and smartphones. The world is becoming far more digitalized, and bitcoin presents a fit for it.

*Consumers. Bitcoin has obviously placed the cart before the horse. It has only reached a fringed group of buyers who have speculated on its price. The target users will not be in developed countries initially, but in underdeveloped countries and emerging markets. A younger market in developed countries are likely to experiment with it. The tipping point will be when more companies begin paying salaries in bitcoin. It will create a fully integrated bitcoin economy. When that happens, people will use it not hoard it. That will be years in the making.

*Other factors. Lawsky's NY reg, the Bitcoin ETF are other factors which can accelerate adoption. However, that does not mean the price of bitcoin will automatically rise.

Independent of all the factors contributing to bitcoin's adoption rate, bitcoin cannot function or fulfill its promise as digital currency until its reach a higher market cap. If the exchanges or bitcoin market economy is somehow manipulated, the price will need to rise much higher than it currently is.

          

1st: the western markets are insignificant. China has the vast majority of volume and coins. Nobody cares about bitstamp.

2nd: yes, price is heavily manipulated out in the open since day 1. Bitcoin inflates with 10% a year. So there is your pricemanipulation. All the stats and numbers are available. Bitcoin is just a practical joke by some satoshi-dude who is porbably running the largest mining-operation himself and dumping since day 1.
Bitcoin is for miners, not for everyday people.

I don't need a large conspiracy to explain why it'll go back to 200$. Nobody wants it because it can't hold its value. Too much coin being dumped by miners.

Great post. Solid high-level summary of the current state of crypto (with only mild speculation interspersed). Bookmarked.

How much incidence in BTC price do you think China has? I'm very curious

The Reality of China's trading volumes
http://www.coindesk.com/reality-chinese-trading-volumes/

Totally agree. I set my "long term" buys at fixed rate above mining costs. I doubt the cost of Bitcoin will cross below the price of mining, but it might come close. Depending on hardware and electricity costs miners are still profiting 20-30%.

Once the price gets low enough or the difficulty high enough "manipulation" will stop and hoarding will increase, causing the price to go up due to no selling pressure.

Another classic example of a double sided argument of why Bitcoin will fail: Some say Bitcoin has bad distribution with large industrial miners having all the coins, others say Bitcoin suffers because all the miners dump all their coins immediately.

(Other examples: Bitcoin will become worth so expensive that it will fail, and the government will never allow Bitcoin/The government obviously created Bitcoin.)

I'd just like to note that Coinbase is not an exchange.

Coinbase does all it's trades completely and solely on Bitstamp. Just compare their 1 minute graphs on bitcoinwisdom, it's a 1:1 copy.

I think the mining theory might have some merit. The higher difficulty goes the less profit to miners the more they will have to dump to remain solvent.

I also think the price is being manipulated. For example, buy off exchanges, dump some of it, buy the next batch cheaper.

This could go on for a while.

Some chinese billionare use bitcoin to convert their yuan to usd without any limit, so btc price could go under the mining cost ( + 10-20 % ) in short term ( ask yourself how many billionare live in china and how many of them want to convert their yuan to usd and how many of them enough to keep the price down by dumping btc on usd exchanges) (+ otc buying and exchange selling)

Where is the buying on Chinese exchanges to support this theory?

The theory is that they bought mining equipment.  ;)

$350 would be nice  ;D

Buy directly from miners or build their own mining farm ( payed with yuan, electricity too )

Doesn't help the price. :)

Care to tell us how exactly institutional traders run hft bots on exchanges that lack infrastructure for hft...  ::)
The trading bots you see on bitstamp, btc-e etc have nothing to do with hft...

China is very active in Bitcoin but saying Billionaires use bitcoins to change their Yuan in USD is false because they don't; it would be a hassle and there are easier way to change it + They prefer buying businesses, other currencies or Gold than USD and they are correct

It is crazy that people buy the USD against the Yuan

Atlas ATS, Huobi

The typically low levels of trading on the exchanges, followed by massive increases in trading during times of price volatility,  suggests to me that there is very little hft going on during normal times.

This is more likely.. When demand exceeds supply price >UP, Supply exceeds demand price >DOWN.

Price is dropping and levels of trading are low.

Conclusion. The Market has now fallen out of love with bitcoin and sees it as Mickey Mouse and will not be taken seriously by the masses or

The Market is sitting on the sidelines with big bags of cash waiting and waiting until they see the signs of hitting the bottom and the Bounce.

My opinion is that as the volumes are low then the swings are happening through day trading and short term speculation.

I,for one, have a shed load of cash sitting on my exchange waiting and will look to get it on around $350 however will try and hold for $320 BUT if take off then I hope i dont miss the boat because it may be a very fast escalation.

Good Luck all

Yes there is undoubtedly a lot of cash sat waiting for 'the bottom'. Every troll and bear on here is included in that camp, too.

It would be fascinating to know the amounts of cash held by various exchanges and see how that matches up to the btc price.

there is indeed some manipulation, i have seen many wall with the same value, from both sides buyers and seller, someone is playing

Not falling out of love because there are new players that pour new money everyday and a lot of money is waiting on the side lines to buy some BTC when it goes up again

A lot of miners need to sell and early adopters have many ways to spend their bitcoins online now and the websites where they spend it mostly sell the BTC they receive

As long OTC bitcoin trades take place, one can never know the actual demand for bitcoin. I would argue that the OTC market is a far better gauge of demand. If the price is being deliberately suppressed, then it is creating the ideal price on-ramp for heavy investors. If/when we see the price rise or accelerate, those investors will have sizeable positions, while everyday buyers will face daily buying limits. Demand pressure can easily reach a bottleneck because of bitcoin's limited supply. This could be in a year, 2, 3 years.

And just how long will miners be willing to go along with the lower price? Bitcoin's difficulty and hashing are ever increasing. Miners have serious expenses to balance out. They can't subsidize an artificial low price.

I don't know how much manipulation is going on but it seems panic is slowly taking a hold again over bitcoiners the last few hours...

At this low level of volume, it's a wonder that exchanges are not discounting trades. I suspect the new trading model is to suppress trades in order to gain commissions for bulk orders rather than depend on fees with low volume.

Most people know about the manipulation, that's why the buy in is going to be so hard to call. I think one massive re-entry is going to turn this around.

It went down sub 300 only to go +100$; the global markets are in total denial or the reality in the US and Europe, they are overestimating the positive results of government actions and QE and underestimating the debt problem of the US and most of Europe; when the market comes to its senses, all markets will be different and we may go on on a more positive and rational ground

We still hear that Japan had a deflation problem and that China is overrated! ;D Both are untrue

yeah sure, this is manipulation but many people left the market the last months because they are sick of this crap. more and more money is pulled out of the market and the minners are dumping all the time