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If and when withdrawls start being processed again, I expect that arbitrage would slowly come back online, narrowing the present gap between Mt. Gox and other exchanges from its current ~8% to something more like 3-4% (perhaps less, depending on the number of people with Trusted verification on Gox). I expect that this won't cause too much drift in the price aside from reconciling the exchanges, since any money that wanted to leave the system probably either has done so or hasn't been spent on anything but "get in the withdrawl queue" any time recently, and deposits have presumably been going to other (cheaper) exchanges.
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That big drop was the price going down.
Anything beyond that is spin and salad dressing.
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Also, if Goat is to be believed, the guys that "Bitcoin Co Ltd" met with aren't even officers of the law - they're just some high-level bankers who gave their opinion that bitcoins were probably illegal. So even the "Bitcoin illegal in Thailand" part has a good chance of being misleading.
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When did Bitcoin become sentient and able to give presentations to banks? And when did it get its own website? The entity in question is some Thai company called "Bitcoin Co., Ltd". Apparently they operate (or, well, used to operate) a currency exchange. Whoever wrote the article was either pretty confused, or didn't realize that conflating Bitcoin as a whole with this Thai currency exchange would be pretty confusing to readers. |
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I think there are still a lot of people who expect that exponential growth will restart in the near term.
I think that it's likely they'll lose confidence before that happens, and I think it's likely that when they do, the price will drop to sub-$50 levels.
That's a bit more nuanced than "the only thing supporting these prices" being visions of sugarplums, but it's in the same ballpark.
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Nobody knows what the real value of a bitcoin is. That's the magic of volatility!
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If you're trying to compare the first and second big crashes, why on earth are you using linear charts?
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Um, somebody has to be there to lend you the ETF in order for you to be able to short it. Wrong! |
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P2SH has turned out to not be used so far, even though at the time it was deemed important enough to not want to wait for a scheduled hard fork.  P2SH is used all the time. It's, like, the second most popular address type (after traditional hash(pubkey) addresses). |
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BTC value has been dropping steadily. Bad news for Winklevoss twins. So, I am predicting it will fall all the down to $2 range by the end of this year.
Probably even lower than that. Overall, my outlook is bearish these days. The price will fall for a while - I've accepted it. But every time I see people talking about the price falling below $2/coin, I wonder what's going on inside their brains. Compare today's world to the world of late 2011. The USD/BTC rate had only spiked once, followed by a long and depressing bear-market, and there was a good chance that over-$10/coin was a one-time thing, an accident never to come again. Other than Silk Road, there was very little you could do with BTC. In that world, in a world where a good argument could be made that Bitcoin was on its way out, the exchange rate tested $2/coin in enormous volume, and $2/coin proved itself sound. If $2/coin was an impenetrable wall of value-confidence back then, what on earth could break that value-confidence today, in a world where high BTC prices have come twice ("and why not again?"), in a world where there are institutional investors dipping their toes into the market, in a world where you can buy food and shelter with your bitcoins? I'm bearish, sure. It's my guess (granted, one that I refuse to trust, or else I'd be shorting like mad) that the bottom will be somewhere in the $11-30 range, which is way lower than what we have today. But barring something that shatters the Bitcoin network itself, I do not think that we will see $1.95/coin again. |
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'deflation' I don't think this word means what you think it means. to reduce (a price level) or cause (a volume of credit) to contract Bubbles and prices can deflate, yes. Ah, my mistake then. I'd only ever heard inflation/deflation used in the context of supply on the market until now, and had thought it was specific to that. |
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If you're so sure, go take out a short position and make 30x your investment.
Talk is cheap.
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'deflation' I don't think this word means what you think it means. |
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Strategy.
Listen. When the price was going up, I was selling. I paced myself - a little at a time, make it so I'd never quite run out, &c.
But because I did that, I can hold as the price falls - even buy as the price falls - and still know that I'm making a profit compared to the last time we were at this pricepoint.
Sure, if I'm 100% certain that the price will move a particular way, it'd make sense to make a big trade on that certainty. The unemotional part of me feels pretty sure that the USD/BTC rate will keep falling. But I know from experience that I'm piss poor at actually knowing how the market will move. I'd rather trade on a mathematically sound system - even when it suggests weird things in the short-term - than trade on my hunches - even when they seem good in the short-term.
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Winkle-evil's Okay first off, I hope you realize that this sort of thing has never not looked ridiculous. JP Morgan has been using its tricks to heavily manipulate the silver market for years. Everybody in silver is bitching about them, but now if the Winkle-evil's do the same thing in BTC everyone cheers them because that will very possibly increase the BTC price in the short term, which is the only thing most of people in here cares about. JP Morgan isn't the issuer of paper silver - they're just a third party who has a lot of money to short it with. Like, I'm not saying people aren't going to do that with this ETF, but you're comparing apples to oranges if you say the issuers here are doing the same thing as JP Morgan is doing. And as an aside, I don't care about whether this pushes the price up or down. That's not the point. The point is so that BTC - or paper that performs roughly like BTC - can integrate with the traditional infrastructure for regular people (e.g. in IRAs). The Winkle-evil's shares are just worthless pieces of paper. Nobody sane would believe he is holding any Bitcoins by owning their shares. There's no way to redeem those shares for blockchain BTC, right? There is if you've got enough of them - that's right in the prospectus. Admittedly, that's not so useful for a small investor, but "needs to be redeems in a big batch" is a long way from "totally irredeemable". |
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Ok so the issue with this is that eventually that 5000 shares are going to have to be paid back, and since brokerages aren't a big fan of letting you essentially form a ponzi scheme with them as the lender, they're going to trigger margin calls. Think about it this way, you know John Law's land scheme? Its essentially that, except in reverse. So it might work for a while, but it will eventually fail, and at that time Bitcoin will have to revert to higher than it was thanks to interest & margin calls.
Sure, if I'm going through a broker. But if I'm a bank with a seat on the exchange, and I'm careful to always cover my shorts before the T-3 delivery deadline, then who has the authority to issue a margin call against them? The SEC? |
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....
Trust me, assuming you are a bull, you should be hoping for tons of naked shorts. The more the better. They borrow bitcoins / ETF bitcoins (in a best-case-scenrio, from you), and start dumping them. You let the market depth eat up his asks and let the price go down. Now you wait until the short is about to expire, re-buy at the lower price, the more the better, causing increase in price. Sooner or later the first of those shorters take profit, buying back more bitcoins than they borrowed to pay you back with interest, but these first dudes walk away with a fair profit. You time your own buy just before the first shorts are about to expire, now the price is going up and the shorters owe you coins, and you just bought bitcoins at a discounted price, and due to margin calls & interest, the whole deal is actually liable to INCREASE the bitcoin price.
There's a reason why naked shorting is a bad practice, its because its incredibly risky, and if too many people do it, then it essentially forms an inverse bubble except worse, since there is the potential to lose MORE than you originally invested. And when the bears take a big risk, and that risk fails, they lose money, and when the bears lose money, the bulls win.
Too much naked shorting can cause all sorts of problems for a commodity, but a declining price (at least in the long term) is not one of them.
Yeah, okay, you can profit from other peoples' naked shorts. But the idea that it will increase the value of the asset assumes that the person shorting naked will actually cover their position someday. Lemme explain. You have your BTC ETF. There's one million shares of it. I naked-short-sell 5,000 shares. Three days later I cover my position by buying 5,000 shares, and immediately naked-short another 5,000. Less exchange fees, my position hasn't changed - it was -5000 (naked) shares yesterday, and I bought 5000 and sold 5000, leaving -5000 (naked) shares today. The result is that, as long as I keep this up, at any given time there are 1,005,000 shares of the ETF on the market - 1,000,000 "real" shares, and 5,000 created by my perpetually renewed naked short position. Which means that to the extent that market considers these ETF shares to be equivalent to holding BTC, I've effectively inflated the supply of BTC. That's the attack I'm proposing, and why I think that even though the Winklevosses can't really cheat, this bitcoin paper can still exist at over-unity to the actual specie. |
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There was a proposal at this year's conference, which essentially amounted to "chain inertia". Basically, the argument was that you can sometimes execute a 51% attack with only, say, 25% of the hashpower - it's all probability, after all. But if miners and clients respond to a reorg by ignoring the new chain unless it can get a 2-3 block lead on the old one, this risk is greatly reduced, because honest nodes have a chance to "catch up".
This doesn't address a situation where a single attacker really does have, say, 60% of the votes. But, well, Bitcoin was never designed to be resilient against that sort of attacker.
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mmm I love honey, and I agree it is a good store of value.. but does Honey go bad over time or get better?
I'd heard somewhere about some honey found in an Egyptian tomb that was still edible. A couple minutes with Google turned up this: http://thebeejournal.blogspot.com/2010/02/ancient-egypt-and-honey-bees.htmlThe Egyptian Pharohs put all that they valued into their tombs and they valued honey. Honey combs were found thousands of years later inside these Egyptian tombs.
These sealed honeycombs were found to have still edible honey inside them. The honey had not gone bad. Because honey doesn't go bad. That's the urban legend. I'm skeptical, but it's definitely the kind of story that inspires me! The honey arrived today. There was some shipping damage, which the post man was not too happy about.
I've sent you PM.
Well, that's an awful shame. I'll be in touch with the apiarists - hopefully we can beef up the packaging and prevent this kind of thing in the future, and I'll see what's feasible to make it up to you. |
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If you truly believe that, don't waste time squawking about it on a forum. Take out a short position and octuple your investment. Talk is cheap. Truth is worth its weight in gold. |
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