Can you explain to me what would be the advantage of buying a bitcoin futures contract instead of just buying bitcoins at spot? How would that advantage outweight the risk of losing bitcoins due to the bitcoin exchange bankruptcy? Can you really afford the risk of keeping your bitcoins at the exchange for 1-2 months? Why and who would do that, if bitcoins are available to withdraw now/deposit back within 1 hour if needed, compared to those crops that will be available only when harvested and that most traders just trade paper contracts of anyway?

Bitcoin futures can exist, but noone would use them, because it makes no sense to.
Bitcoin exchanges don't have incentives to introduce futures contracts, because they cannot be bailed out if they screw up.

Do you mean bitcoin miners would sell their future bitcoin production? That'd be interesting, but that requires much heavier levels of regulation than now, having them registered as companies, etc. In that case, yeah, futures contracts might have a chance.

You can't be sure of that, it all depends on how quickly the price recovers. If the price rests below profitability level for an extended time, the difficulty could stay about the same or even go down for some time as well. Just common sense and economics 101. In any case, there is no reason to be afraid of the lower difficulty, there is more than enough hash rate on the network, even if some miners drop off, there is still plenty left.

Currency futures exist and are popular. They are popular exactly because central banks can print as much fiat as they want and banks can receive that fiat at low cost and do all kinds of funny business with them on big leverage. This has limited application to bitcoin.

Bitcoin exchanges need to have all (or almost all) deposited bitcoins ready to be withdrawn or at least in cold storage and available at short notice. If a bitcoin exchange introduces bitcoin future contracts, and they get popular and then lends customers' bitcoins to someone for promise that they are returned by the date of the future contract expiry or use those bitcoins to fund some other project, and for some reason most customers decide to sell their future contracts before the bitcoins the exchange lent are returned and to withdraw their bitcoins, the exchange is f*cked, because it can't quickly borrow bitcoins same as a bank could borrow fiat from a central bank.

See the difference with currency futures? Physical commodity exchanges can do future contracts too, because most customers trade paper contracts only and don't ask for delivery, so they would only withdraw cash, not actual commodities. It doesn't work same way with bitcoins. If they withdraw, the exchange has to deliver bitcoins digital commodity to all customers, not just to 1-2% of customers who ask for actual delivery, or declare bankruptcy.

Under those circumstances what's the point of having future contracts in bitcoin from the customer's point of view if they could as well just by at spot, withdraw and wait to sell, and not risk being f*cked by the exchange in 1-2 month when a future contract is due for delivery/expiry?

I never said this cannot be done. But because bitcoin is so easy to deliver, there is no practical sense in doing that. There is always a risk of non-delivery if delivery is delayed to the delivery date as is the case with physical commodities, so it makes more sense to buy bitcoin at spot price and withdraw from the exchange to your local wallet, and only deposit to the exchange when you want to sell. No point in storing bitcoins at the exchange while you're waiting to profit from the price appreciation, unless of course you're a day trader.

Physical commodities cannot be shuffled back and forth as easily as bitcoin, that's why future contracts in physical commodities are popular. It's a side effect that most people don't take delivery and just trade paper.

Please see the definition of naked short selling.

If any bitcoin exchange allows limited short selling, they are making sure these trades do not exceed the number of bitcoins the exchange stores for their customers and only allow limited leverage. They can't allow short selling to the extent other physical commodity exchanges allow short selling - naked - that is, not having the actual commodity in its reserves.

I don't know what you mean by 'recent jump'. If you have cash and you buy a lot of something and move the market - this is not price manipulation per se. People use the word 'price manipulation' a lot without actually understanding what it means. I tend to understand 'price manipulation' term only when referred to markets with paper contracts only prevailing. Per this definition price manipulation in bitcoin market is not possible or has only very limited extent.

Bitcoins are scarce like many physical commodities, but unlike physical commodities bitcoins are very easy to be taken delivery of, which makes price manipulation of bitcoins very hard, next to impossible.

No confusion here. Bitcoin is a commodity at this point, digital commodity. It does act as money too, but not many merchants and limited liquidity, so I wouldn't refer to it as money yet.

You can't manipulate its price a lot, because you can't issue paper derivatives against it. You either own bitcoins and sell them or you don't own them and can't sell them. Other commodities have storage and transporation issues, thus making possible the practise of trading paper contracts only (which exactly is what 95% or more traders do at commodity exchanges), which in turn opens possibilities for naked short sales, which is used for price manipulation.

With bitcoin you can take immediate delivery to your local wallet, you don't need to store bitcoins on an exchange. An exchange never knows how many bitcoins would be requested to be withdrawn at any time, so it can't risk allowing to sell bitcoins naked short if it wants to remain solvent. Any exchange that requires you to wait to withdraw your purchased bitcoins is a huge red flag.

This is not a problem, but a natural course of events. Any asset in the free market tends to concentrate in the strong hands in the end, who are less likely to panic sell, which results in less volatility. That is why we see higher volatility percentage wise in the initial stages of an asset trading, and lower and lower volatility as the asset matures. That's exactly what is happening to bitcoin, and that's why it's getting easier to predict the future.

Of course, black swan events (sha256 broken?) cannot be predicted, but FUD is a normal thing in markets and strong hands don't tend to panic sell when they hear/read FUD, whereas weak hands do panic sell, that's why assets go to strong hands who understand and follow fundamentals of an asset, and no even distribution is ever possible. If you took all bitcoins in circulation and distributed them equally among all the population, after a year or two you would see about the same distribution as now, only less than 5% of traders or wanna-be-traders do not become net losers. So forget about even distribution, it never existed in the history of mankind for anything and never will.

Another great thing about bitcoin, making it easier to predict the future is that it cannot be sold naked short (yet?). Any commodity can be sold short because traders cannot easily take delivery. Bitcoin doesn't suffer from this issue, which makes it about the only true free market left in the world economy. True free market is very hard to manipulate, because you can only sell as many items of asset as you actually own, you cannot sell what you don't own. In any other commodity you can sell what you don't own, and if you have a lot of cash (blns), you can easily manipulate the market by trading on leverage. In bitcoin you'd first have to buy those bitcoins and possess them to be able to sell them. In other words, these actions are trackable through price charts and future price action can be predicted more or less. Enjoy the only true free market of crypto currencies on the planet while it lasts, it may not be forever.

Yeah, that works now, thanx.

About those troll buy orders that some of the sell orders got stuck in.
You said after block 286500 the system will only wait for 10 blocks to send btcpay and then release XCPs?
I guess this will work for all new orders only, right? Those that got stuck in the troll orders have to wait for full order expiry?

5.1 develop branch was ok.

I downloaded https://github.com/PhantomPhreak/counterpartyd/archive/v5.2.tar.gz

now getting an error message:

"Please upgrade counterpartyd to the latest version."

what am I doing wrong?

EDIT: never mind, I just cloned the latest develop branch through git, that fixed it.

But what about 1) electricity cost, if daily bitcoin rewards coming from mining = $21->$20->$19->$18->$17 due to growing difficulty, and electricity is constant $20/day, that's losing money at some point, no matter that the hardware is fully paid for.
2) new miners will stop ordering new hardware, since the price is not catching up and profitability is close to zero after electricity or even negative.

I am not saying everyone will stop mining, but hashrate increased 10x over just 3-4 months, it can't go like that forever unless the price catches up, just laws of economics. It can only grow till it's at least marginally profitable. Just like it did go down in the past, in can go down again, before it can go up again when the price has caught up.

6 months of current level of bitcoin price can make a lot of miners re-think if they should temporarily suspend operations or keep losing money.

If price stays a $600-700 for another 6 months, what are you projections for hashrate/difficulty?
Current upwards almost vertical line is unsustainable if price doesn't catch up.

Will this change at block 286500 release all currently stuck matched orders or will it be effective for new orders only?

Why not make sellers of BTC escrow their BTC as well, just like sellers of XCP have to escrow? Is this technically impossible?

At the very least, to check against their BTC balance before letting them place an order if BTC is actually available in their wallet. This doesn't stop them from making many small troll orders with small amounts, so escrow is still better if possible.

So, if someone's order got stuck matched by this troll order, there is no way to get XCP back except to wait till the order expires as set by --expiration parameter? XCP will not be lost and get back to the owner again, not no quick way to get them back?

Nobody knows the future, but a trader must have some sort of trading strategy and allocate resources according to probabilities.


I agree.
But if bitcoin goes to $40, it'll get there on its way to $0, as it'd mean something major had happened (sha-256 broken?), which would render it not able to recover at all, ever.

If it's more of the same FUD we have witnessed over the past 1-2 months, the chance of $40 is 0.1% or less. Now, that's 2014. I wouldn't bet or make probabilities on what can happened in 2015, it's too far away to try to predict in the crypto world.

And we're talking here about closing daily price. Any kind of spike down is possible, like the one we saw at btc-e down to $102, but that's just a spike due to too few buy orders at that very moment on that particular exchange, the closing daily price of course was very different.

This.

Both numbers have less than 5% probability of happening.
Realistically, 2-3k is possible in 2014, 5k if very lucky.

Funny how all the trading of the supposedly decentralized XCP currency migrated to centralized poloniex exchange. Old habits die hard kind of thing

'counterpartyd market' command doesn't work in 5.1 develop branch?

I get an 'invalid choice: 'market' error message.

How do I view all current market orders now?

It would be great to get an official reply when BTC withdrawal will be available (in a few hours, in a few days, when bitcoin developers issue a fix for bitcoind, any other official rep's guesstimate), because it makes me hesitant to deposit other cryptos for trade. I am sure other users are hesitant too.

Dogecoin compressed time by the factor of 12x. What took BTC and LTC years to achieve, DOGE achieved in months due to its community, that makes it better than LTC at least.
When people say, DOGE doesn't bring anything new, well, true, but it doesn't have to. All it needs to succeed is to take the old from the leaders, to draw userbase to its side, to cut a market share.

After all, all cryptos' value is 50% or more - pure speculation, including the grandfather - Bitcoin. So your question on what gives value to DOGE is equally valid for all of them more or less.
I didn't own a single DOGE 3 weeks ago and was sceptical about it. I've changed my mind since. I may be wrong, you don't always hit the right one in investment. The most important point is - don't listen to anyone's advice on the Internet, do your own due diligence. If you don't understand something, don't invest, because it's a sure way to lose money.

Can you give an estimate when BTC withdrawals will be available again?
Are you re-syncing blockchain from block 0? Does it mean it can take a few days?