Ragnar- one of the few newbies not on my ignore list  Careful. He (Ragnar/Fallling) is garnering your trust. Once your defenses are down, he'll betray you in a dramatic true-believer-realizing-he's-been-duped about-face. Treacherous, these trolls  |
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... it isn't inferior to FIAT money at all. Which currency is still backed by Gold? Gold's inherent value isn't that hight, anyways!
What people on bitcointalk call fiat* hasn't been backed by gold for quite some time. The word means "a command or act of will that creates something without or as if without further effort."Fiat is backed by governments, by decree. It's backed by nothing else. *All lowercase letters, BTW. FIAT is a car company, all caps 'coz it's an acronym--either for Fabbrica Italiana Automobili Torino, or Fix It Again, Tony--depending on who you ask. And another thing, you rotten kids! Stay off my lawn!!!!  |
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Wonder if bitcoin_is_a_mirage is a new incarnation of fallllllllllling. New tact of "ooo watch out all your coins will be stolen" instead of "abandon all hope price will be 50 cents next week"
And you, n00b a little too fluent in bitcointalk lore! I know your sort, Mr "I'm totally not falllling 'coz I hate on fallllling!"  |
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I'm hoping that with the amount of bitcoin I own, I will become a whale in say 3+ years...
Just don't turn into one of these ... bear whale manipulators... Those are almost as bad as bear wale manipulators with bees! |
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I take your example to mean that the bitcoin price is a product of consumer/speculator demand. But that also consumer/speculator demand is also a product of the price? Unlike the baker scenario.. And that falling bitcoin prices may in fact reduce demand for bitcoins?
In the same sense as special relativity suggests that light is fast, yeah. |
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I try to be as clear as possible on the first pass. What, specifically, would you like to have clarified?
just how tasty was the cupcake, did it have some rum in it? Pure yumolium. As long as you don't ruin it with Mc.D coffee. That stuff is undrinkable, and I buy those gigantic "40 Miler" styrofoam cups at exit ramp gas stations and never complain. If you HAVE TO buy Mc.D coffee, either cut it with 1/3rd milk, or ask for a cup of ice, pour off 1/4 of the coffee, and dump the ice in. (Mc.D ice cubes taste just like their water--awful. But it's the same awful all across US. I suspect it's a special additive they use to make their water boil at 200 degrees C, and make their coffee possible. |
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Seems that many in this thread are trading like I do my best not to do, something like this:
"I know the market should be doing X, and it's clearly not. I know that I'm right and the market is wrong, so I'll just ignore it until it does X like I know it should."
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I try to be as clear as possible on the first pass. What, specifically, would you like to have clarified?
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You got a lot of explainin' to do, ChartBuddy |
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... There is no consumer or speculator, they are one and the same. ... Wait, did you miss this? If you disagree with something, feel free to point it out. Simply saying "there is no difference" is no better than saying NO U!1! ... I am curious. Are you saying you don't think consumer demand is sufficient to drive bitcoin (price) longterm? Why?
Yes, if we start with the following premises: A. The current exchange rate is the product of consumer demand, and not speculation. By "consumers" I mean the people using Bitcoin as money, not to speculate on its long-term worth. B. The demand will continue to increase. I'm saying neither (A) nor (B) are necessarily true, (A) partially due to supply/demand being kinda misused in the case of Bitcoin. Think about it like this: 1. A baker bakes cakes. 2. You like delicious cakes, they're delicious. 3. There are others who like delicious cakes. 4. The baker keeps raising his cake price until, when he closes up for the night, he has no leftover cakes, but just barely.* Classic supply/demand relationship, right? Here's the good part: (2) above could be seen as a constant. The cake is just as delicious (and desirable) regardless of what the baker charges. If the baker doubles his price, you are not going to want the cake twice as much, right? Not so with Bitcoin. To a speculator, 1 BTC is twice as valuable when its exchange rate doubles. That's why it's important that most Bitcoin holders are speculators and not typical consumers like cake_eaters. See my point? TL;DR: Bitcoin is not goods. It has neither intrinsic value nor is it subject to the classic supply/demand interpretations....
*assuming that selling out every day = max profit, not necessarily true if there are cake addicts, let's say, who'll pay anything for their pastry fix. But that's a tangent. edits... |
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It's not *that* simple, "Speculators" implies some fraction who are in it for short term fiat profits.
As the price of bitcoin rises there is a corresponding increase in the likelihood of a speculator deciding to sell.
It's not simple, but speculators don't need to be daytraders. Many hodlers on this forum, the ones speculating on exchange rate going to the moon, are hoarding and holding. They contribute to the "scarcity," but not in the same way a consumer would. And even day traders, for the time they're in bitcoin, aren't essentially different from long-term holders. The only difference is the timespan. The speculators who are in it for Bitcoin, not fiat profit, simply buy BTC low and sell high, thus amassing more coin. The unit of account is whatever you chose. |
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TL;DR: Bitcoin is not goods. It has neither intrinsic value nor is it subject to the classic supply/demand interpretations.
I would argue that the average user who is interested in buying bitcoin solely to spend, has absolutely no idea what the exchange rate of a bitcoin should be. Really? I haven't met anyone like that since SilkRoad got shuttered. Most places accepting Bitcoin set their prices in dollars, so the folks you're talking about should care about the exchange rate But that's not my point. My point is Bitcoin exchange rate is determined by traders, which [to me] is obvious. Those weird ones who don't care about the exchange rate, other than being ..."unusual," have little to do with exchange rate. |
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... I am curious. Are you saying you don't think consumer demand is sufficient to drive bitcoin (price) longterm? Why?
Yes, if we start with the following premises: A. The current exchange rate is the product of consumer demand, and not speculation. By "consumers" I mean the people using Bitcoin as money, not to speculate on its long-term worth. B. The demand will continue to increase. I'm saying neither (A) nor (B) are necessarily true, (A) partially due to supply/demand being kinda misused in the case of Bitcoin. Think about it like this: 1. A baker bakes cakes. 2. You like delicious cakes, they're delicious. 3. There are others who like delicious cakes. 4. The baker keeps raising his cake price until, when he closes up for the night, he has no leftover cakes, but just barely.* Classic supply/demand relationship, right? Here's the good part: (2) above could be seen as a constant. The cake is just as delicious (and desirable) regardless of what the baker charges. If the baker doubles his price, you are not going to want the cake twice as much, right? Not so with Bitcoin. To a speculator, 1 BTC is twice as valuable when its exchange rate doubles. That's why it's important that most Bitcoin holders are speculators and not typical consumers like cake_eaters. See my point? TL;DR: Bitcoin is not goods. It has neither intrinsic value nor is it subject to the classic supply/demand interpretations....
*assuming that selling out every day = max profit, not necessarily true if there are cake addicts, let's say, who'll pay anything for their pastry fix. But that's a tangent. edits... |
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... WTF, they say central banks are not involved in the creation of bitcoin. You know what they said about official denial! Then it's often true  Bitcoin is internet money, impossible without it. Who brought us internet? Thaaat's right, DARPA. And who funds DARPA? You got it, the gubermint. And whose bitch is the gubermint? The bankers', that's whose! 100% banksters' trick! |
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... There may be no direct causal relationship. But a hugely rising (or falling) number of users transacting in bitcoin will obviously exert pressure on the exchange price.  ... I'm bearish, but I'm also not shorting. I honestly haven't been able to read BTC market like I once could. So if forced to TL;DR, I'd say: The bulk of BTC users are speculators. BTC exchange rate is ultimately determined by their sentiment and trading strategies.<==seems self-evident to me Over the last year, bigger, tougher, smarter kids started playing in our sandbox. I can't compete--trading I do now amounts to little more than gambling. Something like that. Do you mind me asking if you are holding bitcoin or sat on the sidelines in cash? Not at all, but how would you interpret the answer considering that speculation is a competitive, not cooperative, game? (But it's "both," as I'm sure is the case with most people here.) I hold less BTC than I once did, take that for what it's worth (zilch). Interesting that you feel the market movements have changed in some way due to new participants, especially as volatility has reduced?
You would expect the volatility to increase? Why? It takes a much smarter trader to make money in a market with low volatility. I suppose the price is ultimately determined by supply and demand. That is supply from miners, genuine sellers and speculators, versus demand from new and veteran consumer buying. The shifts in balance determine the short term price trends. In such a thinly traded market my view is also that currently sentiment is hugely important as speculation probably has a major role in price discovery*.
The problem is the supply/demand relationship is biconditional, A <-> B. Bitcoin has little intrinsic value. The value of 1 BTC would be close to nothing if there was no user base, no Bitcoin network. The network effect cuts both ways--a telephone set's value grows when more people get phones, but it drops when fewer people have them. Agreed? That said, overall mining supply and consumer demand should drive the price in the longer term which is evident in charts going back several years. Will it continue? I think so.
If I thought so too, and was reasonably sure of it, holding BTC long-term would be a no-brainer. It's obviously not (for me). I am not bothered particularly by short term volatility in the price otherwise I would have sold long ago (and been considerably better off from my bitcoin holdings). The very fact that silicon valley is rapidly integrating bitcoin into everything for what is really a tiny global userbase tells me big business wants bitcoin to succeed.
Big business sees potential profits in Bitcoin. This doesn't translate into "big business wants Bitcoin to succeed" (for me). * i am very busy with my day job but i have for a long time wanted to create a script to scrape the this forum and perform some sentiment analysis to generate some statistics to compare with the exchange rate and google trends etc.
Would be neat, any specific ideas on what sort of data you'll be looking for? I wouldn't know where to start. |
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BTC is for the poor, not the rich. I travel to india quite a bit, and people there are just starting to get it. 6 -12 month fluctuations are irrelevant. It's time is coming, in the short term in may not make a bunch of lazy assholes super rich like they were planning, but it will full fill its promise.
Please understand that if not for those lazy assholes, 1 BTC would be worth pennies at most. That would be [arguably] good for Bitcoin, but I suspect YOU wouldn't want that to happen, amirite? |
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I'm one of many miners not selling at a loss but did have to reduce hash rate to stay profitable...
When you say "profitable," do you mean to say it costs you less in electricity to mine a coin than you could get for it at the current exchange rate? If so, what do you mean by "not selling at a loss"? yes, he is saying that it is still cheaper to mine. not for too long, because by undervolting/underclocking his gear and he is squeezing it. but only because he is paying electricity 0.13 $/kWh. there are a lot of places on earth with cheap 0.06 $/kWh. Then I'm confused about the "not selling at a loss" bit. If it's cheaper for him to mine, then he's "not selling at a profit." Or does "profit" mean recouping the money from the hardware investment? |
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... There may be no direct causal relationship. But a hugely rising (or falling) number of users transacting in bitcoin will obviously exert pressure on the exchange price. ... I'm bearish, but I'm also not shorting. I honestly haven't been able to read BTC market like I once could. So if forced to TL;DR, I'd say: The bulk of BTC users are speculators. BTC exchange rate is ultimately determined by their sentiment and trading strategies.<==seems self-evident to me Over the last year, bigger, tougher, smarter kids started playing in our sandbox. I can't compete--trading I do now amounts to little more than gambling. Something like that. |
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^Gotcha. Neither one of us thinks that there is a causal relationship between user adoption and BTC exchange rates.
We agree that all arguments extrapolating higher BTC exchange rate because greater adoption are nonsense.
We're good. Sorry about the misunderstanding.
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You do understand that consumer adoption follows media exposure, right?
So, just to eliminate any doubt in my mind, since last year we had: 1. Increasing media exposure. 2. Increasing adoption. 3. Falling exchange rate. ∴ If (1) and (2) continue, the exchange rate is going to continue on its present trajectory, i.e. falling. I don't remember using the word price in that sentence. I don't remember using the word "price" in this entire thread. What made you bring it up? I would say personally that adoption is lagging compared to merchant integration, and speculators are selling more than buying resulting in us being at the bottom of a bear market. I think merchant adoption is actually largely irrelevant to the price at current levels of trade.
User adoption is rising and once the price turns and heads back up past 800 a new larger tranche of users will discover how easy it is to buy, save and use bitcoin. They and you will drive the next bubble. As you well know it is a price cycle - not a strict mathematical formula.
Are you saying that user adoption is driven by the price (higher BTC exchange rate will cause greater adoption), and not vice versa? If so, I'd say you're in the minority. Your points would have been equally valid last year after the run to 266 and dive to 60, for a time. Shortly afterward they became very wrong indeed, as I suspect they will again.
I posted a list of [what I believe to be facts], (1) through (3), and a conclusion following from the premise that BTC exchange rate was in a causal relationship with (2). Like so: A -> B ~B A ∴ ~(A -> B) ...so not sure what you mean by "your point." What point do you think I'm trying to make? |
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