You're missing the point. This is not about Bitcoin, this is about any speculative bubble. It could be Ponzi tulips or housing or anything. If nobody sold, the price would go up forever. I've clarified in the next post that some selling can occur at the same time.

You're also in another place semantically than I am. I am talking strictly about BTCUSD. People could use BTC to buy food, as long as BTC selling for USD is controlled and the BTFATH narrative does not stop. BTCUSD would still go up forever.

Arbitrage you say? Arbitrage is not realized in that case, only a massive, massive carry trade. From another point of view: say there's 1000 paper pUSD printed, and about 100k dUSD in zero maturity debt. Supposedly 1 pUSD = 1 dUSD because they're (mostly) fungible. If nobody lost faith in the credit system there would be no run on paper and thus they would stay fungible (even with the gross difference in total money). It is only when liquidity disappears (i.e. when players do not trust the "all algos buy mode" narrative) that the fungibility is lost.

The moral is, one exponential growth completely trumps any lesser exponential growth. Just like Bitcoin blocks have a consistent average of 6-7 minutes instead of 10 for a while now because hashrate grows exponentially, difficulty grows exponentially with the same rate, but delayed a bit. You could extract money from the market as arbitrage constantly, without changing the price ratios in the process. Like a free lunch, if it went up forever. Just like in a hotel with countable rooms, even if the hotel is full you can free a room for a new guest. Or for a thousand. Or for countably many. There's always room in that hotel. There's always juice to extract with arbitrage. In practice, both strategies (hotel, arbitrage) fail when your support ceases to be unbounded so it doesn't feel infinite anymore. That's when people panic.

The real problem is the communication in this untrustful cooperation game. The feedback cycles are powerful enough to be able to move the price anywhere, except in a catastrophic collapse of communication (i.e. Gox megalag, China "banning" Bitcoin, etc). The narrative weakens as the run is extending and some conservative investors pull out etc, then there is a brief moment of silence and there is a phase shift similar to a supercritical crystal collapse. Now it's all vibrating at resonance, in a fragile state of low entropy, then sudden quiet. One second/minute/week later, everybody realises that confusion has set in and pull the lever. The crystal is now shattered at a micro level, in a high entropy state. Work needs to be spent for nucleation to happen again.

I find it more worrisome that they all seem to have a massive fetish with the interpol and DoJ and whatever satanic imagery. The identity blur between various parties makes it worse in this respect. If I had my tinfoil had within reach I would suggest some Police wants to turn Gox into a honey pot? I though they might be interested in personal data of users but seriously, that shit was leaked for 200 BTC or something like that. Surely TPTB have a backup to that, in case of multiple unrelated catastrophic storage failure, certainly.

I believe you are naive in your dismissal. Most if not all fresh mined coins are bought over the counter through long-term contracts. Merchants don't depress the market because hodlers are not suddenly buying all they can buy with Bitcoin. The YEN is inflating fast too, but it's not going down relative to the USD. The higher BTC goes the fewer BTC the hodlers need to sell. And so on. Actually, why would any hodler sell now unless he was squeezed somewhere else?

Markets have two regimes, depending on whether the majority is investors or speculators. In a 100% speculator market where a few large players collude, the price can move up while the cartel is unloading or otherwise ("manipulation"). The cartel can offer a global implicit put ("bailout"). A bubble only breaks when the common knowledge that the price goes up forever starts to falter. When enough players doubt, the market reverses suddenly into the same behaviour, but down.

The point is that, again, if nobody sells then the price goes up forever. It is not even necessary that nobody sells. The unstable equilibrium between the attractors requires that volume goes down as 1/x if you have a fixed amount of cash in the system. Exchange fees simply move the equilibrium to a narrower function, like 1/x^2.

You sound like an excellent player of the game, but you do not, or pretend not to understand how to play the players. In a speculator market like BTC, alts, stocks and everything now, stocks in the 20's, there is no fair value. There is no correct price. It is all a coordination game. I seriously doubt you actually ignore that the other players are strategic too. There are times when that assumption works, but that is not the case now.

I believe you know exactly what I'm talking about and that you're talking your books with no pretense for objectivity (which was established to be the correct behaviour earlier).

Grandpa has some serious lag. They must still be seeing The Gox at 1000$/BTC in order to feel so... pumped.

This is not true. It is not strictly true that you need new money to revisit ATHs. If nobody sells, the price goes up forever. The trick is how to convince everybody that nobody else will panic. This is exactly what the West CBs attempt now.

Mixed the pills again grandpa?

That is the Quadrillion Dollar question. There are many arguments for and against, and this is just a lazy hash of my thought on the matter.

It can be argued FOR, that Bitcoin effectively acts as an inflation hedge and so a war in Europe would be solid fuel boosters to take us out of the atmosphere. The counter-argument is that gold and silver are going down even with QE4ever in full throttle and that the same causes  can depress Bitcoin similarly.

It can also be argued AGAINST, that Bitcoin is still mostly considered a very high risk speculative asset (one vote per fiat unit invested) and so, if the whole worldwide Ponzi collapses then it will be one of the first to see investors selling to cover other failing investments, with the usual speculator/momentum component for some spectacular Bitcoin-style oomph. This is supported by the observation that metals fell when the crash in 2008 really hit the markets. The counter-argument is that Bitcoin is not really metal but a new asset class because... well, google "internet"..., and as such, when money rushes to the exits, more money rushes into Bitcoin than rushes out, with some hysteresis of course.

If you asked me, without pretending to really understand the forces at play, I believe we will go down, then (possibly all the way) up, so it is viable to keep buying on the way down as long as you are not leveraged and you can afford to lose all in a black swan Bitcoin failure. I also believe that in the Bitcoin economy, most bears are bulls incognito.



But completely hijacking the conversation, I posted earlier a link to another thread about Sunlot and you-cannot-make-this-shit-up shenanigans. I got a few rightfully concerned replies, but no real discussion. Does nobody care? I think it's a serious indirect risk to the Bitcoin economy...

I understand that mah87 is on everyone's ignore list but...

...Ven Currency founder Stan Stalnaker informed delegates that at a recent meeting with US watchdogs he was told that FinCen and Treasury experts expect bitcoin to be one of the world's top 20 currencies within 20 years.

In a later panel, investor Udayan Goyal made the boldest prediction of the day: that crypto-currencies will kill Swift within three years. To back up his claim, Goyal used the example of Fidor Bank, which now uses Ripple to move money between three countries without even touching Swift...

Indeed.

Poland http://www.zerohedge.com/news/2013-09-06/poland-confiscates-half-private-pension-funds-cut-sovereign-debt-load
Apparently soon to come to a bank near you in the US/UK/EU

I think many did. But then other things happened out of Cyprus as well, not least the Neo/Bee failwagen.

I've started to believe Cyprus was mostly bail-in beta and moving some oil-igarch money to London/Berlin. I don't think any meaningful regulation changed.

Police is an institution, like State or Law or Church. From the Gendarmery to the SS or Three-Letter-Acronym-Agencies. They are state mandated violence (not debating right or wrong here).

I don't think there's anything remarkable about Cyprus. It's just the perfect place to run a hit-and-run money operation and that's why EVERYONE uses Cyprus.

The non-statist version: https://bitcointalk.org/index.php?topic=590970.0

Looks like the plan IS to get the police in.

This comment is retarded. If companies are considered economic entities on their own, independent of the humans who run them, why wouldn't your fridge be an economic entity on its own, independent of the humans it runs for? Why wouldn't people's t-shirts make them money by displaying ads? Each t-shirt would likely have its own wallet. Bitcoin injects steroids into ubiquitous computing.

So given how this thread is always on-topic, I would like to hear a few reasons for and against NXT, if you ladies and gentlemen have an opinion on the matter.

Troll harder. Even grandpa can see the functional traffic lights in there. If anything, you prove people do dumb shit when presented with traffic lights.

Relax, I'm running a usable Windows 7 in a vBox on unusable Debian. That's the spirit. If you respect real security practices, you only browse with Lynx on handmade hardware

Let me say I didn't manage to actually RUN the simulation. Chrome does not know Java is installed, tried installing it from Chrome's install link and nothing. Opera, Firefox and IE(!) know it's installed but is apparently blocked by some security setting SOMEWHERE because the code isn't signed. (IE didn't even know that, only reported SecurityException's). Found the option in Java settings (Control Panel, i know i know) and set it to "lowest" which apparently means only a allow/block prompt for unsigned code. Now none of the browsers is able to put the goddam parameters in the applet so I get some "height = 0" exception. What the fuck, man? Is Java completely dead like ActiveX already?

To each their own, that's 10 seconds (more in practice) for every intersection you ever drive through. It adds up. Also, I'm much more annoyed by traffic lights waiting than, say, crowded and slowish traffic.

EDIT: to continue the circle jerk with an actual example of real and not simulated traffic light masturbation

http://www.ziarmm.ro/wp-content/uploads/2013/10/semafor-stupid-gold-plaza-baia-mare.jpg

So many people do not understand freedom. You're not free when you can do something. You're free when you can do whatever you want, no questions asked, unless you break someone else's freedom. Since there are always petty conflicts of interests (smokers vs non-smokers), apply tolerance. If you don't like something, it's generally you who should adapt/avoid.

Wisdom: 100% from concentrate

Incentives are EVERYTHING; people need to understand that they cannot assume everyone (most others) to be truthful and that if they align incentives in a game-theoretical setting everyone (each and all) is better off, with the exception of the parasites and the myopic, who are better off in a system that is so easy to game

Prisoners' dilemma is not realistic because that logic only works in one-time games. Society is a repeated game, and someone who defects most of the time is going to lose. If the majority defects most of the time, collusion will appear in which the cooperating minority cooperates inside the group and becomes better. Tit-for-tat (cooperate first) is a surprisingly excellent strategy. Very few non-colluding strategies can do better. The only collusion strategy that does way better is master-slaves. Trust me, 99% of the cases people invoke prisoners' dilemma they use it wrong. If anything, it proves how "unenlightened self-interest" (economic rationality) is dumb and suboptimal compared to "enlightened self-interest" (economic super-rationality).

It is similar to the implications of Godel's theorems. A Turing machine cannot transcend its condition, but mathematicians are not Turing machine. Guess what, neither machine learning is Turing-limited because it is computation in the limit. Don't be the Turing machine in society.

Regarding 2, yes, that is a problem. I do not believe it is a fatal problem, because there exist Pareto superior options almost always. Just like (artifical example) VCG auctions make everybody be truthful (barring collusion).