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1  Other / Beginners & Help / Re: Buy low/ sell high or buy and hold? on: November 23, 2013, 11:13:27 AM
Trading is one of the hardest professions on the planet.  Hard because there is never enough good data to make a decision on, and hard because it is psychologically very tough.  Your brain will tell you it's seen enough data, and it's time to buy or sell.

By your own admission, you ask 'will I make MORE money' ?   This contains the implicit assumption that you will make money with either of your two strategies. 

If you read the net, you will find endless people drawing technical charts telling you why the price will go up / down next.  I wouldn't trust them very far.  I wouldn't trust them.  Or your own eyes.

You will also find that those that have made money, shout louder than those who have lost it.  Hell, if you read the net, you will find enough stories about playing roulette to believe you can win.

My advice : Download as much data as you can, build some simple models and fit them.  In particular try to compute confidence intervals on your parameters.  Try to use as few parameters as possible . 2 or 3 max.   Consider any rule like 'don't buy on friday' a parameter.

Test your model.  Add in realistic transaction costs.  If your resulting profit-and-loss stream time series differs much from a random walk then you might be onto something.

Personally : I believe you can make money out of bitcoin.  But I wouldn't trade it.  Too damn expensive.
2  Bitcoin / Bitcoin Discussion / Re: No Chargebacks; All Transactions Final: Won't Fly. on: November 18, 2013, 08:53:22 AM
Another aspect of bitcoin, is that it may mature into the low-level payment system for the planet, with a higher-level payment system (which has chargebacks etc) layered on top by financial institutions.  How does this work ?

Well TCP/IP , the protocol that runs the Internet delivers packets with a guarantee of delivery.  It's implemented by TCP layered on top of IP which delivers packets with no such guarantee.  It's technically hard to jump to the second layer in one go, much easier, more robust and flexible to build IP first, then add the TCP to produce a reliable system.

The real world of banking has a payment system.  In the UK it's mediated by the clearing banks.  It is not transactional, and has some pretty serious flaws in it (which the banks largely deny).  Bitcoin could be a feasible replacement for such a service.

This is not to say that bitcoin cannot do the higher-level work to, but at the bedrock of finance, a non-reversible, transactional system is essential.






3  Other / Off-topic / Re: Your favorite video games of all time. on: November 17, 2013, 11:24:28 PM
Trivial Pursuit.  (Domark / Oxford Digital Enterprises).

It was was one of the best-selling games ever (measured by market-share) and continued to sell well many years.

Probably unheard of now -- but it represented ground-breaking use of the hardware to get all of the questions and game onto a single disk.  Even the machine code was compressed and decompressed at run time to get it all packed in.

The result was magical.
4  Other / Meta / Re: Watch out for fishing PMs! on: November 17, 2013, 11:17:06 PM
Good kattch
5  Economy / Speculation / The trouble with tribbles on: November 17, 2013, 11:14:18 PM
This exponential growth reminds me of the tribbles on the Enterprise. 

I'd better shut up though or the chartists will start getting excited about Fibonacci thingys.

6  Bitcoin / Bitcoin Discussion / Zero-sum arguments on: November 17, 2013, 10:52:27 PM
A lot of smart people are worried about Bitcoin's increasing importance and value.  They worry that all bitcoin is doing is simply taking money from elsewhere in a speculative frenzy, chasing what is an irrational bubble.

In particular they use the classic zero-sum argument that says that for whoever makes $1 from bitcoin, someone else has lost $1.

Well, in pure accounting terms this is true.  But if Bitcoin represents a beneficial new paradigm in global finance ( and the world certainly needs one!) , then Bitcoin can be adding economic value to the world. 

How does this work ?  Just like any company that builds a better mouse-trap.  People rush to use the new product as it uses less resources than before.  The surplus economic resources represent true global profit.




7  Economy / Speculation / Re: What happens when Hedge Fund managers get involved? on: November 17, 2013, 10:38:59 PM
Short selling requires someone to lend you bitcoins to sell. 

An exchange might allow it  -- i.e. accept your order and execute it, but Bitcoins would actually have to be delivered by someone -- possibly the exchange.

There's nothing special about hedge-funds shorting stuff, except that they like to do it , and have deep enough risk pockets to do it in reasonable size. 

Any decent sized hedge-fund has a pretty strict set of assets that can be traded.  I'm not aware of any big funds that have bitcoin on those lists -- but if the funds and trusts arrive as promised, many hedge-funds will be able to trade them simply as they are listed-shares.

It would be very beneficial to have someone lending bitcoins to allow shorting  -- it brings stability and liquidity to a market.


The only real problem is that there are not enough coins to go around at current prices -- but this was always true.



8  Bitcoin / Bitcoin Discussion / sub-units of Bitcoin on: November 13, 2013, 04:56:22 PM
There is a need for better notation, that doesn't get out of date fast.  millis, and micros etc are too awkward.

My suggestion for how to describe sub-units of coins is to use Log10 notation:

BTC1 = 1 Bitcoin  (The existing format)

1BTC1 = 0.1 Bitcoin (i.e. 10^-1)
2BTC1 = 0.01 Bitcoin (i.e. 10^-2)

etc.etc.

In this way 8BTC1 = 1 Satoshi

So, for example if you wanted to sell something for 0.0075 bitcoins you would say 3BTC7.5  or 4BTC75



9  Economy / Speculation / Potted history of bitcoin price on: November 04, 2013, 07:46:34 PM
This log-price plot of the GOX price since inception is quite remarkable  -- showing an incredibly uniform growth.

It's not speculation  or predictive :  but what it does effectively is express the data about the two axes (time and price) in a way such that the major events can clearly be seen.

If one assumes the uniform growth continues then it does become speculative -- but that is a matter of interpretation.

10  Bitcoin / Bitcoin Discussion / Re: Bitcoin Canary on: September 13, 2013, 05:30:50 PM
That's great -- didn't realise all that was out there. Thanks.
11  Bitcoin / Bitcoin Discussion / Re: Bitcoin Canary on: September 13, 2013, 03:42:11 PM
but the point is to create a central point for everyone to see and watch -- and entice a whistle-blower.  If the central point is not reasonably unique, a breach could easily be fabricated.  With time, a site like this would grow in strength to demonstrate the security of the system.
12  Bitcoin / Bitcoin Discussion / Bitcoin Canary on: September 13, 2013, 03:31:26 PM
Why do we not create a web-site encouraging someone to crack a specific public-key ?

If there is someone at the NSA who wishes to communicate this ability, then they can do so anonymously by simply emptying the wallet. (given Snowden, and Manning, this is highly likely).

There are two outcomes :

1.Wallet is emptied --> someone cracked it, OR the wallet creator moved the money. 

2.Wallet remains untouched.  Either the NSA cannot do it, OR no-one wants to tell.


The ideal scenario is that (2) persists, and maybe members of the bitcoin add tiny chunks of change to the wallet to 'feed the canary' to keep it happy (along with the Bitcoin community).

If the initial key was created at a conference between a large group of people we could reasonably expect to 'lose' the private key.

All we need is a nice website, advertising the challenge,  and promoting an ever-aging, fattening yellow canary , which keeps the miners (just like old times!) and public safe.
13  Bitcoin / Bitcoin Discussion / Bitcoin saving the World : Project Drax on: April 21, 2013, 09:23:31 PM
http://www.spaceguarduk.com/drax/drax-funding/donate-to-project-drax

Asteroids and comets often hit the Earth.  Normally these are small, and cause no damage, but occasionally an object large enough to put the future of the Human race at risk hits the planet.  This has often happened in the past, and will happen again.
 
The Spaceguard Centre has developed a robotic telescope system that is optimised for tracking potentially hazardous asteroids, but we need a wide-field surveillance system. Recently the Institute of Astronomy in Cambridge decided to decommission its wide-field Schmidt Camera, an ideal system for us.  Rather than breaking up the telescope they have gifted the instrument to the Spaceguard Centre.
 
Because the British government is playing no part in asteroid detection or tracking public funding is not available for the project, so we have decided to go ahead on our own, building a dome to house the telescope and upgrading the imaging system.  Any donation (however small) is enormously useful a brick costs 50p and we need 6490 of them!  We are making excellent progress, so many thanks to those who have already helped us.


http://www.spaceguarduk.com/drax/drax-funding/donate-to-project-drax
14  Economy / Service Discussion / Re: Mtgox claim officially turned bitcoin into Ponzi on: April 14, 2013, 09:28:25 AM
I see the quotation 'will rise again' to be more of the biblical type, meaning that it will not die.
15  Bitcoin / Bitcoin Discussion / Bitcoin spotting Asteroids on: April 13, 2013, 03:04:29 PM
A big thank you to the Bitcoin community for contributing over $80 to Project Drax at The Spaceguard Centre.

This has bought over 100 bricks for the new telescope building.  When complete, this will be the biggest telescope in Wales and dedicated to surveying Potentially Hazardous Asteroids.

http://www.spaceguarduk.com/

Please note that the wallet address has changed for donations to : 19Q6tA7NtcbvUDHeUg3gzbF4VHU2XHKD76


We are now starting to think about the CCD device that will be required -- the image forms on a concave 6-inch circular disk.  Most likely this will be a mosaic of chips.  It is going to be somewhat expensive !




16  Economy / Service Discussion / Re: Suddenly MtGox has an invalid https certificate on: April 12, 2013, 03:32:45 PM
Update : Now it is signed by Verisign -- it was briefly signed by 'British Telecom' -- which was untrusted.  I have a .PNG of this if anyone wants to see it.

17  Economy / Service Discussion / Suddenly MtGox has an invalid https certificate on: April 12, 2013, 03:30:10 PM
Suddenly my browser does not like the Gox certificate.  Is someone spoofing Gox ?

18  Economy / Service Discussion / exchange problems on: April 12, 2013, 11:33:49 AM
The lesson we are repeatedly and painfully learning is that Gox is simply not up to the job.  It is easy to run an exchange when times are calm, but when things get rough , you need an exchange that does not simply go opaque.

One solution is to copy traditional markets , suspend trading , and re-build the order book over say 15 minutes to find the new equilibrium price, this 'volatility auction' finishing at some random time after the 15 minutes.

Personally I think the community needs to fund not one, but say three new exchanges which should have widely shared ownership, and compete against each other for business.

This would then allow one , or even two exchanges to periodically close to perform maintenance -- something that must cause Gox all manner of problems.



19  Economy / Speculation / Re: Gox Owes Me Coins. on: April 12, 2013, 11:27:04 AM
New orders are immediately queued in a FIFO queue -- which is a very cheap operation.

They are then taken out of this queue, and matched in the orderbook.

When this queue is very long, there is a considerable delay between submitting your order and, that order getting matched, so it can appear that (for example) the market price is well bid at $150 , you submit a 'sell at $130$ order, and then you see the market trade at $100, your order not executed.


Gox need to indicate WHEN there is a fast-market , and ideally estimate and publish the lag.

20  Other / Off-topic / Re: Do you think the Queen is buying up Bitcoins? on: April 12, 2013, 11:13:47 AM
She is a great deal more than just The Queen of England ( & Wales,which is strictly speaking , a principality )

She is head of the UK and 15 other Commonwealth States.


However, I would be concerned if my picture and authorised signature (chief cashier) appeared on a bank-note along with a long dead promise.


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