If I had to pick the lowest possible bottom, no matter how unlikely... I'd probably put it at $200/BTC.

Now, do I actually think it'll go that low? No, of course not. $200/BTC is a ridiculous number. Bitcoin prices have never dropped that steeply before. The worst bear market we've ever had was a 90% drop. More generally, the nadir of a bear market in BTC strongly resists crossing below the peak of the previous cycle's bull market; that would imply that $15k-$20k/BTC is a more "reasonable" floor.

But if we go beyond "reasonable" and into "possible at all"... consider the sentiment that followed the 2013 bubble. This was the first time a Bitcoin bull market made it into the local newspaper. This was the first time people were sounding the alarm in a serious way about the carbon footprint of PoW. The biggest Bitcoin exchange had just closed its doors after being "hacked" (and then revealed to have been a bucket shop). And then we had a year and a half of bear market before stabilizing at $250 - a downward trend longer than the project had ever seen before.

The argument against a $15k/BTC pricepoint is mostly based on technicals - it requires us to assume that numbers on a chart will move the way they moved before.

But the argument against a $150/BTC pricepoint is based on sentiment and fundamentals - it only fails if there's some type of news worse for Bitcoin than the news was in 2014-15, and I can't think of any news that would meet that standard without destroying the ability to transfer a bitcoin at all (in which case price would be meaningless).

So if you want the "absolute bottom" - the "lowest possible price", even if it's only barely plausible - then that's where I'd point.

I think I am misunderstanding this thread.

I thought "Bitcoin maximalism" was the ideology that "people who use altcoins are enemies of Bitcoin", not any of the things OP is talking about.

The last time I saw that number - $300k/BTC - was in 2013. There was a European silver salesman on here who calculated it based on what you'd get if you tried to fit the "market cap" (to use the term loosely) of gold into BTC.

At the time, the exchange rate's all time high was $260/BTC. It was easy, then, to dismiss the idea - a 1000x appreciation - as the sort of fever dream that bulls tend to get amidst the euphoria of bubble conditions.

It's a surreal experience to see numbers like that again today, when that "1000x appreciation" is more like "12x appreciation". All of a sudden it's a bit harder to dismiss.

Well, if you were waiting for CoinMarketCap you can break out the champagne now

It's considered normal income & uses the normal income tax rate. Federally it's anywhere from 10% to 37% marginal depending on your income. Then there's state income taxes added on, which can be anything from 0% (Washington) to 13.3% (California).

(I am not a CPA, etc)

Peercoin had two weaknesses that Eth2 does not.

1) Nothing at Stake resistance. Eth2's "weak subjectivity" assumption isn't the dealbreaker that PoW partisans tend to see it as IMO. In particular, it's not clear that PoW coins don't have weak subjectivity, thanks to the influence of exchanges on "deciding" which chain is exchangeable for money in the event of a deep enough reorg. Meanwhile, Peercoin devs (AFAICT) dismissed N@S as a "purely theoretical attack" and refused to take any effort defending against it.

2) Peercoin's sole interesting feature was PoS; Ethereum has a bunch of other features which make it interesting even without it getting the scalability benefits of sharded Casper FFG.

If/when Eth2 launches, and if/when it's been in production long for people to be confident in its stability, I think it has a lot of upside potential.

A working, major Proof of Stake implementation is a big deal.
It answers one of the most salient arguments against broad cryptocurrency adoption these days: the effects of PoW-based mining on the environment.

And Ethereum already has a lot going for it in terms of features (autowallets, Tornado-based private transactions, the ERC20 sea...) whether or not it can make PoS work.

I'm not sure this logic holds for Ethereum; it's already been through one high-profile fork where the "new" coin surpassed the old one. If Eth2 works, my best guess is that those on the Eth1 side who refuse to adopt the two-way peg with Eth2 will eventually be frozen out by the Ice Age; to escape that, they'd have to write a fork of their own, which will make it harder to call themselves really "Ethereum".

This type of thing is easy to joke about, and I definitely bought my share of thousand dollar cookies.

But I think it's important to remember that by buying those sandwiches and pizzas - and buying them with BTC, not by converting to cash first - early adopters paved the way psychologically for people to believe that BTC are actually worth something. Who knows whether the bitcoins that bought those things would really be worth that much now if they hadn't been spent?

Here I am in the Wall Observer thread in November 2020, when for the first time in quite a while, it seems there's some significant Walls to Observe.


Lots of folks wanting to cash in now that we're near ATHs again it seems ^_^

Seems so.

Ever since Bitcoinica I've been sort of leery of operations that use Bitcoin and other cryptocurrency to synthesize weird financial derivatives, so I can't exactly say that I'm bullish on Ethereum's DeFi story in particular.

But the general ability to do other interesting Ethereum autowallet/smart contract stuff with bitcoins is very tempting, and it's nice that there's an alternative to WBTC gaining traction to allow bitcoins into that execution environment. Almost like Ethereum doing the job of an L2/sidechain on top of Bitcoin.

I wish the Ren people were more specific about how RenVM "generates" the private keys to sign off on releasing escrowed bitcoins, though. They claim it's trustless, but Bitcoin sigscripts are simplistic enough that making that true would take some seriously clever tech.

If we're going to be honest... then probably nothing, because I'm not confident enough in timing the market to either buy or sell at that particular price.

But if I was the kind of person to bet on this stuff, I think I'd consider buying a straddle option.

Given the history, I somehow doubt the price would stay at $20k for long - judging by past behavior of this market, I'd be more likely to expect that either there'd be a new ATH and bull would officially be back in season, or it'd "fail to break through" and a bunch of old money would push the price down by realizing their gains.

If I could find one at a reasonable price, a straddle seems like the right tool to make a bet on that outcome.

This is a more interesting question.

I think it's a good idea; having a plan makes it easier to keep a level head in a volatile market like this.
But I think having a price in mind is not enough - deciding how much you will sell at that price is just as important.

I don't think it makes sense to have a price to sell 100% of your BTC at, if you are not here purely for trading. I used to post "current money or bust" a lot on these forums. These days, I'm less confident that BTC is shaped properly to become "current money" (i.e., something that circulates like cash and can be used as such), but the point still holds that nobody really knows what the future of this thing will be, so holding back a little of your stash "just in case" seems smart.

So barring emergencies, a better strategy is to say "at these prices, I'll sell these %s of my BTC", picking numbers such that it'll be "worth it" in your real life. For example, an amount that will let you FIRE without relying on future BTC gains. Or to put a down payment on a house, or so forth. Something concrete that the money will do to improve your life, above and beyond "well I guess I have a lot of USD now".

But that also means the amount isn't necessarily static! You'll have to adjust them if your IRL needs change, or the amounts necessary increase/decrease. And those adjustments must be kept independent of whatever the BTC market is doing; the point of a financial plan is to keep you from getting swept up in the market's emotions and doing something irrational.

That's my take, anyway.

Vis a vis exchanges: I think some exchanges don't intend to be fractional-reserve or bucket-shops at first, but end up becoming bucket-shops, because if they're hacked or lose coins due to a bug, it is easier to fib that they're still solvent and remain popular than tell the truth and make everyone panic to withdraw. Easy for them to fool themselves that "we'll just keep it under wraps while we figure out some way to get solvent again".

Of course, it's hard to distinguish that situation, from the outside, against a situation where they planned to fool around with the deposits from the beginning.

---

In the more general sense, though, I think the effective monetary base being able to grow bigger than the underlying asset, is impossible to avoid if we expect people to ever use BTC as money, because any lending activity at all increases M2/M0.

Imagine that I loan 100 bitcoins to someone. Afterwards, they have 100 bitcoins, and they have a 100BTC debt to me. And I now have a 100BTC credit against them.

For the moment, let's assume that the borrower is very low risk of defaulting. A well trusted, rich person with plenty of assets to seize if they default.

Now, this means that the market value of my 100BTC credit against them is really 100BTC, right?
And I can sell this debt on to people, for the same value as a bitcoin itself.
There have even been Bitcoin ETF proposals that base their asset management strategy on such an idea - buying BTC futures on CBOE rather than holding the bitcoins directly & having to worry about key control and so forth. These are debt instruments, not bitcoins, but if they are worth exactly the same amount as bitcoins at market, they still increase the "supply" of BTC on the market, don't they?

This is similar to how many countries use US dollars as a reserve currency, but they don't hold physical bills - they hold some treasury bond or long-term CD so they can at least get a little interest payment on it.

To imagine that Bitcoin will go mainstream and yet avoid this fate, you need to somehow imagine that people will stop borrowing money, which seems impossible in a world that invented debt long before it invented coinage (see also).

I miss Casascius

Apparently he's getting help posting these from friends outside of prison, who send him charts every week to draw on and write about.
Yesterday four posts went up, first one is here (each ends with a link to the next).

TL;DR: He sees December 2017 as being either the (3) after Jan 2015's ④, in which case he imagines a price target around $100k...


...or as I⑤ ending a giant Wave I that encompasses most of Bitcoin's history, in which case we have two more downtrends to weather and should expect a bottom well below $3k.


I don't know much about Elliot waves and am not sure I believe in them myself, but thought it would be interesting to y'all especially given Ross's more general notability.

It feels like every six hours I see a fresh "news" article on my feed about how "the bubble is on" or "BTC has crashed" because of a 15-20% price motion.

I worry that these people are missing a history lesson.

Here's the period between the 2011 and 2013 bubbles:



So the 2011 bubble follows a pattern that even new folks, who joined in 2017, should recognize: a dizzying rise, followed by a year of gradual, painful losses.

But between when the price hit bottom (when six figures of BTC changed hands at the $2 pricepoint), and when the 2014 bubble began, there was a third pattern: long periods of relative stability (with fluctuations in the 20% range), punctuated by brief bullish periods (Dec 2011 bringing us to a semi-stable $5, July 2012 bringing us to a semi-stable $13, and the time spent around $100 in mid-2013).

As an example, we can zoom in on the $5 period:

Clearly, there are big daily moves going on here! Imagine what people might have been thinking on March 19th, or April 20th!
But in the end, these moves were just a random walk around a somewhat stable price.

Similar behavior can be found in the 2015-2016 chart, after 2014's despair had run its course but before 2017's fever began.



This historical behavior, to me, implies two things:
1) For cryptocurrency as it is today, even "stability" sees 20% fluctuations.
2) Months-long periods of this "stability" are normal; not everything is boom or bust.

So today, with prices going back and forth between (roughly) $11k and $13k, I can't help but think that folks who are taking every motion as an omen of a larger trend are wearing themselves out needlessly. This might just be the start of another stable period - a chance for the ecosystem to get comfortable with the idea that $12k is the "normal" price of a bitcoin.

Calm down. "It" doesn't have to happen today, or even this month. It'll happen when it happens.

People try to predict how biblical apocalyptic events will come about, even though the bible itself says those events will be completely unexpected when they finally happen.

This person has the same problem. If the bible is a reputable authority, then predictions like this absolutely can't succeed, and are a waste of time anyway.
But if the bible is not a reputable authority, then the whole argument is based on nothing.

So, in short, I voted "disagree".

The key here is not hashrate precisely - that depends on technological advances.
Rather, I had in mind marginal costs - electricity - because the difficulty adjustment is in essence an economic peg: the average miner's marginal cost to mine approaches the block reward.

Today, whether clean or dirty energy, the marginal cost to generate electricity is 5-10¢/kWh.

Thus, a hypothetical world of 2021 with 6.25 BTC block rewards, a $1/microBTC pricepoint, and power plant costs on the low end of that scale (if we assume tech there continues to improve), would be using an extra ~750GW of electricity. If we are talking solar farms, then it's solar farms that add up to about the acreage of Switzerland.

Not impossible, but still dizzying to imagine as a physical implication of a price change.

That Reddit post is very silly. Where's the altcoins? Why is a Bitcoin in common usage with 1% issuance per year still "deflationary"? People don't need loans in the brave new world of 2025? And are we meant to believe governments didn't use M-of-N escrow to protect their stashes?

This is even putting aside the more fundamental issue, that if the rebels have the power of traveling time, they can destroy Bitcoin easily, by double-spending and then reverting via blocks from the future. Much easier/cleaner than nuclear submarine plan

Well, "zero" is a long way down; even Zimbabwe Dollars are worth a little as novelty gifts.

That said, I think both are pretty unlikely, assuming no big changes to the code. Very hard to secure the network at that pricepoint, without building many many power plants...

So after looking into volume on the top exchanges, it looks like today's excitement may have begun in Japan.

Here's a line from Coincheck's minute-by-minute volume (as reported by BitcoinCharts):

This is a small move in terms of price, but a fairly large trade for this particular exchange - about 7x the usual minute-by-minute volume.

This is followed a couple minutes later by high volume on Kraken (USD):
and Bitstamp:
And then the other exchanges. Most small exchanges see big volume bumps at 04:32:00, but feedback into Coincheck seems to happen comparatively fast; it begins at 04:31:00 too.

Could arbitrage from this big Coincheck trade have been the event that kicked off today's green candle? Or am I reading too much into this, and the trade at 4:28 was just a coincidence?