This what you have in mind? Or something more short-term?

I kind of suspect it'll take even a bit longer before that sentiment really sinks in.

I remember, late last year in masterluc's thread, I was arguing that the next ATH couldn't reasonably be further away than a year. Because: history.

Took me a while to get that idea out of my head for good - which, by the way, doesn't mean I think Bitcoin is doomed. Just that naive extrapolations like "we had a growth spurt every X months, so the next one must be right around the corner" are dangerous to your mental health (and profits, if you trade).

Here's another thought: we keep referring back to 2011/2012 as the "bad years" for price. The argument is usually made that, no way we're going through such a period of (relative) drought again because this time: investments! public interest! everything is different!

Which is true, of course. But that's the reason why price is around $500 now, and not $5.

So I see a chance at least that we will look back on 2014, maybe even 2015, and think of those years as the "really bad years" in the future, not 2011/2012.

(note please, I said: "I see a chance", not "I'm sure that's what's going to happen.)

(mini necro, because it's a topic I've been wondering about myself)

(also, more or less just piggybacking on your post, not addressing you directly in the following rant...)

I don't mind (and understand) "holders" frequenting the speculation forum. I don't mind (and understand) them posting. I get why they're rallying together in a downtrend - it's a nightmare of its own to see your account value (as measured in USD) melt away day by day.

I do mind however the sometimes rather aggressive "anti trading" sentiment in here.

Where. On. Fuckin. Earth? should trading / price discovery / speculation be discussed if not on the Speculation subforum?

Don't trade, but hold on to those coins - absolutely fine by me. But if you constantly feel the need to tell traders who post here that they are in reality "tarders", and need to stop their idiotic ways, then you're no better than trolls like fallling and their ilk.

/rant

I wouldn't go as far as pronouncing the rest of the pack 'crap', but my own investment mirrors your sentiment, it seems.

In the 'privacy enhanced crypto' niche (which I believe to be an important long-term investment) I currently consider it advisable to hold (and buy) XMR, DRK, and BBR (ordered by decreasing percentage of investment).

Don't apologize. Interesting post, and pretty obvious to me that it was a quote, not your own statement.

Now, jl777's rant sounds half whiny, half entitled, but he also made a point I can sort of appreciate:

Monero supporters (or at least a vocal subset) have the unpleasant habit of not only talking up Monero, which is fine, but also talking down every single other alt.

It's more a stylistic issue than a moral one, in my opinion, but I dislike it. Makes us look petty, as a community.


That said, the "ultimatum" of the jl777 quote is ridiculous. By requiring a 'be nice to me' condition on coins and their community to be allowed to join his secret little club chain he made sure nobody in his right mind would want to join.

Let's compare it:

XMR
30d volume = 5,800 BTC
650,000 XMR mined, 30d SMA 0.0037, 2,405 BTC equivalent mined
ratio volume to supply: 2.4


BTC volume is more problematic. Arbitrage links between exchanges are well established, so in principle, all volume (USD, CNY, EUR) counts, but I am not willing to count CNY volume 1:1. There are smarter ways to discount some of the zero-fee volume, but for simplicity sake I'll just say that we probably can agree that Chinese "real" (i.e. human) volume is probably not much lower than USD volume, so I will just double USD volume for the sake of this calculation and be done with it.

BTC
30d volume 840,000 BTC (in USD), x 2
108,000 BTC mined
ratio volume to supply: 15.6

So, by volume alone: no, I don't think we're undervalued.

Interesting background. Thanks.

Bolded is what I had in mind more or less in my ha ha only serious post above about a merge of XMR and BBR. Not going to happen, of course, but at the same time, if in 10 years from now we don't have a precedence of two major coins merging, I'd be seriously surprised.

Care to give a tl;dr of what the angle is of that one? I googled it, and my eyes glazed over at the wall of text I found being, well, imprecise in what this is supposed to be. Surely he can't propose equal valuation of different cryptos?

Wouldn't it be amusing if XMR and BBR would merge at some point in the future, to create the one, definitive CN coin?

The details would be a nightmare to work out - who's going to be the lead dev? how to merge the blockchains? how to reconcile the difference in the protocols? how to establish consensus, or rather: economical majority being in favor of the merge - but it'd be an interesting, possibly long-term profitable for everyone, experiment.

Now, flame away, if you must.

I see now. Didn't at first get your point about the connection between Mtgox and the 2012 period. Yes, I agree, absolutely a possibility. I have a hard time believing BTC scammers/criminals are comfortable being long term holders, speculating on price increase. It's already clear that it will be increasingly difficult to have meaningful privacy using Bitcoin (hence: the alternative cryptos targeting that niche), so applying the simple "What would I do test", I probably would try to get out of the position as fast as possible, without tanking price too much. Too bad we'll probably never know for sure what happened :/

Not sure, but is this a test of sorts? I'm absolutely sure I'm not the only one outperforming the market (i.e. buy & hold), and pretty sure there are a lot more successful traders than me, both in percent and absolute profits. I'm doing... okay.

Anyway, I only started trading last year, and wouldn't claim I really know what's going on, and handle other people's money. Also, a very practical consideration: in an illiquid market like this, I'm already struggling with slippage at my current volume. No idea how that could be handled if managed funds are more - guess that requires a completely different type of trading strategy, that I simply have no clue about.

I personally have a lot more trouble with the mid term calls than with the short term predictions. Identifying a likely developing trend, and selling or buying into it seems relatively easy for me. But the question how to take your profits, in USD or BTC, *that's* the tricky bit, imo. Park them in BTC, and you'll see your profits melt away. Park them in USD, and one swing you missed later, and you only buy 2/3 of your original coins back.

You could, you know, try selling some when it looks like price is about to take a dive. That tends to give plenty of powder to buy.

...

I know, I know, not an option. "Hodl for life" and so on

Problem is, doing so presents a huge liability to the exchange. "Hey, why did you cut my API access, this bot's behavior was by design."

There are many things wrong with existing exchanges, but not turning off some trader's bot is not one of them, imo.

What can I say. I'm a sucker for boring, meaningless movies, as long as they feature beautifully composed crane shots.

It pains me to agree with El Stolfi, but, yeah. That's my understanding as well: they hope to rake in $200M and buy accordingly, not that they're sitting on that amount waiting to spend it from Sept. 1st.

I have made a similar distinction a bit earlier in cypherdoc's thread. The difference between the 'accumulation' scenario and the 'attack on the network' scenario is in the ratio of coins held vs. coins sold to suppress price, and in the long-term profitability goal.

The accumulator expects positive return on his investment in the long run (accepting short to mid term losses, perhaps), the attacker is willing to actually lose money on this method, since the goal is preserving a status quo at all costs.

That said, I don't consider the attacker scenario likely. Central banks, governments are not particularly nimble. More likely, imo, that if anyone is forward thinking enough to install such a regimen, it'd be a private sector actor.

Great movie. And a great quote in this context

Chiming in to say I get your point: you don't have evidence of a particular vulnerability, but experience shows that on a project this scale, some - possibly catastrophic - vulnerabilities are very much to be expected.

Case in point: If you would have suggested two years ago that a major exploit exists that allows an attacker to potentially read out plaintext password information in a widely used - widely used in financially sensitive applications, that is - open source SSL implementation, most here would have sneered at the idea. Yet, that's exactly what happened, and we're somewhat lucky how it was discovered (and fixed), with little damage, as far as I can tell.

Not sure I agree. I understand the desire to read the market in more fundamental ways, to understand "reasons" for price movements, but most of the time, that line of reasoning goes back to fundamentals and news - and that, in my experience and opinion, misses a big part of what actually drives the market more than half the time.

Anyway, I'm sure there is a narrative for the stagnation period of 2012 that is slightly more explanatory. In essence: necessary consolidation after an extremely volatile period ($1 -> $32 -> $2), together with the fact that no "real world" events took place that were strong enough to overcome that market sentiment (like: Argentinians decide big time to use btc as an inflation hedge).

As for a possible (partial) explanation of the current stagnation, see my point below...



I don't claim I believe with certainty that this is going on, I am submitting that, if a large enough entity (or several) would plan to buy large amounts of coins, and have some patience, this would probably a scenario worth exploring. In terms of tax efficiency, waiting for the ETF would probably be the better choice, but in terms of price control, the method I described would in principle beat a fund that is, ultimately, positive feedback linked to the markets.

I disagree that miners would prevent this taking place. No disrespect to miners, they're the backbone of the network, but amateur miners seem to be not necessarily the most economically rational actors. Go look around in this forum how often the fall for the fallacy: 'It's sunk cost anyway, I'll let my outdated miners run as long as they produce coins', and how often more economically minded users need to tell them that the actual calculation needs to be based on total cost of future production of coins (mainly: energy costs) vs. number of coins bought at market for the same costs.

Larger mining operations are undoubtedly much more economically savvy, but I've argued over and over again that I believe that, with the increasing "professionalization" of Bitcoin and Bitcoin mining, short-term profit opportunity will probably outclass long-term speculative investment. In other words: large miners sell more than they hold, especially considering that we are currently nowhere near a new uncontested bull market (which means the ratio of sold vs. held coins can change if the market sentiment changes, and miners might hold more than they sell if they feel it's a sure thing price will go up.)

Finally, we have plenty of evidence that public market price as determined by on exchange trading is a major reference point for off exchange transactions (just one example: the SR coin auction, where every party that spoke on it refered to "the market price" as if it were the obvious metric). Binding a large mining operation to you in a mid to long-term contract, maybe even offering a premium (although, from hearsay, I've only heard of large holders being made sub market offers, off exchange), then using some fraction of the coins to strategically depress price, would seem like a very good strategy to me, and relatively risk free: if it works, market price stays low, and accumulation proceeds at a low cost. If it fails, and price refuses to be depressed, the account value of coins gained so far appreciates, which is a sweet little consolation price.

Arbitrage by miners could throw a spanner in the works of this mechanism, but profits would be comparably marginal: the goal of the accumulator is not to destroy the on-exchange price, just to keep a lid on it. For the arbitreur miner, the reward is small (sold his coins at market price, is able to buy them back slightly below perhaps), and more importantly: for the large operations, the initial problem would re-appear - what to do with a large amount of coins, when you in reality prefer to hold USD (by my assumption that professional mining operations are short-term opportunistic, and not long-term married to Bitcoin success).

It's a tragedy of the commons style scenario: presumably, miners would be better off selling directly on the exchanges, since the higher volume generated there would ultimately drive up price, but individually, they fear the risk of lower profits because of increased selling pressure on exchange, so they seek arrangements off exchange.

I'll say it one more time: The above is (motivated, I think) speculation. I make no claim this is necessarily happening. I only point out that I believe it is a possible, maybe even probable, mechanism taking place, accounting - at least partially - for the current stagnation period.