Euclid is a group of day traders and economic analysts in the Bitcoin community, working out of one of the top Econ schools (top 0.1% ranking) in the country. This year, Euclid’s attention shifted from Forex to Bitcoin. If you haven’t heard of us before, that means we’re doing our job right. Our goal is to make the highest gains possible, as short as possible, with the minimal impact or notice on the long-term market. In Forex, this was easy, our trades were a drop in the ocean. This year, however, our actions can be seen dotted along the altcoin markets like breadcrumbs, if you know where to look. It’s been a great year, but we need to adapt, and adapt quickly, to continue making our gains.
So, Euclid is going public with a network of altcoin traders.
It’s the twilight of 2013, and with it, the beginning of the best year of Bitcoin. It is also the beginning of the worst year of Bitcoin. Allow me to explain:
The price of Bitcoin, or any currency, is ultimately determined by two factors: Marginal supply and Marginal demand. Bitcoin’s uniquely controlled supply, means that its price is almost entirely the subject of demand. In the case of cryptocurrencies, that demand is in the form of an adoption cycle, ranging from 0 to 100% of total adoption. Contrary to popular belief (
http://www.x-btc.com/1/post/2013/11/bitcoin-is-not-surging-going-ballistic-or-going-on-an-astronomical-tear.html) adoption curves are not exponential. They are cumulative normal distributions, a pattern found throughout all of nature. It probability mass is known as the Gaussian distribution, or the Bell Curve. It measures from 0% of Bitcoin adopters to 100%, and more importantly, gives the cumulative probability of the next new bitcoin adopter in the next time period.
We have two predictions for the probability distribution of these curves. The formula:
1/(standev*SQRT(π*2))*e^-(((day#-mean)^2)/2*standev^2)
We’ve derived two curves from the data, one with and one without bubbles. The first curve has a mean of day 2100, with a standard deviation of .003. The second curve, which is what we predict emerging altcoins and pump and dump schemes are moving the price to, has a mean of 2300 days and a standard deviation of .002. Below is a chart of the two curves. The scale on the left is in % of the price as of Dec. 27th 2013. The scale on the bottom is the day since Bitcon’s creation.
http://s27.postimg.org/nnhi1sldv/probability_curves.pngWhy is its growth stunted? 2013 is the first year when the marginal supply will be constrained significantly (
https://en.bitcoin.it/wiki/Controlled_supply), as we have breached the 50% threshold for the mining of all coins. This will make a huge impact on the success of pump and dump schemes, which will (and already have) net lower and lower gains over the year. If frequency continues, they will put a cap on the maximum price and pull the minimum price floor lower and lower. As you can see by tge chart, we predict that the bitcoin price, between now and 2017, can be doubled over its potential by just controlling the availability of altcoins and the frequency of pump and dumps. This means any gains between now and then will be doubled as well.
A pump and dump scheme increases the marginal adoption rate, shifting the entire cumulative curve closer to the current timeline. Or, in other words, a pump and dump scheme that doesn’t drop the currency below the normal price before the scheme has increased the number of adopters. This is detrimental to the long-term price, and lengthens (by the same % of value generated from new adopters) the time to the max value. This is dangerous, since it allows outside environmental factors more time to affect the market before peak market capitalization is reached.
To put it simply: Pump and dump schemes and other crypto coins are lengthening the time it takes for Bitcoin and other, stronger currencies to reach their max value. This gives the government a longer timeline before they can regulate. Euclid deems these two factors the greatest threat to the survivability of BTC.
A new solution to value creation is needed.
Currency is merely a storage of value, and value is merely a term for purchasing power. It doesn’t matter if you are trading Bitcoins, Dogecoin, Bananas, sunglasses, or green pieces of paper. Crypto currencies are no different, and they all follow simple rules.
In the wake of a few events this last year (Fontas pulling out of Pump schemes, the China affair, Fincen reports and the altcoin explosion), we’re planning to take a more active role in the market and try to maintain the greatest aggregate profit from the market, and curb the potential long-term damage to Bitcoin. In light of recent events, we think it’s necessary to take a more general, active role in strengthening the currency.
Pump and dump schemes are, frankly, unsophisticated and crude. Nested investments, controlling supply and demand on aggregate, and drawing mass value is the celestial machine. It’s not about getting singular, large gains, but by multiplying gains repeatedly in exceedingly short periods of time. If successful, to those involved we will offer technical analysis, quant trading programs, and most importantly, loss mitigation. This means if you lose money on a campaign, we will pay you directly to cover your losses.
Euclid wants to build a network of volume market-makers to make some adjustments to various Altcoin markets over the course of this year, and that will require more volume than our group has, so we’re opening the doors to potential gains to people who are capable of holding or moving currency when necessary. There’s an increasing number of people interested in more stable, long-term cryptocurrency investment, so we believe there’s a definite need for this type of control. We want to offer accurate technical analysis, careful planning, and brilliant execution to the Crypto currency markets, something that is has lacked since the beginning, and for a short while, we’re opening doors to the best and brightest of the crypto community to work with us.
Euclid_predicts@null.net, and
https://twitter.com/EuclidPredicts if you’re interested. We are not asking for money. We don’t want your wallet address, or even your name, in fact, we’re better off not knowing anything about you. All we want is a group of close, trusted, intelligent traders to work together and share academic knowledge with.
Money flows to the most intelligent. They stay ahead of the curve, they know when a scam exists, and they protect eachother.
Here’s to the best year of Bitcoin, and the worst year of Bitcoin.
- Max Cohen, Euclid
