Halving guide for noobs: Why it's not possible for halving to be priced in now

[korila]

Ethereum shills getting desperate.  They can't find anyone to dump their artificially pumped bubble on so they're even spamming this section now.

r0ach would you please be quite
everything is going exact opposite of what you said~

Eth is the new king!

[DeathAngel]

r0ach I really hope you're right with all this, we need a good price rise to attract new investors attention.

[DeathProxyX]

I'm not a programmer and i'm not a miner. But i have a long term exeperience in Currency trading and an Economic degree. So i talk about bitcoin as a currency and not as a simple digital good. Well, i read a lot about Halving prediction, but i would say that if we consider BTC as a currency, an high price (that would consider BTC as a strong currency) should be really bad in a new market because buying good denominate in BTC It will not be cheaper for those who does not already own BTC , with  the risk to block  BTC expansion and closing the market to new investors.

[Denker]

I'm not a programmer and i'm not a miner. But i have a long term exeperience in Currency trading and an Economic degree. So i talk about bitcoin as a currency and not as a simple digital good. Well, i read a lot about Halving prediction, but i would say that if we consider BTC as a currency, an high price (that would consider BTC as a strong currency) should be really bad in a new market because buying good denominate in BTC It will not be cheaper for those who does not already own BTC , with  the risk to block  BTC expansion and closing the market to new investors.

Anf that is exactly your problem.Your thinking completely 1 dimensional and see Bitcoin only as a currency.
But this is soo dumb!!!
Bitcoin is several things at the same time.And everyone participating decides on his own what it is subjectively.
The majority here does not see Bitcoin as a currency.At least not yet!
For the majority it's an investment or an object of pure speculation.And that's why it's value continue being volatile and rise over the long run.
And have you ever thought that in the future we don't have to measure BTC in whole coins?
We can also pay in mBTC or uBTC. So there is more then enough space for gains and no reason to argument that Bitcoin is too expensive to get in. Maybe in 10-15 years we talk about bits!!!!And pay in bits! And everyone who bought whole coins now and have the patience to hold for several years might become wealthy.

Or the exact opposite happens and Bitcoin completely disappears.If that is the case then something better, also open, permissionless, more decentralized, more anonymous, with more potential will have taken over. Awesome!Count me in!

But never will one of these premined, centralized and highly manipulated altcoins or of those closed, permissioned bankcoins takeover.

[r0ach]

Eth is the new king!

Eth is about to implode no matter how many 1 star shill accounts you create:

I'd be much more worried about how much the Eth price is going to implode.  It's a single entity pumping Eth into an even bigger bubble than it already was, who is also going to exit before the Eth DAO can dump on May 28th.  So first the Eth pumper dumps, then the Eth DAO people dump, then the Bitcoin halving happens to dump Eth more.  What do you suppose the Eth price is going to be after 3 mega dumps?

[korila]

Eth is about to implode no matter how many 1 star shill accounts you create:

Date Registered:   August 16, 2012, 11:48:33 PM
This is my account registered date, I was here before you~~,
so don't judge by star numbers :p

Coinbase is adding ETH, everyone is on ETH~
Big BTC whales are fading BTC and moving to ETH~

[DeathProxyX]

I'm not a programmer and i'm not a miner. But i have a long term exeperience in Currency trading and an Economic degree. So i talk about bitcoin as a currency and not as a simple digital good. Well, i read a lot about Halving prediction, but i would say that if we consider BTC as a currency, an high price (that would consider BTC as a strong currency) should be really bad in a new market because buying good denominate in BTC It will not be cheaper for those who does not already own BTC , with  the risk to block  BTC expansion and closing the market to new investors.

Anf that is exactly your problem.Your thinking completely 1 dimensional and see Bitcoin only as a currency.
But this is soo dumb!!!
Bitcoin is several things at the same time.And everyone participating decides on his own what it is subjectively.
The majority here does not see Bitcoin as a currency.At least not yet!
For the majority it's an investment or an object of pure speculation.And that's why it's value continue being volatile and rise over the long run.
And have you ever thought that in the future we don't have to measure BTC in whole coins?
We can also pay in mBTC or uBTC. So there is more then enough space for gains and no reason to argument that Bitcoin is too expensive to get in. Maybe in 10-15 years we talk about bits!!!!And pay in bits! And everyone who bought whole coins now and have the patience to hold for several years might become wealthy.

Or the exact opposite happens and Bitcoin completely disappears.If that is the case then something better, also open, permissionless, more decentralized, more anonymous, with more potential will have taken over. Awesome!Count me in!

But never will one of these premined, centralized and highly manipulated altcoins or of those closed, permissioned bankcoins takeover.

Yes, i saw my opinion only on my knowledge area. I understand that in future we should pay in mBTC or in satoshi too, but if BTC now are  holding by a few people ( how we are? 5/10 millions that hold bitcoin), an high price probably goes to move BTC from a currency to an Investment Good (and if i remember well, an american judges has cosidered BTC as a commodities!)

[Cuntabula]

Ethereum shills getting desperate.  They can't find anyone to dump their artificially pumped bubble on so they're even spamming this section now.

r0ach would you please be quite
everything is going exact opposite of what you said~

Eth is the new king!

Certainly starting to look that way. Probably because bitcoin technology ain't so disruptive anymore, hasn't really added anything new since 2009... Still waiting for a good pump to get out, but starting to lose hope

[r0ach]

hasn't really added anything new since 2009

Proof of stake, like all recursive systems, aren't decentralized - they're permissioned ledgers.  Your fraudulent statement is actually backwards.  No altcoin has improved on BTC at all besides ring signatures and zk-snarks for anonymity, but those may or may not be useful depending on if BTC adds anonymity functions itself via sidechains or other method.

[Cuntabula]

Bitcoin hasn't really added anything new since 2009

Is a scientific fact.
Last gen tech is last gen tech. You hating on new, better crypto disrupting the cozy status quo only makes you look ridiculous (have you invested more than you could afford to lose?).

One more scientifical fact: ETH price up ~1600% this year alone. BTC?

[r0ach]

Next lesson for the shills:

Why proof of stake has no value:

Since Satoshi did not solve the Byzantine generals problem, this means confirmations are completely arbitrary.  So why are two confirmations more useful in Bitcoin (PoW) than one?  Because it's an open entropy system where over a period of time, it's either unlikely or statistically impossible for someone to maintain a monopoly on block validation when there is no upper limit to confirmations.

Recursive systems like proof of stake tend to permanently monopolize block validation by design, with no real fault or state recovery to fix it once it goes off the rails.  This makes a proof of stake confirmation essentially worthless due to being a bounded entropy system.

On top of being worthless, proof of stake is also a permissioned ledger.  The purpose of mining in Bitcoin is to create a permanent decentralized exchange peg, which thus results in a permissionless system.

[abercrombie]

"Stop buying, the halving is already priced in..."  

[zimmah]

I am claiming that the halving is already at least partially priced in.

This. It's a sliding scale. As we near halving, the halving becomes more priced in. There won't be an instant price jump the moment the halving occurs.

Nah, there's a difference between economic expectations and economic reality.  People guess at what effect it will have beforehand in hopes of making a profit, then the mining supply is cut in half afterwards and it changes from random gamblers messing around in the market to the equivalent of someone flipping a light switch to turn gravity on.

If the random gamblers have overextended themselves above what the market can bear post-halving, then the price would go down.  If the random gamblers have not, then it goes up.  The fact that the price had a solid floor around $420 for a LONG TIME even with constant daily China dumpings means the market is obviously not overextended.

I agree with almost everything you say, rOach; however, I would hardly characterize $420 as a "LONG TIME" floor.

For almost a year (late 2014 and through a lot of 2015), we did witness $220-ish as a kind of floor that was infrequently breached.

After the price spike from $230-ish to $500 (from August 2015 to November 2015), there was a period of finding the new floor, and I would argue that to had become, largely, floating in the range of $360 to $460, and we are still in that floating.. but slowly floating upwards in that range and likely to break out of that range.  The NOT priced in nature of the halvening is likely only part of the story concerning why we are soon on the precipice of a 5x to 10x bubble, which could actually take a year or so to play out.... and then likely bring us into the range of having a floor in the $2k territory...

Anyhow, I largely agree with you, rOach, and surely none of us have crystal balls that actually work...  .

In 2013 we had 2 'bubbles' of a 10x magnitude in the same year, this was also after a halving (although the halving was at 2012-11-28 and the first bubble was at its peak in late april (although the price did rise gradually ever after the halving).

I think it's reasonably likely to see another 10^2x run.

Now that would make for some news headlines in 2017, reaching $40,000

[zimmah]

I'm not a programmer and i'm not a miner. But i have a long term exeperience in Currency trading and an Economic degree. So i talk about bitcoin as a currency and not as a simple digital good. Well, i read a lot about Halving prediction, but i would say that if we consider BTC as a currency, an high price (that would consider BTC as a strong currency) should be really bad in a new market because buying good denominate in BTC It will not be cheaper for those who does not already own BTC , with  the risk to block  BTC expansion and closing the market to new investors.

This only counts if your economy relies on bitcoin.

since we don't have a country were wages are paid in bitcoin, taxes are paid in bitcoin and expenses are paid in bitcoin, this whole argument is moot.

Because even if prices are labeled in bitcoin, as long as the seller doesn't have expenses that are calculated in bitcoin (and not just fiat prices converted to bitcoin), the bitcoin price is not higher than the fiat price.

There are no downsides to having a strong bitcoin.

For example a strong yuan is destructive to Chinese economy, because china relies on exports. If chinese companies need to pay wages in yuan, and taxes, and raw materials, all prices in yuan, and then yuan becomes expensive compared to the euro, then Chinese exports would become relatively expensive compared to eastern-european exports. So then amercan companies would prefer to buy from eastern europe instead.

The chinese economy would collapse because no one wants to buy their expensive products.

With bitcoin this is not the case, since we have no economy that relies on bitcoin exports.

[JayJuanGee]

I am claiming that the halving is already at least partially priced in.

This. It's a sliding scale. As we near halving, the halving becomes more priced in. There won't be an instant price jump the moment the halving occurs.

Nah, there's a difference between economic expectations and economic reality.  People guess at what effect it will have beforehand in hopes of making a profit, then the mining supply is cut in half afterwards and it changes from random gamblers messing around in the market to the equivalent of someone flipping a light switch to turn gravity on.

If the random gamblers have overextended themselves above what the market can bear post-halving, then the price would go down.  If the random gamblers have not, then it goes up.  The fact that the price had a solid floor around $420 for a LONG TIME even with constant daily China dumpings means the market is obviously not overextended.

I agree with almost everything you say, rOach; however, I would hardly characterize $420 as a "LONG TIME" floor.

For almost a year (late 2014 and through a lot of 2015), we did witness $220-ish as a kind of floor that was infrequently breached.

After the price spike from $230-ish to $500 (from August 2015 to November 2015), there was a period of finding the new floor, and I would argue that to had become, largely, floating in the range of $360 to $460, and we are still in that floating.. but slowly floating upwards in that range and likely to break out of that range.  The NOT priced in nature of the halvening is likely only part of the story concerning why we are soon on the precipice of a 5x to 10x bubble, which could actually take a year or so to play out.... and then likely bring us into the range of having a floor in the $2k territory...

Anyhow, I largely agree with you, rOach, and surely none of us have crystal balls that actually work...  .

In 2013 we had 2 'bubbles' of a 10x magnitude in the same year, this was also after a halving (although the halving was at 2012-11-28 and the first bubble was at its peak in late april (although the price did rise gradually ever after the halving).

I think it's reasonably likely to see another 10^2x run.

Now that would make for some news headlines in 2017, reaching $40,000

Fair enough...

You seem to be generally agreeing with the concept that even though history may not repeat itself it may rhym?


2012/2013 gives us a model for what is theoretically possible and likely what continues to be theoretically possible.  For sure, there are no guarantees regarding this near term future outcome,yet we should still prepare ourself for something like a 10x times 2 scenario taking place (whether we conceive the odds as 50/50 or 2/98 or .01/99.99

[AZwarel]

I'm not a programmer and i'm not a miner. But i have a long term exeperience in Currency trading and an Economic degree. So i talk about bitcoin as a currency and not as a simple digital good. Well, i read a lot about Halving prediction, but i would say that if we consider BTC as a currency, an high price (that would consider BTC as a strong currency) should be really bad in a new market because buying good denominate in BTC It will not be cheaper for those who does not already own BTC , with  the risk to block  BTC expansion and closing the market to new investors.

Do not take it personally, but this does not make any sense (pun intended):

First:
If one has no BTC right now, it does not matter have much the goods he wants to buy in the future will cost in BTC; if it goes up in price by 10x folds for example, he will need the same amount of value ($)->BTC-> goods than now, it does not affect him.
Also, we had prices as:
0,001$ BTC, 0,1$ BTC, 1,0$ BTC, 10,0$ BTC, 100,0$, 1000,0$ over the last 6 years, and somehow it still getting more and more investors/users adopting it than ever. Actually, going to 10,000$, or even 100,000$ from today's 500$ isn't that a big jump, like from 0,1$ to 100$ was*

*(network effect annuls the necessity to axiomatically increase the value that each new participant has to put in the network, because the number of potentat users grows exponentially, while the unit/cost does not has to, hence balancing the two off - in other words: doesn't matter if 100 people puts 100$ dollars in it, or 1000 people puts 10$ in it. If the new 1000 people puts the same 100$ in it, the price/unit will grow significantly - not by a linear 10x ofc, but it will grow).

So your theory does fail in the light of real life historical facts. And math. Especially math.

Second:
It does not matter, that you think about BTC as a currency only, by definition it is also - minimum - a payment network, if you can not see the extra added value in that, than you do not understand the basics of Bitcoin, the network. The majority of the market participants - investors, innovators, speculators, researchers, companies, etc - disagree with you, hence you end up on the "minority fork" of "broken grammar economic degree experience".

Third:
In a global/liquid/connected free market, good money (rises in value by time) drives out bad money (decrease in value by time), just like how dollars, pound sterling, Netherland's gineau, Venecian gold coins, etc etc did in the past eras, exactly because they appreciated in purchase value in contrast to every other (less global/local) currency at their time, and yet, somehow people went nutso to hold just a little bit of those in their pockets. Please return that economic degree, before it inflates away any more.

[AZwarel]

Next lesson for the shills:

Why proof of stake has no value:

Since Satoshi did not solve the Byzantine generals problem, this means confirmations are completely arbitrary.  So why are two confirmations more useful in Bitcoin (PoW) than one?  Because it's an open entropy system where over a period of time, it's either unlikely or statistically impossible for someone to maintain a monopoly on block validation when there is no upper limit to confirmations.

Recursive systems like proof of stake tend to permanently monopolize block validation by design, with no real fault or state recovery to fix it once it goes off the rails.  This makes a proof of stake confirmation essentially worthless due to being a bounded entropy system.

On top of being worthless, proof of stake is also a permissioned ledger.  The purpose of mining in Bitcoin is to create a permanent decentralized exchange peg, which thus results in a permissionless system.

r0ach, I admire your patience trying to teach thermodynamics to presumed trolls 

Especially how most - even well intended fellows here - do not get why PoS is an utter failure as a network security model (added, the economic incentive model is counterproductive, resulting in very hackable, centralized like security!).

Just imagine their horror as we would explain them how the early miners effectively would still be able to control ~10-20% of the network security with their laptop made coins hodled in a PoS wallet in the era of huge asics farms Hillarious!