I am pretty confident we are the new wealthy elite, gentlemen.

[JayJuanGee]

"What is causing the slump is people are dollar cost averaging out, everyone is saying the transactions are up, that's because everyone is selling. Those are transactions."



For every seller there is a buyer, you might as well say that everyone is buying.

I think JoeVentura has a valid point regarding the fact that if the BTC price is falling, then more coins are being offered for sale than there are coins being bought - and that is why the price is falling.  On the other hand if there are more coins being bought than offered, then the price rises.

As you suggest, Arriemoller, in the end, that claim about dollar cost average selling may NOT be saying too much; however, I believe more importantly, is that JoeVentura got it wrong b/c dollar cost average selling would have been taking place as the price was rising... however, the price has been falling for nearly a year... so what we have NOW, or at least in the past 4 months or so, are continued attempts to force the price down by big cats and attempt to cause regular people to panic and to sell their coins.. and this dynamic is NOT about dollar cost average selling, like JoeVentura is so boldly and wrongly asserting.

force the price down by big cats and attempt to cause regular people to panic and to sell their coins..  << sorry not buying this.

Except it already happened when price hit 300. In a very short amount of time there were countless posts on reddit and forums about people who put their money savings of  5-10 000 USD when btc price was around 500-800 and to cite them :"must cash now I cannot fail my family by loosing more". The price then took a quick dip to 275 where it stopped.

Yep.. sad but true... there are a lot of variations of such stories, and the downward BTC price manipulators can have this kind of negative scaring effect on regular people because the regular people have not been prepared for such an extended downtrend in the BTC market.... and they are still panicking on a regular basis in spite of decent flat and/or trending upward BTC price movements in the last couple  of days.  Regular people are scared to get into BTC and scared to stay in BTC.. even though this is likely a fairly decent time to enter a BTC position.

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[Cryddit]

At the risk of intruding on all the price speculation and we're-gonna-be-rich/poor stuff on here, I want to focus on something more fundamental for a minute.

There are essentially two threats that make transferring value online risky (and risk is expressed in expense).  The first is exploitation of a technical flaw by a cracker to redirect or obstruct the transfer.  The second is malfeasance by a money transmitter (which is why money transmitters have to get licensed and monitored, etc).  This is a trillion-dollar problem, in terms of it costing the world trillions of dollars per year to deal with this risk.

Blockchain-based cryptocurrency (at the moment, Bitcoin) is so far the only method of transferring value online to offer cryptographic protection from both of these threats.  So, at least potentially, the world has much to gain by doing business in Bitcoin. 

That said?  We take our business off the blockchain often enough for both threats to be relevant to Bitcoin transactions regardless of cryptographic protections.  We see prime examples of both risks in the collapse of Mt.Gox. 

Gox had a fatally flawed method of handling transaction malleability, and someone (or someseveral) exploited the technical flaw to steal a half-billion dollars worth of coin from Gox over a period of nearly a full year.  In fact we don't even know whether that technical flaw was a genuine mistake or deliberately inserted by people at Gox in order to facilitate the theft.  Which brings us to the second risk - malfeasance by a money transmitter.   Whether or not people at Gox planned the theft, they continued operating as a "fractional reserve" system long after they became aware of it - AND FAILED TO FIX IT, exposing themselves and their clients to continued theft!!  To cover the past and ongoing theft, they deliberately manipulated the market using "Willy Bot," sending the prices on an unsupported stratospheric ride as a desperate attempt to hold off the collapse.  This manipulation sucked more and more money into the black hole which was Gox for nearly eight months, multiplying both the duration/expense of theft and the collateral damage done in the collapse by at least factors of six.

Thus, even though the blockchain protocol is designed specifically to protect both against exploitation of technical flaws by crackers and against malfeasance by money transmitters, we have horrifically expensive examples of both wrapped up in a single incident.  Why did this happen?  It happened because we trusted Gox with our blockchain-secured money even when they were not using the blockchain protocol.  Essentially people gave up sole control of the cryptographic keys that controlled their coins, leaving them to Gox and trusting Gox as holder of keys to tell them whether or not the blockchain was intact with respect to their coins.  And Gox lied.

Malfeasance by money transmitters (such as Gox) has been demonstrated as a genuine risk for Bitcoin because Bitcoiners  allowed Gox to do something we didn't have to allow them to do.  Because we gave up control of our coins to another party, and trusted that party to be honest.  We made ourselves vulnerable to the primary risks that the Bitcoin protocol was designed to protect us from.  The expense of Gox's collapse put Bitcoin firmly into the same expense category as credit card transactions, wiping out the financial advantage of using Bitcoin.  Now as Bitcoin becomes more accepted, we're getting more money transmitters.  Bitpay, etc, are, like Gox, in the business of holding the keys to other people's money.  They are money transmitters whose potential for technical failure and malfeasance continues to put Bitcoin business in the same risk category as credit cards - and, inevitably, therefore in the same expense category as credit cards. 

This model (with money transmitters, online wallets, etc) does not realize the potential savings to the world of using Bitcoin.  Because merchants are still exposed to the risks of technical failure and of malfeasance, they are not saving risk (and therefore not saving expense).  The issue is not about whether Bitpay etc are immediately selling coins - the issue is about people trusting someone who is not themselves to hold their keys and therefore being vulnerable to the risk of that party's failure to hold the keys securely.

So, short version of the story; had you asked me a year ago, I would have said that the emergence of money transmitters in Bitcoin was an aberration because the protocol was built specifically so that people could do all of that for themselves.  I'd have said that Bitcoin would take off when people got over their reliance on third parties and therefore started realizing the potential for financial advantage.   But when I look at it today and I see money transmitters becoming entrenched in the Bitcoin economy, it's becoming more and more clear that if we don't get away from that, then we have nothing to offer merchants better than what the credit card companies are offering them.

It's one thing for me to explain to a CFO that they don't need the money transmitter or the exchange and that they can manage their own wallet and be fully protected from that third-party risk; but in the first place they don't usually believe me. Worse, there is a legit worry about first-party risk (ie, that a company insider with access to the wallet could steal the company's Bitcoin, as may or may not have happened at Gox).  Relying on money transmitters (third party risk that's bonded and insured) is their standard method for mitigating first-party risk (an inside job for which they'd eat the loss directly).

So, if we think Bitcoin is advantageous to the world -- if we want there to be a financial advantage to the world from using it -- we have to find ways to actually deliver the savings that the protocol was designed to deliver.  We have to enable the users to cut out money transmitters and third parties.

[vesperwillow]

^- One of the best reads in a long time.

[Erdogan]

^^

About service companies:

Companies like Bitpay can offer instant payment to the merchant in a non complex way, cheap. Companies like that can be many, there is no need for the gigantic back stage processing that credit card companies have. Sufficiently many, right-sized companies is not much of a risk to bitcoin.

Another example is low cost payments (Circle), in case the blockchain fee should increase significantly. Payment from one user of the system to another. A plethora of service companies like that. If necessary, the companies could establish 1 on 1 relationships to clear such payments between users of those different service companies. No system risk to bitcoin.

Bitcoin debit card companies (Coinkite) (A card like a debit card, denominated in bitcoin, paying out bitcoin to merchants). I guess some users would prefer a standard card in stead of using a more complex smartphone. Multiple companies could agree on a standard and make 1 to 1 clearing deals. Also no systemic risk.

These types of services are welcome. We will see how badly they will be regulated by coercion from the state, if not, they will be held in check by the market (with some cockups). If the market demands it, and it can be supplied to the right price, it is good.

[CoinCidental]

^- One of the best reads in a long time.

It states the problem, but what's the solutions?

Where is your average Joe going to get his Bitcoins without without trusting a third party like gox or mintpal?

The trust is the point of failure that probably is stoppong a lot more people jumping into btc

How can you get them?  Without sending money to btcE or bit stamp which I trust neither and don't even consider trusting the smaller less known exchanges etc

Until there's a rock solid way for someone to buy 100,000usd+ of Bitcoins with zero risk of being ripped off the whales will not jump on board

There is no exchange I would ever trust with 100k or more

[Piston Honda]

^- One of the best reads in a long time.

It states the problem, but what's the solutions?

Where is your average Joe going to get his Bitcoins without without trusting a third party like gox or mintpal?

The trust is the point of failure that probably is stoppong a lot more people jumping into btc

How can you get them?  Without sending money to btcE or bit stamp which I trust neither and don't even consider trusting the smaller less known exchanges etc

Until there's a rock solid way for someone to buy 100,000usd+ of Bitcoins with zero risk of being ripped off the whales will not jump on board

There is no exchange I would ever trust with 100k or more

I'd still cash out into FIAT if I had that much BTC lol...maybe not all, but most.

[Gleb Gamow]

Why is a thread that Atlas started nearly 3 1/2 years ago still going strong?

[BlindMayorBitcorn]

Why is a thread that Atlas started nearly 3 1/2 years ago still going strong?

The title of the thread went viral...or something:)

[thew3apon]

^- One of the best reads in a long time.

It states the problem, but what's the solutions?

Where is your average Joe going to get his Bitcoins without without trusting a third party like gox or mintpal?

The trust is the point of failure that probably is stoppong a lot more people jumping into btc

How can you get them?  Without sending money to btcE or bit stamp which I trust neither and don't even consider trusting the smaller less known exchanges etc

Until there's a rock solid way for someone to buy 100,000usd+ of Bitcoins with zero risk of being ripped off the whales will not jump on board

There is no exchange I would ever trust with 100k or more

If you are buying that large of amounts of money you will likely need to trust an entity that does not deal exclusively with bitcoin (so in the event their bitcion are stolen via a hack it can recover and honor deposits). A few examples would be second market, the COIN ETF that hopefully would be launched soon

[Cryddit]

These types of services are welcome. We will see how badly they will be regulated by coercion from the state, if not, they will be held in check by the market (with some cockups). If the market demands it, and it can be supplied to the right price, it is good.

The actual point of regulation is to try to minimize the expense of dealing with them.  Unregulated businesses in a situation where they are trusted (ie, where they can screw their customers over) are very expensive.  In fact, experience shows, more expensive than tightly regulated ones.

We would like to not labor under the cost of regulation.  But avoiding regulation doesn't work to keep costs down either, unless we can come up with trust-free (ie, where they CAN'T screw their customers over) models for these services.

This is about adoption; if Bitcoin remains more expensive (ie, if the cost savings of a trust-free business model remains something we can't actually deliver to end users and businesses) then there isn't an economic motive for mainstream businesses to adopt Bitcoin. 

[marcus_of_augustus]

Why is a thread that Atlas started nearly 3 1/2 years ago still going strong?

Atlas was the Boss.

[Beliathon]

Just bought 3 more BTC for 1k, like a fuckin BOSS

[Soros Shorts]

Why is a thread that Atlas started nearly 3 1/2 years ago still going strong?

It's a lot more interesting than connect-the-random-dots-and-uncover-the-conspiracy threads.

[jbreher]

[quote author=Cryddit link=topic=12156.msg9459949#msg9459949 dat
Gox had a fatally flawed method of handling transaction malleability, and someone (or someseveral) exploited the technical flaw to steal a half-billion dollars worth of coin from Gox over a period of nearly a full year.    
[/quote]

At the risk of detracting from an otherwise important part, is this not an unvetted allegation? Something certainly was amiss at Gox, but I've yet to see an explanation that ties such a loss to transaction malleability.

[BayAreaCoins]

hedge hedge hedge

[hongw]

dat
Gox had a fatally flawed method of handling transaction malleability, and someone (or someseveral) exploited the technical flaw to steal a half-billion dollars worth of coin from Gox over a period of nearly a full year.    

At the risk of detracting from an otherwise important part, is this not an unvetted allegation? Something certainly was amiss at Gox, but I've yet to see an explanation that ties such a loss to transaction malleability.

There was actually a research report put out shortly after gox claimed that malleability was the reason for their lost coins; it said that their claim would not have been possible if every single TX that was affected by malleability was a TX that gox was sending to their customers

[Cryddit]

Gox had a fatally flawed method of handling transaction malleability, and someone (or someseveral) exploited the technical flaw to steal a half-billion dollars worth of coin from Gox over a period of nearly a full year.    

At the risk of detracting from an otherwise important part, is this not an unvetted allegation? Something certainly was amiss at Gox, but I've yet to see an explanation that ties such a loss to transaction malleability.

Hmm.  Apparently you are right.  According to the article at

https://www.cryptocoinsnews.com/malleability-bankrupt-mt-gox/

Blockchain exploration reveals that the losses due to transaction malleability prior to Gox freezing withdrawals cannot have been more than one percent of the amount missing.

Of course this doesn't invalidate the point; it just shifts the bulk of the horrifying cost from the risk of crackers exploiting a technical flaw to the risk of malfeasance by a money transmitter.   The point remains that we need a trustless business model for money transmitters, regardless of whether their incompetence is more technical or ethical.

[jabo38]

^- One of the best reads in a long time.

It states the problem, but what's the solutions?

Where is your average Joe going to get his Bitcoins without without trusting a third party like gox or mintpal?

The trust is the point of failure that probably is stoppong a lot more people jumping into btc

How can you get them?  Without sending money to btcE or bit stamp which I trust neither and don't even consider trusting the smaller less known exchanges etc

Until there's a rock solid way for someone to buy 100,000usd+ of Bitcoins with zero risk of being ripped off the whales will not jump on board

There is no exchange I would ever trust with 100k or more

I think Coinbase is insured and allows the user to use a vault now in which they have the private keys. 

If the money is ripped off before it gets into the vault, Coinbase's insurance should cover it.  If it is ripped off after it is in the vault and the user has the private keys, then the user probably did something wrong.

[Erdogan]

These types of services are welcome. We will see how badly they will be regulated by coercion from the state, if not, they will be held in check by the market (with some cockups). If the market demands it, and it can be supplied to the right price, it is good.

The actual point of regulation is to try to minimize the expense of dealing with them.  Unregulated businesses in a situation where they are trusted (ie, where they can screw their customers over) are very expensive.  In fact, experience shows, more expensive than tightly regulated ones.

We would like to not labor under the cost of regulation.  But avoiding regulation doesn't work to keep costs down either, unless we can come up with trust-free (ie, where they CAN'T screw their customers over) models for these services.

This is about adoption; if Bitcoin remains more expensive (ie, if the cost savings of a trust-free business model remains something we can't actually deliver to end users and businesses) then there isn't an economic motive for mainstream businesses to adopt Bitcoin. 

I don't agree. The point of regulation is to create relative bans and relative privileges, which escalates to absolute bans and privileges, which is equal to a monopoly by coercion. It always reduces the options for the market, which makes everything more expensive.

Bitcoin is not perfect for all purposes, so we need extensions. Trustless solutions using crypto is preferrable, but in trading goods and services for money, some level of trust both ways between customer and supplier is always necessary and not always unwanted, and service companies that need a low level of trust to help the process is ok.

[fabiola!]

Just bought 3 more BTC for 1k, like a fuckin BOSS

Oi! Showing off is prohibited. stop it!