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

[IOTUSA]

it is the same story all over again.
if i wasn't so lazy i would have searched the forum and listed all the topics from the last halving and people saying halving has priced in and price is not gonna rise. now we all know how that ended by that time.

Yes, it rose substantially before the halving and then was fairly flat for a couple months after the halving until the Cyprus bubble began.

I think Litecoin's halving is more relevant since it was just last year. In that case, there was a bubble caused by all the halving hype (plus the steep increase in all crypto prices). The bubble popped just before the halving and the drop continued past the halving. It stopped falling and has been flat ever since.

I believe that Bitcoin will behave similarly except that any halving hype bubble will be limited by the block size drama and the "death spiral" hysteria.

You can't compare the halving function in Litecoin to Bitcoin. In Litecoin, people just took their ASIC and mined some random altcoins instead. The amount of hardware in the bitcoin network is 100x or more of the Litecoin network, and platform value is 15x. No valuable comparison can be made.

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[r0ach]

it is always like this, there is a flat line with a nearly stable price (maybe small sparks here and there) and everybody accumulating and then something happens (and it doesn't matter what if you ask me) and then price explodes.

i say this time it is going to be the block size after halving. whether it is segwit, lightning network or classic; as soon as it becomes certain the price will explode.

Core has already conceded on a block size hard fork increase in 2017.  So segwit + 2mb fork = 3.2mb.  Then schnorr multisig is supposed to reduce transaction overhead substantially on top of that.  It's interesting that Trump wants to ban money transfers to Mexico, which would cause a 600%+ increase in Bitcoin market cap if they switched to Bitcoin to bypass that (likely higher since it's fully capitalized cap), while Bitcoin throughput might also be having a similar large increase at the same time.  Bring on the Mexicans.

[JayJuanGee]

it is the same story all over again.
if i wasn't so lazy i would have searched the forum and listed all the topics from the last halving and people saying halving has priced in and price is not gonna rise. now we all know how that ended by that time.

Yes, it rose substantially before the halving and then was fairly flat for a couple months after the halving until the Cyprus bubble began.

I think Litecoin's halving is more relevant since it was just last year. In that case, there was a bubble caused by all the halving hype (plus the steep increase in general crypto prices). The bubble popped just before the halving and the slide continued past the halving. It stopped falling and has been flat ever since.

I believe that Bitcoin will behave similarly except that any halving hype bubble will be limited by the block size drama and the "death spiral" hysteria.

it is always like this, there is a flat line with a nearly stable price (maybe small sparks here and there) and everybody accumulating and then something happens (and it doesn't matter what if you ask me) and then price explodes.

i say this time it is going to be the block size after halving. whether it is segwit, lightning network or classic; as soon as it becomes certain the price will explode.

Actually, this is a real decent point that seems to relate to momentum, and what causes the momentum is not so important as the fact that momentum is created.

Accordingly, the flat price performance periods seem to serve as back and forth and uncertainties about which direction is the price going to go.  Attempts at spreading FUCD, and also attempts to hype, too.  Yet during the more or less flat periods, there is an inability to push prices either above a certain price point or below another price point. 

Likely in the past 3 months or so, we've had prices largely between $360 and $460... and some unsuccessful attempting to push beyond those price points.  Further, during this past three month period, there was a certain amount of the bitcoin community buying into various disinformation regarding technical problems with bitcoin blocksize limits and mixing up the topic of "technical problems" with overly exaggerated concerns about governance issues and seemingly purposeful creation of a variety of loudly vocalized discontent. 

Yet, as time passes and maybe as some of the quasi-related technical implementations (such as segwit) roll out (and the sky doesn't fall), momentum is going to pick up in the upward price direction and a large number of people following bitcoin and also newbies to bitcoin are going to jump on the bitcoin train for the upward momentum that will likely be difficult to hold back (at least for a certain period) that may well take us to the $3,000 to $5,000 price territory.. this may not specifically be halvening that causes it, but a variety of factors coming together (which no doubt will include some of the dynamics of supply and demand - which involves materially that half of the amount of coins are being mined on a daily basis).

[JayJuanGee]

Most people in the speculation forum don't understand anything about Bitcoin mining.  The first thing you need to understand is, nobody running a current process node miner actually turns them off no matter what the price does.  You're either an ASIC dealer that spent millions on research and design to make it, or some random Joe that paid a big premium for one.  Turning them off makes no sense for anyone since Bitcoin is an asymmetric investment.  Unless you're mining with crazy expensive electricity, your current generation miner will either pay off eventually, or Bitcoin will go to 0.  There's no purpose in turning it off.

While I like your thinking in general, this is a false dichotomy. You're forgetting that miners can and will SELL THEIR HARDWARE. We all know that mining becomes half as profitable overnight when the reward splits. Then likely the price of mining hardware will drop. If the price of mining hardware drops, couldn't the price of coin drop also, despite the decrease in supply? Do we have a good handle on demand? And what percentage of cash for coin exchange is just miners SELLING TO THEMSELVES to keep the price up?

When I look at exchange traffic and charts, it looks like automated trading to me.

I've bolded your last two sentences, above.

You are likely engaged in a bit of fiction thinking if you believe that miners buying/selling to themselves would have any meaningful impact on price or that it is any kind of widespread factor that affects price in any significant way.  Further, in recent years, most legitimate exchanges (that affect prices) have various kinds of fees that would cause disincentives to trade with self.  The extent to which some of the Chinese exchanges have no fees also cause a dramatic increase in volume, and they tend to not be much if anything of price leaders in recent years (and yes those exchanges are likely heavily employing bots that trade on very tiny spreads).

Employing bots on fee bearing exchanges does not delegitimize the trades, and the exchanges that maintain fees tend to be the most likely to be the price leaders... and even when exchanges allow for a large amount of leverage trading, those kinds of practices can take away (or at least discount) their ability to be price leaders.  Yet, in the end, the price is driven by the combination of the actions on the exchanges, which supply of "actual" coins will factor into how much the price changes in one direction or another.

[primer-]

This guy, roach, is an idiot. Just look at his post history.
I guess he sold his wife for bitcoin, expecting to profit + buy her back after the halving... 

[marcus_of_augustus]

Brilliant post r0ach, it has certainly flushed out the trolls and haters (at least we can find them all in one place now.)

What he is describing is the demand floor that mining represents for a current and on-going demand of 3600 bitcoins per day at cost price.

As market price decreases below cost price that 3600 bitcoin per day number increases, and exponentially not linearly.

100 days after halving (~3.5 months) there will be a shortfall of 180,000 coins, at the current cost.

200 days after halving (~7 months) there will be a shortfall of 360,000 coins ... i.e. the total 'float' presently in all the exchanges.

[dooglus]

If the price is guaranteed to rise significantly after the halving, why aren't you buying as many coins as you can now so you can make a guaranteed profit when the price rises? Why wouldn't the smart money buy up all the cheap coins now, up to the post-halving price, and therefore pricing in the halving jump in advance?

I put it to you that this has already happened.

[marcus_of_augustus]

If the price is guaranteed to rise significantly after the halving, why aren't you buying as many coins as you can now so you can make a guaranteed profit when the price rises? Why wouldn't the smart money buy up all the cheap coins now, up to the post-halving price, and therefore pricing in the halving jump in advance?

Nobody knows how much bitcoins will cost to produce in January next year.

[r0ach]

If the price is guaranteed to rise significantly after the halving, why aren't you buying as many coins as you can now so you can make a guaranteed profit when the price rises? Why wouldn't the smart money buy up all the cheap coins now, up to the post-halving price, and therefore pricing in the halving jump in advance?

I put it to you that this has already happened.

Because small traders are agile traders that have advantages in markets.  If someone is a billionaire, they're not going to go all in on Bitcoin because...they aren't going to go all in on anything no matter how good it sounds.  You have some rare exceptions like Soros, but he's an insider trading financial terrorist benefiting from government connections and should be in jail.

[smooth]

If the price is guaranteed to rise significantly after the halving, why aren't you buying as many coins as you can now

How do you know he's not?

Why wouldn't the smart money buy up all the cheap coins now, up to the post-halving price, and therefore pricing in the halving jump in advance?

The answer would be there is not enough 'smart' money playing in this market, relative to the amount of 'dumb' money that incorrectly doubts r0ach's theory.

I don't really agree with this, but the argument can be made.

[r0ach]

Right now we seem to be in the final stages of accumulation before the price moves, as you can see from that picture I posted earlier.  Either guys like this will succesfully drop the market to $410 or something and then buy, or within the next 5 days, you will start seeing big chunks taken out of the sell side and it moves up:

The difference in buying at 410 and 420 is pretty irrelevent at this point, so I don't even know why they're doing it.  Maybe they think they can force triangle convergence downward for a bigger discount, who knows.  It seems they already own lots of coins, so this would be an extremely stupid move when post halving price is a function of what the market can bear pre-halving.  Trying to tank the market on purpose right before halving is about the dumbest thing you can do when you're simultaneously invested in it.  Maybe they just really want that $10 discount.

[JayJuanGee]

Right now we seem to be in the final stages of accumulation before the price moves, as you can see from that picture I posted earlier.  Either guys like this will succesfully drop the market to $410 or something and then buy, or within the next 5 days, you will start seeing big chunks taken out of the sell side and it moves up:

The difference in buying at 410 and 420 is pretty irrelevent at this point, so I don't even know why they're doing it.  Maybe they think they can force triangle convergence downward for a bigger discount, who knows.  It seems they already own lots of coins, so this would be an extremely stupid move when post halving price is a function of what the market can bear pre-halving.  Trying to tank the market on purpose right before halving is about the dumbest thing you can do when you're simultaneously invested in it.  Maybe they just really want that $10 discount.

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I agree with a lot of what you are saying, rOach; however, when attempting to predict price direction and market behaviors of various mixed motive actors, we cannot assume that everyone who has accumulated a bunch of bitcoins owns those coins for the purpose of profiting off of those bitcoins directly.  

It seems to me that there are some actors (including finance institutions, payment processors and governments) who likely own a significant quantity of bitcoins, but they are invested in bitcoin not being successful and they perceive it to be in their best interest if bitcoin is not successful (and bitcoin's price is suppressed) ... therefore, these kind of persons (entities) may still own some bitcoins and are willing to lose money on their bitcoin investment/holdings in order to gamble that they are going to be able to profit in other ways (so long as bitcoin's price does not go up).

[GonnaGrinditout]

My scenario for bitcoin price on the long term: ↗
My scenario for bitcoin price after the halving: ➘
A lot of recent buyers bought BTC just because they read on forums, crypto-medias that the price is going to rise very fast to the moon the day of the halving, or the day after... When they will realize it's not true, they will sell because they don't believe in the potential of bitcoin, like long term holders, they are just speculators. No increase, no profit, no reason to hold.
In addition, I think a lot of people in the bitcoin community are really frustrated with the problems of scalability, and the central planning by Blockstream: as I understand this part of the community thinks bitcoin is not anymore the cryptocurrency envisioned by his creator Satoshi Nakamoto and that core devs are working for the blockstream company instead of working in the interest of bitcoin users (we don't care if it is true or not, because it's not the topic here). This part of the community which is feeling betrayed could have sold their bitcoins 3 or 6 months ago, (like Mike Hearn did) but guess what: they are also waiting for the halving, in the little hope of a slight price increase and better conditions to sell.

[BellaBitBit]

Interesting explanation specifically about mining.  I don't think anyone knows how this is going to go.  There could be a scenario where a bunch of mainstreamers start hearing about a "profit situation" with the halving of bitcoin and it could jack up the price - this could also not happen.  There are many things that can take place before halving, it is an eternity away.

[r0ach]

There are many things that can take place before halving, it is an eternity away.

Lol, something 90 days from now is an eternity?  

[lyth0s]

R0ach what would you predict for bitcoin price just before the halving, 1 month after and 6 months after? This is a speculation sub-forum and I'd like to hear your opinion.

I won't pass any judgement if your actual $ amount predictions are wrong. But I will give you cred for them if they are correct   I agree that the price will go up as well and the full price cannot be "factored in" before the actual supply/demand changes have affect.

[solitude]

[/quote]

It seems to me that there are some actors (including finance institutions, payment processors and governments) who likely own a significant quantity of bitcoins, but they are invested in bitcoin not being successful and they perceive it to be in their best interest if bitcoin is not successful (and bitcoin's price is suppressed) ... therefore, these kind of persons (entities) may still own some bitcoins and are willing to lose money on their bitcoin investment/holdings in order to gamble that they are going to be able to profit in other ways (so long as bitcoin's price does not go up).
[/quote]

While there is no doubt some rich cunts who have been buying as much bitcoin as they can get their hands on the past couple of years, possibly with the ultimate plan of eventually seeing bitcoins demise, I can assure you they will never get their hands on my coins, regardless of how low (and maybe high) the price of bitcoin goes.

There are a shitload of people just like me who are smart (and stubborn) enough to never ever sell their coins.

All they can do is paint bitcoin in a negative light through the jewish-controlled mass media like they're currently doing with Donald Trump.

[Chef Ramsay]

[Chef Ramsay]

[Chef Ramsay]