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

[Chef Ramsay]

insert garbage spam here

^Click this guy's post history.  Every single post is "blah blah bitcoin will crash to 0 any second" for like a year straight while it goes from $200 to $500 instead.  Not sure how he isn't banned being the most obvious banking shill spam account on the forum.  The banking shill idiots obviously didn't think people can look up their posts to spot them with ease.

Obvious tentacle of the lambwhore, same tactic every time it posts. Complete shill I might add.

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[JayJuanGee]

insert garbage spam here

^Click this guy's post history.  Every single post is "blah blah bitcoin will crash to 0 any second" for like a year straight while it goes from $200 to $500 instead.  Not sure how he isn't banned being the most obvious banking shill spam account on the forum.  The banking shill idiots obviously didn't think people can look up their posts to spot them with ease.

Obvious tentacle of the lambwhore, same tactic every time it posts. Complete shill I might add.

Hahaahhahahahah...

Funny that he joined right in the middle of August 2015... right when Bitcoin began it's famous move out of the 2015 $200s rut... and life for BTC has been pretty good since then.... .. except for these various XT/Classic whiners who also claim that bitcoin does not scale... blah blah blah.. let's change governance...

Yeah, right... 

[dooglus]

If bitcoin halving for 2016 is already priced in, does that mean the halving in 2020, 2024 and onwards are also priced in already? 

Yes, of course.

If the forthcoming halving was known to be the last ever halving, we would all know that the supply isn't capped at 21 million, but is instead infinite. That would of course affect the price.

Everyone knows that the Bitcoin supply is capped at 21 million, and takes that into account when considering the value of a bitcoin. The cap is the result of all future halvings.

Thanks for showing how dumb their argument is.  After this halving, inflation is down to 4% or so instead of 8% I believe.  Going to be interesting seeing some of the weaker South American currencies trying to compete with it.

Our argument is that all future halvings are already known about, and are therefore already priced in. What is dumb about that?

I am yet to see any argument from you that supports your claim that the next halving isn't (and cannot be) priced in.

[megadeth]

If bitcoin halving for 2016 is already priced in, does that mean the halving in 2020, 2024 and onwards are also priced in already? 

Yes, of course.

If the forthcoming halving was known to be the last ever halving, we would all know that the supply isn't capped at 21 million, but is instead infinite. That would of course affect the price.

Everyone knows that the Bitcoin supply is capped at 21 million, and takes that into account when considering the value of a bitcoin. The cap is the result of all future halvings.

Thanks for showing how dumb their argument is.  After this halving, inflation is down to 4% or so instead of 8% I believe.  Going to be interesting seeing some of the weaker South American currencies trying to compete with it.

Our argument is that all future halvings are already known about, and are therefore already priced in. What is dumb about that?

I am yet to see any argument from you that supports your claim that the next halving isn't (and cannot be) priced in.

One good reason your argument fails is that there is no guarantee of bitcoin surviving upto each halving.

[r0ach]

If bitcoin halving for 2016 is already priced in, does that mean the halving in 2020, 2024 and onwards are also priced in already?  

Yes, of course.

How did you develop such primitive level of thinking???  I'm not sure what school of economics or trading you're following here, but it's one that obviously did not teach you the words "time opportunity cost", so of course it's not priced in, holy shit.  Claiming not one, but THREE halvings are already priced in is pure insanity.

From the way you talk, you seem to think highly of your intelligence for some unknown reason, so I'm guessing you're one of those rainman guys who can count a box of matches before it hits the ground but can't understand basic concepts like being able to tie your shoes or drive a car without killing 10 people.  Or the fact that for something to be "priced in" would imply a level of homeostasis, which is completely IMPOSSIBLE when either the price has to go up a lot or lots of miners would have to turn off their equipment.  

Miners are not turning off their brand new 16nm equipment.  They've already invested literally hundreds of millions of dollars in them.  They will simply start buying coins off the wall to dollar cost average if price doesn't go up and move it up themselves.  Miners aren't powerless, broke idiots just sitting around waiting for fate to give them some random outcome.

[stckpkr7000]

I'm with you Roach.  Some folks have zero understanding of VERY basic economic principles.  I guess common sense isn't as common as I once believed.  Increasing demand  (no guarantees this will be the case, but history is on our side), with less coins joining the float will absolutely positively increase the price.  There is NOOOOOOO way around it, but some can't seem to grasp the concept of supply/demand.  Bitcoin has been slowly increasing over the past several months.  This means more money is coming into BTC vs the $ amount joining the float on a daily basis.  Yes, some miners and others sit on their coins, but they have their reasons.  Big fish are starting to swim into this space and it will be a game changer.  The coming economic weakness will bring much uncertainty, plus the halving and diminishing fear regarding the fork.  Heck, throw in a possible ETF enabaling Joe Trader to buy and sell BTC.  1,000+ coming to a theatre near you.

[dooglus]

I'm with you Roach.

I understand that you want and expect the price to rise, but do you agree with the roach that it is impossible for a known future event (the halving) to already be priced in?

[dooglus]

the halving is a non-event with respect to price, or at most it is an event of trivial proportion. There is nothing to price in or not price in.

The halving halves the supply of new coins from 3600 coins per day to 1800 coins per day.

If we take a simplistic view that there is a steady demand of 3600 coins per day at the current price then it is safe to assume that suddenly halving the supply while not changing the demand will cause an increase in price.

The problem with this is that everyone already knows that the supply is about to halve, and so some people will already have been acting upon that knowledge.

[Amph]

the halving is a non-event with respect to price, or at most it is an event of trivial proportion. There is nothing to price in or not price in.

The halving halves the supply of new coins from 3600 coins per day to 1800 coins per day.

If we take a simplistic view that there is a steady demand of 3600 coins per day at the current price then it is safe to assume that suddenly halving the supply while not changing the demand will cause an increase in price.

The problem with this is that everyone already knows that the supply is about to halve, and so some people will already have been acting upon that knowledge.

there is a fallacy in this that assume that the dumped coin are equal to the total coins produced, what if they are only dumping 900 coins per day, which is in fact equal to their consumption since the ratio is 4:1 right now between consumption and earning?

this will lead us to the fact that with the halving the dumping will change only by 450 coins per day, which is nothing for the market

[classicsucks]

the halving is a non-event with respect to price, or at most it is an event of trivial proportion. There is nothing to price in or not price in.

The halving halves the supply of new coins from 3600 coins per day to 1800 coins per day.

If we take a simplistic view that there is a steady demand of 3600 coins per day at the current price then it is safe to assume that suddenly halving the supply while not changing the demand will cause an increase in price.

The problem with this is that everyone already knows that the supply is about to halve, and so some people will already have been acting upon that knowledge.

there is a fallacy in this that assume that the dumped coin are equal to the total coins produced, what if they are only dumping 900 coins per day, which is inf act equal to their consumption since the ratio is 4:1 right now between consumption and earning?

this will lead us to the fact that with the halving the dumping will change only by 450 coins per day, which is nothing for the market

The market is the market. If demand remains steady (not saying it does) and supply is cut in half (this IS guaranteed), price should double. Demand is a big unknown - probably the majority of it is NOT for commerce, but rather for SPECULATION. I believe that speculators have asymmetrical knowledge, and vary widely in their understanding of investing, markets, and cryptos. Thus the next 3 months are going to be an interesting time... If the halving is already priced in, in theory there could be no movement, or even a downward movement, at next halving. I regard this as unlikely. Downtrends are usually panic-based.

Let's remember that miners are not required to sell coins mined.  Incentive to sell increases as price increases. If I was mining on a huge scale right now, I'd probably be pocketing all of my coin, while quietly selling off my mining gear for more coin... 

As discussed previously, miners have a collective incentive to keep prices up, so logically they're engaged in price boosting using any and all techniques available. Traders are interested in volatility and had their pump-n-dump fun a few years back. An unknown group is likely interested in shorting, I guess this group would include state actors?

[marcus_of_augustus]

The problem with this is that everyone already knows that the supply is about to halve, and so some people will already have been acting upon that knowledge.

... ummm, by doing what exactly? Most people are stupid and lazy and wont act until they have to, usually when it is too late. And what can they do exactly, produce more coins now in anticipation of the halving??

[talks_cheep]

So much ignorance, especially the so called hero and legendary level members, they should be ashamed. It just proves they're mostly bulltards who are waiting to unload their bags on unsuspecting victims noobs. F&ck'em all.

[r0ach]

The market is the market. If demand remains steady (not saying it does) and supply is cut in half (this IS guaranteed), price should double.

If supply is cut in half and demand remains the same, market goes parabolic and you end up with $10,000 xboxs on ebay.  While we are not cutting the supply in half of all Bitcoin's in circulation, the price of Bitcoin is determined by float, which newly mined coins make up a huge part of.  

To emphasize the point, it's estimated by some that up to 30% of Bitcoins might have been lost by users in the early stages of the coin (but not nearly as many people lose coins now).  If you could prove or disprove this fact, it probably wouldn't even have an effect on price because it's just not part of the float of coins on the market.  So, while cutting non-float coins in half can even give you no effect on the market, cutting newly mined coins in half is where the big effect happens.

[nanobrain]

Most people are stupid and lazy

or arrogant enough to believe that.

[r0ach]

Most people are stupid and lazy

or arrogant enough to believe that.

No, this is backed by the laws of thermodynamics, properties such as homeostasis, and the path of least resistance.  An example being, human brains take large amounts of energy.  Humans supposedly only use a fraction of their brains.  Since you didn't evolve to require eating 100 McDonald's burgers per day to power the full extent of your brain, you're kind of inherently lazy by default.  Dolphins supposedly even shut parts of their brains off while still roaming around.  

If you did evolve to use 100% of your brain and bodily systems at all times, and the required, intensive metabolic activity to support it, the wear and tear on organs and buildup of external carcinogens from processing all that would probably kill the host pretty fast before being able to participate in K selection strategy, so you'd require R selection strategy and devolve to a rat.  That is, unless you can genetically engineer humans with the same types of anti-carcinogen attributes as things like sharks, or pseudo-biological immortality like jellyfish, plus a post scarcity ecosystem/economy on top of that...

[marcus_of_augustus]

Most people are stupid and lazy

or arrogant enough to believe that.

... she said, while splayed on the couch, munching on a box of jacks watching daytime soaps.

[Amph]

demand remaining the same and the dumping from miner cut in half does not equal to an increase

remember that demand being the same can also mean that they buy at the same value, no at a better value

less dumping just mean that the value will hold strong at what it is right now, so do not assume an increase in this case either...

[marcus_of_augustus]

the halving is a non-event with respect to price, or at most it is an event of trivial proportion. There is nothing to price in or not price in.

The halving halves the supply of new coins from 3600 coins per day to 1800 coins per day.

If we take a simplistic view that there is a steady demand of 3600 coins per day at the current price then it is safe to assume that suddenly halving the supply while not changing the demand will cause an increase in price.

The problem with this is that everyone already knows that the supply is about to halve, and so some people will already have been acting upon that knowledge.

The halving does not halve the supply. The supply increases with every block. Bitcoins are not consumed. The 3600 or 1800 BTC mined yesterday will be part of the supply today, and the 3600 or 1800 BTC mined today will be part of the supply tomorrow, along with the 3600 or 1800 BTC mined yesterday. Even if you consider 50% of the coins each day as lost or otherwise consumed or unavailable, the supply still increases with every block.

... and so the 'supply' of fiat that represents demand for bitcoin is potentially all the fiat in the world by that logic? (And increasing by the billions of fiat per month at last count)

[BlueSuede]

the halving is a non-event with respect to price, or at most it is an event of trivial proportion. There is nothing to price in or not price in.

The halving halves the supply of new coins from 3600 coins per day to 1800 coins per day.

If we take a simplistic view that there is a steady demand of 3600 coins per day at the current price then it is safe to assume that suddenly halving the supply while not changing the demand will cause an increase in price.

The problem with this is that everyone already knows that the supply is about to halve, and so some people will already have been acting upon that knowledge.

The halving does not halve the supply. The supply increases with every block. Bitcoins are not consumed. The 3600 BTC mined yesterday will be part of the supply today, and the 3600 BTC mined today will be part of the supply tomorrow, along with the 3600 BTC mined yesterday. Even if you consider 90% of the coins mined each day as lost or otherwise consumed or unavailable, the supply still increases with every block.

Consider this: when the number of bitcoins mined each day drops to 0, will we suddenly run out of bitcoins? No. At that point, the supply will be constant (ignoring market factors and lost coins). As long as new bitcoins are being mined, the supply is increasing.

Bitcoins are not "consumed" per se but the number of people holding them or using them for trading \ speculation are constantly increasing; so we can assume that the demand mean is increasing over a long period of time.

I still belive that the bitcoin price isn't 100% influenced by demand\offer tho; it's highly speculative. And thus i belive the expectation for the price increase will drive the price up by itself

[r0ach]

And thus i belive the expectation for the price increase will drive the price up by itself

The common spam you always see from the banker shills on here is that "if everyone thinks the price will go up the market will do the opposite!".  WRONG, pumpers are always looking for an excuse to pump the market to some bollinger band busting levels after they buy in early, whether it's Bitcoin, gold, or goats.