talks_cheep (OP)
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April 08, 2016, 12:03:10 AM |
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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.
If you're mining, you likely already own coins, and increasing hash power just drives the price up of the ones you already have as well. Trust me, I've rented out like 80% of the hashpower of entire altcoins, I'm an expert on this from firsthand experience. Since the amount of miners deployed increased a lot with the recent price increase, this means the floor miners will stop selling at raised too. After the halving, the miner profitability drops in half. If the majority of the network is composed of ASICs that are supposed to be technologically viable, or even near their ROI period at all, but the sell rate is not favorable to that, they will simply stop selling, supply withers to nothing, then the price boom occurs.
Miners also tend to mine at a loss in hopes of future returns (being a deflationary system and all) long before turning their miners off. It is 100% inevitable price increases after halving. Post halving price is a function of what the market can bear pre-halving. We've already seen the Mike Hearn R3 propaganda scare dumps where the market didn't drop that much then rebounded anyway. There's not a problem with the market supporting this ballpark of pre-halving price of around a 410 floor.
No matter how you look at it, post halving, in one way or another, through multiple dynamics, the supply will decrease propotional to demand. Mining is a form of demand. Mining is a decentralized exchange, Coinbase is a centralized exchange. The price could increase 50%, it could increase 100%, or depending how elastic demand is, it could go much higher through a big shock in supply side distortion. Around 75% of Bitcoin has already been mined, so the hard part, the putting money up front to capitalize the accumulation period, is already done. Now the people who have accumulated just wait for inflation to drop, like it's about to do, then send the market higher. The market will move through both predictable laws of economics and whale engineering at the same time.
Mining has no effect on the bitcoin price. You can turn off your miners and no one will care; you can turn on your miners and no one will still care. Now, if ALL MINERS decide to turn ALL mining gears off, then it will probably impact the price, but that will NEVER happen, so let's not go there.
On the other hand, bitcoin price has a tremendous impact on mining. We've seen it in 2015 when bitcoin price was in the toilet, the hashrate stayed about the same or went up a little.
Miners can only generate about 1440 bitcoins a day, when you consider that a Chinese exchange can digest 1440 coins in one minute, you can see the futility of argument about mining affecting bitcoin price.
Some hero/legendary members are so short-sighted or so bulltardy that they refuse to see the truth, or they see and know the truth but can only spew lies upon lies for their personal benefit.
As for the market price being what it is, almost double since January 2016, the only reasonable explanation is the Halving in July. Everyone and their grandmothers know what's coming. Traders, seeking only profit, must engage proactively or else they will be blind-sided, so they buy more than they sell, precisely because they know it's about to become a little more scarce.
Beware of heroes/legendary members who tout only one side of the argument, they come with hidden agendas and vested interest.
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