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chiropteran
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April 01, 2013, 10:26:31 PM |
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What we can easily predict is that it will not take several months to burst.
Why do you say that? It has already been several months. |
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jwzguy
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April 01, 2013, 10:27:08 PM |
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What do you think these people will do when they see the bitcoin price drop like a rock through their buying price? Look at the 2011 bubble.
Yes, please at 2011. Now look at what happened every time the price went down 20% in the last 2 months. Take a good look. There have already been plenty of opportunities to panic. Where do you see any evidence for that? I could just barely believe a doubling of real-world use, but please tell me who buys which goods or services for bitcoin? namecheap.com or wordpress.com? Reddit Gold? Have you ever heard of anybody paying a bitcoin there?
Holy shit, are you serious? Can you possibly be serious? I see more evidence for it constantly. There was a reddit topic today about how 18k USD (at time of tip, not now) has been paid out through the reddit tipbot. That's 18k in just TIPS. There are new companies posting -every single day- now. Wordpress is big, yes. Expensify is HUGE. Bitpay has signed up thousands of businesses. I'm not going to sit here and spend 2 hours listing all the posts I've read in the last 6 months...if you're not bothering to keep up, then don't make ridiculous statements like "real world usage has not increased." I'm posting this on my new monitor from BitcoinStore.com. |
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hgmichna
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April 01, 2013, 10:31:41 PM |
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What we can easily predict is that it will not take several months to burst.
Why do you say that? It has already been several months. No, I mean from now. It will not take several more months from now until it bursts. |
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bootlace (OP)
Full Member
 Offline
Activity: 364
Merit: 100
Justice as a Service Infrastructure
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April 01, 2013, 10:35:52 PM |
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If bitcoin survives for another good number of years and does not get overtaken by something like a hypothetical bitcoin2, its prospects are, indeed, bright.
However, at the moment this rather extreme price bubble is about to severely damage its fair reputation.
Currently it is not the Cypriots or the Spaniards who buy bitcoin. It is only a growing bunch of newbie speculators and their mothers. The only reason why they buy bitcoin is because the price is rising. And the price is only rising because these people are buying bitcoin. This is how bubbles are made.
There has been no significant increase in real-world use of bitcoins. A few more companies are now accepting bitcoins, but very few customers actually pay in bitcoin. Therefore the price will sink back to pre-bubble levels within about half a year after this bubble bursts, which it may do within weeks.
As usual it is impossible to make any precise estimate about how high a bubble will go, because a single person can prick it by selling a lot of bitcoins and thus inciting a sell-off panic. If nobody does, such a bubble can grow to strange heights. But even then this one cannot grow to $1,000. As the Germans say, trees do not grow into heaven.
It is a bit difficult to say what the pre-bubble value is, because this one began before the previous one of 2011 was fully deflated. I am sure though that the bitcoin price will fall to some $20 level and quite possibly into the single digits. $50 is way out of reason. Let's talk again in half a year's time.
I agree, I've been researching and following the behaviors of the so called 'new investors' on this forum, on reddit/r/bitcoin, on Twitter, YouTube videos, comments of Bitcoin articles etc - and I get a general feeling that people feel excited because they are some kind of revolutionary changing the world and becoming a millionaire in the process (after Zuckerberg did it, everyone feels like 'why not me too!'). It's certainly a dream that would excite any person and could even lead them to think and act irrationally. What I have NOT heard is of case studies involving businesses who are rejoicing that they started accepting bitcoins (in fact I believe the bitcoinstore.com is having lots of issues despite even providing cheaper prices), I have not seen any 'killer app' (Satoshi Dice is, sadly, the most used 'function' right now), I have not even seen people excited to even spend or send their coins anywhere despite the value and supposed myriad of things they can do with it. I don't think this bubble will pop easily, the adopters are probably willing to go broke to get a chance to live that dream they have in their mind of being Bitcoin millionaires. It's going to be an interesting thing to observer, that's for damn sure. |
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chiropteran
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April 02, 2013, 12:00:47 AM |
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What we can easily predict is that it will not take several months to burst.
Why do you say that? It has already been several months. No, I mean from now. It will not take several more months from now until it bursts. I'm confused because immediately before that, you said "nobody can predict the height of that peak" How can you accurately predict it will not take several months? I don't think you can. I was worried this might be a bubble too, but if the bubble didn't "pop" when the blockchain forked, what is going to take to cause it to break? I don't think a mere lack of inflation will cause it to burst, it's going to take some serious negative event, something huge and difficult to fix. I'm not sure such a thing even exists, bitcoin seems to be a lot more resilient now. |
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Peter Lambert
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April 02, 2013, 12:04:23 AM |
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How can you accurately predict it will not take several months? I don't think you can. I was worried this might be a bubble too, but if the bubble didn't "pop" when the blockchain forked, what is going to take to cause it to break?
I don't think a mere lack of inflation will cause it to burst, it's going to take some serious negative event, something huge and difficult to fix. I'm not sure such a thing even exists, bitcoin seems to be a lot more resilient now.
Bubbles do not pop when something bad happens, they pop when there is no more money pouring in to hold up the price. |
Use CoinBR to trade bitcoin stocks: CoinBR.comThe best place for betting with bitcoin: BitBet.us |
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chiropteran
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April 02, 2013, 12:26:01 AM |
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Bubbles do not pop when something bad happens, they pop when there is no more money pouring in to hold up the price.
Why would there ever be a lack of money coming in, in the absence of something terrible occurring? If price drops naturally, it just makes the long term enthusiasts more likely to buy up coin. |
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hgmichna
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April 02, 2013, 06:25:26 AM
Last edit: April 02, 2013, 01:17:55 PM by hgmichna |
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Bubbles do not pop when something bad happens, they pop when there is no more money pouring in to hold up the price.
Why would there ever be a lack of money coming in, in the absence of something terrible occurring? If price drops naturally, it just makes the long term enthusiasts more likely to buy up coin. If you look at the price curve, perhaps at a smoothed average, you will see that the growth is exponential. This means that the total bitcoin market capitalization will very soon grow beyond any attainable value. This is typical bubble behavior. The bubble suddenly bursts when the price no longer increases, because there are also quite a few people who are fully aware that this is a bubble and will try to get out before it bursts. There will also be people who just bought and now see their wealth shrinking fast. They will try to recover some of it by selling their bitcoins. That is because most experienced speculators know that it will be difficult to sell bitcoins immediately after the burst. |
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chiropteran
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April 02, 2013, 12:06:00 PM |
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If you look at the price curve, perhaps at a smoothed average, you will see that the growth is exponential. This means that the total bitcoin market capitalization will very soon grow beyond any attainable value.
Your first part is true, growth is exponential. The second part is not true. We have seen value increase 10X over 6 months. The total bitcoin market cap could increase at this rate for over a year without exceeding the market cap of Apple, just as an example. If a stock can do it, bitcoin can. |
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OnlyGoodVibes
Newbie
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Activity: 41
Merit: 0
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April 02, 2013, 01:56:19 PM |
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I think hgmichna has a very worthwhile down to earth opinion. People who truly believe the value of BTC is fundamentally supported by retail because they bought a coffee from their local hipster coffee shop yesterday need to think a bit harder about why people are willing to pay more and more for BTC, not because they can buy stuff without the tyrany of the banks, but because they want in on the bubble. Greed prevails, and greed falls.
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Draino
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April 02, 2013, 02:06:20 PM |
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Peter Lambert
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April 02, 2013, 02:08:42 PM |
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Bubbles do not pop when something bad happens, they pop when there is no more money pouring in to hold up the price.
Why would there ever be a lack of money coming in, in the absence of something terrible occurring? If price drops naturally, it just makes the long term enthusiasts more likely to buy up coin. It is people who think like this who wonder why they are left holding an empty bag. |
Use CoinBR to trade bitcoin stocks: CoinBR.comThe best place for betting with bitcoin: BitBet.us |
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dacoinminster
Legendary
Offline
Activity: 1260
Merit: 1031
Rational Exuberance
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April 02, 2013, 02:53:20 PM |
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jwzguy
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April 02, 2013, 03:55:32 PM |
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