Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

[Richy_T]

I do gather that you, richie, are inclined to follow the price follows hashrate nonsense,

Let me stop you right there. That is by no means the case and I don't believe I have ever stated anything that could even be construed as such.

As far as I'm concerned, we're in a process where Bitcoin is trying to find where its price matches its value (and I believe we are quite a long way yet) via the market discovery process. Along the way that will be moderated by a variety of mechanisms which I won't go into here but a little logic shows that this can only be accomplished via a volatile process (how volatile it needs to be is an interesting question but the actuality is that it has been violently volatile). This process seems to be fairly well divorced from the hashrate.

Now, the mechanism for hashrate seems to be "If Bitcoin is profitable, buy more equipment". That does potentially link hashrate and price (but not in the direction that the opinion you incorrectly ascribe to me would suggest). However, as Bitcoin as near as dammit always been profitable, the restricting factor has been equipment availability which has lead to a total divorce between the two concepts. I will say that on at least one occasion, miners have surprised me by being willing to be patient for future profits rather than following pragmatism but they surely had good reason and that doesn't really affect things much.

[Richy_T]

Well, it finally happened. I am Corona positive.

This is almost as much of a bummer as BTC not reaching 100k last year.

Take two of these and call me in the morning.

[ChartBuddy]

Explanation

[JayJuanGee]

I do gather that you, richie, are inclined to follow the price follows hashrate nonsense,

Let me stop you right there. That is by no means the case and I don't believe I have ever stated anything that could even be construed as such.

As far as I'm concerned, we're in a process where Bitcoin is trying to find where its price matches its value (and I believe we are quite a long way yet) via the market discovery process. Along the way that will be moderated by a variety of mechanisms which I won't go into here but a little logic shows that this can only be accomplished via a volatile process (how volatile it needs to be is an interesting question but the actuality is that it has been violently volatile). This process seems to be fairly well divorced from the hashrate.

Now, the mechanism for hashrate seems to be "If Bitcoin is profitable, buy more equipment". That does potentially link hashrate and price (but not in the direction that the opinion you incorrectly ascribe to me would suggest). However, as Bitcoin as near as dammit always been profitable, the restricting factor has been equipment availability which has lead to a total divorce between the two concepts. I will say that on at least one occasion, miners have surprised me by being willing to be patient for future profits rather than following pragmatism but they surely had good reason and that doesn't really affect things much.

Well I am glad that you stated your position more specifically, and surely I am not proclaiming that any of us will be able to articulate the many ways that bitcoin price moves in one direction or another whether we are talking about short-term or long term, but those fairly simplified assertions that BTC price is lead by hashrate seem quite wanting in terms of their explanations and I am glad to hear that are not falling in that camp.  

For sure, even if we might be asserting that BTC price does not necessarily follow hashrate or mining costs, for sure, for whatever reasons, there are going to be short-term correlations, and for sure a decently large numbers of miners are motivated by either current price or their speculations about future price, whether short-term, long-term or speculating about various aspects of operating their business that might also have some relationships to BTC price movements.. and for sure uncertainties too.. that are not just about BTC price, directly - such as energy costs or like you mentioned, cost and availability of some kinds of equipment or parts - or maybe another somewhat unrelated cost that you mentioned a while back.. the cost of wood to build a shed.. for example..

[ChartBuddy]

Explanation

[DaRude]

A little bit of light on a dim Monday.  I feel exactly zero sympathy for this asshole.  I feel a little bit for his family.  But I watched him personally cheer on the lawsuits coming out of the project he supported.

What he built was so CLOSE to a good idea but based on such a bad idea there was no saving it.



One more thing.

He STILL hasn't learned his lesson.  Twetch did not fail because of bad PR!  It failed EXACTLY BECAUSE it was anchored to a centralized chain and the centralized actors decided to kick him out, and the market was wise enough to also value the centralized project where it belonged.  But this is just the sort of failure that awaits those who build on a centralized blockchain and then do not stay on the right side of those who control the database...  Twetch did not fail because Calvin likes little girls.  It failed because the idea of writing the entire internet to a blockchain is a retarded.

Asshole still doesn't get it.  (Sorry to any of you WO brothers who still hold out hope for the big chains.)

For some reason i was thinking that watching that shitshow BSv fall apart would be more enjoyable. Instead it's like watching cult followers coming outside after the cult has collapsed, they're scared, they don't know what to do next, they reveal the true cost of the cult on themselves and their families, and they're asking for forgiveness. At least he had the intelligence to finally open his eyes, but as you said he's still oblivious to the true root cause of his failure, that he built on a closed/centralized chain.

[strawbs]

AFP News Agency
@AFP
#BREAKING IMF urges El Salvador to remove Bitcoin as legal tender
7:59 PM · Jan 25, 2022·TweetDeck

https://twitter.com/AFP/status/1486051087736094729


EDIT: IMF seriously legitimating our lil fiend. This is big^TM.

I clicked on your link and I was reminded why I never visit Twitter - the comments by anti-bitcoiners demonstrate quite depressingly how little people understand what bitcoin is, why it was created and what it is going to achieve. We have a lot of work to do to change minds, but at least the likes of Bukele are  pushing things forward. I just hope that other countries in similar positions to El Salvador have the courage to follow suit before pressure from the IMF and other actors becomes too much for El Salvador to bear on its own. We could do with several more South American presidents taking a leaf from Bukele's book.

[UnDerDoG81]

Yesterday I saw a video on Tiktok from this Pablo guy (thinks he is Bitcoin Jesus). He is saying that Michael Saylor bought almost all of his Bitcoin in leverage, that he is only the CEO of Microstrategy and that if the others want, they can panic sell all Bitcoins without MS agreeing to it and that he lost trillions in the dot com bubble. I was always suspicious about Michael Saylor, but then again, I never trust rich people.

I have no clue about all this and wonder what you all think about this? Will MS be the new MtGox who will cause the next Bitcoin crash at some point?

A man on the internet (ie a random fuckwit) said "any old shit"     so it must be true.

As Jay said just sell all your coins now you don't need an excuse

But it wont make you any less stressed out as your fiat will have devalued 30% over next 4 years while you will never afford to buy those bitcoin back.

DYOR on MSTR the NASDAQ listed company.

Men this place has become so toxic. It was just a question of what others think. But the bashing was predictable. Jay is on my ignore list for a long time already so I ignore his toxic bs... Only a handful members are worth reading their posts nowadays...

[PoolMinor]

I do gather that you, richie, are inclined to follow the price follows hashrate nonsense,

Let me stop you right there. That is by no means the case and I don't believe I have ever stated anything that could even be construed as such.

As far as I'm concerned, we're in a process where Bitcoin is trying to find where its price matches its value (and I believe we are quite a long way yet) via the market discovery process. Along the way that will be moderated by a variety of mechanisms which I won't go into here but a little logic shows that this can only be accomplished via a volatile process (how volatile it needs to be is an interesting question but the actuality is that it has been violently volatile). This process seems to be fairly well divorced from the hashrate.

Now, the mechanism for hashrate seems to be "If Bitcoin is profitable, buy more equipment". That does potentially link hashrate and price (but not in the direction that the opinion you incorrectly ascribe to me would suggest). However, as Bitcoin as near as dammit always been profitable, the restricting factor has been equipment availability which has lead to a total divorce between the two concepts. I will say that on at least one occasion, miners have surprised me by being willing to be patient for future profits rather than following pragmatism but they surely had good reason and that doesn't really affect things much.

Well I am glad that you stated your position more specifically, and surely I am not proclaiming that any of us will be able to articulate the many ways that bitcoin price moves in one direction or another whether we are talking about short-term or long term, but those fairly simplified assertions that BTC price is lead by hashrate seem quite wanting in terms of their explanations and I am glad to hear that are not falling in that camp.  

For sure, even if we might be asserting that BTC price does not necessarily follow hashrate or mining costs, for sure, for whatever reasons, there are going to be short-term correlations, and for sure a decently large numbers of miners are motivated by either current price or their speculations about future price, whether short-term, long-term or speculating about various aspects of operating their business that might also have some relationships to BTC price movements.. and for sure uncertainties too.. that are not just about BTC price, directly - such as energy costs or like you mentioned, cost and availability of some kinds of equipment or parts - or maybe another somewhat unrelated cost that you mentioned a while back.. the cost of wood to build a shed.. for example..

I may have mislead the bulk of you in what I meant in regards to miner's revenue and difficulty/hashrate.

The point was much deeper than hashrate, mining infrastructure has always dictated what equipment is available to the public. If it weren't for the lack of BFL Jalapenos I would probably not heard of Bitcoin for another year after I did.
Bitcoin is an peer-to-peer electronic "cache" system. It is a distributed ledger that stores data across the world. The price to pay to store information in the blockchain is paid by tx fee. The mining equipment and companies/people that are willing to store the database and run the software to support the network of transactions get rewarded with BTC. Currently the price to mine 1 BTC is ~$24,000. The price of Bitcoin is too high according to this data. Fortunately the supply is less than the demand thus affording the price to be higher than what it "costs" to mine.
Yes speculation plays a role but it is mainly driven by the mining infrastructure. Supply chain disruptions have had a reasonable effect on what should have been escalating difficulty thus driving cost of mining higher.

Also Lightning network turned Bitcoin into POS; robbing miners of the tx fees since those txs on LN aren't on-chain. Likely this did not have much difference but worth noting

[cAPSLOCK]

Yesterday I saw a video on Tiktok from this Pablo guy (thinks he is Bitcoin Jesus). He is saying that Michael Saylor bought almost all of his Bitcoin in leverage, that he is only the CEO of Microstrategy and that if the others want, they can panic sell all Bitcoins without MS agreeing to it and that he lost trillions in the dot com bubble. I was always suspicious about Michael Saylor, but then again, I never trust rich people.

I have no clue about all this and wonder what you all think about this? Will MS be the new MtGox who will cause the next Bitcoin crash at some point?

A man on the internet (ie a random fuckwit) said "any old shit"     so it must be true.

As Jay said just sell all your coins now you don't need an excuse

But it wont make you any less stressed out as your fiat will have devalued 30% over next 4 years while you will never afford to buy those bitcoin back.

DYOR on MSTR the NASDAQ listed company.

Men this place has become so toxic. It was just a question of what others think. But the bashing was predictable. Jay is on my ignore list for a long time already so I ignore his toxic bs... Only a handful members are worth reading their posts nowadays...

Internet suicides are always so underwhelming.  I wish you the best sir.  But I do not see this place as all that toxic... You should have been an a mac vs pc usenet group... or early linux kernel mailing lists.  'Round here people speak their mind and call each other out of their perceived BS... It's not that bad.

The point you were making had some merit.  Saylor is a great asset to the bitcoin community, but that makes him a powerful point of failure as well.  But the point  being made back was also good.  Since he is the head of a publicly traded company he cannot exactly do a rug pull.

And what do you suggest, that he cannot sell when he chooses to just because he has a big position?

I want Bitcoin to remain as unregulated as possible.

[strawbs]

Yesterday I saw a video on Tiktok from this Pablo guy (thinks he is Bitcoin Jesus). He is saying that Michael Saylor bought almost all of his Bitcoin in leverage, that he is only the CEO of Microstrategy and that if the others want, they can panic sell all Bitcoins without MS agreeing to it and that he lost trillions in the dot com bubble. I was always suspicious about Michael Saylor, but then again, I never trust rich people.

I have no clue about all this and wonder what you all think about this? Will MS be the new MtGox who will cause the next Bitcoin crash at some point?

A man on the internet (ie a random fuckwit) said "any old shit"     so it must be true.

As Jay said just sell all your coins now you don't need an excuse

But it wont make you any less stressed out as your fiat will have devalued 30% over next 4 years while you will never afford to buy those bitcoin back.

DYOR on MSTR the NASDAQ listed company.

Men this place has become so toxic. It was just a question of what others think. But the bashing was predictable. Jay is on my ignore list for a long time already so I ignore his toxic bs... Only a handful members are worth reading their posts nowadays...

Michael Saylor announced his intention to hold BTC on Microstrategy's balance sheet well before doing so. He then offered to buy back the shares of any existing shareholders who were not happy with this new policy. He displayed exemplary transparency. No mention of leverage.

This information is readily found in the public domain, so even the slightest bit of digging would show that this guy called Pablo on TikTok is full of shit.

[ChartBuddy]

Explanation

[somac.]

Yesterday I saw a video on Tiktok from this Pablo guy (thinks he is Bitcoin Jesus). He is saying that Michael Saylor bought almost all of his Bitcoin in leverage, that he is only the CEO of Microstrategy and that if the others want, they can panic sell all Bitcoins without MS agreeing to it and that he lost trillions in the dot com bubble. I was always suspicious about Michael Saylor, but then again, I never trust rich people.

I have no clue about all this and wonder what you all think about this? Will MS be the new MtGox who will cause the next Bitcoin crash at some point?

A man on the internet (ie a random fuckwit) said "any old shit"     so it must be true.

As Jay said just sell all your coins now you don't need an excuse

But it wont make you any less stressed out as your fiat will have devalued 30% over next 4 years while you will never afford to buy those bitcoin back.

DYOR on MSTR the NASDAQ listed company.

Men this place has become so toxic. It was just a question of what others think. But the bashing was predictable. Jay is on my ignore list for a long time already so I ignore his toxic bs... Only a handful members are worth reading their posts nowadays...

Seriously though, there's this saying that goes "verify, don't trust" that applies to people on TikTok too, actually it applies to anything anyone says.

[fillippone]

Badly needed hopium:



Katie Wood Sees one Bitcoin worth 1.36 Millions in 2030, and here explains why.

[DaRude]

There is something that bothers me for some time. If someone knows the answers, it would be nice to share them. It is about the derivate markets. It is clear that the cash settled futures contract divert money from acutal invesment in Bitcoin, thus creating an artificial paper liquidity. My quiestion is whether what is happening on the derivate exchanges can lead to a pump/dump of the spot exchanges? It is supposed that derivate exchanges follow the spot exchanges with their index price, not vice  versa, but is this the reality? I have the gut feeling that the spot exchange traders look at the derivate exchanges and if they see a dump there, they also sell. Which is illogical especially for the cash settled contracts. Because nobody can transfer a paper bitcoin and sell it on a spot exchange. But the daily traders have proved many times they have no clue about... anything, even basic math. Also, I wonder if Binance has a physical futures contracts like bakkt,  because a lot of derivate trade is going on there lately and it seems to has an impact on the spot price.

Can paper derivatives effect the underlying? Yes. Can it get to the point where the tail's wagging the dog? Possible, and therere examples in history when that happened, but i don't believe that it's happening with BTC.

Just a hypothetical, lets image you have 100.000 cash settled futures contracts which you got at an average price of $40.000/BTC, they expire today and lets say they use exchange's XYZ spot as a reference rate.
Imagine that current spot on XYZ is $37.500.
1-You don't do anything, Futures settle at $37,5k, you loose $2.500 per contract so you're down $250MM total. That sucks!

2-You look at XYZ and notice that the ask side of the book is pretty thin, you estimate that there will only be BTC5.000 for sale between $37,5k and $42,5k. You transfer $200MM to XYZ and buy everything in sight until $42.5k.
=You're successful and price closes at $42,5k. You're up $2,5k per contract or $250M from futures, but you bought BTC5k for $200MM, so you end up with $50MM and BTC5k profit.
=You're not successful and market actually moves against you and settles at $35k. You lost $500MM on futures, and paid $200M for BTC5k which are now only worth $175MM. -525MM REKT

And it works the other way around. If you sold futures, and then try to short the spot to bring it down so you're more profitable.

Problem is you need to corner the market to be able to pull this off, and there are always bigger whales. Futures platforms are not that dumb too, so theyre using weighted averages across multiple exchanges as a reference rate https://www.cmegroup.com/trading/cryptocurrency-indices/cf-bitcoin-reference-rate.html

There are hedge fund market makers and then there are youtube daily traders that cant do basic math. Don't confuse the two.

BAKKT is not even on a map anymore, do they even still offer BTC futures? Binance is currently the biggest dog and believe they're BTC settled. https://analytics.skew.com/dashboard/bitcoin-futures

Edit: fillippone popped in right on time, he has a whole thread on futures https://bitcointalk.org/index.php?topic=5188060

[ChartBuddy]

Explanation

[fr4nkthetank]

gaming the close on futures is illegal.  However gaming the spot price in bitcoin is hardly enforceable...

[ChartBuddy]

Explanation

[d_eddie]

Q: "When do I push the BUY button?"

Unclear words of wisdom by Artie 'Sharkey' Hayes ;-)

https://blog.bitmex.com/bottomless/

TL;DR: I want to see 28.5k to call a bottom. Will it actually happen? Not necessarily. Look at corporate bond rate spread for a glance into the near future.

[Torque]

AFP News Agency
@AFP
#BREAKING IMF urges El Salvador to remove Bitcoin as legal tender
7:59 PM · Jan 25, 2022·TweetDeck

https://twitter.com/AFP/status/1486051087736094729

I hope Nayib in turn urges the IMF to go suck of a bag of dicks.