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

[Searing]

Nice!!!!!!!

We moved up $3.00!!!!


 

whoo who...

well with no or little volume..everyone hoarding btc including whales on anticipated next rally....and only a certain speed of newbies or adaptation
in the real world to encourage demand or crazy btc'er's like us to further buy/mine and hold and crank the cycle around to the next level

it likely is gonna be a big 'yawn' for a few more months imho

seems we have hit a bottleneck and thy name is "bitcoin acceptance/expansion" of course it is hard to do with all the press/and claims of FUD
and every day the prediction of BTC's ultimate failure in order to sell papers or make $$$ for your network etc

yet BTC still chugs along (just not at the speed I'd like)

guess it makes sense it is universal among the 10 people that I told last fall and now they asked so I told them how I'm doing this year with BTC
they still think it is a big ponzi scheme scam and I should cash out....they cling to the belief it is a 'bubble' 'scam' because to admit otherwise
means they missed the boat when I told them about BTC last fall....that is an unacceptable deflation of ego if BTC fails would be an ego  boost.
cause they 'called it' as a scam....so denial has kicked in imho...so I will shut up about it till they ask another 1/2 year from now on my BTC hobby
(poor deluded fool that I am in their view) maybe if BTC is over 1K by then I can get them to admit it 'might' not be a scam...

man I hate these negative BTC headwinds by the powers that be/press/media etc

anyway BTC is still  plugging along ..but we may sit imho at between 550 usd and 650 usd for quite a while maybe as long as Oct 2014 before
enough acceptance/expansion happens...to make the price stabilize at a higher level again just in a poor mood this week with above...so take
this with a grain of salt..

what do I know just my pessimistic view over getting beat up on bitcoin by the above family/friends/co-workers etc that I tried to tell about it
last fall.....the consensus in my small world/group has not changed..in fact it seems more hostile...again if I'm right they all missed the boat

somehow I am pretty sure if BTC hits 2k it is all gonna be my fault I did not convince the people above to get some BTC last year or this week

so it goes I guess

Searing

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[ChartBuddy]

Explanation

[aminorex]

The listing of COIN will be a liquidity event like no other in BTC history.  The most extreme bubble in BTC history is the 53x ramp from April to June of 2011.  It would be unreasonable not to consider that the impact of COIN might exceed that event, therefore.  A 60x ramp would achieve that by a significant margin, without breaking new territory.  

Let's suppose that there is a 50% chance of COIN being listed, and an 90% chance of a multi-month topping formation to ensue, and a 10% chance of that formation, conditional upon its formation, breaking a new scale record.  I consider all of these estimates to be low-ball.  The resulting contribution to the aggregate value of a bitcoin in Q1 2015, over all scenarios, is 920; a 25 bp/diem return means that if all other scenarios were flat zeros, even so your expection is net 9 bp/diem positive carry against current BFX margin rates.  

If the stopping time of a 13% margin call at 620 is less that sqrt((920-620)*9/25) ~ 10 times the duration of the scenario (I take at 160 days), then there is a net negative expectation.  I will spare you the stopping time calculation (a bunch of stochastic integration very ill-suited to a forum post).  It is much less.  In other words, I consider provable given a few reasonable and not very limiting scenario assumptions (although not here proven even conditionally) the (perhaps obvious) conclusion that even the most eggregiously optimistic scenario cannot justify the risk of full margined carry, unless you can get substantially better rates (or higher leverage limits) elsewhere.

Holding, on the other hand, is a no-brainer.  

Intermediate leverage falls between, and I have yet to calculate the optimum, which depends on better scenario coverage for its confidence margins.  It really requires a numerical approximation to do it on a principled basis with reasonable margins, at my level of understanding.  I couldn't expect to produce a closed form for the general case in the time one could allow to do a doctoral dissertation, so it's just not practical for me to try.

TL;DR: HODL

[ChartBuddy]

Explanation

[keithers]

Past history has shown us that BTC can only sit stagnate for short spurts. I'm thinking we are bound to see some volatility soon. Hopefully in the green direction!

[JorgeStolfi]

The listing of COIN will be a liquidity event like no other in BTC history.

In what ways is COIN different from SMBIT and PBP?
 

[Asrael999]

The listing of COIN will be a liquidity event like no other in BTC history.

In what ways is COIN different from SMBIT and PBP?
 

An ETF can be invested in by anyone regardless of their net worth. It will also be eligible for pension accounts -which neither SMBIT or PBP are. It should also be far more liquid.

EDIT:

Do I think it will have an immediate positive impact on the bitcoin price? No, professional investors already have a number of options for bitcoin investment - and the vast majority will choose to invest in companies that will make money from bitcoin adoption via fiat cashflows, (this they understand eg coinbase, bitpay, circle ) rather than taking a speculative punt on bitcoin itself, which ultimately may only be an exchange medium through which fiat passes in order to reduce transaction costs.   That said the new ETF will be different to the previously registered fund types

[JorgeStolfi]

[ COIN ] will also be eligible for pension accounts -which neither SMBIT or PBP are.

Thanks! I thought that the main advantage of SMBIT over bitcoin itself was that it could be used for retirement accounts, some of them at least (Roth?)

[aminorex]

[ COIN ] will also be eligible for pension accounts -which neither SMBIT or PBP are.

Thanks! I thought that the main advantage of SMBIT over bitcoin itself was that it could be used for retirement accounts, some of them at least (Roth?)

You can certainly hold BTC in an IRA, Roth or traditional, or a 401k, Roth or traditional, etc.  However, it is very inconvenient to do so today.  With COIN it will become substantially easier, although it's still a bit of a bother to convert in most cases.  This is typical of highly regulated systems.  The rules don't actually prevent you from doing anything you choose, they just make it costly and difficult to do anything creative or counter-cultural.

COIN is an open-ended fund.  Any retail investor can buy it.  Any mutual fund the rules of which allow it can buy it.  In the extremal case, all of the funds currently being used to purchase other ETPs (stocks &c) can flow into COIN.  That's a lot.

The only practical limit to the amount of fiat COIN can burn is the propensity of the regulators to pull the plug.  SMBIT, PBP in contrast live in a very rarified atmosphere.

In an extreme (not yet extremal) scenario, COIN burns too much fiat, so it is halted.  Meanwhile, now mania is only piqued by events, and all the fiat, in a frenzied heat, leaves the capital markets to seek BTC over the counter.  Singularity is discovered - an alternate extremum.

[Asrael999]

[ COIN ] will also be eligible for pension accounts -which neither SMBIT or PBP are.

Thanks! I thought that the main advantage of SMBIT over bitcoin itself was that it could be used for retirement accounts, some of them at least (Roth?)

I am not sure about that - you may be right - the minimum investment in SMBIT is quite large, the ETF should have a much smaller investment size.  Please also see my EDIT to my previous post, I am also a little dubious that a listing for COIN has an immediate positive impact on the price of BTC.

[Asrael999]

[ COIN ] will also be eligible for pension accounts -which neither SMBIT or PBP are.

Thanks! I thought that the main advantage of SMBIT over bitcoin itself was that it could be used for retirement accounts, some of them at least (Roth?)

You can certainly hold BTC in an IRA, Roth or traditional, or a 401k, Roth or traditional, etc.

COIN is an open-ended fund.  Any retail investor can buy it.  Any mutual fund the rules of which allow it can buy it.  In the extremal case, all of the funds currently being used to purchase other ETPs (stocks &c) can flow into COIN.  That's a lot.

The only practical limit to the amount of fiat COIN can burn is the propensity of the regulators to pull the plug.  SMBIT, PBP in contrast live in a very rarified atmosphere, in comparison.

In an extreme (not yet extremal) scenario, COIN burns too much fiat, so it is halted.  Meanwhile, now mania is only piqued by events, and all the fiat, in a frenzied heat, leaves the capital markets to seek BTC over the counter.  Singularity is discovered - an alternate extremum.

Agreed - and thanks for the info on US pension systems, I was unaware of this.
My question is - Is the mere existence of COIN enough to trigger a price rise - or do you need another trigger event (or series of events) where COIN can then facilitate the investment of fiat into BTC?

[aminorex]

My question is - Is the mere existence of COIN enough to trigger a price rise - or do you need another trigger event (or series of events) where COIN can then facilitate the investment of fiat into BTC?

I said COIN removed the limits on how much fiat "can" flow in.  The willingness of buyers to buy determine how much "will" flow in.  I don't have any adequate model for that (heh).  Some argue that none is possible.  I think their notions of adequacy are unreasonable, however.

Yeah, you definitely need a trigger sequence.

[dannyspk]

The listing of COIN will be a liquidity event like no other in BTC history.  The most extreme bubble in BTC history is the 53x ramp from April to June of 2011.  It would be unreasonable not to consider that the impact of COIN might exceed that event, therefore.  A 60x ramp would achieve that by a significant margin, without breaking new territory.  

Let's suppose that there is a 50% chance of COIN being listed, and an 90% chance of a multi-month topping formation to ensue, and a 10% chance of that formation, conditional upon its formation, breaking a new scale record.  I consider all of these estimates to be low-ball.  The resulting contribution to the aggregate value of a bitcoin in Q1 2015, over all scenarios, is 920; a 25 bp/diem return means that if all other scenarios were flat zeros, even so your expection is net 9 bp/diem positive carry against current BFX margin rates.  

If the stopping time of a 13% margin call at 620 is less that sqrt((920-620)*9/25) ~ 10 times the duration of the scenario (I take at 160 days), then there is a net negative expectation.  I will spare you the stopping time calculation (a bunch of stochastic integration very ill-suited to a forum post).  It is much less.  In other words, I consider provable given a few reasonable and not very limiting scenario assumptions (although not here proven even conditionally) the (perhaps obvious) conclusion that even the most eggregiously optimistic scenario cannot justify the risk of full margined carry, unless you can get substantially better rates (or higher leverage limits) elsewhere.

Holding, on the other hand, is a no-brainer.  

Intermediate leverage falls between, and I have yet to calculate the optimum, which depends on better scenario coverage for its confidence margins.  It really requires a numerical approximation to do it on a principled basis with reasonable margins, at my level of understanding.  I couldn't expect to produce a closed form for the general case in the time one could allow to do a doctoral dissertation, so it's just not practical for me to try.

TL;DR: HODL

I've always found staggering credibility in your posts. So, looking at what you wrote, Bitcoin price went from $0.6 to $32 between April to June of 2011. That's a 53x ramp as you said. Are you saying after the listing of COIN, Bitcoin will see another surge of 60x from it's current $600?

[kehtolo]

Nice!!!!!!!

We moved up $3.00!!!!


 

what do I know just my pessimistic view over getting beat up on bitcoin by the above family/friends/co-workers etc that I tried to tell about it
last fall.....the consensus in my small world/group has not changed..in fact it seems more hostile...again if I'm right they all missed the boat


Searing

..Had a conversation last weekend with an otherwise very intelligent guy. He also thinks bitcoin is a ponzi and a scam..
We talked about the concept on money and ponzi's.. i didn't convince him of anything.. nor did he convince me of anything.. (his arguments were nothing i haven't heard before anyway)
At least he had heard of it and some opinions on it.. even if i thought they were wrong.

I don't waste time on people like this.. it's not my job to change their minds.. but maybe like you, we can revisit the topic in another 1/2 year.. and might have a different conversation.

[ChartBuddy]

Explanation

[aminorex]

I've always found staggering credibility in your posts.

Perhaps in this case my staggering credibility derived from copping to the fact that I'm too lazy/dumb to do the proper maths.  And from the fact that I am staggering just a bit.

So, looking at what you wrote, Bitcoin price went from $0.6 to $32 between April to June of 2011. That's a 53x ramp as you said. Are you saying after the listing of COIN, Bitcoin will see another surge of 60x from it's current $600?

No, I'm just trying to make you think that's what I'm saying.  (Truth in humor: It suits me if people think about inspiring extrema as well as the dismal ones so often promulgated.)

What I am saying is that there is a case to be made that it is possible, on the basis of historic precedent, and on the basis of fundamental market structure.  Once possibility is established we are motivated to ask how probable it is.  It seems much more probable that the fund will rise 60x (BTC market cap about 500bn, which is less than half of Apple, for example) than that a bitcoin singularity occurs.  Given the propensity of market panics to lead to divergent behaviours, even the latter is conceivably possible.  Or bitcoin can go to zero due to a bug or an cryptographic innovation or a political action.

I'm raising various extreme scenarios.  Usually an extreme scenario requires lots of things to happen in just the right way, so they don't happen very often.  But it's good to be prepared, and they do exercise the limits of our preparedness.  That includes extremely bullish cases as well as extremely bearish ones.  (But that doesn't mean that the two opposite extremes cancel each other out.  Whether they do depends on your utility function, which is a whole 'nother topic.  Utility functions I consider reasonable result in very asymmetric outcomes:  There is much more risk of missed opportunity than there is risk of ruinous calamity -- and, most practically, the latter is much easier to hedge.)

[Peter R]

I've always found staggering credibility in your posts.

Perhaps in this case my staggering credibility derived from copping to the fact that I'm too lazy/dumb to do the proper maths.  And from the fact that I am staggering just a bit.

stagger |ˈstagər| verb
1 walk or move unsteadily, as if about to fall:
2 astonish or deeply shock: (as adj. staggering)

The question is: did he mean definition 1 or 2?

In any case, I agree that it is difficult to overstate the potential impact of COIN. 

[nioc]

I believe aminorex has been drinking yet he is coherent.  What is he doing up in the middle of the night?

[ChartBuddy]

Explanation

[dnaleor]

The listing of COIN will be a liquidity event like no other in BTC history.  The most extreme bubble in BTC history is the 53x ramp from April to June of 2011.  It would be unreasonable not to consider that the impact of COIN might exceed that event, therefore.  A 60x ramp would achieve that by a significant margin, without breaking new territory.  

(...)

TL;DR: HODL

Most bullish post since months.

Reminds me of this chart:

 

I sincerely hope you you are right. It would mean I could retire when i'm only 25  LOL