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Question: What happens first:
New ATH - 43 (69.4%)
<$60,000 - 19 (30.6%)
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Author Topic: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion  (Read 26401400 times)
This is a self-moderated topic. If you do not want to be moderated by the person who started this topic, create a new topic. (174 posts by 3 users with 9 merit deleted.)
NotLambchop
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November 15, 2014, 12:54:23 PM

Wassup hoes gentlemen?

BlindMayorBitcorn
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November 15, 2014, 12:55:26 PM

 Cheesy
Chang Hum
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November 15, 2014, 12:58:24 PM

ignored
you really believe that in a market where the price rises due to demand being larger than supply, anyone is losing money or trying to make money because of others losing money, than you are mistaken by an order of magnitude that i cannot express without getting offensive.

if 10 people hold 10 apples and there are another 10 people want to have some of those apples- what will happen? Price rises. Who the fuck lost money? you say that apple scheme is a ponzi, being a hero in a BITCOIN forum. wow.

Dear @Chang_Hum, I hope you are enjoying the warm welcome that this thread reserves for those who have the bad habit of pointing out the obvious.  Grin

In case you didn't notice, I quoted his post from 2012 saying bitcoin was useless

No it didn't  Huh it was a post relating the events and news at the time which were silk rd (reference to drugs) in the press, and a mass of idiots handing money over to Pirate40s Ponzi Scheme  (reference to Ponzi). as I've previously stated I was bullish on Bitcoin at the time as I was actually USING it as a part of my business (so I found it USEFUL).
ChartBuddy
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November 15, 2014, 01:01:17 PM


Explanation
hdbuck
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November 15, 2014, 01:01:57 PM

to buy or not to buy.. that is my question. Huh
NotLambchop
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November 15, 2014, 01:05:38 PM

to buy or not to buy.. that is my question. Huh

dinofelis
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November 15, 2014, 01:11:38 PM

Why are there people so damn desperate to keep the price below 400? What are they afraid of? What do they want?

Most people purchase Bitcoins in the speculative hope they can later profit by selling them at a higher price to other market participants. As it's mathematically impossible for this to continue ad infinitum it's foolish to think you can continue to make money at the expense of other market participants (of which you yourselves are among) beyond the peak of adoption.

Once adoption rates have peaked, which they more than likely did last year, there's little left but a massive downside caused by an imbalance of those wishing to cash out vs new money coming in from those wishing to speculate on further price rises.  As the imbalance becomes more apparent new adopters are likely to become fewer and fewer thus escalating the downside.

As more people start to realize risk/reward is a bad bet and that the coins are gradually becoming worth less vs USD, a cash grab situation is likely to arise in which people will become aware coins are actually only backed by buy orders amounting to about 0.01% of the arbitrary market capitalization. This situation could be immensely profitable for those buying into the next round of folly.

All those who have become rich from Bitcoin have simply done so at the expense of later market participants, many of whom are likely to realize large losses on the flip side at some point. Hence why it's reasonably comparable to a giant ponzi scheme.


I have been trying for a while to wrap my mind around the price of bitcoin, and as such, it is necessary to understand the price formation of monetary assets in general.  von Mises and Rothbard are a good starting point to that.

With bitcoin, we are witnessing - maybe - for the first time since a very very long time - the emergence of another market-determined monetary asset which has not been issued by a state and as such, imposing the quasi monopoly.  The last time must have been when silver or gold became "money".

When an asset becomes a monetary asset, by definition, its market price will be way above its "usage price".  For gold there remains still a jewelry usage price (which is way way below the market price of gold) ; for fiat and bitcoin, the usage price is essentially zero, so the ONLY price they have is their "monetary contribution".

In a steady-state system, the price of a monetary asset is given by the "quantity theory of money", which states that:

P x Q = M x V, where P is the price of the goods - so the price of the monetary asset is its inverse: B = 1 / P

B = 1/P = Q / (M x V)

Q is the amount of goods bought by the monetary asset, M is the amount of monetary asset in circulation, and V is the average velocity (the number of times per year that a given bitcoin is used to buy something).

V is the inverse of T, the (harmonic) average holding time of a bitcoin: the number of years a bitcoin is held as store of value.

So the "end value" in steady state of a bitcoin will ultimately depend on two things:
how much stuff is bought using bitcoin, and how long one holds one's bitcoins.

The rise in value from 0 to the steady state value B represents a lot of value of course, which "came out of nothing".  

There is indeed an initial "free" transfer of value from the whole economy using bitcoin in the end steady state towards two classes of people:

- those who give out the first time a bitcoin (the miners).  This is called seigniorage.  It is what central banks are good at: printing new money and cashing in on first distribution of it.

- the "early adopters" who stored value in bitcoin before its market value reached B.  This last thing is something that has probably not been witnessed since gold became money in the early days of history.

So yes, there is a steady flux of value from the recent adopters to the early adopters and the miners.  That is part of the build-up of the market cap of the monetary asset.  

Of course, the market price doesn't need to follow the quantity theory of money price: it can *anticipate* it.  If everybody would be strongly convinced that a bitcoin were worth $ 10 000 in 5 years from now, most people wouldn't sell them below, say, $ 4000. People would be willing to buy them for $ 4000. It is because one doesn't really know that the price is lower, or higher, than the steady state monetary value once bitcoin is regularly used as means of payment.  

In the end, however, the bitcoin price will be determined by two factors:
the total quantity of goods that is bought with it, and the average holding time of a bitcoin (as store of value).

This will determine the final market cap of the monetary asset "bitcoin".  It can by potentially much higher than today, or it can be lower.  It could potentially drop to zero if it fails to become a monetary asset after all.

What I'm not clear about, is whether bitcoin could become a sole store of value, without being able to buy goods with it.  

So I have no idea what is the end market cap of bitcoin.  I guess nobody has.  There's a potential for a very high market cap if bitcoin is used a lot as means of payment, and if people hold it for a while.  
NotLambchop
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November 15, 2014, 01:14:42 PM

... it is necessary to understand the price formation of monetary assets in general.  von Mises and Rothbard are a good starting point to that...

hyphymikey
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November 15, 2014, 01:17:04 PM

I think it is time to open long position again  Grin There is not much coins to 410$, easy money.

Have you seen what happens when we cross 400? Immediate dumping. Be careful, at least until Sunday night. It seems as if someone is trying to keep the price under 400, maybe until their fiat arrives at the exchanges. I would personally wait until we start moving up on high volume Sunday as to not get caught in another trap.
goldsun
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November 15, 2014, 01:17:53 PM

Can anyone try to explain shortly about how to short and long bitcoins and something about leverage? Would be appreciated. I am still kind of new into bitcoin Smiley
zakalwe
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November 15, 2014, 01:43:16 PM

Of course boy, I always do.

at being a complete dickhead  Grin


This confirm who you are. I had no doubt, boy.
rebuilder
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November 15, 2014, 01:47:02 PM

I think it is time to open long position again  Grin There is not much coins to 410$, easy money.

Have you seen what happens when we cross 400? Immediate dumping. Be careful, at least until Sunday night. It seems as if someone is trying to keep the price under 400, maybe until their fiat arrives at the exchanges. I would personally wait until we start moving up on high volume Sunday as to not get caught in another trap.

I'd hardly call it dumping. The market was ridiculously overextended and even at these levels the price has risen exceptionally since two weeks ago. Did you really expect BTC to just keep gaining several percent a day?
Chang Hum
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November 15, 2014, 01:56:14 PM

Of course boy, I always do.

at being a complete dickhead  Grin


This confirm who you are. I had no doubt, boy.

Sorry I don't get that joke, you winning at being a complete dickhead confirms who I am, what does that mean exactly? and I'm 32 so don't know why you keep writing boy? are you trying to patronize me or do you have some sort of personality disorder? Huh
shanecoins
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November 15, 2014, 01:59:18 PM

I think it is time to open long position again  Grin There is not much coins to 410$, easy money.

Have you seen what happens when we cross 400? Immediate dumping. Be careful, at least until Sunday night. It seems as if someone is trying to keep the price under 400, maybe until their fiat arrives at the exchanges. I would personally wait until we start moving up on high volume Sunday as to not get caught in another trap.

I'd hardly call it dumping. The market was ridiculously overextended and even at these levels the price has risen exceptionally since two weeks ago. Did you really expect BTC to just keep gaining several percent a day?
yes Smiley
zakalwe
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November 15, 2014, 02:00:31 PM

Of course boy, I always do.

at being a complete dickhead  Grin


This confirm who you are. I had no doubt, boy.

Sorry I don't get that joke, you winning at being a complete dickhead confirms who I am, what does that mean exactly? and I'm 32 so don't know why you keep writing boy? are you trying to patronize me or do you have some sort of personality disorder? Huh


I would have bet you wouldn't understand, boy.............and please go on, You are fascinating me with you clever way to write. Boy.

Listen to me, get a job and be serious...................boy.
ChartBuddy
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November 15, 2014, 02:01:18 PM


Explanation
NotLambchop
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November 15, 2014, 02:03:34 PM

zakalwe
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November 15, 2014, 02:10:07 PM

Here comes another clown......
Phillis
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November 15, 2014, 02:11:00 PM


the real chart buddy
Chang Hum
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November 15, 2014, 02:11:39 PM

Of course boy, I always do.

at being a complete dickhead  Grin


This confirm who you are. I had no doubt, boy.

Sorry I don't get that joke, you winning at being a complete dickhead confirms who I am, what does that mean exactly? and I'm 32 so don't know why you keep writing boy? are you trying to patronize me or do you have some sort of personality disorder? Huh


I would have bet you wouldn't understand, boy.............and please go on, You are fascinating me with you clever way to write. Boy.

Listen to me, get a job and be serious...................boy.

fascinating you with the clever way I write, do you mean asking a question? specifically why you're calling a 32 year old man a boy? it doesn't bother me it's just a bit odd and I'm curious why?

Also why do you presume I don't have a job? You're correct I don't, but it's also odd as I don't believe you know me or why you think I'd take any sort of advice from you as you come across as a complete fucking idiot!
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