What is going on? Trading volume is so low!

[xavier]

I run a market making bot.  It maintains orders on both sides of the book at 1.3% intervals.  When my buy orders are filled, it places a sell 1.3% higher.  When my sell orders are filled, it places a buy 1.3% lower.  I lose out when it trends continuously, but it stabilizes price and I turn a profit when the bulls and bears duke it out.  By keeping orders on the book, I help make it possible for companies like bitpay that need to accurately price and immediately convert bitcoins to USD and companies like bitinstant and coinbase that need to go the other way.

Good job man! If a bunch of people did this, bitcoin would be stable as a rock!

I'm trying to be a market maker, too, just with a slightly different strategy. Best thing is, it's not charity! Market makers earn profits (buy low, sell high) as a reward for the service they do to the system (stability)!

First things first, running a bot is not so easy with bitcoin - because of the volatility. The small % money you make by essentially getting a couple of points greater than inefficient traders (ie. making a few pips on the buy/sell spread) over a period of months can be ereased in 1 day if the price moves 40%. I think with bitcoin a bot is a very difficult way to make money and an easy way to loose. Not to say it cant be done, but dont be fooled into thinking it's easy.

Now, since we're really talking about the volume here and why it's low?

Low volume is a bear signal. Why? Because buyers drive markets. And buyers drive volume. I repeat - buyers drive markets, not sellers! It means, less people are putting money into bitcoin. Sure, less people are selling also, but sellers can only have one effect on the price, to move it downwards. If the lack of buyers (as evidenced by low volumes) continues, you're going to see holders of bitcoins becoming more and more nervous and eventually selling off coins, which will cause a price downtrend, which will equally bring more sellers to market.

A low volume at this stage is a bear sign. Unless bitcoin can bring new money into the market, if low volumes continue we're going to see a continued downwards movement in the price.

[hahahafr]

I run a market making bot.  It maintains orders on both sides of the book at 1.3% intervals.  When my buy orders are filled, it places a sell 1.3% higher.  When my sell orders are filled, it places a buy 1.3% lower.  I lose out when it trends continuously, but it stabilizes price and I turn a profit when the bulls and bears duke it out.  By keeping orders on the book, I help make it possible for companies like bitpay that need to accurately price and immediately convert bitcoins to USD and companies like bitinstant and coinbase that need to go the other way.

Good job man! If a bunch of people did this, bitcoin would be stable as a rock!

I'm trying to be a market maker, too, just with a slightly different strategy. Best thing is, it's not charity! Market makers earn profits (buy low, sell high) as a reward for the service they do to the system (stability)!

First things first, running a bot is not so easy with bitcoin - because of the volatility. The small % money you make by essentially getting a couple of points greater than inefficient traders (ie. making a few pips on the buy/sell spread) over a period of months can be ereased in 1 day if the price moves 40%. I think with bitcoin a bot is a very difficult way to make money and an easy way to loose. Not to say it cant be done, but dont be fooled into thinking it's easy.

Now, since we're really talking about the volume here and why it's low?

Low volume is a bear signal. Why? Because buyers drive markets. And buyers drive volume. I repeat - buyers drive markets, not sellers! It means, less people are putting money into bitcoin. Sure, less people are selling also, but sellers can only have one effect on the price, to move it downwards. If the lack of buyers (as evidenced by low volumes) continues, you're going to see holders of bitcoins becoming more and more nervous and eventually selling off coins, which will cause a price downtrend, which will equally bring more sellers to market.

A low volume at this stage is a bear sign. Unless bitcoin can bring new money into the market, if low volumes continue we're going to see a continued downwards movement in the price.

I took the time to post this message so you can know you are wrong. You forget a lots of variables in your analysis.

[notme]

Since the DDOS yesterday, MtGox turned off API support for anything calling the older https://mtgox.com/api pages and is now only allowing orders to be placed through their data.mtgox.com url calls.

I haven't looked on the forum much but didnt see this announced anywhere. Over the next few days I imagine others who run bots will pick up on this, fix their code and re-start their bots.

*edit* To clarify, I believe the API functions to query order response / account data were changed.

Plz forgive my ignorance. Are the bots hostile toward Mtgox?

No, when I talk about bots, I mean the scripts that are written to trade on mtgox through their API. These scripts usually trade high volume (much more volume than users using the website interface).

Why do they use these bots? Do they analyzing data, and buying and selling btc automatically?

I run a market making bot.  It maintains orders on both sides of the book at 1.3% intervals.  When my buy orders are filled, it places a sell 1.3% higher.  When my sell orders are filled, it places a buy 1.3% lower.  I lose out when it trends continuously, but it stabilizes price and I turn a profit when the bulls and bears duke it out.  By keeping orders on the book, I help make it possible for companies like bitpay that need to accurately price and immediately convert bitcoins to USD and companies like bitinstant and coinbase that need to go the other way.

That is genuinely fascinating. Thanks for telling us how your operation works. Now here's a man who knows how percentages work. Do you mind if I ask a question plz? How efficient is the following trading method? Use the MACD to mark buy and sells, and when there is uncertainly or very weak trends, go half in. Basically hedge both ways. Is this an ok method? any suggestions would be appreciated plz?
1.3% intervals is obviously a figure you've arrived at after a great deal of trial?

I'm not sure I'd trust a single signal to trade on.  If you're looking for something simple, a balancing strategy is decent.  Basically, you keep 50% of your value in bitcoin and 50% in USD and rebalance once a week or so to maintain the ratio.  Obviously, you can use any ratio you want.  Keep a little more in bitcoin when things look bullish, keep a little more in fiat when you're bearish.

I wouldn't rely solely on one indicator. But MACD might be a primary, and refer to others to paint a more detailed picture. I've only been learning about indicators the last few days, so have a lot to learn.
I have no idea where to start with bots. Where to get one, or how to use it. I'm curious about such things, but probably dont have enough time or money to invest in btc to make it worth while. Or is it simpler than I might think?
Thanks again for your advice. I have some work to do on my trading method, and your a big help

Questing, you should look up technical analysis. A lot of bots will do this. I used to run a number of bots, one which ran arbitrage across a few brokers averaging out the price across them and others which used technical analysis. They are / can be very very successful if you know what you are doing. There is a lot of potential to make a lot of money doing this still. I turned my bots off recently to concentrate on other bitcoin projects, all funded using the profits I made bot trading.


notme: did you have to update your code recently with all the mtgox api changes? my scripts were caught out a number of times by mtgox upgrading their api. Last week it was them turning off anything sending orders to their non data.mtgox.com url.

I use this gem: https://github.com/sferik/mtgox

Usually others keep it up to date, but on occasion I've had to make some updates myself.  This is a perfect example of a situation where many eyes and users makes for much more robust software with less downtime.

[Peter Lambert]

Now, since we're really talking about the volume here and why it's low?

Low volume is a bear signal. Why? Because buyers drive markets. And buyers drive volume. I repeat - buyers drive markets, not sellers! It means, less people are putting money into bitcoin. Sure, less people are selling also, but sellers can only have one effect on the price, to move it downwards. If the lack of buyers (as evidenced by low volumes) continues, you're going to see holders of bitcoins becoming more and more nervous and eventually selling off coins, which will cause a price downtrend, which will equally bring more sellers to market.

A low volume at this stage is a bear sign. Unless bitcoin can bring new money into the market, if low volumes continue we're going to see a continued downwards movement in the price.

Depends on how you look at the market.

A low volume at this stage is a bear sign. Unless dollars can bring new bitcoins into the market, if low volumes continue we're going to see a renewed downwards movement in the price. Dollars dropped to about 3.8 mB before rebounding and after weeks of high volatility they have stabilized at about the current rate of 8.7 mB.

You are right, buyers drive markets. If the people who are holding bitcoins do not want to use them to buy dollars, then people will have to start offering more dollars to get those bitcoins.

[cbeast]

Even with a 10% higher difficulty, the downward trend continues. The small GPU miners are shutting down and being replaced by ASICs. The USA is no longer a major contributer to the hashrate, so the ecosystem is going into unfamiliar territory. What currency will replace the dollar for buying bitcoins? VCs also look at things like infrastructure and the USA has diminishing support for Bitcoin. Until Western miners can get their hands on ASICs, there probably won't be much investment in USD to raise Bitcoin price, nor develop Bitcoin businesses at the rate they should be seeing by now. I suppose as long as the Chinese have all the ASICs and they are not buying Bitcoins, then the price of Bitcoins will drop to the cost in electricity for ASIC miners. Any idea how much that is at the current difficulty?

[giantdragon]

then the price of Bitcoins will drop to the cost in electricity for ASIC miners.

Don't forget about cost of the ASICs itself, they are far from be cheap and have no other use besides Bitcoin mining!

[amencon]

Even with a 10% higher difficulty, the downward trend continues. The small GPU miners are shutting down and being replaced by ASICs. The USA is no longer a major contributer to the hashrate, so the ecosystem is going into unfamiliar territory. What currency will replace the dollar for buying bitcoins? VCs also look at things like infrastructure and the USA has diminishing support for Bitcoin. Until Western miners can get their hands on ASICs, there probably won't be much investment in USD to raise Bitcoin price, nor develop Bitcoin businesses at the rate they should be seeing by now. I suppose as long as the Chinese have all the ASICs and they are not buying Bitcoins, then the price of Bitcoins will drop to the cost in electricity for ASIC miners. Any idea how much that is at the current difficulty?

Do you believe price follows difficulty and not the other way around?

Why does some other currency have to replace the dollar for buying bitcoins?  You seem to imply the hashrate is tied to this somehow?

Has the price of bitcoins, to your knowledge, ever followed the electricity cost to produce it for any reasonable length of time?

Haven't there been a handful of recent articles about more (mostly US) VC money than ever being pumped into bitcoins, most notably the $5m from Fred?

What rate of Bitcoin business development "should" we be seeing right now?

Not saying you are wrong about anything but can you connect the dots a bit better to show how you've come to the conclusions you have?

[cbeast]

Even with a 10% higher difficulty, the downward trend continues. The small GPU miners are shutting down and being replaced by ASICs. The USA is no longer a major contributer to the hashrate, so the ecosystem is going into unfamiliar territory. What currency will replace the dollar for buying bitcoins? VCs also look at things like infrastructure and the USA has diminishing support for Bitcoin. Until Western miners can get their hands on ASICs, there probably won't be much investment in USD to raise Bitcoin price, nor develop Bitcoin businesses at the rate they should be seeing by now. I suppose as long as the Chinese have all the ASICs and they are not buying Bitcoins, then the price of Bitcoins will drop to the cost in electricity for ASIC miners. Any idea how much that is at the current difficulty?

Do you believe price follows difficulty and not the other way around?

Why does some other currency have to replace the dollar for buying bitcoins?  You seem to imply the hashrate is tied to this somehow?

Has the price of bitcoins, to your knowledge, ever followed the electricity cost to produce it for any reasonable length of time?

Haven't there been a handful of recent articles about more (mostly US) VC money than ever being pumped into bitcoins, most notably the $5m from Fred?

What rate of Bitcoin business development "should" we be seeing right now?

Not saying you are wrong about anything but can you connect the dots a bit better to show how you've come to the conclusions you have?

Difficulty determines the electric cost per bitcoin. Electricity is a large part of the cost of good sold. This has been the rule for most of the last four years.

The USD trade has dropped with the US hashrate. Coincidence?

The Bitcoin protocol is finished thanks to the great effort of the talented developers we have, but a few million dollars investment in a breakthrough disruptive technology is barely a start.  It will take decades of man hours of software development to make the protocol user friendly. Either we pay programmers now or educate future generations to continue development in their spare time.

[amencon]

Even with a 10% higher difficulty, the downward trend continues. The small GPU miners are shutting down and being replaced by ASICs. The USA is no longer a major contributer to the hashrate, so the ecosystem is going into unfamiliar territory. What currency will replace the dollar for buying bitcoins? VCs also look at things like infrastructure and the USA has diminishing support for Bitcoin. Until Western miners can get their hands on ASICs, there probably won't be much investment in USD to raise Bitcoin price, nor develop Bitcoin businesses at the rate they should be seeing by now. I suppose as long as the Chinese have all the ASICs and they are not buying Bitcoins, then the price of Bitcoins will drop to the cost in electricity for ASIC miners. Any idea how much that is at the current difficulty?

Do you believe price follows difficulty and not the other way around?

Why does some other currency have to replace the dollar for buying bitcoins?  You seem to imply the hashrate is tied to this somehow?

Has the price of bitcoins, to your knowledge, ever followed the electricity cost to produce it for any reasonable length of time?

Haven't there been a handful of recent articles about more (mostly US) VC money than ever being pumped into bitcoins, most notably the $5m from Fred?

What rate of Bitcoin business development "should" we be seeing right now?

Not saying you are wrong about anything but can you connect the dots a bit better to show how you've come to the conclusions you have?

Difficulty determines the electric cost per bitcoin. Electricity is a large part of the cost of good sold. This has been the rule for most of the last four years.

The USD trade has dropped with the US hashrate. Coincidence?

The Bitcoin protocol is finished thanks to the great effort of the talented developers we have, but a few million dollars investment in a breakthrough disruptive technology is barely a start.  It will take decades of man hours of software development to make the protocol user friendly. Either we pay programmers now or educate future generations to continue development in their spare time.

Isn't it more the price that determines difficulty?  You could replace the hashrate of GPUs with ASICs and wouldn't the cost per bitcoin in electricity go down with the same difficulty?  When price goes up mining is more profitable and more miners enter the game, then the difficulty rises due to this not the other way around.  We are supposed to get an approximately flat rate of coin generation regardless of difficulty.

Do you have evidence of the correlation of US hashrate and USD trade?  I have no idea if this is coincidence or not as I haven't tracked both closely.

I agree with your last part that it will take considerable development to make the protocol user friendly.  I think development will continue to increase as wider and wider adoption and knowledge is spread.  It looks like more startups are focusing around bitcoins now than in the past.  Of course we all want more money and work put in to make things happen faster.

[cbeast]

Even with a 10% higher difficulty, the downward trend continues. The small GPU miners are shutting down and being replaced by ASICs. The USA is no longer a major contributer to the hashrate, so the ecosystem is going into unfamiliar territory. What currency will replace the dollar for buying bitcoins? VCs also look at things like infrastructure and the USA has diminishing support for Bitcoin. Until Western miners can get their hands on ASICs, there probably won't be much investment in USD to raise Bitcoin price, nor develop Bitcoin businesses at the rate they should be seeing by now. I suppose as long as the Chinese have all the ASICs and they are not buying Bitcoins, then the price of Bitcoins will drop to the cost in electricity for ASIC miners. Any idea how much that is at the current difficulty?

Do you believe price follows difficulty and not the other way around?

Why does some other currency have to replace the dollar for buying bitcoins?  You seem to imply the hashrate is tied to this somehow?

Has the price of bitcoins, to your knowledge, ever followed the electricity cost to produce it for any reasonable length of time?

Haven't there been a handful of recent articles about more (mostly US) VC money than ever being pumped into bitcoins, most notably the $5m from Fred?

What rate of Bitcoin business development "should" we be seeing right now?

Not saying you are wrong about anything but can you connect the dots a bit better to show how you've come to the conclusions you have?

Difficulty determines the electric cost per bitcoin. Electricity is a large part of the cost of good sold. This has been the rule for most of the last four years.

The USD trade has dropped with the US hashrate. Coincidence?

The Bitcoin protocol is finished thanks to the great effort of the talented developers we have, but a few million dollars investment in a breakthrough disruptive technology is barely a start.  It will take decades of man hours of software development to make the protocol user friendly. Either we pay programmers now or educate future generations to continue development in their spare time.

Isn't it more the price that determines difficulty?  You could replace the hashrate of GPUs with ASICs and wouldn't the cost per bitcoin in electricity go down with the same difficulty?  When price goes up mining is more profitable and more miners enter the game, then the difficulty rises due to this not the other way around.  We are supposed to get an approximately flat rate of coin generation regardless of difficulty.

Do you have evidence of the correlation of US hashrate and USD trade?  I have no idea if this is coincidence or not as I haven't tracked both closely.

I agree with your last part that it will take considerable development to make the protocol user friendly.  I think development will continue to increase as wider and wider adoption and knowledge is spread.  It looks like more startups are focusing around bitcoins now than in the past.  Of course we all want more money and work put in to make things happen faster.

There's a lot of speculation that goes into price, but it usually corrects with difficulty. I expect a downward trend in price to overcome any speculative exuberance until adoption and utility grows.

The globe on blockchain.info shows that the USA has quickly diminishing hashrate in relation to the global participation. The fact that this occured as the hashrate in China boomed leaves little doubt that GPU miners in the West are shutting down and China has new ASIC miners. Price is dropping as GPU miners drop out and hashrate continues to climb.

Maybe if price drops far enough and difficulty goes high enough, we'll start seeing more ASICs in the West, after the profitability of ASICs in down.

[amencon]

Difficulty determines the electric cost per bitcoin. Electricity is a large part of the cost of good sold. This has been the rule for most of the last four years.

The USD trade has dropped with the US hashrate. Coincidence?

The Bitcoin protocol is finished thanks to the great effort of the talented developers we have, but a few million dollars investment in a breakthrough disruptive technology is barely a start.  It will take decades of man hours of software development to make the protocol user friendly. Either we pay programmers now or educate future generations to continue development in their spare time.

Isn't it more the price that determines difficulty?  You could replace the hashrate of GPUs with ASICs and wouldn't the cost per bitcoin in electricity go down with the same difficulty?  When price goes up mining is more profitable and more miners enter the game, then the difficulty rises due to this not the other way around.  We are supposed to get an approximately flat rate of coin generation regardless of difficulty.

Do you have evidence of the correlation of US hashrate and USD trade?  I have no idea if this is coincidence or not as I haven't tracked both closely.

I agree with your last part that it will take considerable development to make the protocol user friendly.  I think development will continue to increase as wider and wider adoption and knowledge is spread.  It looks like more startups are focusing around bitcoins now than in the past.  Of course we all want more money and work put in to make things happen faster.

There's a lot of speculation that goes into price, but it usually corrects with difficulty. I expect a downward trend in price to overcome any speculative exuberance until adoption and utility grows.

The globe on blockchain.info shows that the USA has quickly diminishing hashrate in relation to the global participation. The fact that this occured as the hashrate in China boomed leaves little doubt that GPU miners in the West are shutting down and China has new ASIC miners. Price is dropping as GPU miners drop out and hashrate continues to climb.

Maybe if price drops far enough and difficulty goes high enough, we'll start seeing more ASICs in the West, after the profitability of ASICs in down.

Do you have a theory on why price would correct to difficulty?  Logically it makes sense to me that when price rises it becomes more profitable to mine, then more miners are turned on and difficulty goes up following price.  When profitability goes down due to lower price then some miners turn off and difficulty drops, again following price.  There is probably more to the story than just that but an explanation why you think price would correct to difficulty might help me understand your point of view.

I also think increased adoption and utility could be somewhat decoupled from more hashrate since it's likely a different class of users will be attracted into the future.  Less technically savvy users will also start mining in much lower ratios to number adopted when measured against early adopters in the past.

As far as US hashrate falling vs China (and elsewhere) and a corresponding drop in BTC price, if we assume the two are correlated then my only theory there would be that possibly US miners had more disposable income and the larger percentage of coins mined outside the US now have a larger portion being sold back on the market as soon as they are mined.  Is this your thinking as well?

[cbeast]

Difficulty determines the electric cost per bitcoin. Electricity is a large part of the cost of good sold. This has been the rule for most of the last four years.

The USD trade has dropped with the US hashrate. Coincidence?

The Bitcoin protocol is finished thanks to the great effort of the talented developers we have, but a few million dollars investment in a breakthrough disruptive technology is barely a start.  It will take decades of man hours of software development to make the protocol user friendly. Either we pay programmers now or educate future generations to continue development in their spare time.

Isn't it more the price that determines difficulty?  You could replace the hashrate of GPUs with ASICs and wouldn't the cost per bitcoin in electricity go down with the same difficulty?  When price goes up mining is more profitable and more miners enter the game, then the difficulty rises due to this not the other way around.  We are supposed to get an approximately flat rate of coin generation regardless of difficulty.

Do you have evidence of the correlation of US hashrate and USD trade?  I have no idea if this is coincidence or not as I haven't tracked both closely.

I agree with your last part that it will take considerable development to make the protocol user friendly.  I think development will continue to increase as wider and wider adoption and knowledge is spread.  It looks like more startups are focusing around bitcoins now than in the past.  Of course we all want more money and work put in to make things happen faster.

There's a lot of speculation that goes into price, but it usually corrects with difficulty. I expect a downward trend in price to overcome any speculative exuberance until adoption and utility grows.

The globe on blockchain.info shows that the USA has quickly diminishing hashrate in relation to the global participation. The fact that this occured as the hashrate in China boomed leaves little doubt that GPU miners in the West are shutting down and China has new ASIC miners. Price is dropping as GPU miners drop out and hashrate continues to climb.

Maybe if price drops far enough and difficulty goes high enough, we'll start seeing more ASICs in the West, after the profitability of ASICs in down.

Do you have a theory on why price would correct to difficulty?  Logically it makes sense to me that when price rises it becomes more profitable to mine, then more miners are turned on and difficulty goes up following price.  When profitability goes down due to lower price then some miners turn off and difficulty drops, again following price.  There is probably more to the story than just that but an explanation why you think price would correct to difficulty might help me understand your point of view.

Yes, profitability is the incentive for turning on miners except when we have game changers like ASICS. The difficulty jumps these days are an order of magnitude higher than a year ago. Profit margins for GPU mining are so small that only when there are speculation driven price spikes does it pay to run GPUs. Still, that's a good reason to hang onto them as reserve miners.

I also think increased adoption and utility could be somewhat decoupled from more hashrate since it's likely a different class of users will be attracted into the future.  Less technically savvy users will also start mining in much lower ratios to number adopted when measured against early adopters in the past.

It will be interesting to see if major firms jump into Bitcoin with dedicated mining consumer products.

As far as US hashrate falling vs China (and elsewhere) and a corresponding drop in BTC price, if we assume the two are correlated then my only theory there would be that possibly US miners had more disposable income and the larger percentage of coins mined outside the US now have a larger portion being sold back on the market as soon as they are mined.  Is this your thinking as well?

I don't think it is necessarily a disposable income issue as much as the market freedom of countries. Competition amongst exchanges will provide liquidity. When the world has easy access to Bitcoins, volatility will diminish and Bitcoin price will grow steadily with market confidence and utility. Until then we will see bubbles, slow access to ASICs, and media FUD.

[amencon]

Difficulty determines the electric cost per bitcoin. Electricity is a large part of the cost of good sold. This has been the rule for most of the last four years.

The USD trade has dropped with the US hashrate. Coincidence?

The Bitcoin protocol is finished thanks to the great effort of the talented developers we have, but a few million dollars investment in a breakthrough disruptive technology is barely a start.  It will take decades of man hours of software development to make the protocol user friendly. Either we pay programmers now or educate future generations to continue development in their spare time.

Isn't it more the price that determines difficulty?  You could replace the hashrate of GPUs with ASICs and wouldn't the cost per bitcoin in electricity go down with the same difficulty?  When price goes up mining is more profitable and more miners enter the game, then the difficulty rises due to this not the other way around.  We are supposed to get an approximately flat rate of coin generation regardless of difficulty.

Do you have evidence of the correlation of US hashrate and USD trade?  I have no idea if this is coincidence or not as I haven't tracked both closely.

I agree with your last part that it will take considerable development to make the protocol user friendly.  I think development will continue to increase as wider and wider adoption and knowledge is spread.  It looks like more startups are focusing around bitcoins now than in the past.  Of course we all want more money and work put in to make things happen faster.

There's a lot of speculation that goes into price, but it usually corrects with difficulty. I expect a downward trend in price to overcome any speculative exuberance until adoption and utility grows.

The globe on blockchain.info shows that the USA has quickly diminishing hashrate in relation to the global participation. The fact that this occured as the hashrate in China boomed leaves little doubt that GPU miners in the West are shutting down and China has new ASIC miners. Price is dropping as GPU miners drop out and hashrate continues to climb.

Maybe if price drops far enough and difficulty goes high enough, we'll start seeing more ASICs in the West, after the profitability of ASICs in down.

Do you have a theory on why price would correct to difficulty?  Logically it makes sense to me that when price rises it becomes more profitable to mine, then more miners are turned on and difficulty goes up following price.  When profitability goes down due to lower price then some miners turn off and difficulty drops, again following price.  There is probably more to the story than just that but an explanation why you think price would correct to difficulty might help me understand your point of view.

Yes, profitability is the incentive for turning on miners except when we have game changers like ASICS. The difficulty jumps these days are an order of magnitude higher than a year ago. Profit margins for GPU mining are so small that only when there are speculation driven price spikes does it pay to run GPUs. Still, that's a good reason to hang onto them as reserve miners.

I also think increased adoption and utility could be somewhat decoupled from more hashrate since it's likely a different class of users will be attracted into the future.  Less technically savvy users will also start mining in much lower ratios to number adopted when measured against early adopters in the past.

It will be interesting to see if major firms jump into Bitcoin with dedicated mining consumer products.

As far as US hashrate falling vs China (and elsewhere) and a corresponding drop in BTC price, if we assume the two are correlated then my only theory there would be that possibly US miners had more disposable income and the larger percentage of coins mined outside the US now have a larger portion being sold back on the market as soon as they are mined.  Is this your thinking as well?

I don't think it is necessarily a disposable income issue as much as the market freedom of countries. Competition amongst exchanges will provide liquidity. When the world has easy access to Bitcoins, volatility will diminish and Bitcoin price will grow steadily with market confidence and utility. Until then we will see bubbles, slow access to ASICs, and media FUD.

Interesting insights.

Thanks.