Why does it keep falling ?

[stic.man]

also the price fell like a dollar

a few weeks ago it would go up and down a dollar every hour or so

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[walidzohair]

Great Post .. from mining economy to transaction economy ....

I just asked the same question several days ago here

http://forum.bitcoin.org/index.php?topic=24854.0

the question is .. will it survive ?

As for mining economy:

* Huge mining bounty.
* Huge mining community.
* Huge overall network security.
* Tiny neglect-able transaction fees.

BUT, for transaction economy:
* Will the transaction fees stay low enough to continue using this commodity as a sub-dollar Hawala medium ?

If yes then huge miners will cash-out leaving the system vulnerable to attacks can be made by them or any hacker network that can offer to utilize couple mining pools that we have right now.

If NO then the system will be less-business attractive with: no advantage in lower transaction fees, questionable anonymity, less security backed up by smaller mining community, delayed transactions, volatile sub-hour pricing .. etc.


* Will the mining community continue to be this large providing this amazing network safety ?


I am a BTC man ... and these questions to know more or to pin point near less-than-a-year issues.

[Alex Beckenham]

I didn't say anything about selling for $17/BTC...I sold all my coins for $16.1/BTC and I still think it's way overvalued.

Well, I should say thanks then... I bought a couple of those.

[Alex Beckenham]

Proof:

Sorry I'm old. The only thing that image proves to me is that you know how to use the Resize tool.

[Jaagu]

Personally I'm getting out now while there is still a decent profit on it. The bubble is bursting.
After the crash people thought they were buying in low and that kept it at it's price, now it's dropping to it's real value. It would be stupid to pretend to know what the real value is, but it's certainly not $17.

Hey, lardycake, don't pretend you ever had any bitcoin! I've been watching you and other trolls here. You better shut up.

[Nagle]

At the current price and difficulty level, mining no longer really pays. Many complaints on the mining forums. Those with sunk costs in hardware may still be making some money, but it no longer pays to buy new hardware for mining. Most of the "miners" don't count the cost of floor space and staffing, but now, even as a marginal cost business, it's not that attractive. Miners are dropping out. In this situation, the difficulty should creep back down, but that happens slowly. Right now, Bitcoins seem to be priced near the cost of producing them.  That's the closest thing to a fundamental this market has.

The buy-side market depth on Mt. Gox is shrinking. They had around 40,000BTC of buy orders a few days ago, but now there are only 20,000.  This may simply reflect people pulling cash out of Mt. Gox. Probably a wise move.  Now that things have quieted down, the price is creeping back down into the $15 range on very thin trading.

Of course, there's no rational market for pricing Bitcoins. It's a pure speculation.

[evolve]

my guess is that this weeks flat trading scared a few speculators into selling, dropping the price into the low 16's yesterday...thats causing a ripple effect and now there is a panic sale that will prob drive it down to mid or low 15's

i actually wish i had more usd in dwolla or on the exchange to buy more today...i spent my reserve cash on the low prices yesterday......my guess is the price will settle at 14-15 and go back up to 16-17 in the next few days. 

in any case, im keeping my money in....i could be wrong, but if i am, i haven't lost too much (never gamble what you cant afford to lose  )

[markm]

What "should" be happening, if the various "nations" I have been developing "national currencies" for have any useful insight in the ways they plan to try to get their "national currencies" up and running, is...

1) Make sure to have a truly significant portion of the total number of coins so far made at some point in time.

2) Try to obtain a truly significant portion of the other currencies that people use to buy your type of coins.

3) Once you have truly significant "reserves" of "other currencies", start trying to "support" your type of coins by buying back, at less than you sold them for, any that anyone wants to sell.

This assumes the "nation" creating the currency actually plans to stick around and actually support its currency, instead of being just a fly by night nth-world micronation established mostly for the purpose of trying to 'con' other nations into accepting its ponz^H^H^H^Hcurrency long enough to raise a pile of loot to fade into the sunset with.

-MarkM-

[PatrickHarnett]

At the current price and difficulty level, mining no longer really pays. Many complaints on the mining forums. Those with sunk costs in hardware may still be making some money, but it no longer pays to buy new hardware for mining. Most of the "miners" don't count the cost of floor space and staffing, but now, even as a marginal cost business, it's not that attractive. Miners are dropping out.

Miners are not dropping out - growth is still above 1% per day (in any other market, that is HUGE).  http://bitcoin.sipa.be/  Growth has slowed - that is all you can say at the moment.

[Alex Beckenham]

I didn't say anything about selling for $17/BTC...I sold all my coins for $16.1/BTC and I still think it's way overvalued.

Well, I should say thanks then... I bought a couple of those.

No...thank YOU.

Sold them to you 16.1, and bought back at 15.2 overnight.

Happy days  

Congratulations. Meanwhile I just keep buying.

[hello_good_sir]

This is really a decimal point issue.  Right now mining produces 300 coins per hour.  In order to keep the price stable new people need to buy that many per hour.  Basically unless we increase the number of people inflation will eat our money.   We can't get new people because $17 seems like too much.  It is a psychological thing.  If the decimal point were moved two places we could tap whole new markets.  People with fancy phones would drop $10 to try it out.  "Oh I can get 60 bitcoins for $10, I'll try that".  "Oh I can get half of a bitcoin for $10, that doesn't sound fun"".

[zby]

This is really a decimal point issue.  Right now mining produces 300 coins per hour.  In order to keep the price stable new people need to buy that many per hour.  Basically unless we increase the number of people inflation will eat our money.   We can't get new people because $17 seems like too much.  It is a psychological thing.  If the decimal point were moved two places we could tap whole new markets.  People with fancy phones would drop $10 to try it out.  "Oh I can get 60 bitcoins for $10, I'll try that".  "Oh I can get half of a bitcoin for $10, that doesn't sound fun"".

Yeah - 300 coins per hour - 7000 per day - that is about $100 000 in current prices.  On one hand this is only about $2 daily for every mtgox user - I think most of us can afford that, but I am skeptical about the will to regularly put these $50 each month.

[kiba]

Personally I'm getting out now while there is still a decent profit on it. The bubble is bursting.

After the crash people thought they were buying in low and that kept it at it's price, now it's dropping to it's real value. It would be stupid to pretend to know what the real value is, but it's certainly not $17.

You mention a bitcoin bubble? You get a bitcoin bubble comic!

[billyjoeallen]

This is really a decimal point issue.  Right now mining produces 300 coins per hour.  In order to keep the price stable new people need to buy that many per hour.  Basically unless we increase the number of people inflation will eat our money.   We can't get new people because $17 seems like too much.  It is a psychological thing.  If the decimal point were moved two places we could tap whole new markets.  People with fancy phones would drop $10 to try it out.  "Oh I can get 60 bitcoins for $10, I'll try that".  "Oh I can get half of a bitcoin for $10, that doesn't sound fun"".

Yeah - 300 coins per hour - 7000 per day - that is about $100 000 in current prices.  On one hand this is only about $2 daily for every mtgox user - I think most of us can afford that, but I am skeptical about the will to regularly put these $50 each month.

Many are investing 10X that amount and new accounts are being registered all the time. I don't thinkit's unreasonable to assume that there's at least 40,000 people either mining and not selling, selling goods/services on line and saving the proceeds or buying on other exchanges.  That means ~1/day required.

We could easily maintain that even with little growth until the bitcoin/block reward is reduced, but it's highly unlikely to be necessary.

[Jalum]

We could easily maintain that even with little growth until the bitcoin/block reward is reduced, but it's highly unlikely to be necessary.

Oooo are we at the bargaining stage of grief now?  So now the discussion is how if all the bitcoiners just spent a little money to prop up their "investments", everything would work out?  Seriously?

[billyjoeallen]

We could easily maintain that even with little growth until the bitcoin/block reward is reduced, but it's highly unlikely to be necessary.

Oooo are we at the bargaining stage of grief now?  So now the discussion is how if all the bitcoiners just spent a little money to prop up their "investments", everything would work out?  Seriously?

I could liquidate my entire holdings today and still book a considerable profit. Why would I have any grief?  I'm crying all the way to the bank.

Why are you even here if you think it's all going down? If you don't like the party, you can leave. You think you're ruining it, but you're actually just providing the entertainment. Thanks for that.

[wareen]

Why are you even here if you think it's all going down? If you don't like the party, you can leave. You think you're ruining it, but you're actually just providing the entertainment. Thanks for that.

Yes! Finally it's Jalum time again

[TraderTimm]

We could easily maintain that even with little growth until the bitcoin/block reward is reduced, but it's highly unlikely to be necessary.

Oooo are we at the bargaining stage of grief now?  So now the discussion is how if all the bitcoiners just spent a little money to prop up their "investments", everything would work out?  Seriously?

What if everyone ran to the haberdashery, what would happen to hat prices?!

The problem with being a successful troll is you have to work at it. Really, you can come up with something better than that, you pedantic jackanape.

[Jalum]

What if everyone ran to the haberdashery, what would happen to hat prices?!

If the only purpose of hats is to sell them for real money, then people would have lots of hats until they decided to sell them for money.  At which point the bagholders (hatholders in your example) would subsidize the profits of everyone who got out before them.  When the discussion is literally that you should invest more money into something so the value of it doesn't go down naturally, you're the sucker.

But hey, don't mind me.  Go invest more dollars so your bitcoins don't lose dollar value.  That always works in the real world.

[TraderTimm]

But hey, don't mind me. 

Trust me when I say - I don't.

Got to keep your troll quota up, eh?