Plateau move or Phase Transition followed by crypto winter?

[CornCube]

First, I’m going to start another thread about the whether a crypto winter is now impossible or not. Interested to discuss analogous to the DOW stopped having deep, drawn out crashes after 1929 Great Depression and only goes to new plateaus with minor, short-leveled corrections. Will BTC stop having crypto winters? I will start a new thread to discuss this.

If you want to zoom the following charts, click here.

Martin Armstrong’s recent blog sparked some private discussion which I wanted to bring to this forum to crowd source the analysis:

Meanwhile, we will let Socrates generate the Reversals and the timing arrays for the forecast as we do with any instrument. At least it is a computer with no bias. So far, it indicates we are only in a Phase Transition.

However, this run-up began with the November 25th ECM turning point from the 8,000 level,

So far his computer has analysed that Bitcoin is in a “phase transition”.

Armstrong’s appears to be referring to the analysis in his recently published $750 How To Trade A Vertical Market guide, from which I excerpted the following (highly miniaturized so as to make it nearly illegible so as to not steal the value) log-scale historical chart of the DOW:

https://i.imgur.com/IuVwtOu.png

So notice the DOW had two phase transitions followed by water fall collapses in 1835 and 1929, with the 1929 crash being in the range of -90%. After that, the DOW made plateau moves in 1970s and 2000s, but the percentage declines (volatility) climbing to -54% for the 2007-9 subprime crash as compared to the more moderate level in the 1970s.

What I interpret in that DOW chart is that volatility increased in the USA while it was moved from gold standard without a national central bank to having Fed to prevent declines, but now the volatility is increasing again (because the Western nation-state-based, monetary system is falling apart) but the USA stock market is still being driven by its unique short-dollar-vortex position as the reserve currency.

Armstrong is referring to his ECM model turning points wherein the world in a Private wave that will peak in 2032 meaning that the public institutions (including the fiat monetary system) will be destroyed and replaced by the move to privatized institutions. So Armstrong is pondering if Bitcoin is just in a phase transition or if something more fundamental is going on. Well Bitcoin is going to become the NWO reserve currency, but Armstrong does not realize this yet. He is just starting to wake up about Bitcoin.

Here’s @Trolololo’s chart of BTC with my hand (inaccurately) drawn update for comparison:

https://i.imgur.com/3TsnW28.png

The question is whether this principle of phase transition versus plateau moves relates to Bitcoin?

Note that the BTC crashes are not shaped anything like waterfall collapses, except for the decline side in 2011 but the recovery was more U-shaped. Rather they are vertical up moves that resemble phase transitions but with U-bottom (instead of waterfall) collapses wherein the cups of the bottoms are becoming shallower and longer in duration as follows. Perhaps Armstrong classifies anything that doesn’t decline more than 67% to the bottom as a plateau move, else a phase transition regardless of whether the decline is waterfall. Bitcoin isn’t getting waterfall collapses because the adoption is ongoing despite any price changes, thus not everyone in the ecosystem is panicking when the price peaks and declines (in 2014 and 2015 venture capital continued to pour in while the price was declining and ETH issued the first ICO). So thus maybe we can say Bitcoin is transitioning from phase transitions to move of a plateau moves (and the chart is a continuous fractal pattern also in that way with patterns within patterns).

The 2011 BTC decline was -93% and 5.5 months crypto winter in duration. The early 2013 -67% correction was short-lived and not deep enough so it was just a step along the move to the high at the end of the year. The 2013-2015 decline was -83% and 13.5 months crypto winter in duration.

So clearly Bitcoin is in another huge up move to be followed with a subsequent decline which will be less than -83% but much longer in duration than 13.5 months. Bitcoin plateaus in that way, because the mania about it (it’s replacing the world monetary system!) gets ahead of the actual implementation, adoption, and use case realities, and this time will not be any exception.

The 2013 peak was ~35X the 2011 peak and ~500X the 2011 bottom. Those ratios applied to current move would give us a maximum peak of $35 – $100K. But I’m nearly certain the ratios should decline as the rate of adoption is slowing and flattening as evident by the chart. So looks like the peak will instead probably be in the range of $18 – $50K. Probably to be followed by a decline of perhaps -67% that may bottom after 27 months.

Bitcoin is an adoption oriented phenomenon which is reflected in it’s chart. The DOW reflected the industrialization of the USA and the monetary system that adapted to fulfill it. That nation-state fiat monetary system is not well adapted to the coming Knowledge age (as we leave the Industrial age), so thus the monetary system is being replaced with cryptocurrency.

Thoughts?

Here’s some zoomed in equivalents of the DOW chart, which I obtained from the Internet:

https://i.imgur.com/5D26QLp.gifhttps://i.imgur.com/esLsriq.png

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[CornCube]

Re: This won't end well

Four scenarios and their probabilities for me:
- No correction. (10-20%)
- Correction, but hype hasn't ended: 19.xxx -> >10.000 -> to tha moon (40K?). (20-30%)
- Deep correction/crash with panic and "people trapped inside the blockchain", followed by a real bear market: -> down to ~2.000-3.000 , stabilizing at about $5.000 (30-40%)
- Bitfinex/Tether conspiracy theory is true: -> down to $1000 or below.  (10-20%)

The 2nd one has the highest probability right now.

The 3rd one has the highest probability after we hit the $40k peak.

The last (4th) one will occur during the 3rd one, and will also include a blood bath for non-compliant ICOs and a SegWit theft wherein the blockchain steals $billions of Bitcoin “pay to anyone” donations.

You're way overanalyzing the bitcoin move […] I'd say that's already occurred in bitcoin for this wave.

Indeed I think BTC already topped out (or will next week as the move from $11k to $16k may have only be one leg of two legs up) at $18k – $25k¹ then will U bottom for a couple or few months and then skyrocket again to $40k (ditto as in 2013). Then a 67% decline back to < $15k.

Perhaps the altcoins will moon now during the interim lull (usually happens when BTC pauses), as LTC did in 2013 after the first BTC peak.

¹  _{Average pricing including Asian exchanges which are higher as quoted on Coinmarketcap, Shapeshift, and others}

And you think things like transaction fees and load capacity have zero effect on that?  That price just magically always increases in a 45 degree line?  You're trying to apply Metcalfe's law to something that's already virtually topped out in terms of load capacity.  I mean, Hall Finney already said bitcoin is useless except as a settlement network years ago.  For something like Metcalfe's law to apply when it's a settlement layer, it means govts would have to adopt the thing as the world reserve currency, otherwise it's not exactly having any interaction at all with most of the world's inhabitants.

The transaction volume layer doesn’t need to be on the Bitcoin blockchain nor necessarily even offchain! And yes Bitcoin will be the NWO reserve currency as designed by the Zionists who control it.

You’re going to miss out on $1 million per BTC in 2026 with your silly tinfoil hat precious metals delusion.

Those mumbling at TMSR (trilema.com) represent millions of BTC.

It actually doesn’t matter who is running their client now. What matters is that millions of BTC believes Bitcoin has no value if it can be mutated, because the smart people understand that Bitcoin is more valuable as a reserve currency of the wealthy, because the wealthy matter and the masses (sheep to be harvested) do not (in a paradigm that is not decentralized, which proof-of-work can never be!). That is just economics. Even Trump understands it:

Most importantly, a big tax cut (from 35% to 20%) is planned for the corporations which will make the U.S. society richer, especially in the long run. Companies are the places that can use extra cash most effectively – partially as an investment allocated by some of America's best managers – which is why the lowering of their taxes is the best investment for the whole. Everyone who fails to get this simple point of trickle-down or supply side economics is just an economics (and history) crackpot. Try to cover it by your left-wing beliefs or anything else but it's actually crackpottery that is behind it.

However, the “bigger fish eat the little fish” paradigm doesn’t scale to only one big fish that ate everything (this is why the Zionists ultimately fail), i.e. even though wealth is power-law distributed, still 50% remains with the minnows (but they can’t organize themselves politically and thus precisely why we need true decentralization). Thus I still continue working on my altcoin protocol.

I will need to study the technological security of those instant offchain  “cross chain” swaps. I expect to find security weakness of the sort of game theory attacks I mentioned about Mt. Box settlement spikes on chain. In any case, any altcoin which enables Lightning Network (LN) is going to subject to the threat of volume spikes due to Mt. Box. If an altcoin is not threatened by that (because it can handle nearly any volume such as the design I am working on), then it doesn’t need LN any way!

Yes altcoins can already do transactions much cheaper than Bitcoin and that doesn’t matter. Bitcoin’s transaction volume demand will always continue to increase because BTC is the reserve currency of crypto and so everyone wants to bank their profits in their unit-of-account which is BTC.

Bitcoin’s transaction market share will drop precipitously, but it’s share of the economic pie of crypto will remain very significant and grow because of the reason I stated. BTC miners/whales do not care about transaction volume, they care about value of the transactions and thus the amount of fees that those whose transacts fit within 1MB block size can afford to pay. For example, when every BTC transaction is $10 million, then a $5000 fee per transaction will not be a problem.

The log target is $100k just sayin.. give it a month or so.

Show me a chart that has that target projection drawn on it.

The adoption rate has to slow in percentage terms. Oak tree seeds grow to saplings quickly rapidly, but not to the moon.

Although I can say that that slowing can be accounted for significantly in the longer duration of the U-bottom from 2013 – 2018 as compared to 2011 – 2013. So it’s not entirely implausible. Peak-to-peak appears to project less than $100k though.

John McAfee Bets His Manhood that BTC will reach $1 mil by 2020

He better prepare some hot sauce. No way BTC hits $1 million by 2020.

The more likely time frame for BTC to reach $1 million is 2024 – 2026.

I also think BTC might go to $7000 - $8000 (maybe even higher) in next weeks or months (before any crypto winter).

2x will die and BCH will also go very high.

"Crypto winter is coming again ..."

Different times, the past has nothing to do with the future  

I’m documenting in this thread all of you stating: “it’s different this time and the widespread, centralized failure of Mt. Gox can never be repeated in any form”.

Just like I documented in March and April everyone stating that LTC’s move from $4 to $6 was nothing and it would drop back down again. Then it went to $85.

Just like how I recently documented in the “BCH bleeding death" thread and the thread "people think that Bitcoin Cash can disappear", how everyone thinks BCH is dying (and scorn it the same as they did for LTC), and let’s observe if it rises to $1000 or $1500.

Something very widespread and sinister is brewing, but it may take us higher and deeper first before it reveals itself.

Given the timing is so uncertain, it's possible that BCH could decline significantly before it catapults. In my theory, the protagonists would want BCH to be sold off and cheap as possible before beginning their SegWit attack. However, if SegWit2x fails (not the attack) as I expect in November, BCH and LTC (with its larger blocks and SegWit) may be the beneficiary for big blockers. So perhaps we get another spike upwards for BCH and LTC (i.e. SegWit not destroyed yet, so 8MB blocks on BCH and 2MB blocks and SegWit on LTC), then perhaps some long drawn out decline before the massive SegWit attack, BCH skyrocketing, and then the crypto winter. There are many possible scenarios.

Seems we are likely to get the battle over larger blocks before the battle over the viability of SegWit. The SegWit attack probably won't occur in 2017.

We’re obviously in a phase transition right now, and the big money is starting to notice. But how long will this phase transition go on before it reaches nosebleed and needs to take dive? $8000 - $10,000 within a month? Then we’ll get some exhale (not dive) into altcoins because of the risk of the 2x fork in November (and my bets are still on LTC and BCH for the reasons I already explained because I expect 2X to fail to be adopted). Then $25,000 by Q1 2018? That would take us to ~$0.5 trillion market cap (perhaps $1 trillion overall including all altcoins), which would presumably set the gears into motion to insure the institutional players want in. And will the catalyst for any subsequent dive be dire (e.g. the SegWit attack I posited) and create a winter? Will the big money get the “custodian insurance” they need in time to come in and support this phase transition before any such crypto winter?

And whether SegWit, Lightning Networks, and ICOs (i.e. the current paradigms that the current phase transition are hinged on) are the paradigms that will take us to this future?

It seems the vehicles are being created to allow more speculative players into the market, but afaics the institutional players will not be able to buy into this bubble within the next few months:

[…]

Thus expect overshoots and massive waste as the free market takes money from fools and routes that money to those who can best allocate it for optimum production.

The governments may try to step in to stop the massive waste of selling empty speculation bags to greater fools (no crypto projects have any appreciable real world use/adoption except maybe Bitcoin and Steem) and take their cut of the pie as the cost of our inability to organize ourselves without massive waste. Yet decentralization trumps centralization (eventually and more readily in this era of the Internet) and so some projects are going to figure out a way to allocate capital better than the government privilege+monopolistic-theft model, and these paradigms will “steal” (i.e. reallocate) it all back away from the corrupted retards in government ^{(and those who ride the governments’ coattails who implicitly corrupted because they choose to comply and take the Mark of the Beast instead of coming out of the Great Harlot, thus by their complicity they perpetuate the corruption)} and into massive decentralized production.

And so yeah, expect theft and concomitant corrections along the way as the free market annealing mechanism plays out and we astute developers bring decentralization to the real world adoption.

I am employing http://cryptowat.ch to view the charts. On a 1D (1 day) chart, LTCUSD is still in a bullish trend. LTCBTC appears to be finding a spike down, V bottom somewhere in the 0.0070s. Should rocket up again. Extremes have to reached first. I still think $100 and $150 are potentially realistic targets during this current period (over next couple of months or so). Of course, nothing is certain, just talking probabilities. If LTCBTC breaks below 0.0059, that could signal the end of the bullish trend, especially if LTCUSD has also broken down from its trend (just view the LTCUSD chart, the trend slope is obvious). We were expecting LTCBTC to reach 0.03 before this bullish trend ends (and possibly 0.05 on some insane moonshot spike), so if that holds then at $150 […]

I think this is impossible.

“It can never happen” is the attitude we need for it to happen.

Nevertheless it is quite plausible that after a minor correction from $8 - 10k down to maybe $5 - 6k, then we could get another move up in Q1 2018. The bubble could possibly run much further and become much more extreme, maybe even continuing on throughout 2018. Or not.

I am thinking an exhale into altcoins may be coming after Nov. 15 or 25th, similar to August.

Grandmothers holding the 90+% of ICO tokens which will go to zero is something I am keeping my eye on.

All of Hyperme.sh’s predictions above came true or soon will.

[miscreanity]

This isn't disputing your assessment, only contemplating how quickly widespread usage might occur and whether a major catalyst could be lurking. An adoption S-curve is not necessarily going to cause an immediate price move. These levels are certainly looking for a correction or at least a pause, though I wonder whether the recent ~30% dip in Bitcoin already cleared the froth.

So I'm left wondering... Bitcoin is a technology. The infrastructure is already in place for it to be used - smartphones. There are already existing paradigms that adults of all ages can use in order to make use of the system to make transfers.

Automobiles required roads, fuel and maintenance/repair support systems. The telephone needed vast stretches of cabling. The Internet required computers and communication hardware to be widely available. We are now in a period of Facebook, Instagram and WeChat where sudden and rapid user growth is a matter of software installation. The rails are already here, and general populations are starting to take interest.

Separately, what is the Bitcoin market value compared to the crypto economy as a whole? Will wealth held in Bitcoin simply spread to other crypto, simply shuffling the balance around? If so, is adoption better measured by the entire ecosystem?

Look at Litecoin now - launching while Bitcoin is stationary. If they keep popping off and Bitcoin starts waning, will awareness spread among individuals outside of crypto as they discover that there's an entire universe of investments that Bitcoin opened the door to?

Finally, which projects are close to active usage in existing environments aside from crypto? Ripple is certainly being made use of by banks; Stellar has its place as well as Iota... Bitcoin and Ethereum may take a back seat for a spell while more well-defined use cases run the show in the near-term.

Is this a hydra that will keep propelling crypto forward; when one lags, the others forge ahead? I am considering the potential that, even if Bitcoin stalls, the crypto economy as a whole may make new highs and continue doing so for some time.

[CornCube]

@miscreanity, imo all that you described is supports my logic on why Bitcoin’s (cryptocurrency’s) crypto winters are becoming longer in duration and less extreme in depth, i.e. speculation is gradually being supplanted by actual adoption. All those anecdotal reasons don’t supersede the mathematics of adoption (they’re a manifestation of the mathematics but remember smaller things grow faster in percentage terms than larger phenomenon). The speculation that remains will overshoot the reality of the ecosystem adoption and we will get another decline (formerly known as “crypto winter”), it just will not be as deep (but it will be longer) than the prior one:

Bitcoin isn’t getting waterfall collapses because the adoption is ongoing despite any price changes, thus not everyone in the ecosystem is panicking when the price peaks and declines (in 2014 and 2015 venture capital continued to pour in while the price was declining and ETH issued the first ICO).

[…]

The 2011 BTC decline was -93% and 5.5 months crypto winter in duration. The early 2013 -67% correction was short-lived and not deep enough so it was just a step along the move to the high at the end of the year. The 2013-2015 decline was -83% and 13.5 months crypto winter in duration.

So clearly Bitcoin is in another huge up move to be followed with a subsequent decline which will be less than -83% but much longer in duration than 13.5 months. Bitcoin plateaus in that way, because the mania about it (it’s replacing the world monetary system!) gets ahead of the actual implementation, adoption, and use case realities, and this time will not be any exception.

The 2014 – 2015 crypto winter didn’t stop the ecosystem from booming. ETH issued an ICO for $18 million in 2014 which was shocking to all of us at the time (but I think Mastercoin has done a $1 million ICO in 2013 and @jl777 afair had raised 1500 BTC for SuperNet). Also the venture capitalists were increasing their investments throughout the crypto winter. I expect the same and at an increased level for the coming ~27 month decline after the peak perhaps with 8 years before the next peak is reached at $1 million per BTC.

I think $100k is plausible before the ensuing ~27 month decline by perhaps -2/3 of the price. We should at least reach $40k on this peak (although we might get a multi-month pause and correction after reaching $18k – $25k first).


Examples of the speculation exceeding the reality is the recent LN demo wherein people think that suddenly means that everyone can instantly buy coffee with Bitcoin and they think the fundamental insecurity of SegWit on Bitcoin is solved:

It looks like news of LN transactions on mainnet happened yesterday when the pump started, I wonder if it's related. The video got a lot of views:

https://www.youtube.com/watch?v=a73Gz3Tvx3k

Im not gonna lie tho, it looks pretty slick.

What if it ends up working well? Let's say it catches on and the average Joe end user happily can buy coffees with BTC finally (they don't care about any of the technical details anyway), and there is no segwit attack and we all get rich from holding BTC? It's a possibility.

A controlled demo really says nothing about the game theory of Mt. Box centralization of the hubs of LN. And the fact that most users will simply choose to have an account with a hub and thus be given fractional reserves. And the failures of hubs like we have failures of exchanges  now. And the runs on the bank. And the surge spikes of settlement load on the main chain. Etc..

We’re a long way from knowing which electronic currency people are going to want to use to buy coffee. Even if LN worked perfectly it would not necessarily win the adoption race for uptake.

I can’t predict whether SegWit will be a failure mode for BTCSegWit. We’ll have to wait and see.

[Fatoshi]

Simple rhetorical question.


Most reading this are I assume are Crypto savvy even following the tech for years and have high levels of tech/wallet know how far beyond the average person.



So what have you bought with Bitcoin?.....

[kfactor]

... So what have you bought with Bitcoin?.....

A good measure of satisfaction for the time I spent mining, and suffering the joke that was Black Arrow (thank the lord I was only into BFL for a jalapeno)

[Fatoshi]

So my point is adoption is almost non existent at least as a payment medium and I dont care how easy its made with an app. 99% will not care if they pay with btc over fiat when they use their phone or app to make a payment online.

[miscreanity]

@miscreanity, imo all that you described is supports my logic on why Bitcoin’s (cryptocurrency’s) crypto winters are becoming longer in duration and less extreme in depth, i.e. speculation is gradually being supplanted by actual adoption.

When you mention Bitcoin in the context of this thread, are you referring to crypto in general?

I agree with your assessment regarding the likelihood of a decline following this run up. It seems that you're also saying that the subsequent activity will be more turbulent, as investment in this sector becomes even more heated than during the prior subdued period - correct?

As for 100k, I threw that out as a remote possibility for a spike high on overshoot. I do agree that the target of 40k is much more attainable in the near-term, although at the moment I have no charts to directly show such levels. My current charts top out around 20k.

http://www.tradingview.com/x/kZTQwBYB/

http://www.tradingview.com/x/0gb9bKRl/

[CornCube]

@miscreanity, imo all that you described is supports my logic on why Bitcoin’s (cryptocurrency’s) crypto winters are becoming longer in duration and less extreme in depth, i.e. speculation is gradually being supplanted by actual adoption.

When you mention Bitcoin in the context of this thread, are you referring to crypto in general?

Yes, but I’m pointing out that although the crypto winter brutalized the altcoins, there were new ICOs and launches taking place in 2014 and accelerating into 2015 and 2016. So the adoption sector of the ecosystem did not slow down, it kept on growing.

I agree with your assessment regarding the likelihood of a decline following this run up. It seems that you're also saying that the subsequent activity will be more turbulent, as investment in this sector becomes even more heated than during the prior subdued period - correct?

Adoption and startups facet of the ecosystem is growing more and more heated. I do not think that will pause in any decline, although non-compliant ICOs might be walloped.

Everyone is so wealthy enough now that a 2/3 decline from $40k will not stop any projects from being funded.

As for 100k, I threw that out as a remote possibility for a spike high on overshoot. I do agree that the target of 40k is much more attainable in the near-term, although at the moment I have no charts to directly show such levels. My current charts top out around 20k.

http://www.tradingview.com/x/kZTQwBYB/

http://www.tradingview.com/x/0gb9bKRl/

Your $20k could possibly be the peak before the possibly multi-month correction I am contemplating as a possibility before we attain the final peak before the 2/3 decline.

Sensing that BTC may exhale after the CBOE futures launched on Sunday or the CME on Nov. 18. Nasdaq futures not to launch until 2018.

Possibly the leg from $11.5k – $17k (Kraken) was the first of two legs? So 2nd leg to ~$20+K next week?

Could you update your 2nd chart? Hasn’t it already hit the $17k resistance? So where do you see $20k on that chart?

EDIT: cryptocurrency can have this volatility while still be consistent with a move to private monetary system by 2032 per Armstrong’s ECM Private wave model. The USA stock market’s rise to 42,000 doesn’t have to peak/plateau at same junctures as cryptocurrency. A decline of 2 years could correspond with the decline and bottoming of Asia in 2020. Asia is driving much of the speculation growth of cryptocurrency.

[thejaytiesto]

So I'm left wondering... Bitcoin is a technology. The infrastructure is already in place for it to be used - smartphones. There are already existing paradigms that adults of all ages can use in order to make use of the system to make transfers.

Automobiles required roads, fuel and maintenance/repair support systems. The telephone needed vast stretches of cabling. The Internet required computers and communication hardware to be widely available. We are now in a period of Facebook, Instagram and WeChat where sudden and rapid user growth is a matter of software installation. The rails are already here, and general populations are starting to take interest.

Crypto (or at least PoW coins which are the only coins I would consider safe thus far) also have a problem of infrastructure...:nodes. You need a decentralized network of nodes. If your blocks are huge, then your transactions are validated by some corporation. If we all had affordable super computers ahead of the demand of transnational volume, we could run huge blocksizes at home and always be ahead of mainstream adoption's demand curve but that's not how it works unfortunately.

Same as mining infrastructure with it's centralizing problems.. etc.

So you either pay increasingly bigger fees for onchain transactions, or pay a tradeoff in a less-than-ideal transaction if you want to cater for the masses demands. Maybe this tradeoff cannot ever be avoided because it's some sort of physical limit? (like the speed of light or whatever). That is the trillion dollar question. If someone comes up with something that keeps your track record as safe as a strong PoW network without all the negatives then it would be a real bitcoin killer. What are the chances of this happening anytime soon? I would say rather low. Until then you have to live with what you have, and BTC is what we have. If this real bitcoin killer that defeats it on every department shows up, we would get rich as fuck since we would be the first to know about it (we would know at least in practice, since it doesn't work until it's in the wild, holding billions of a marketcap and not blowing up, but let's say it works in theory then on practice). Sounds too good to be true, so for the time being, you better hold some BTC, with it's cons and pros, it's what we have thus far. The other altcoin proponents have always some weaknesses that simply don't cut it and wouldn't justify mass exodus from BTC to them. Speculation is wild when some of these show up. Just see IOTA. You could have turned 1 BTC into 10 BTC the other day, during BTC's bull. It shows there's a demand for a "bitcoin killer", but like I said, in the long term it goes back to BTC since there isn't such thing yet.

[CornCube]

If your blocks are huge, then your transactions are validated by some corporation.

Even if the blocks are small, an oligarchy is the only possible outcome of proof-of-work, both because of economies-of-scale of ASICs which can’t be avoided with any algorithm and because as transaction fees become the majority of the mining income then consensus does not converge (i.e. is incentives incompatible).

So you either pay increasingly bigger fees for onchain transactions, or pay a tradeoff in a less-than-ideal transaction if you want to cater for the masses demands. Maybe this tradeoff cannot ever be avoided because it's some sort of physical limit? (like the speed of light or whatever). That is the trillion dollar question. If someone comes up with something that keeps your track record as safe as a strong PoW network without all the negatives then it would be a real bitcoin killer. What are the chances of this happening anytime soon?

I claim to have that design already (and my angels have read it). It’s described in the secret version of the linked document above (which I may have sent you a link to some months ago) which doesn’t have the second half of the document elided.

I would say rather low.

I would say rather high because I’m privy to information you don’t know yet, except I will say I can’t be sure that my design will remain decentralized. And the security model is different. Yet what I hope is:

As I explained upthread, I think the only social consensus should be to maintain immutability.

It’s true that I see even flaws in my own design which could potentially cause it to become centralized, but I’m working on the notion that people will be able to form groups of like-mindedness about protecting the invariants of the protocol. The key is for the community to be able to objectively distinguish malfeasance and for each individual to be able to independently and effectively route around it, i.e. castrating the powe of political influence.

The devil is in the details.

You contradict yourself regarding forming a democratic utopia when it is convenient to do so to support your arguments. In the above quote in a separate thread, you compose an argument for what I have been arguing all along ITT... leveraging Social Consensus to keep a protocol static. If you believe such Social Consensus can be obtained to keep a protocol the same (IE. BCH), then surely the same Social Consensus can be reached to change a protocol for the betterment of the protocol (IE. Bitcoin). You can not castrate political influence altogether

I’m delighted you went scouring in another thread and brought this up. Because you’re advertising for me. Thanks.

You correctly rebutted yourself. The key distinction is using social consensus to keep a protocol immutable, not for changing it. And to do that requires that each individual can act independently to defect from mutations. Also of course it requires that the protocol meet the needs of most users and not need changes.

Until then you have to live with what you have, and BTC is what we have. If this real bitcoin killer that defeats it on every department shows up, we would get rich as fuck since we would be the first to know about it (we would know at least in practice, since it doesn't work until it's in the wild, holding billions of a marketcap and not blowing up, but let's say it works in theory then on practice). Sounds too good to be true, so for the time being, you better hold some BTC, with it's cons and pros, it's what we have thus far. The other altcoin proponents have always some weaknesses that simply don't cut it and wouldn't justify mass exodus from BTC to them. Speculation is wild when some of these show up. Just see IOTA. You could have turned 1 BTC into 10 BTC the other day, during BTC's bull. It shows there's a demand for a "bitcoin killer", but like I said, in the long term it goes back to BTC since there isn't such thing yet.

IOTA is entirely centralized and requires a Coordinator they refuse to remove and let it run decentralized because they know their consensus  technology is a (fabulous technobabble) lie. Use google with “site:bitcointalk.org Come-from-Beyond TPTB_need_war" and “site:bitcointalk.org Come-from-Beyond iamnotback" to find the banned technical discussions. Someone who invested in the ICO told me they refuse to release tokens to all and that is why the price is mooning (limited supply which is not accurately accounted for in the Coinmarketcap) and when they do finally release the tokens, then the price may crash.

To bring your post back on topic to this thread, indeed we must enter another crypto winter eventually, because the technologies and reality doesn’t quite yet meet the speculative expectations.

But I want to make it clear that no altcoin which scales volume transaction volume will have the same security model as proof-of-work. Therefore, BTC will never be replaced as the reserve currency. Yet do note that proof-of-work will ways be run by an oligarchy (which for example in the case of Bitcoin makes it superior to proof-of-stake), thus the security model is one of transparency of correctness but weakness against fragility. The proof-of-work security model is antifragile on the long-tail distribution; whereas, my design is long-term antifragile but near-term less deterministically transparently objective (aka Vitalik’s weak subjectivity but with some improvements wherein I employ statistical objectivity).

For example, the point of my altcoin project is to scale into the knowledge age (i.e. not compete for the most liquid, fungible reserve currency unit-of-account). It’s not to actually kill Bitcoin, which would be a silly futile goal:

Yes altcoins can already do transactions much cheaper than Bitcoin and that doesn’t matter. Bitcoin’s transaction volume demand will always continue to increase because BTC is the reserve currency of crypto and so everyone wants to bank their profits in their unit-of-account which is BTC.

Bitcoin’s transaction market share will drop precipitously, but its share of the economic pie of crypto will remain very significant and grow because of the reason I stated. BTC miners/whales do not care about transaction volume, they care about value of the transactions and thus the amount of fees that those whose transacts fit within 1MB block size can afford to pay. For example, when every BTC transaction is $10 million, then a $5000 fee per transaction will not be a problem.

I told you upthread that fungible monetary systems are the property of Satan. You’re wasting your time idolizing shiny pieces of metal thinking that is a solution to anything.

We’re moving into a knowledge age. I will not repeat all the upthread explanations and links. Readers can scroll back.

Unless you're trying to channel Coincube over here, it's kind of ludicrous you claim to know what god is.

Satan can be characterized as the collective failure of humans, e.g. as it says in the Bible that 666 is the number of a man.

The images of Satan as some devilish creature can be construed to be an attempt to visualize this collective failure. It doesn’t necessarily mean that Satan is that creature.

We should also define failure in this context. Failure is an integral facet of the inexorable universal trend towards maximum entropy. Fungible systems tend towards top-down, economies-of-scale, thus must eventually be destroyed by creative destruction in order for maximum entropy to progress. Yet they are expedient and necessary along the way. They for example harbor stability for a while.

Cryptocurrency either centralizes into complete control faster and more so than anything else, or you just have endless chain forks like bitcoin cash, bitcoin gold, etc. […]  All roads lead to subsidizing your own enslavement.  And this is why I prefer metals.

The endless forking means it can’t be entirely centralized. The fungible value will always be sucked into the center (i.e. Zionists who control the reserve currency Bitcoin), but remember my (AnonyMint’s) seminal essay is that knowledge production can’t be extracted with fungible finance. I keep repeating this and it keeps flying right over your head. You may never grok it.

Fungible money and the fixed capital investment industrial age is dying.

If you don't want to live in an unwinnable casino gulag, metals wins again because shorting to cost of production just gives you a free money buying opportunity.

Only for metals which sit in your basement and are entirely useless. As soon as you need to actually spend them as money, then you will always be right back in the Zionists’ fungible money system.

[CornCube]

It’s not prudent to take profits on BTC on a peak before a crypto winter unless you pay 0% tax or unless you have some greater opportunity cost or short-term compelling need to spend the funds (e.g. Vitalik didn’t sell the BTC raised in Ethereum’s ICO so development funds decreased in value) or an investment that will rise during the crypto winter (e.g. LEAPs on the DOW or gold bullion), because you decrease the amount of BTC you will have by the tax rate % unless you’re able to repurchase the BTC at a price drop (from your selling price) lower than that said tax percentage. And presumably you’ll find some way to get into a lower CGT situation before you eventually take profits such as even donating it later to worthwhile nonprofit causes (which don’t pay tax on it).

Crypto investors should seriously consider how to get themselves into a 0% tax situation.

P.S. Note it might be possible to take out a low-interest loan backed by the crypto asset, and paying that interest until you later liquidate crypto at a lower tax rate, may be more favorable, but that is a complex arrangement.

[CornCube]

A more detailed log-scale chart also points to the same conclusion that the peak before any 27 month crypto winter would be at least $40k – $50k, with a possibility for $100+k:

https://www.tradingview.com/chart/BTCUSD/BzKoYDVE-BTC-Let-the-shorting-Begin/

That chart also alerts me to another possibility, which is a several months correction from the current level or $40k – $50k level, and then the final blowoff peak at $40k – $50k or  $100+k respectively. IOW, the start of the long crypto winter could be delayed into 2019 or 2020.

In any case, I think it is best to HODL now. I doubt the current level is the start of a 27 month crypto winter.

P.S. given the potential gain for BTC from the current level is ~3X (or maybe 5X at an extreme to $100+k), the altcoins are likely to moon soon and gain on BTC, because most of them have 10+ X gains potential before the next crypto winter.


Crypto winter if it ever comes could be due to any one of the following reasons:

The 3rd one has the highest probability after we hit the $40k peak. But the bottom would be > $10k.

The last (4th) one [the Tether/Bitfinex collapse] may occur during the 3rd one, and may also include:

• the Tether/Bitfinex collapse
• a blood bath for non-compliant ICOs
• SegWit theft wherein the blockchain “steals” $billions of BitcoinSegWit “pay to anyone” donations
• skyrocketing transaction fees and excruciating slow confirmations on BTC

[btcone111]

Excellent piece of work - thank you very much.
Pretty much also sums up what I've been reading and believe in right now at this moment.

[hamdoc]

Hi. I'm new here. How does plateau move differ from phase transition. Can u pls. Explain.
 And govt. Mulling banning cryptocurrencies in India fearing it's use in terror financing? Thanks for ur insight..

[TERA2]

The question right now is are we in early 2013 or late 2013/2011? Will there be one more wave up (to say 60,000), or is it straight to crypto winter?

[megadeth]

Reviving this thread with the accurate predictions by Coincube, miscreanity and Tera.