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Author Topic: bitcoin's volitility is good  (Read 1047 times)
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November 27, 2013, 03:20:16 PM
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most people lament the bitcoin exchange rate volatility, but it may be a good thing at this point in time. why? well, if there was a steady, but rapid, increase in value, entrepreneurs wouldn't bother risking their resources on building out bitcoin infrastructure; they would just buy and hold bitcoins, instead.

pundits like to take shots at BTC, claiming it's too volatile, but lets face it, it's a priori. it's based on how they think the world should work, not what's happening right in front of their eyes!

they claim it's too volatile, they claim you can't have a deflationary currency, they claim it's not backed by anything. yet here we are.

reality is trumping them!

yes, it may be volatile, but look around: it doesn't matter.

the market is winning, and the cocky swagger of those that denounce bitcoin is draining day by day.

at some point, there'll be less volatility, and it will help bitcoin-as-a-medium-of-exchange. that points not right now. and that's ok!

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November 27, 2013, 03:58:52 PM
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most people lament the bitcoin exchange rate volatility, but it may be a good thing at this point in time. why? well, if there was a steady, but rapid, increase in value, entrepreneurs wouldn't bother risking their resources on building out bitcoin infrastructure; they would just buy and hold bitcoins, instead.

pundits like to take shots at BTC, claiming it's too volatile, but lets face it, it's a priori. it's based on how they think the world should work, not what's happening right in front of their eyes!

they claim it's too volatile, they claim you can't have a deflationary currency, they claim it's not backed by anything. yet here we are.

reality is trumping them!

yes, it may be volatile, but look around: it doesn't matter.

the market is winning, and the cocky swagger of those that denounce bitcoin is draining day by day.

at some point, there'll be less volatility, and it will help bitcoin-as-a-medium-of-exchange. that points not right now. and that's ok!

Posts like this make me sick.

Yes, I myself am profiting from the volatility (mostly upside) but as someone who actually got into Bitcoins for real world transactions, I can tell you volatility is horrendous for the health of something whose main purpose and value is that of a currency. Infact, this is just plain economics 101. Bitcoin needs to find some stable ground in order to firmly establish itself as an alternative currency, until then, its just gambling.


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November 27, 2013, 04:01:47 PM
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Volatility isn't built in in bitcoin per se and sooner or later (probably much later) the price will become more stable. It's all beccause of the adoption phases that we are right now.
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November 27, 2013, 04:01:58 PM
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until then, its just gambling.

whats wrong with the gambling where everybody who plays it wins?

i am satoshi
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November 27, 2013, 04:18:45 PM
 #5

until then, its just gambling.

whats wrong with the gambling where everybody who plays it wins?

Aside from it being one of the seven deadly sins (although I am not too sure if it actually is tbh), if taken to its extreme, it will kill Bitcoin.

At some point in amongst all the exorbitant speculation, real world economic transactions using Bitcoin must kick in and propagate, but for this, price stability is a must. Until then, Bitcoin is only going to be used for fast money transfers, online black market purchases, and money laundering (the latter might admittedly be a substantial market in itself).

It is all very well sitting back and toasting exorbitant riches that most of you never imagined you could ever have (not me, despite using Bitcoins since 2011, it is only very recently have I moved a significant amount of capital into Bitcoins for speculatory purposes), but at some point, we are akin to a bunch of parasites sucking the lifeblood out of the host organism.

Thing is, many on this web forum are so drunk on avarice that they cannot even see this.

Kraken Account, Robbed/Emptied. Kraken say "Fuck you, its your loss": https://bitcointalk.org/index.php?topic=1559553.msg15656643#msg15656643

Bitfinex victims. DO NOT TOUCH THE BFX TOKEN! Start moving it around, or trading it, and you will be construed as having accepted it as an alternative means of payment to your USD, BTC, etc.
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November 27, 2013, 04:21:05 PM
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until then, its just gambling.

whats wrong with the gambling where everybody who plays it wins?

Aside from it being one of the seven deadly sins (although I am not too sure if it actually is tbh), if taken to its extreme, it will kill Bitcoin.

At some point in amongst all the exorbitant speculation, real world economic transactions using Bitcoin must kick in and propagate, but for this, price stability is a must. Until then, Bitcoin is only going to be used for fast money transfers, online black market purchases, and money laundering (the latter might admittedly be a substantial market in itself).

It is all very well sitting back and toasting exorbitant riches that most of you never imagined you could ever have (not me, despite using Bitcoins since 2011, it is only very recently have I moved a significant amount of capital into Bitcoins for speculatory purposes), but at some point, we are akin to a bunch of parasites sucking the lifeblood out of the host organism.

Thing is, many on this web forum are so drunk on avarice that they cannot even see this.
fake bear
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November 27, 2013, 04:31:45 PM
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we are akin to a bunch of parasites sucking the lifeblood out of the host organism.

Not quite Mat. The process that goes on now is pretty simple - bitcoin has to reach the stable price. It can't be born having 1T value - it has to grow to that level, that's what we are seeing. As for the riches that get distributed to early supporters, it's exactly like any other startup operates. You support it early with your money - you get richer in the end or whenever the hell you decide to get off.

The high price is needed. Infrastructure is needed. Exchanges and speculation is also needed. All of these are small parts that contribute to the overall bitcoin success. For example, if you hold much wealth in coins, would not you give money to the developers team? I don't have much, but I feel it is safer for me if I support funding of the core project and the side projects that I feel lead to the development of bitcoin. To be able to do this, I need the "riches" that bitcoin grants me. There is no sucking, just deserved rewards.

i am satoshi
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November 27, 2013, 04:40:10 PM
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Not quite Mat. The process that goes on now is pretty simple - bitcoin has to reach the stable price. It can't be born having 1T value - it has to grow to that level, that's what we are seeing. As for the riches that get distributed to early supporters, it's exactly like any other startup operates. You support it early with your money - you get richer in the end or whenever the hell you decide to get off.

The high price is needed. Infrastructure is needed. Exchanges and speculation is also needed. All of these are small parts that contribute to the overall bitcoin success. For example, if you hold much wealth in coins, would not you give money to the developers team? I don't have much, but I feel it is safer for me if I support funding of the core project and the side projects that I feel lead to the development of bitcoin. To be able to do this, I need the "riches" that bitcoin grants me. There is no sucking, just deserved rewards.

You know, when I first heard of Bitcoin...wayyyy back... it really appealed to the anarchist in me and I thought that I would throw 500 GBP at it just to 'support' it and not worry about losing the money. But I never ever did, and even if I did, I would have quintupled my money, creamed my pants and cashed out. I understand the argument of speculators 'providing liquidity' to a market, but everything in its correct measure I would say.

Could we really say that Bitcoin speculation is in its correct measure?

Of course not, this is shaping into the most turbulent speculative mania (as far as investments open to the common man goes) in the past hundred years, but a speculative mania it is.

fake bear

I am not a bear. I am very much a bull. I turned bearish right on the eve of the last crash and expected a bounce followed by a trend towards a lower price base. But very soon, I realised that I was wrong, and again, turned bullish, and pt my money where my mouth was.

I think this market will go apeshit in a way not yet seen.

But I also believe that at its present rate, one day Bitcoin will implode, and one day, Bitcoin will not exist.

Kraken Account, Robbed/Emptied. Kraken say "Fuck you, its your loss": https://bitcointalk.org/index.php?topic=1559553.msg15656643#msg15656643

Bitfinex victims. DO NOT TOUCH THE BFX TOKEN! Start moving it around, or trading it, and you will be construed as having accepted it as an alternative means of payment to your USD, BTC, etc.
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November 27, 2013, 04:46:20 PM
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fake bear

I am not a bear. I am very much a bull. I turned bearish right on the eve of the last crash and expected a bounce followed by a trend towards a lower price base. But very soon, I realised that I was wrong, and again, turned bullish, and pt my money where my mouth was.

I think this market will go apeshit in a way not yet seen.

But I also believe that at its present rate, one day Bitcoin will implode, and one day, Bitcoin will not exist.

Exactly what I meant, that's why I'm saying you're a fake bear. You pretend to be bearish so people think there's still bears in this market. So those people can make a judgement to say 'we are not at the top because there are still bears' and buy. But in reality, you're a bull, acting as a bear.
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November 27, 2013, 06:47:31 PM
 #10

most people lament the bitcoin exchange rate volatility, but it may be a good thing at this point in time. why? well, if there was a steady, but rapid, increase in value, entrepreneurs wouldn't bother risking their resources on building out bitcoin infrastructure; they would just buy and hold bitcoins, instead.

pundits like to take shots at BTC, claiming it's too volatile, but lets face it, it's a priori. it's based on how they think the world should work, not what's happening right in front of their eyes!

they claim it's too volatile, they claim you can't have a deflationary currency, they claim it's not backed by anything. yet here we are.

reality is trumping them!

yes, it may be volatile, but look around: it doesn't matter.

the market is winning, and the cocky swagger of those that denounce bitcoin is draining day by day.

at some point, there'll be less volatility, and it will help bitcoin-as-a-medium-of-exchange. that points not right now. and that's ok!

Posts like this make me sick.

Yes, I myself am profiting from the volatility (mostly upside) but as someone who actually got into Bitcoins for real world transactions, I can tell you volatility is horrendous for the health of something whose main purpose and value is that of a currency. Infact, this is just plain economics 101. Bitcoin needs to find some stable ground in order to firmly establish itself as an alternative currency, until then, its just gambling.





If bitcoin was stable it would be boring!!!!! Nobody would trade it! aapl is under 500$ and is boring nobody really trading it right now, moves the opposite of the the S&P... I expect it to push to a million and if theres no volatility then there is no volume. No volume = no price increase.... Avg summer has little to no volume in the market. most weeks the stock moves sideways, up for a day then sideways.

Great post BitcoinNews.io



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November 27, 2013, 10:36:34 PM
 #11

Exactly what I meant, that's why I'm saying you're a fake bear. You pretend to be bearish so people think there's still bears in this market. So those people can make a judgement to say 'we are not at the top because there are still bears' and buy. But in reality, you're a bull, acting as a bear.

I was a bear back when Bitcoin shot through 50 USD. This was 5 times what I had paid for my last couple of hundred Btc (all spent on SR!), so there was no way was I getting caught out in this trap! HA!

Sadly for me, Btc has never seen 50 USD since. Even the flash crash from 260 USD took the price down to over 60 USD.

Having decided that the Btc market had stabilised back in Sept, I took my fist speculative dip into Btc. I invested around 1500GBP. By early Nov, this amount had more than trebled....then the market took a pull back, and the recovery seemed to be faltering a good bit short of the all time high....SO I SOLD EVERYTHING!

Sadly for me, Btc has almost trebled again since then.

As soon as I sold however, as I was drifted to sleep that night, I heard a voice in my head say "Mat u fkn donkey!" That night, I had a dream that Bitcoin was shooting past 600 USD. I woke up mega-pissed off, and set about trying to get a substantial lump of capital onto Bitstamp. This whole process took around 8-9 days. with my hands tied, I witnessed my dream (subconscious instinct) come true, and then some. By the time I was in a position to purchase coin on Bitstamp, we were in parabolic territory and no way was I entering here.

I predicted an imminent crash.

I got absolutely ridiculed from many on here (there are select individuals on this forum who I sincerely hope are 'all in' when this sucker finally does go down once and for all), recieving the usual flurry of derision and 'Face Palm' jpegs.

And then the crash happened.

This time though, the price curve did not behave like the text-books say it should. I soon started to realise this, but never made my first tentative moves into the market until it was plainly obvious that Bitcoin was bouncing right back, missing out on some very cheap buy-in opportunities but I never have been one for (big) risks. The fact that Bitcoin recovered so quickly and has now punched its way to a new all time high, where it is currently consolidating, is ultra fkn bullish....as any textbook would atest to.

I have known about Bitcoin and been buying and spending Bitcoin probably far longer than most people on here. Had I invested the same amount of capital into Bitcoin in the past 3 years  as I have done on gold and silver, I would be a multi-millionaire today.

Having watched time and time again all this life changing financial opportunity go whizzing past my face, and having stood thinking, 'ah, but it must surely be too late now', only to have been proven wrong time and time again, I am now knee-deep in Bitcoin (although certainly not waist deep). I am a long term bull, but a cautious one, who refuses to swallow any of the delusional madness propagated by many members of this forum and elsewhere, and am very ready to change my whole opinion and outlook on Bitcoin in a flash.

Bitcoin is one very hot potato. Thus far, Bitcoin has actually rewarded the delusional nutters who have held no matter what due to their religious belief in their own whacky Bitcoin paradigms. One day however, these people will get badly burned. This is just how the universe works. I intend to do my utmost not be amongst them.

Kraken Account, Robbed/Emptied. Kraken say "Fuck you, its your loss": https://bitcointalk.org/index.php?topic=1559553.msg15656643#msg15656643

Bitfinex victims. DO NOT TOUCH THE BFX TOKEN! Start moving it around, or trading it, and you will be construed as having accepted it as an alternative means of payment to your USD, BTC, etc.
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November 27, 2013, 11:46:37 PM
 #12

Take for a moment the stock analyst definition of volatility.

There are two measures, ALPHA and BETA. ALPHA is the linear growth. That's not volatility. So just because bitcoin is growing (fast or slow), that's the alpha. It means it's a good investment as a currency since it will out-grow inflation. Which is a critical need of a good currency.

The second component is BETA. BETA is the wiggle it does on the path to reaching alpha. So a straight line up means strong ALPHA, but zero BETA (volatility).

Earlier last week when it dropped it was exhibiting high beta. But right now, it's a pretty steady climb without a lot of volatility.

I think the main concern as a currency is long-term stability. That question reaches past the ups and downs of the market. That question asks, are you sure something won't happen to suddenly make bitcoin worthless. Some hack, some bug, some error, some hacker, something.

If I have a bar of gold under my bed, I know that in 10 years, I'll still have a bar of gold. What it will be worth is anyone's guess, but it will still be there, all covered in dust bunnies, yet still be there.

So bitcoin is a different animal to most people. We as technical people understand it, but most do not.

The it's not so much the volatility, it's the long term sustainability.

Once that's resolved in more people's minds, then it can safely grow to the moon. But at this point it is at the whims of people's greed and fears. Greed to make money, and fears of a collapse.

As a technical analyst, we believe that the price RIGHT NOW, not in 3 seconds, not 3 seconds ago, but right now is the sum of all the players greed, fear and knowledge. And right now (as of this post), the number is high, and feelings are pretty good.

So to sum up, it's not volatility that you have to worry about, but fears.

: )

(enjoy the turkey) cj

www.QuantTech.us -- Artificially Intelligent Adaptive Algorithmic Trading Systems
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November 28, 2013, 01:22:42 AM
 #13

I think it's good as I it'll get new investors who weren't able to getin before.

If the price drops to $500 I know many people who'd buy in versus the currently value. They are afraid they'll miss the boat and buy more BTC then before.

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