rpietila Wall Observer - the Quality TA Thread ;)

[AnonyMint]

So consensus here is that bitcom could go to $70, an altcoin could be a much better investment and TA is a much more reliable price indicator than FA for btc. Mmmmkay, guess I have to sell all my coins now. Or actually, should probably do the opposite of what people are thinking here.

You misinterpreted my post. Even if an altcoin could succeed in the way I suggested, how would you know which one? Thus your chances of beating your investment in Bitcoin are slim.

I was explaining why you are locked into this groupthink, because statistically you can't break out of it. Because you don't have the insider view I have being a different level of programmer than you. I can evaluate things that you can't. However, even with that advantage, my odds of prediction against the mainstream inertia are not even as high as 50%. Yet they aren't as low as 0.1% either. At this moment, I would place the odds of my prediction some where in the low single digits percentage. Within a few weeks if developments come, I might be able to raise that higher than the teens.

The key most factoid is a cpu-only coin (no GPUs!) could be a viral threat to Bitcoin, as it can spread by word-of-mouth even to those who heard of Bitcoin and want to mine some coin for free and the neato "hey I did it too" factor.

If you think $550 is the bottom because we've spent some time here on the 60 minute then please do laugh at us and HODL and buy more bitcoins. I'm fine with it. My charts indicate that $550 is in no way a super bottom that will start a rally to $100000 or whatever people are dreaming of these days.

I concur. Bitcoin needs rejuvenated, emotional rocket fuel (remember this bubble is all about rationalization and not technological facts, as I pointed out the technological reality in my posts that no one wants to admit). A dip below $300 would create a frenzy of very bullish people that bought in at a price that gives them an orgasmic need to ejaculate their enthusiasm all over the boards. (I suppose you can include me in that group, since I've apparently become obsessed lately)

However, that doesn't mean it must happen that way.

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[creekbore]

because statistically you can't break out of it. Because you don't have the insider view I have being a programmer. I can evaluate things that you can't.

Wow, congrats.
I didn't think anyone could out do aminorex for pomposity and arrogance, but I reckon you're getting there.

Glory be and thank the Lord for the programmers, they will save us (from ourselves).....I seem to recall you like to quote scripture to us.

[AnonyMint]

It is a fact that people close to a technology have an early advantage that the general public can not. However they also frequently overestimate their beloved technology as there are market realities they (usually subconsciously) chose to be oblivious to. So the sword cuts both ways, there is no free lunch.

Risto the creator of this thread is a Christian. I provided scriptures for him, but I can make the same logical argument from a non-religious perspective also.

aminorex, knows how to use a thesaurus, e.g. quotidian instead of daily and apposite instead of appropriate, apt, befitting or suitable.

[AnonyMint]

Now for a dose of reality on those illogical $million price projections for Bitcoin...

- Technologies have a known adoption cycle

Logistic S-curve adoption.

But the breadth of adoption depends on the utility of the technology.

Smart phones and toilet paper are technologies just about everyone needs (note I don't use the latter).

Unless Bitcoin will be morphed via offchain reserves to correct glaring weaknesses in its technological design, then it can not and will not appeal to most of the population.

If you are not factoring that into your FA analysis, then your FA is flawed.

First of all Bitcoin (as it currently stands unless morphed as I say above) will be limited to reasonably affluent, white males mostly under age 50. Thus figure the upper limit of adoption is several hundred million. Note NE Asians are white.

So we may already be at that adoption "chasm" you mentioned, or it will come on the next run up and peak in price.

- To adopt Bitcoin, you must buy bitcoins
- Buying bitcoins from a rigid stock increases its price to induce existing holders to sell

Assuming the stock is rigid and hasn't morphed into an offchain reserves coin.

- The value of Bitcoin network is correlated with the number of its members
- The purchasing power of one bitcoin is roughly linearly correlated to the number of bitcoin owners in the world and it can be expressed with the following equation: 0.0005*U (USD/BTC), where "U" is the number of bitcoin owners.

And so Bitcoin's value will not approach fiat for general commerce without being so morphed.

Given the above argument, you can see why a dip below $300 is psychologically important. We ain't going to da moon, so a lower entry price builds enthusiasm and bullish resolve.


P.S. White is a factor because browner people are too busy enjoying the outdoor and natural life. The white males are stuck inside with winter and find indoor male hobbies. Females in general aren't going to adopt anything that is not super easy, not threatening, available in pink, and lovingly accepted by their peers.

Add:

Andreas M. Antonopoulos claims in the developing world Bitcoin is approached by a different class. However if as it appears be he is referring to his experiences in South America, there is a huge influx of former European immigrants there.

[creekbore]

It is a fact that people close to a technology have an early advantage that the general public can not.

But your join date for this forum is (precisely) one year ago...given your omnipotent tech-powers, I'd have expected you to have been around much longer.

I can make the same logical argument personal opinion from a non-religious perspective also.

FTFY

[AnonyMint]

creekbore, you expected Larry Page and Sergey Brin to be hanging around in Yahoo back in the late 1990s too.

I don't need to win any political contest. We share information here. What you do with it, is your own.

[RAJSALLIN]

Anonymint, I'm not going to argue with you. Your programming skills are far superior to mine. Also just the vast amount of time you spend on this forum should automatically put your bitcoin knowledge in another division compared to mine.

In general I agree with your comments to a large degree (which I think you know). Still, I do wonder what you really think about the adoption rate of bitcoin since it seems like you are contradicting yourself at times. Stating things like bitcoin will become the elites new monetary system for global surveillance of all transactions, bitcoin is perhaps the mark of the beast, Satoshi Nakamoto was the US government etc. Those type of comments don't scale well when assuming bitcoin is only a geek phenomenon for white males bellow 50. Perhaps you are having a hard time estimating the adoption rate in which I understand since it's basically what we are all discussing here. A continued exponential increase in bitcoin users will automatically lead to price increases (even if some exchanges start utilizing fractional reserve banking, which probably already has happened by the way). Will the exponential increase continue? I think so and have not seen anything that shows otherwise as of yet.

[threecats]

Quote:


"White is a factor because browner people are too busy enjoying the outdoor and natural life. The white males are stuck inside with winter and find indoor male hobbies. Females in general aren't going to adopt anything that is not super easy, not threatening, available in pink, and lovingly accepted by their peers."

"First of all Bitcoin (as it currently stands unless morphed as I say above) will be limited to reasonably affluent, white males mostly under age 50. Thus figure the upper limit of adoption is several hundred million. Note NE Asians are white."

Anonymint. If you want to break out of the rather small racial / misogynistic  bubble you are opining from you could research what Mpesa (Kenya based, with hundreds of millions of Africans as a customer base, skin color other-than-white) is doing with bitcoin. Implementation being lead by a young woman who spends more time with African bankers than barbies.

Or not. Your choice.

[rpietila]

I just scored 59236 in this game by having the following tiles:

4096 (I won't tell the colour of it but it seems to be on-topic)
1024
512
2*128
64
32
16
2*8
4*4
2*2

[aminorex]

because statistically you can't break out of it. Because you don't have the insider view I have being a programmer. I can evaluate things that you can't.

I didn't think anyone could out do aminorex for pomposity and arrogance, but I reckon you're getting there.

I don't mind being ranked with AnonyMint on an axis which correlates positively with intelligence, because I think he's rather clever.  But did it have to be this one?  Time to review Dale Carnegie I guess.

[Biodom]

So what did I understand:

- Bitcoin is a technology
- Technologies have a known adoption cycle
- To adopt Bitcoin, you must buy bitcoins You can just mine. Some companies (KnC) immediately sell mined BTC for $$$-is this adoption?
- Buying bitcoins from a rigid stock increases its price to induce existing holders to sell
- The value of Bitcoin network is correlated with the number of its members Members are an unclear category. Who is a member? Number of wallets cannot be used because many of them do not have any BTC-were probably created during purchase, then emptied.
- The purchasing power of one bitcoin is roughly linearly correlated to the number of bitcoin owners in the world and it can be expressed with the following equation: 0.0005*U (USD/BTC), where "U" is the number of bitcoin owners.

So I am all for listening to other viewpoints, as long as they conform to observable reality like the ones I presented.

By the way, the excellent clarity of the message was supplied by Cohiba Siglo VI.

Not to disagree, but to discuss (see comments in text and below).
I found some very strange statistics: apparently, average number of transactions barely budged in the last 12 mo (to my eye it looks like 10-15% growth max).
https://blockchain.info/charts/n-transactions?timespan=1year&showDataPoints=false&daysAverageString=7&show_header=true&scale=0&address=
If bitcoin is growing in utility-why transactions are barely growing?

[aminorex]

Not to disagree, but to discuss (see comments in text and below).
I found some very strange statistics: apparently, average number of transactions barely budged in the last 12 mo (to my eye it looks like 10-15% growth max).
https://blockchain.info/charts/n-transactions?timespan=1year&showDataPoints=false&daysAverageString=7&show_header=true&scale=0&address=
If bitcoin is growing in utility-why transactions are barely growing?

Number of transactions is not important.  Number of participants and total value transferred are important.  (Mid-2013 dust transactions < 5430 satoshi were effectively stopped.)  For a useful transaction value, multiply estimated transaction volume by BTCUSD rate, adjusted for USD inflation.

[SlipperySlope]

I found some very strange statistics: apparently, average number of transactions barely budged in the last 12 mo (to my eye it looks like 10-15% growth max).
https://blockchain.info/charts/n-transactions?timespan=1year&showDataPoints=false&daysAverageString=7&show_header=true&scale=0&address=
If bitcoin is growing in utility-why transactions are barely growing?

I believe that the number of Bitcoin transactions is a good indicator of the underlying economy, and very useful for fundamental analysis.

Most analysts and pundits who refer to the number of transactions prefer an alternate chart available from Blockchain.info . . .

https://blockchain.info/charts/n-transactions-excluding-popular?timespan=2year&showDataPoints=false&daysAverageString=7&show_header=true&scale=1&address=

Popular addresses are excluded from the preferred chart because of the issue with numerous dust transactions related to gambling sites, e.g. Satoshi Dice last year.

It appears from that indicator that the number of Bitcoin transactions increases at about 5x per year and the trend continues. Given the bitcoin prices have increased at a rate of 10x per year, one may ask whether prices have gotten far ahead of transactions. I hypothesize that prices are ahead because speculators have the future in mind, not the present.

Using data presented by http://www.coinometrics.com/bitcoin/tix, the sum of competing payment network transactions is 345,292,000 per day. Using the Blockchain.info figure of 58,620 for adjusted current daily Bitcoin transactions, then at 5x increase per year, the number of daily bitcoin transactions will exceed the current bank card, amex, paypal, etc. competition in five or six more years.

[windjc]

I found some very strange statistics: apparently, average number of transactions barely budged in the last 12 mo (to my eye it looks like 10-15% growth max).
https://blockchain.info/charts/n-transactions?timespan=1year&showDataPoints=false&daysAverageString=7&show_header=true&scale=0&address=
If bitcoin is growing in utility-why transactions are barely growing?

I believe that the number of Bitcoin transactions is a good indicator of the underlying economy, and very useful for fundamental analysis.

Most analysts and pundits who refer to the number of transactions prefer an alternate chart available from Blockchain.info . . .

https://blockchain.info/charts/n-transactions-excluding-popular?timespan=2year&showDataPoints=false&daysAverageString=7&show_header=true&scale=1&address=

Popular addresses are excluded from the preferred chart because of the issue with numerous dust transactions related to gambling sites, e.g. Satoshi Dice last year.

It appears from that indicator that the number of Bitcoin transactions increases at about 5x per year and the trend continues. Given the bitcoin prices have increased at a rate of 10x per year, one may ask whether prices have gotten far ahead of transactions. I hypothesize that prices are ahead because speculators have the future in mind, not the present.

Using data presented by http://www.coinometrics.com/bitcoin/tix, the sum of competing payment network transactions is 345,292,000 per day. Using the Blockchain.info figure of 58,620 for adjusted current daily Bitcoin transactions, then at 5x increase per year, the number of daily bitcoin transactions will exceed the current bank card, amex, paypal, etc. competition in five or six more years.

It seems like growth on this chart is more like 3.5-4x instead of 5x.

[Biodom]

I found some very strange statistics: apparently, average number of transactions barely budged in the last 12 mo (to my eye it looks like 10-15% growth max).
https://blockchain.info/charts/n-transactions?timespan=1year&showDataPoints=false&daysAverageString=7&show_header=true&scale=0&address=
If bitcoin is growing in utility-why transactions are barely growing?

I believe that the number of Bitcoin transactions is a good indicator of the underlying economy, and very useful for fundamental analysis.

Most analysts and pundits who refer to the number of transactions prefer an alternate chart available from Blockchain.info . . .

https://blockchain.info/charts/n-transactions-excluding-popular?timespan=2year&showDataPoints=false&daysAverageString=7&show_header=true&scale=1&address=

Popular addresses are excluded from the preferred chart because of the issue with numerous dust transactions related to gambling sites, e.g. Satoshi Dice last year.

It appears from that indicator that the number of Bitcoin transactions increases at about 5x per year and the trend continues. Given the bitcoin prices have increased at a rate of 10x per year, one may ask whether prices have gotten far ahead of transactions. I hypothesize that prices are ahead because speculators have the future in mind, not the present.

Using data presented by http://www.coinometrics.com/bitcoin/tix, the sum of competing payment network transactions is 345,292,000 per day. Using the Blockchain.info figure of 58,620 for adjusted current daily Bitcoin transactions, then at 5x increase per year, the number of daily bitcoin transactions will exceed the current bank card, amex, paypal, etc. competition in five or six more years.

This is quite 'selective" statistics when you have to remove popular addresses. Even with that, the growth is roughly 3X, not 5Xfold in 12 mo
https://blockchain.info/charts/n-transactions-excluding-popular?timespan=1year&showDataPoints=false&daysAverageString=7&show_header=true&scale=1&address=

[SlipperySlope]

I found some very strange statistics: apparently, average number of transactions barely budged in the last 12 mo (to my eye it looks like 10-15% growth max).
https://blockchain.info/charts/n-transactions?timespan=1year&showDataPoints=false&daysAverageString=7&show_header=true&scale=0&address=
If bitcoin is growing in utility-why transactions are barely growing?

I believe that the number of Bitcoin transactions is a good indicator of the underlying economy, and very useful for fundamental analysis.

Most analysts and pundits who refer to the number of transactions prefer an alternate chart available from Blockchain.info . . .

https://blockchain.info/charts/n-transactions-excluding-popular?timespan=2year&showDataPoints=false&daysAverageString=7&show_header=true&scale=1&address=

Popular addresses are excluded from the preferred chart because of the issue with numerous dust transactions related to gambling sites, e.g. Satoshi Dice last year.

It appears from that indicator that the number of Bitcoin transactions increases at about 5x per year and the trend continues. Given the bitcoin prices have increased at a rate of 10x per year, one may ask whether prices have gotten far ahead of transactions. I hypothesize that prices are ahead because speculators have the future in mind, not the present.

Using data presented by http://www.coinometrics.com/bitcoin/tix, the sum of competing payment network transactions is 345,292,000 per day. Using the Blockchain.info figure of 58,620 for adjusted current daily Bitcoin transactions, then at 5x increase per year, the number of daily bitcoin transactions will exceed the current bank card, amex, paypal, etc. competition in five or six more years.

It seems like growth on this chart is more like 3.5-4x instead of 5x.

Agreed.

Using a two year version of the chart, I read 3.2x per year transaction growth. Which yields a 7-8 year time frame before the number of daily bitcoin transactions will exceed the current bank card, amex, paypal, etc. competition.

[Peter R]

Using a two year version of the chart, I read 3.2x per year transaction growth

Interesting.  You are claiming that usage statistics (like transactions) are increasing at about 3.2X per year, yet price is increasing at roughly 10X per year.  If we assume that usage stastics are linearly proportional to the number of users, N, perhaps what we are seeing is Metcalfe's Law play out in front of our eyes:

Metcalfe's law states that the value, V, of a telecommunications network is proportional to the square of the number of connected users of the system, N:    V ~ N²  .

According to Metcalfe's Law, the value of the bitcoin network increases by a factor of 10X each time the number of users increases by sqrt(10) = 3.16.  If you remove the volatility in the price action, we get a pretty good fit!

[bucktotal]

Using a two year version of the chart, I read 3.2x per year transaction growth

Interesting.  You are claiming that usage statistics (like transactions) are increasing at about 3.2X per year, yet price is increasing at roughly 10X per year.  If we assume that usage stastics are linearly proportional to the number of users, N, perhaps what we are seeing is Metcalfe's Law play out in front of our eyes:

Metcalfe's law states that the value, V, of a telecommunications network is proportional to the square of the number of connected users of the system, N:    V ~ N²  .

According to Metcalfe's Law, the value of the bitcoin network increases by a factor of 10X each time the number of users increases by sqrt(10) = 3.16.  If you remove the volatility in the price action, we get a pretty good fit!

this correlation may interest you.

https://bitcointalk.org/index.php?topic=441336.0

Price = #ofUsedAddresses^2/(e^27.5)

or

Price = #ofUsedAddresses^2.26/(e^32)


edit: today is at ~ 31,500,000 addresses.... P = ~1150

[Peter R]

this correlation may interest you.

https://bitcointalk.org/index.php?topic=441336.0

Thanks for the link.  I had seen that before, however, I didn't really like how he used the cumulative number of addresses.  I think we want to compare price with observables that are clearly linked to the present number of users, N, as per Metcalfe's law.  

[aminorex]

this correlation may interest you.

https://bitcointalk.org/index.php?topic=441336.0

Thanks for the link.  I had seen that before, however, I didn't really like how he used the cumulative number of addresses.  I think we want to compare price with observables that are clearly linked to the present number of users, N, as per Metcalfe's law.  

active wallets over 24 hours is a suitable proxy for number of users.  it is a direct read of the number of nodes active in the network.