Bitcoin Forum
December 11, 2016, 02:42:59 AM *
News: Latest stable version of Bitcoin Core: 0.13.1  [Torrent].
 
   Home   Help Search Donate Login Register  
Pages: « 1 2 [3]  All
  Print  
Author Topic: Biggest sell signal if we go under 5.70-5.80 level  (Read 5550 times)
BubbleBoy
Sr. Member
****
Offline Offline

Activity: 322



View Profile
September 09, 2011, 04:17:51 PM
 #41

The whole "price can't fall bellow X because miners will do Y" line of thought is flawed. If the price falls, the most inefficient miners will start to go offline, as they sink more and more underwater. The decrease in difficulty will make the remaining miners more profitable, so an equilibrium will be reached. The same happens if the price increases, new miners come online and eat up the large profit margin, leaving only those with the thinnest margins or the best technology.

The price can fall very nicely bellow 4$, 1$, 0.1$ and any such arbitrary limit because it's only supported by the interest of people buying into the currency, at a rate at least equal with the mining rate. If miners hoard instead of selling  it makes no difference: they are effectively Bitcoin buyers, they buy with the resources used for mining which as explained above have a financial value very close to the market price.

So you tell me, what is the net buy-in Bitcoin will see each month ? If you got that you can easily compute the market price:
- 1 million $/ month -> 5$/BTC
- 200K $/ month -> 1$/BTC
etc.

In order to sustain that price you need to have consistent buy-in month after month. There's simply not enough going on in the bitcoin economy to warrant such large positive cash inflows. It's a currency used, literally, only by the members of this forum. Maybe a few thousands - tens of thousand dollars a month, leading to a BTC price in the pennies range. We have a long way down people.
1481424179
Hero Member
*
Offline Offline

Posts: 1481424179

View Profile Personal Message (Offline)

Ignore
1481424179
Reply with quote  #2

1481424179
Report to moderator
1481424179
Hero Member
*
Offline Offline

Posts: 1481424179

View Profile Personal Message (Offline)

Ignore
1481424179
Reply with quote  #2

1481424179
Report to moderator
1481424179
Hero Member
*
Offline Offline

Posts: 1481424179

View Profile Personal Message (Offline)

Ignore
1481424179
Reply with quote  #2

1481424179
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
1481424179
Hero Member
*
Offline Offline

Posts: 1481424179

View Profile Personal Message (Offline)

Ignore
1481424179
Reply with quote  #2

1481424179
Report to moderator
1481424179
Hero Member
*
Offline Offline

Posts: 1481424179

View Profile Personal Message (Offline)

Ignore
1481424179
Reply with quote  #2

1481424179
Report to moderator
1481424179
Hero Member
*
Offline Offline

Posts: 1481424179

View Profile Personal Message (Offline)

Ignore
1481424179
Reply with quote  #2

1481424179
Report to moderator
Blitz­
Donator
Legendary
*
Offline Offline

Activity: 1596


"Cut Your Loose"


View Profile
September 09, 2011, 04:26:22 PM
 #42

*whew* good thing bitcoins are designed as a means of exchange and not an investment
Ah, so that’s why there’s a 21 mil cap.

"Bitcoin had been transformed from an anarachistic challenge to the financial status quo, to the crypto spawn of Satan, fuelled by cut-throat greed and delusions of avarice." - MatTheCat
"these people don't seem to want to stop till Bitcoin is completely destroyed and left like an old cum rag in the corner of the room." - ShroomsKit
finnthecelt
Full Member
***
Offline Offline

Activity: 140


View Profile
September 09, 2011, 05:46:15 PM
 #43

Technically we could easily go under $1.00. It will be very interesting to see how many keep mining as we drop here. The trend is definitely down.

The nominal price of BTC only matters is miner intends to HOLD BTC.

For a miner who mines and sells on a regular basis Price * Difficulty is a better measure of profitability. 

For example a miner generates same amount of revenue (in $) with either:
$100BTC & 1777774.48 difficultly
$1.00BTC & 17777.7448 difficultly
$0.01BTC & 17777.7448 difficultly
$0.001BTC & 177.777448 difficultly


Quote
I will now be mining at a loss but I will keep mining. I'm in this for the long haul and will accept the "investment cost" of electricity. When I was buying silver I was parting with cash and now the metal just sits there for future use. The risk is MUCH higher for the BTC though.

Why?  When you were investing in silver if you could buy it for $4/oz or mine it yourself for $9/oz which would be a better investment.

If your cost to "build" one BTC is $4.00 and you can simply buy BTC on the market for $3.00 why would you overpay?

EVERYONE buys BTC.  Miner just buy it indirectly in the form of electricity and amortized hardware.

LOL! You are so right. Ever since I wrote that I've been thinking about it..... Why would I depreciate my gear when I could take the cash and buy MORE BTC?

Difficulty is going to plummet. I'd say I'll have the miners shut down for maybe a month.
kloinko1n
Full Member
***
Offline Offline

Activity: 177


View Profile
September 09, 2011, 06:13:47 PM
 #44

It was about time that those 'greedy miners' would panic and sell off all their bitcoins.
Now the crime syndicates can buy them and start doing their business with it.
Expect the price to rise soon after the crash!  Grin
niko
Hero Member
*****
Offline Offline

Activity: 742


There is more to Bitcoin than bitcoins.


View Profile
September 11, 2011, 08:33:49 AM
 #45

(...) The hole problem is that Bitcoin is inflating at a very high rate, the miners have to much power over the price of Bitcoin, the only way to stop that is to do what they are doing to the Bitcoin Economy. Stop them from making easy money. I have said this from the very beginning, look at my old posts, maybe someone understands this...

Speculation is easier and more profitable than mining. And speculators have too much power over the price of Bitcoin, not miners. Hence the concept of "moving the market." As for inflation, it is the way it is, and it is so by design. Everyone knows it, there is nothing unexpected about it, so it can't really be a problem - it's simply the reality.

Many people know about it, but far from all of them really understands it. The concept of a high inflation environment is hard to grasp.
Alright, we all need to do a better job understanding Bitcoin inflation, and educating others about it.  This would prevent lots of misunderstandings that are costly to those who misunderstand it.

They're there, in their room.
Your mining rig is on fire, yet you're very calm.
David M
Sr. Member
****
Offline Offline

Activity: 476


View Profile
September 11, 2011, 08:51:22 AM
 #46

When the priced breached the sub $6 low (~$5.74 or whatever the blow off trade bottom was)*, I expect the next major bottom/sell off point** to be $4.13.

* I was not expecting that low to be taken out.
** A trader's schizophrenia.

YMMV.
Phinnaeus Gage
Legendary
*
Offline Offline

Activity: 1302


Bitcoin: An Idea Worth Spending


View Profile
September 11, 2011, 02:14:55 PM
 #47

Smart Money Drives the Financial Markets? ~Tom Williams: http://www.youtube.com/watch?v=6jwEwlZnSFY
ElectricMucus
Legendary
*
Offline Offline

Activity: 1540


Drama Junkie


View Profile
September 11, 2011, 02:45:13 PM
 #48

When the priced breached the sub $6 low (~$5.74 or whatever the blow off trade bottom was)*, I expect the next major bottom/sell off point** to be $4.13.

* I was not expecting that low to be taken out.
** A trader's schizophrenia.

YMMV.
That would be scraping the trendline. However fear is strong right now and if the panic increases we could reach 3.24 I wouldn't bet on it but it could happen.

PS: yeah it's me green-line guy  Cheesy

First they ignore you, then they laugh at you, then they keep laughing, then they start choking on their laughter, and then they go and catch their breath. Then they start laughing even more.
skubeedooo
Newbie
*
Offline Offline

Activity: 22


View Profile
September 11, 2011, 02:48:40 PM
 #49

but they are fighting all the greedy miners that are selling their coins at the exchanges

Where would you get your coins to buy and sell without us greedy miners?   Tongue

Let me see, we have already 7 + million coins in the Bitcoin Economy. We need miners that believe in the Bitcoin Economy long term, not greedy miners that hit the exchanges with sell orders asap.

Nonsense.  Bitcoin doesn't need miners to write blank cheques for it to survive.  If the price was $0.01 or $100 it would not make much difference, what matters is volatility.  Why would anyone care what the absolute level is?  What matters is that they can easily transfer btc into real currency and back, so that there is little or no market risk when making transactions.  The problem we have had is the transition from hobbyist miners who 'hoard' bitcoins to professional miners who sell as they mine.  The price will naturally converge to the rate at which investors put money in divided by the rate bitcoins are mined.  No problemo.  Why all the angst?
Pages: « 1 2 [3]  All
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!