i don't think anybody in that topic thought $10k is a joke. but everyone had problem with the way you came up with $10k price.
basically for me, your method is severely flawed because you are trying to link bitcoin' value with the cost of its mining. you are forgetting that the cost of mining bitcoin increases with its price! so if we assume cost of mining according to you is $10k and price reaches $100k by the end of the year, the cost of mining will also increase to $100k. and if it drops to $10 the cost of minng will drop to $10 too.
you can't use something that moves because of price as the reason for speculating the price.
and if it drops to $10 the cost of minng will drop to $10 too.
Not necessarily. The cost of mining depends on how efficient each miner operates, and even on how long they are willing to mine at a loss. It's not entirely uncommon for miners to mine at a loss.
The most efficient operations tend to sell enough of their coins so that they can manage to mine a certain number of months without gaining anything back. Miners even short Bitcoin to cover the risk of falling prices.
In the very long term when prices don't recover and miners run out of their reserves they won't have a choice but to give up or significantly shrink their operations, but Bitcoin as it is right now is too bullish for that.
my example wasn't meant to explain different possible scenarios. and you shouldn't take the numbers literary. my point was that to show that you can not predict the price based on the cost of mining because the cost changes with price not the other way around.
maybe it was better to tell that example this way:
if price were $100 and cost of mining were $100 and bitcoin price fell down to $10, the cost wouldn't stay up at $100, it will also drop and it certainly can't keep the price up. alternatively if cost were $100 and price went to $1000 the cost will also rise after the price and can not keep it down.
That is incorrect the cost of mining has to do with the hash rate. It has nothing to do with the price. The cost of mining is independent of the price.
They are extremely correlated though, so you might as well say that the cost of mining depends on the price. Hash rate and price are directly related.
Let's say that BTC was trading at $100k and it costs $50k to mine a coin. There's 2x profit to be made there, so more miners will enter to take some of that profit. Who could pass up 100% ROI? As more miners enter the market as a result of the price, the global hashrate goes up. This causes difficulty to go up, so it will cost more to find a block. Eventually there will be an equilibrium where the cost to mine is very close to the price of a coin (depending on other factors though, such as electricity costs).
Or on the opposite end, let's say that BTC was trading at $50k and it costs $100k to mine a coin. Anyone still mining would be taking a substantial loss, so miners will start shutting down their farms if it is more profitable to shut down compared to mining at a loss. Global difficulty goes down, making it easier to find blocks and thus mine coins. It will eventually reach below $50k to mine a coin as less profitable miners would keep shutting down their equipment.
I calculate the cost of BTC based on the number of points of sales and services that work with Bitcoin.
At the beginning of my article I tried to substantiate such an approach using the example of the Dollar, Pound and Yen.
The total bitcoin money supply as of December 23, 2018, is 17,436,737 BTC. Each outlet gives a capitalization of 10,316 ounces of gold, respectively. It turns out 14,125 points give a total bitcoin capitalization of 145,971,400 ounces of gold. We divide this amount by the number of bitcoins and we get one bitcoin equal to 8.37 ounces of gold. Or 10,347 dollars, respectively.
I read your article on how you predicted that it will go above 10,000$ (10,347$ to be exact) but something still bugs me and it's on top of my head. Where did you come up the value of each outlet/establishment is worth 10,316 oz of gold? Did you just come up with that number on your own? Or how did you simply value it like that?
Don't hate me with this one but I'll be disapproving your way of analyzing the price for BTC. Outlets that accept Bitcoin cannot really be a good factor on at least looking for the fair value of it, they just simply accept Bitcoin but it doesn't directly correlate to it being a demand for them. It's not like they are buying them from you they are just accepting it as a mode of payment. Even if you say it counts as a real world use we cannot guarantee anything that BTC payments is something that they receive almost half of the time they open and close their business daily. Yeah sure a lot of outlets are accepting Bitcoin but does that mean its their number one or two received payments in their business?
In the near future I will update my calculation.
I'm curious how it will change.
And we will check in it the autumn.
