Can Bitcoin Become Negative in Value?

[Wenbing]

I was shocked for reading a market breaking new as strange as this.

I paused and reflected again and again by applying this condition to other market assets.

I read from Blomberg that the price of crude oil has declined into a negative  of $-37.63/barrel.

What will happen to countries that depend solely on crude oil revenue?

What will happen to the investors in crude oil?

A very serious reflection is that fact that, is it possible for bitcoin value to also drop into the negative?

What if the following happen:
1. A ban in the demand for bitcoin and a ban in the use of bitcoin.
2. Backing off of bitcoin miners from the business of mining?

Could these causes bring the value of bitcoin to something similar to the historic oil Price drop of $-37.63?

What do you have to say about this?

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[SatsLife]

bitcoin's supply is perfectly inelastic. It's not possible for it to be negative.

And oil itself isn't negative, thats just a futures contract. you have to take delivery of that -$37 oil. 1000 barrels. They are basically paying you come get it.

[amishmanish]

As storage capacity fills up, the Oil producers are still gonna keep pumping. They need someone to deploy tankers and make arrangement to store it so they can keep pumping more. Shutting down the supplies is a costly affair as they have to pay off employees and the loans taken for setting up the infrastructure. They are offering to pay so they don't have to go into the shutdown spiral.

Bitcoin has no delivery costs. You don't have to spend anything to remember 12 word passphrase or store it somewhere safe. Miners will simply shutdown if it ever becomes "unsafe" to run miners and produce bitcoin. What they will never do is to pay someone to take it off from their addresses.

Only in bitcoin discussion can we attempt comparing apples and generators?

[avikz]

I was shocked for reading a market breaking new as strange as this.

I paused and reflected again and again by applying this condition to other market assets.

I read from Blomberg that the price of crude oil has declined into a negative  of $-37.63/barrel.

What will happen to countries that depend solely on crude oil revenue?

What will happen to the investors in crude oil?

No! It had reached to negative for a short moment and then again gone up. Currently the BRENT CRUDE is trading somewhere near to $16/barrel. However, this is also not a sustainable price so millions of jobs will be lost for this as OPEC countries will have to stop oil product to balance with demand, which has reached a record low due to the current situation.

But we will also have to understand that the situation is not permanent. As soon as the world comes out of the lockdown and the industries start their production - the demand for oil will come back to normal. Once demand increases, the price will increase as well.  

A very serious reflection is that fact that, is it possible for bitcoin value to also drop into the nagative?

What if the following happen:
1. A ban in the demand for bitcoin and a ban in the use of bitcoin.
2. Backing off of bitcoin miners from the business of mining?

Could these causes bring the value of bitcoin to something similar to the historic oil Price drop of $-37.63?

What do you have to say about this?

No for bitcoin! Bitcoin is not a traditional market asset. It's a good amount of production cost as well. In view of this, I don't see bitcoin going to negative value ever. A blanket ban can't be achieved on an asset like bitcoin, it has its own technical complexities!

The 2nd one is more serious and can't be entirely impossible! However, there's a chain reaction we need to understand. If we see existing bitcoin miners are moving out of mining, it would reduce the mining difficulty and it would give chance to another group of miners to jump in if the network difficulty reaches to an optimum level. We will never see a complete stop in bitcoin mining ever. There will always be a group miners waiting for an opportunity to start with mining provided it is profitable to them. So if one set of miner moves out, there will always be another set of miners waiting to enter the market. So while the 2nd option is not entire impossible but extremely unlikely to happen!

Hope this helps!  

[CryptopreneurBrainboss]

Only in bitcoin discussion can we attempt comparing apples and generators?

Lol buddy, don't insult bitcoin. In your above sentence, bitcoin better be the apple while Oil is the generator.

Responding to the OP, the price of bitcoin can never be traded in negative figure, the only possible outcome is, the market will lack buyers meanwhile there'll excess sellers willing to sell their bitcoin at very cheap price but they won't find anyone willing to buy those coins off their hands. This is just an absolution though as the possiblity of this happening is nearly zero.

Bitcoin isn't been regulated by any government body that you'll think a ban on its patronage would be that effective to render the coin useless. China has tried that in the past but only had a short term success of affecting the price of bitcoin. Although it didn't send it to a negative value as that's just impossible.

[Wenbing]

bitcoin's supply is perfectly inelastic. It's not possible for it to be negative.

And oil itself isn't negative, thats just a futures contract. you have to take delivery of that -$37 oil. 1000 barrels. They are basically paying you come get it.

Great comment.
But, look at the conditions I highlighted. What if those conditions were to be true, then what'll happen?

If there is no demand for bitcoin, then the inelastic will be forced to become elastic automatically.

[NeuroticFish]

I paused and reflected again and again by applying this condition to other market assets.

I read from Blomberg that the price of crude oil has declined into a negative  of $-37.63/barrel.

I guess that you either didn't reflect enough, either trying to rise a fake problem.
There's a huge difference between goods/objects that take space (storage) and computer/virtual things that don't need warehouses.

The oil negative price was temporary to avoid getting the point they don't have any means to store it and also avoid shutting down production.
Bitcoin is generated in the same way and the transaction go on in the same way no matter what's its price in US Dollar. 1 BTC = 1 BTC.

So basically you compared apples with virtual oranges.

[cafetools]

There are millions of dollars in lost Bitcoin! They will be lost forever, and more gets lost by unlucky people every day!

[pooya87]

first of all that number is not price of oil exactly. that is the result of contracts that were made months ago by the companies thinking their storages would be empty by now and they can re-fill it with the oil that they receive now. but since the usage were reduced and a lot of other things that led to their storages remain full, they can no longer store the new oil they are supposed to receive now. so they have to pay a less amount of money that it would cost them to transfer the oil to their place and store it somehow to someone else to take it off their hands. in other words they are trying to lose less money.
that is not something that can ever happen in bitcoin! storing bitcoin doesn't cost anything like oil does!

1. A ban in the demand for bitcoin and a ban in the use of bitcoin.
2. Backing off of bitcoin miners from the business of mining?

1. who bans bitcoin? the entire world? that would never happen. one or two or even 10 countries banning bitcoin is not going to change anything as it is currently banned in some of them.
2. the same as #1.

you can never prevent people from using something that is decentralized.

[blockman]

This is not new to have a thought of what if bitcoin goes to negative value. We've seen people who were thinking of bitcoin to go zero then there's this scenario that happens to oil so people started to compare it with the latter. But you have to look for certain factors that might cause bitcoin to that percentage. But with this factor quoted below, it's highly unlikely that it will go to negative.

There are millions of dollars in lost Bitcoin! They will be lost forever, and more gets lost by unlucky people every day!

It can be back to a few centavos to 1 digit per piece but not negative.

[jseverson]

This is why oil was in the negatives:

Prices went negative — meaning that anyone trying to sell a barrel would have to pay a buyer $30 — in part because of the way oil is traded. Futures contracts that require buyers to take possession of oil in May are expiring on Tuesday, and nobody wanted the oil because there was no place to store it. Contracts for June delivery were still trading for about $22 a barrel, down 16 percent for the day.

So strictly speaking, oil itself doesn't have negative value, the said futures contracts of oil do. Future contracts of oil that don't require you to take physical custody should still retain some value. But yeah, unless it somehow cost you money to hold Bitcoin (which can never realistically happen), no doomsday scenario can lead to a negative valuation.

[witcher_sense]

What if the following happen:
1. A ban in the demand for bitcoin and a ban in the use of bitcoin.
2. Backing off of bitcoin miners from the business of mining?

Both of these are very unlikely to happen, especially "ban in the demand", which even doesn't make any sense. Demand is not something goverment can ban, it is determined by desire or ability of people to buy something. Governments can't stop people who want to buy something valuable. If people continue to see bitcoin as valuable asset, they will buy it and hold it. For bitcoin to stop being demanded by people, it needs to lose all the properties that make him valuable. If bitcoin weren't decentralized, secure, scarce, censorship-resistant, etc, it wouldn't have value at all and its price would be zero, but still no negative

[Darker45]

bitcoin's supply is perfectly inelastic. It's not possible for it to be negative.

And oil itself isn't negative, thats just a futures contract. you have to take delivery of that -$37 oil. 1000 barrels. They are basically paying you come get it.

Great comment.
But, look at the conditions I highlighted. What if those conditions were to be true, then what'll happen?

If there is no demand for bitcoin, then the inelastic will be forced to become elastic automatically.

If there is no demand for Bitcoin, then the value will hit zero. It will not go lower than that. You aren't paying a rent for your wallet, are you?

Are you referring to these?

1. A ban in the demand for bitcoin and a ban in the use of bitcoin.
2. Backing off of bitcoin miners from the business of mining?

1. That ban has already taken place in the past and even until today. Bitcoin is still sticking around, right? If in case each and every country in the world bans the buying and use of Bitcoin, that does not necessarily mean Bitcoin will hit zero or a negative value. The online universe is as wide as the real universe. People can do as many things there. The good thing about Bitcoin is that a ban will remain just a mere word people can easily dismiss as nuisance. There is nothing to shut down really; there is nothing to padlock; there is nothing to takeover; and so on.

2. If every single miner is backing out, then Bitcoin becomes useless, zero in other words, but not negative. But whether it happens in real life or not is a different story altogether.

[ife2020]

It is True that crypto currency is volatile but anything can happen, but bitcoin going negative is not one of that.
bitcoin is not only the king of blockchain and crypto currency, it is widely accepted and even countries such as China, Korea and India atr beginning to embrace it.

If a country as large as usa finally express acceptance and widely adoption of bitcoin, the price would surge even higher

[kryptqnick]

I agree that Bitcoin cannot have a negative value. I think it's deeply related to the way price formation and trading works. Here's a quote from a Forbes article about oil:

as demand hits rock-bottom and storage tanks fill up, companies are now paying traders to take oil off their hands.

If you need to dispose of something because keeping it will involve additional costs, so you pay someone to take it, that's how you reach a negative price. Those who have BTC usually don't have associated risks of holding, so there's no need to pay someone to take your Bitcoins. This means that even if Bitcoin costs nothing, nobody would pay to get rid of it, and thus the price would never be negative. Even miners can just shut down but they surely won't pay people to take those Bitcoins miners mined.

[Little Mouse]

There are a lot of issues behind the negative value of crude oil including demand to be collapsed, storage and other factors.
In case of bitcoin, even if there is no demand, still BTC will not be negative value because no one will be needed to spend anything on storage. If you check what happened on mtgox hack, you will get that it is impossible to get negative value for bitcoin.

[obanqueiro]

   I have read a few threads why its actually associated with oil price what to do with BTC

[UserU]

If you check what happened on mtgox hack, you will get that it is impossible to get negative value for bitcoin.

After a brief read, the way those hackers managed to steal those 2K Bitcoins was quite amusing. Forcibly reduce the price to 1 cent and quickly snapped up all of them.

Theoratically it's possible for BTC to go to the negative (provided someone's willing to payto rid Bitcoins off his/ her possession), but there's absolutely no logical reason to do so. After all, one could just dispose of them by sending the amounts to some unknown address or changing the password to the wallet.

[CarnagexD]

I agree that Bitcoin cannot have a negative value. I think it's deeply related to the way price formation and trading works. Here's a quote from a Forbes article about oil:

as demand hits rock-bottom and storage tanks fill up, companies are now paying traders to take oil off their hands.

If you need to dispose of something because keeping it will involve additional costs, so you pay someone to take it, that's how you reach a negative price. Those who have BTC usually don't have associated risks of holding, so there's no need to pay someone to take your Bitcoins. This means that even if Bitcoin costs nothing, nobody would pay to get rid of it, and thus the price would never be negative. Even miners can just shut down but they surely won't pay people to take those Bitcoins miners mined.

The same with me from the previous day the market price of the oil drops rapidly and this is not a piece of good news it hits all over the market price and today there are a lot of people asking too does the market price of the bitcoin becomes negative? The answer is absolute No. There is a chance that the market price of the bitcoin drops lower than 1$ but still, it has a value unlike the oil also we have the miners to keep up the quantity of the bitcoin because miners too are the responsible on it if they stop the supply of the bitcoin becomes limited and also today there are a lot of people accepting the use of the bitcoin as the use for a transaction and this is good because by now they are starting to build and promote the efficiency of the future transactions of the bitcoin.

[fiulpro]

For the people wondering if Bitcoins become negative in value they will be paid to buy some Bitcoins , well it is not true.
Firstly Bitcoins can never be negative trust me. They are far too popular to go tulips .
There are people waiting around this world for the Bitcoins price to hit bottom so that they can purchase as much as they can , also the government have seen acceptance of cryptocurrencies like Bitcoins everywhere.
Bitcoins it is a risky asset and therefore we are always a scared of loosing the money here but at the same time we have seen ups and downs , but it always excelled .
With the central banks and governments creating their own online government bank currencies , one can imagine how the acceptance of Bitcoins will grow over time.
In a crisis like this with banks and governments failing , Bitcoins is much more effective and efficient in providing a major breakthrough for everyone involved , it opens up the opportunities of overseas trading and which is unmatched by any governmental service .
Also I understand that Bitcoins is not a safe heaven , but let's be honest: what is ?
Even USD which was supposed to be a safe asset for millions of people , trading in it , crashed out suddenly and the situation is not set to improve in the upcoming year , proves that the government based assets reaches dead end at any pandemic , epidemic or war , we need a currency like Bitcoins to neutralize the situation.
To let people choose and expand their horizons . Besides providing jobs , it has been proven to provide opportunities + having international transfers safer and cheaper .