Price is only a dollar lower than yesterday, how does that hurt anyone besides speculators and people leveraged on bitcoinica?
Surely you are joking. Bitcoin lost 20% in a single day. That's bad enough - puts it in a league with pennystock in the eye of the beholder. Worse is that it was like an epileptic seizure. I mean going between 4.64 and 6.95 within minutes! Doubt this will inspire much confidence in everyone watching.
The good news is that a number of gamblers got bloodied up good. As Vandroiy said before: That's the silver lining.
Bitcoin IS a penny stock in terms of fundamentals. (Market cap is only $550MM.) So how can we expect it to perform like a blue chip?
Without price rising to above $100 (That's about $9 billion market cap), we can never have a stable day.
With or without Bitcoinica, $200K is sufficient to push the price from 4.64 to 6.95 within minutes. And without Bitcoinica, that would happen too (Bitcoinica volume was insignificant during the rally you mentioned).
Bitcoin is like a penny stock? Oh, say it isn't so!
All kidding aside, it's good to see at least a couple people involved with bitcoin know the difference. Also, the point about the
magnitude of the volatility should not be overlooked. I've seen quite a few comments dismissing the volatility of bitcoin on the basis that other assets exhibit volatility. You don't see this kind of volatility in much other than distressed currencies like the Zimbabwi dollar or out and out money raising scam vehicles like penny stocks. That is to say, right now bitcoin trades like a piece of crap that almost no one should take seriously.
I'm not trying to start another argument on this subject with anyone, as it simply is what it is. Zhoutong's example of how little money it takes to move the price of bitcoin should be self-explanatory.
During the 1990s I made the acquaintance of some professional penny scammers and had a hypothetical discussion about what it might take to do it. The suggestion was to look for vehicles that could be manipulated with an investment of around $500K more or less. So, by that yardstick being able to create a 50% price swing for $200K current is actually a real bargain, such a deal