Dogecoin tips itself to oblivion?

[rikkejohn]

But how would it die?

No altcoin that's on major exchanges will EVER die, even if the devs abandon it, other people will take over and fork it.  The most obscure shitcoins from a year ago are still going strong.

Do you actually believe this? There are many coins with a passionate dev group and a longer history than Dogecoin that will never ever be anything more than bits on a hard drive, nothing more than an archive of broken dreams and lost promise.

Dogecoin can drop so low in volume and market cap that it will never draw the interest of anyone anywhere. If it does, you will not revive that dead shibe.

You can't kill the passion and energy of tens of thousands of shibes; Dogecoin will not die.

Doge problem is its holders are sheep, and one rule of the market; the sheep always get slaughtered.

Yes, the committed Doge guys are a little bit easily led 

[lynn_402]

Yes, the committed Doge guys are a little bit easily led 

And by who are they led? Please elaborate.

[flound1129]

While doge looks like a survivor, the simple fact is that Too Many Coins dooms it to a low value relative to BTC.  I don't think it is anything more complicated than that.  With the recent rise in BTC prices the fiat value of doge is not down that dramatically, though it is clearly down.

Due to its community, doge remains a good gateway coin for people new to crypto, but a pretty poor investment due to Too Many Coins.

Good Luck!

This is correct.  However there is a fairly aggressive halving schedule, so this problem should take care of itself over the long run.  The community is still strong.

[ranlo]

While doge looks like a survivor, the simple fact is that Too Many Coins dooms it to a low value relative to BTC.  I don't think it is anything more complicated than that.  With the recent rise in BTC prices the fiat value of doge is not down that dramatically, though it is clearly down.

Due to its community, doge remains a good gateway coin for people new to crypto, but a pretty poor investment due to Too Many Coins.

Good Luck!

This is correct.  However there is a fairly aggressive halving schedule, so this problem should take care of itself over the long run.  The community is still strong.

It's also worth noting that if DOGE can somehow decouple itself from BTC, it wouldn't be dependent upon it anymore. This would be a huge change and could mean great things for the coin. The question is whether or not it'll happen. With such a big community backing it and some crazy marketing ideas, it's possible (though it will still be tough).

[HR]

Liquidating alts into BTC to sell for fiat.  Seen this happen many times when BTC rises.

Worse yet! (and, yes, understood, that makes sense, but, as I said, that's worse yet, and further undermines your argument).

mine those coins into oblivion by immediately

Ever heard of difficulty?

To that I reply what may sound like an idiotic ever heard of ASIC? Really, flound, I can't believe I'm hearing this from one of the most important pool operators around. ASIC cuts scrypt power costs by what? Over 900%? Said another way, ASIC mining variable costs are 1/10 that of GPU mining? (That's just to throw out low-ball figures - the high end is around 1/20th the cost, so get ready.) "Ever heard of difficulty?" Are you serious? At a 1/10 cost to mine, difficulty could rise 10 fold and the ASICs would still be profitable!!!! Where do you think the widely distributed user base and secure network will be by then? 99% of scrypt coins are currently NOT PROFITABLE using GPU, *ALREADY*, and price isn't rising. Why do you think that is happening? You think those coins will be able to recover after the ASIC demolition? You're dreaming pal. As soon as they go back to profitable for the ASIC, those same ASICs will be back like zombies. The position you are arguing is untenable, and your argument (or lack of as it were) only more clearly reveals that fact. As I said, I can't believe I'm hearing this from you. I can only guess that you must have a very strong predisposition that needs to be reinforced at whatever cost. In any event, let's promise to get together and talk about this again once diff has risen by 1000% (you and the handful of ASICs still mining on Multipool   ).

I'm not sure what you're trying to say.  Difficulty adjustment ensures a constant supply of coins no matter what the network hashrate is.

Yes, you'll need an ASIC to mine scrypt efficiently, you pretty much do right now.  Just because people have ASICs does not mean that more coins per day will magically be produced.  The production rate will be the same as it is now.  Some (One?) scrypt coin(s) still have slow difficulty adjustments, which means that the hashrate of those coins will most likely start swinging violently every few days until a faster adjustment is implemented.  Still, I can't see LTC getting caught in a difficulty trap unless most of the dedicated hash on it drops off and I just don't see that happening.

I missed this before . . . sorry.

You're not sure what I'm "trying to say"? It's pretty clear if you stay with what I said and don't unnecessarily clutter the subject. Why would you want to unduly complicate and confuse by introducing irrelevant comments like "more coins per day will magically be produced" or "difficulty adjustment ensures a constant supply of coins no matter what the network hashrate is"? What do either have to do with what I was saying?

If you want to understand, you need to limit your comprehension efforts to what was said, and that was:

EXTREMELY LOWER ENERGY RELATED MINING COSTS = LOWER PRICES (unless everyone is holding long term   )

That's it in a nutshell. Don't convolute the issue. Forget about hashrates and difficulty. Use the scientific method and change only one independent variable at a time = try calculating profitability using 1/10 to 1/20th the former cost of electricity. Do that before trying to get cute.

Start calculating from that base, and then, later, you can continue on towards more 'complicated' calculations like: how low could price go before the ASICs are no longer profitable? I'll give you a very direct hint on that one: at today's price, diff, hashrate, etc., (holding all other variables constant - all other things being equal, as they say in layman's terms), DOGE could fall to .00000005 - 0.00000010 and the ASICs would still be profitable on a variable cost only basis (ALL OTHER THINGS BEING EQUAL), and you can bet they'll be mining 'till they drop' as they do everything they can to eke out whatever return they can before turning into very costly paperweights.

BTW, now you'd be prepared to change other variables, like, for example, hashrate (which would directly effect dependent variables, which in this case would be difficulty, which, in turn, keeps production relatively constant as you assert, correct?) Double the hashrate, and now you've got a lower ASIC profitability range of 10 to 20 satoshi, quadruple the hashrate and that lower range turns into 20-40, etc., etc. As I said in the post that you chose to unnecessarily complicate, difficulty would rise proportionately with hashrate . . .

Now, here's what's complicated (apart from being able to close your eyes and visualize a rotating cube): normally, price would rise with rising hashrate, rising difficulty and decreasing production (caused by another independent variable which is reward 'halving'). Why is that not happening?

That is where I left you in the post that you had difficulty understanding. Why is that dynamic turned upside down? Is it that the answer to that question is not suitable to your preconceived notions? Is it that the answer is not in line with your agenda? Is this the complication that upsets your applecart? Might this be what you are not sure about and what drives you to turn a relatively simple equation into a tortuous and obtuse labyrinth?

P.S. Kind of glad that I missed your original response so that I could bring this very simple but very undesired reality back front and center, since, by the look of things, a lot of people are still scratching their heads.

[lynn_402]

I missed this before . . . sorry.

You're not sure what I'm "trying to say"? It's pretty clear if you stay with what I said and don't unnecessarily clutter the subject. Why would you want to unduly complicate and confuse by introducing irrelevant comments like "more coins per day will magically be produced" or "difficulty adjustment ensures a constant supply of coins no matter what the network hashrate is"? What do either have to do with what I was saying?

If you want to understand, you need to limit your comprehension efforts to what was said, and that was:

EXTREMELY LOWER ENERGY RELATED MINING COSTS = LOWER PRICES (unless everyone is holding long term   )

That's it in a nutshell. Don't convolute the issue. Forget about hashrates and difficulty. Use the scientific method and change only one independent variable at a time = try calculating profitability using 1/10 to 1/20th the former cost of electricity. Do that before trying to get cute.

Start calculating from that base, and then, later, you can continue on towards more 'complicated' calculations like: how low could price go before the ASICs are no longer profitable? I'll give you a very direct hint on that one: at today's price, diff, hashrate, etc., (holding all other variables constant - all other things being equal, as they say in layman's terms), DOGE could fall to .00000005 - 0.00000010 and the ASICs would still be profitable on a variable cost only basis (ALL OTHER THINGS BEING EQUAL), and you can bet they'll be mining 'till they drop' as they do everything they can to eke out whatever return they can before turning into very costly paperweights.

BTW, now you'd be prepared to change other variables, like, for example, hashrate (which would directly effect dependent variables, which in this case would be difficulty, which, in turn, keeps production relatively constant as you assert, correct?) Double the hashrate, and now you've got a lower ASIC profitability range of 10 to 20 satoshi, quadruple the hashrate and that lower range turns into 20-40, etc., etc. As I said in the post that you chose to unnecessarily complicate, difficulty would rise proportionately with hashrate . . .

Now, here's what's complicated (apart from being able to close your eyes and visualize a rotating cube): normally, price would rise with rising hashrate, rising difficulty and decreasing production (caused by another independent variable which is reward 'halving'). Why is that not happening?

That is where I left you in the post that you had difficulty understanding. Why is that dynamic turned upside down? Is it that the answer to that question is not suitable to your preconceived notions? Is it that the answer is not in line with your agenda? Is this the complication that upsets your applecart? Might this be what you are not sure about and what drives you to turn a relatively simple equation into a tortuous and obtuse labyrinth?

P.S. Kind of glad that I missed your original response so that I could bring this very simple but very undesired reality back front and center, since, by the look of things, a lot of people are still scratching their heads.

I still don't get this.. When there will be only 5 billion coins produced per year, and a demand that's sufficient to buy them, how can the fact that ASICs are still profitable even at a lower price influence what people will pay for the coins? That seems to me like good news, since it mean that even in a crash, the network could still remain secure.

[HR]

I still don't get this.. When there will be only 5 billion coins produced per year, and a demand that's sufficient to buy them, how can the fact that ASICs are still profitable even at a lower price influence what people will pay for the coins? That seems to me like good news, since it mean that even in a crash, the network could still remain secure.

I'll conclude that you've done the math and that your question goes beyond and builds upon the basic 'givens' outlined above.


Your phrase "there will be only 5 billion coins produced per year, and a demand that's sufficient to buy them" suggests to me that you believe that demand will be greater than supply (you are giving more weight to potential demand when using the word "sufficient" and less weight to potential supply when using "only"). That's a major assumption you are making, and the kind of assumption professionals term as "imposing your expectations on the market".

Only the market knows what is "sufficient" and what isn't. The market will tell us in no uncertain terms, and it does so everyday in merciless fashion to those who impose their own expectations on the market.

"What people will pay" is another expression often used by participants who are caught in the trap of imposing their beliefs on the market, and is accompanied by other similar phrases like, "it's not rational", "it's obviously worth more", etc., etc. What people may or may not be willing to pay has nothing to do with price. Price is determined by supply and demand, and all we can do is speculate about what price may do in the future; hence, the need to be as objective as possible and to screen your data as thoroughly as possible as well. Remember, people always want to get the best 'deal' they can, regardless of the 'value' they actually assign to what is being purchased.


Your "good news" that the network will still be secure even in a crash only goes so far: until the end of ASIC profitability, when everything goes dark (because the widely distributed user base will have long before been destroyed) and the coin breathes its last breath (and there's absolutely nothing that says that LTC is an exception either, or even BTC for that matter, longer term).

[flound1129]

I still don't get this.. When there will be only 5 billion coins produced per year, and a demand that's sufficient to buy them, how can the fact that ASICs are still profitable even at a lower price influence what people will pay for the coins? That seems to me like good news, since it mean that even in a crash, the network could still remain secure.

I'll conclude that you've done the math and that your question goes beyond and builds upon the basic 'givens' outlined above.


Your phrase "there will be only 5 billion coins produced per year, and a demand that's sufficient to buy them" suggests to me that you believe that demand will be greater than supply (you are giving more weight to potential demand when using the word "sufficient" and less weight to potential supply when using "only"). That's a major assumption you are making, and the kind of assumption professionals term as "imposing your expectations on the market".

Only the market knows what is "sufficient" and what isn't. The market will tell us in no uncertain terms, and it does so everyday in merciless fashion to those who impose their own expectations on the market.

"What people will pay" is another expression often used by participants who are caught in the trap of imposing their beliefs on the market, and is accompanied by other similar phrases like, "it's not rational", "it's obviously worth more", etc., etc. What people may or may not be willing to pay has nothing to do with price. Price is determined by supply and demand, and all we can do is speculate about what price may do in the future; hence, the need to be as objective as possible and to screen your data as thoroughly as possible as well. Remember, people always want to get the best 'deal' they can, regardless of the 'value' they actually assign to what is being purchased.


Your "good news" that the network will still be secure even in a crash only goes so far: until the end of ASIC profitability, when everything goes dark (because the widely distributed user base will have long before been destroyed) and the coin breathes its last breath (and there's absolutely nothing that says that LTC is an exception either, or even BTC for that matter, longer term).

Miners will mine until it becomes unprofitable to do so, yes.  However the 'unprofitable' threshold changes with every new generation of asics.

What people may or may not be willing to pay has nothing to do with price. Price is determined by supply and demand

Supply and demand means exactly that the price will be whatever people are willing to pay.

[HR]

. . . price will be whatever people are willing to pay.

You got one side of the equation anyway . . .


Pick and choose what suits you . . . the hallmark of a hollow position.



How about trying to answer the main question? You know, the one that confused you? https://bitcointalk.org/index.php?topic=621383.msg6908763#msg6908763


DoN'T WoRRY iF You CaN'T. i'LL LeaVe You aLoNe. DoN'T MaKe a PRaCTiCe oF BaNGiNG MY HeaD aGaiNST THe WaLL aNYWaY.

[ranlo]

Supply and demand means exactly that the price will be whatever people are willing to pay.

And what people are willing to sell at.

People are willing to pay $10 for a Lambo but dealer wants $200k, it's not worth $10 now.
People are willing to pay $200k but Lambo dealer wants $200k, it's worth $200k.

It requires both parties.

[flound1129]

. . . price will be whatever people are willing to pay.

You got one side of the equation anyway . . .


Pick and choose what suits you . . . the hallmark of a hollow position.



How about trying to answer the main question? You know, the one that confused you? https://bitcointalk.org/index.php?topic=621383.msg6908763#msg6908763


DoN'T WoRRY iF You CaN'T. i'LL LeaVe You aLoNe. DoN'T MaKe a PRaCTiCe oF BaNGiNG MY HeaD aGaiNST THe WaLL aNYWaY.

Like I said, the answer is difficulty.  Energy efficiency goes up 10x?  So does difficulty, maybe more.  Tell me, how much more energy efficient is a 1TH Bitcoin miner using 1400W vs. a GPU that does 1GH @ 250W?

Now, what was the bitcoin difficulty the last time mining on GPU was profitable?  What was the price?

[flound1129]

Supply and demand means exactly that the price will be whatever people are willing to pay.

And what people are willing to sell at.

People are willing to pay $10 for a Lambo but dealer wants $200k, it's not worth $10 now.
People are willing to pay $200k but Lambo dealer wants $200k, it's worth $200k.

It requires both parties.

You're talking about an illiquid market.  In a liquid market, price moves with supply and demand.  Coin markets, especially for the more popular coins, will be getting more and more liquid as time goes on.

[ranlo]

Supply and demand means exactly that the price will be whatever people are willing to pay.

And what people are willing to sell at.

People are willing to pay $10 for a Lambo but dealer wants $200k, it's not worth $10 now.
People are willing to pay $200k but Lambo dealer wants $200k, it's worth $200k.

It requires both parties.

You're talking about an illiquid market.  In a liquid market, price moves with supply and demand.  Coin markets, especially for the more popular coins, will be getting more and more liquid as time goes on.

If nobody was willing to buy a Bitcoin at $50 right now, it would be worth less than $50. That's just the demand part. If people don't want to supply at $50, it's not worth $50. In either case, it requires both parties to agree on an equilibrium; not just one.

[flound1129]

Supply and demand means exactly that the price will be whatever people are willing to pay.

And what people are willing to sell at.

People are willing to pay $10 for a Lambo but dealer wants $200k, it's not worth $10 now.
People are willing to pay $200k but Lambo dealer wants $200k, it's worth $200k.

It requires both parties.

You're talking about an illiquid market.  In a liquid market, price moves with supply and demand.  Coin markets, especially for the more popular coins, will be getting more and more liquid as time goes on.

If nobody was willing to buy a Bitcoin at $50 right now, it would be worth less than $50. That's just the demand part. If people don't want to supply at $50, it's not worth $50. In either case, it requires both parties to agree on an equilibrium; not just one.

That would be an illiquid, irrational market.

Liquidity and rationality are two different things.