nrd525 Market Tracker

[figmentofmyass]

The scary scenario is if 14k was a lower high and we go down to 3k (or even just 5k).  If bitcoin stops have bull cycles that hit all-time-highs, then a lot of people are going to leave the market.

I think the community/ecosystem is big enough that we'd sustain 1k, and maybe 3k.  3k might break with enough bearish conditions.

if we go back to $3k, the blood won't stop there. too much time has passed for a double bottom. then we'd be looking at crossing the 2013 ATH in the $1000s. that would certainly change the historic bullish paradigm.

more likely IMO, this is either part of a long term sideways consolidation like 2015 or it's a short term dip like august 2016.

[nrd525]

I hope we get some solid answers from this!
https://www.coindesk.com/crypto-traders-lawsuit-claims-bitfinex-tether-cost-market-over-1-trillion


I'm skim reading the lawsuit and it is very bearish.  It is possible that some people may have convinced themselves that 1) Bitcoin is all about bubbles 2) Willybot worked and 3) We could create the largest bubble ever and do so legally using shell corporations / operating outside of the US.  Not sure how anyone can read this report and not think we'd see at least a 10% decline within 24 hours.

[figmentofmyass]

I hope we get some solid answers from this!
https://www.coindesk.com/crypto-traders-lawsuit-claims-bitfinex-tether-cost-market-over-1-trillion

add a few more zeros on, why not!? how can they possibly claim trillions in damages---because of a "market manipulation"? what kind of gorilla math is this?

the law firm obviously isn't privy to the CFTC and DOJ investigations. it seems like they're just going off public information like the university of texas study. despite all the flack tether gets, i'm skeptical about the manipulation claims. this professor found the cited correlations "not statistically significant":

However, another study published last September by University of Queensland professor Wang Chun Wei found that while “tether grants were potentially timed to follow bitcoin downturns,” the actual correlation was “not statistically significant.”

I'm skim reading the lawsuit and it is very bearish.

Not sure how anyone can read this report and not think we'd see at least a 10% decline within 24 hours.

interestingly enough, the market pumped 7%. news is funny like that.

[marky89]

I hope we get some solid answers from this!
https://www.coindesk.com/crypto-traders-lawsuit-claims-bitfinex-tether-cost-market-over-1-trillion

What constitutes a class member? Seeing as this is based on market manipulation claims, are we all eligible to be class members if we're Bitcoin traders? I'm happy to take a cut of $1.4 trillion.

Something tells me Bitfinex and Tether don't have that kind of money though.

[nrd525]

I don't think they are actually claiming any amount for losses.  The article headline doesn't match the lawsuit (which could be why the price isn't reacting, people haven't actually read the 95 page lawsuit and would discount it as  FUD if you just read the headline).

The class is defined to include everyone who didn't trade on Bitfinex.  Which seems weird, but apparently we users agreed to use arbitration under the terms of service.

Is there any precedent for financial compensation for losses due to speculative bubbles based on fraud?  I don't know of any.  Though there are laws that require that people who profited from ponzis (notably Madoff) pay back their fake "interest".  And there are laws about buying stolen property.  But I'm guessing that nobody had to pay back gains from say the Hunt brothers cornering the silver market.

It seems like this is more likely to lead to criminal charges against Bitfinex than civil charges with a financial reward, and that they'd be brought by the NY Attorney General.  But there is a financial motivation to bring civil charges, and they might be easier to prove (I think you need a majority of the jury, instead of unanimity).

I removed my bids from 7700 to 6100.  Got bids down to 3k.

[exstasie]

Is there any precedent for financial compensation for losses due to speculative bubbles based on fraud?  I don't know of any.

What losses are they claiming? Were these traders shorting the market and they're trying to blame Tether for pumping it back up? Isn't that the often repeated claim, that Tether prints USDT to prop the crypto markets up?

It seems like this is more likely to lead to criminal charges against Bitfinex than civil charges with a financial reward, and that they'd be brought by the NY Attorney General.  But there is a financial motivation to bring civil charges, and they might be easier to prove (I think you need a majority of the jury, instead of unanimity).

Since the claimants filed in federal court, the verdict must be unanimous. I've always heard the burden of proof is lower in civil cases though.

[nrd525]

I'm not sure what losses the class suit is claiming.  I think they believe that the Tether manipulation has hurt the price of bitcoin, whereas I think it has currently helped.  Though if people start looking deeper into it, instead of just ignoring it as the "same old FUD" - we could go to 1k and then it would really hurt.

What is a good way to distinguish between real bad news and the "same old FUD"?  For instance, it took a while to realize that the stories of China banning bitcoin were more complex than a simple yes or no.  The Chinese have a complex set of rules designed to limit the use of bitcoin, but they tolerate some uses and mining.  It also took time to realize that China banning bitcoin would be largely neutralized by increases in usage in other countries.

On the other hand, the FUD about MtGox ended up being completely real (in that case it was obvious that there was a withdrawal problem from the premium).  As did my doubts about all the early bitcoin stocks on the bitcoin stock exchange (some of these were investing in ponzis so...), and all the lending schemes that turned out to be from scammers or ponzis.  The ponzis were obvious from the rate of return.

It's my opinion that the doubts about Tether have enough of a scientific basis to warrant serious concern.  And as a user of it from 2013 to 2017, the practices of Bitfinex have not always been the most ethical or professional.  But they do fall short of being obvious scammers.

Ooh, we need to hire that team that went after GE (and previously went after Madoff) for faking their profits.  We need foresnic financial accountants!
https://www.cbsnews.com/news/general-electric-accounting-fraud-bigger-than-enron-alleged-by-madoff-whistleblower/

The doubt about ICOs and altcoins is slowly been proven to be true (though it varies on an alt-coin basis with some holding up very well).  Though the SEC hasn't gone after the ICOs as much as I'd expected/hoped.

...

Bearish: Trump could over-react to the move towards impeachment and do something very harmful to the global economy (or he could do something very bullish, though without a majority in Congress it'd be hard to do a tax cut).  Like get further intrenched in a trade war or a military war.  He's been a bit more off the wall than normal on Twitter.

[illyiller]

It's my opinion that the doubts about Tether have enough of a scientific basis to warrant serious concern.

They've warranted serious concern for a long time. I've been thinking for years that they are just one big law enforcement action away from becoming the next BTC-e. I wouldn't be surprised if the indictment's already under seal and the DOJ is just waiting to make their move.

Until Tether and Bitfinex literally have the FBI seal over their domains, the market won't care. We've already been through years of this FUD and the bank wires are still flowing.

[nrd525]

From Bitcoin Taxes (bitcoin.tax domain?). The IRS has confirmed you can use FIFO and more importantly Lots for your accounting method to figure your basis. This is great as I went with using Lots which I think is ideal given bitcoin's tendancy to go up AND down.  LIFO (edited, previously I mistakenly wrote FIFO) is great for an appreciating asset, but bitcoin has these 85% plunges.  It is a total nightmare to track, but if you limit the number of your trades and spends - then it is doable.  

The tax strategy I like to use is if I'm spending bitcoin, buy them first (in the exact amount needed) and then spend them as quickly as possible. So with using Lots you can have effectively zero capital gains on it for small purchases or very near zero for larger ones.

They also ruled that hard forks are treated as income.  I guess that correctly as well!  The alternative of viewing it as stock split was just too messy as you wouldn't have a good way of dividing the basis.  Notably with some of the weirder forks, like bitcoin diamond, they were traded on exchanges where you couldn't deposit them at 10x the real market price. So even using the market price of the two sides of a fork to determine the basis would have been messy as you didn't know the market price for the lesser coin often, and you'd have to pick a day and time (or average period) to get the market prices for.


[NEW] FIFO and Specific Identification
 
Up till now, most accountants have recommended only using FIFO, as it is the default IRS cost basis method. However, the IRS has now confirmed that specific identification can be used. This is extremely significant, as you could select from your "lots" of owned crypto and choose the ones with the best tax outcome. You could, for instance, reduce the current year short-term tax liability and push it into the following year to take advantage of reduced long-term capital gains rates.
 
Bitcoin.Tax has offered specific identification methods since we started in 2014, and allows you to pick from a variety of strategies, such as last-In last-out, lowest-cost and closest-cost, to minimize tax liabilities.

[exstasie]

From Bitcoin Taxes (bitcoin.tax domain?). The IRS has confirmed you can use FIFO and more importantly Lots for your accounting method to figure your basis. This is great as I went with using Lots which I think is ideal given bitcoin's tendancy to go up AND down.  FIFO is great for an appreciating asset, but bitcoin has these 85% plunges.  It is a total nightmare to track, but if you limit the number of your trades and spends - then it is doable.

I've always used specific lot identification. That's what my accountants have always recommended for crypto. FIFO seems like an absolute nightmare for tax optimization like long term gains rates.

[nrd525]

Oops I meant LIFO =)

[STT]

Not sure how anyone can read this report and not think we'd see at least a 10% decline within 24 hours

Sounds like the power of a rumour vs news, there isnt enough to move the market from what its already speculating within the price and if they get exactly what they expected then likely we reverse from then on; a relief rally maybe.    I'd be surprised if they shut down the exchange for being fraudulent which is the correct magnitude of action for a shock, some minor rebuke is more like it.   I guess the market could be surprised so we'd get proper movement but another negative report wasnt enough.   Maybe we already fell because of that and now its rebounding.
  I was considering a short but honestly it doesnt seem likely to react in that way, friday tomorrow then weekend and I think its better to wait till Monday to speculate a negative.   I dont want to watch it especially till then and it seems like we can drift upwards even if its just to fall later and my observation is that the weekend is a perfect fit for that behaviour.

[nrd525]

Was the near 14k top really correlated with the collapse of the Chinese token crypto ponzi?  Richard Heart is a crazy guy, but sometimes insightful and a great alternative to groupthink.
https://offthechain.substack.com/p/2-billion-ponzi-scheme-uncovered

Vanatu (tiny island) arrests on June 27, China arrests on July 1.  Topped on June 25.
https://offthechain.substack.com/p/2-billion-ponzi-scheme-uncovered

[nrd525]

Now they need to start fining and jailing people.
https://www.coindesk.com/sec-halts-telegrams-1-7-billion-unlawful-token-issuance

[figmentofmyass]

Now they need to start fining and jailing people.
https://www.coindesk.com/sec-halts-telegrams-1-7-billion-unlawful-token-issuance

the bigger story is further down in the article. the SEC just settled with the creators of EOS, who raised $4.1 billion in an ICO. they got a slap on the wrist---only $24 million in fines and no requirement to register with the SEC.

it sure doesn't sound like anyone's going to jail for this stuff.

[nrd525]

Ooh.  Trump appointees at work!

I lean towards this being my favorite indicator for bitcoin. And it's currently looking like we might bottom around $4300 (so perhaps 3100 - 5500).
https://trends.google.com/trends/explore?date=today%205-y&geo=US&q=bitcoin

There is a case for institutional money replacing some of the retail money (so then search trend is less important), but the institutional money probably isn't stupid enough to believe that bitcoin is always going to have another 10x-100x bull cycle.  I think the retail hardcore bitcoin enthusiasts are the base and the type of people to hold if we go down to $1000.

[nrd525]

It's Digital Gold for Gamblers!
https://www.coindesk.com/thrill-seeking-drives-investors-to-trade-crypto-study-finds

[figmentofmyass]

It's Digital Gold for Gamblers!
https://www.coindesk.com/thrill-seeking-drives-investors-to-trade-crypto-study-finds

i'm not surprised. i can hardly stomach stocks and forex trading because they are so bloody boring, and bitcoin was the first asset i ever traded. i guess we have real live proof now that us crypto traders are after the roller coaster more than anything else!

[nrd525]

SIM card swapping fraud is a problem.  Don't rely upon your phone number to secure anything.  Use Google Authenticator or other more secure 2FA methods.

https://www.coindesk.com/michael-terpin-urges-fcc-to-curb-crypto-fraud-that-cost-him-24-million

[nrd525]

This is a very interesting claim.  It probably was due to multiple causes.  The larger the bubble, the easier it is to pop it (or on second thought, maybe this isn't true as people who would short it get wrecked and you can run out of people who are feel they know enough to try to short?).  At least the larger the bubble the more likely it is to pop, as you have increased incentive to do so (and there are some rational people who take profit).

https://www.coindesk.com/trump-administration-popped-2017-bitcoin-bubble-ex-cftc-chair-says