Semi-rational exuberance anyone?

[gigitrix]

IMO, Bitcoins will be either worth over $5000/BTC or < $0.01/BTC and everything in-between is an amazing adventure.   

This is true. It either succeeds globally, or fails. I just don't see a middle ground. THAT's why I'm bullish about bitcoin!

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[TraderTimm]

It only fails if there ends up being one user left.

I don't see that happening, so I'm in until I am dead in the ground.

[Bit_Happy]

I'm bullish + obsessed, and also able to call this week clearly A Bit Crazy.

[bitcoinminer]

Hi Guys... new kid on the block.

I experienced the same thing trying to buy with dwolla - except I tried to buy at 9 and now its 17.

Just looking at the market cap, it has gone up 250% - if you think of it like a traditional stock, it has gone up more than double, without the appropriate "earnings" - I'm thinking it's going to settle back down a bit.  If difficulty increased 55% at $8, and if we assume its going to go up another 50% or so, (these are all guesses), I'm thinking $16-$18/BTC is not unreasonable.

The question then becomes for me, as a "new guy", do I spend the money buying coins, or buying the hardware... I have a decent PC rig already, minus the video card... was going to do dual 5870's or a single 5970.  I see everybody going crazy for the 6990s, but honestly, the pricing on a 5970 is 400% of a 5870, but its only 200% of the speed.

The advantage obviously being if you have 1 PC, and the "coin" to spend on video cards, you can put two 6990s or 5970s in, which will then be double the speed (or more) of two 5870s.

Unfortunately I took a night to "sleep on it" before ordering video cards, and now they're all out of stock.

Do you guys have a spot youre willing to share that accepts good old fashioned credit cards to purchase 5870 or 5970?  Paypal is the Great Satan, and we refuse to do business with each other, and I don't have any BTCs yet.

[Hans0]

I will tell you in numbers what the bitcoin price is going to be: A few days ago all btc were 45m$ worth. Imagine a world where alle currency is based on bitcoin instead of being based on gold. That would mean that the value of all goods and services in the entire world would map to bitcoins. The world is worth about 10^6 more that 45m$. That would account for an increase in price of factor 10^6 but there are two problems: a) There will be 3x more bitcoins => 1/3 price; b) bitcoins will be illegal in all major countries => only illegal activity like smuggling, drugs, weapons, illicit work and tax tricks like paying half of the price of a new house in bitcoins to reduce taxes will be on bitcoins. That would be about factor 1/10.

All in all the price will increase by factor: 10^6 * 1/3 * 1/10 = 30,000

These calculations were done at 8€/btc => new price will be 240,000€/btc ~ 320,000$/btc within 5 years. Just be sure to realize that bitcoins will be illegal and you will have to hold them for 5-10 years before you can make use of them (buy a house or car, or spend them in a country where they are still legal).

Also you must realize that when (not if) the $ and € become worthless people will flee to btc. Just don't make the mistake to cash out into $ or € when the price peaks because you will receive worthless paper money for it. Never cash out, or at least cash out in gold and silver.

[wareen]

The question then becomes for me, as a "new guy", do I spend the money buying coins, or buying the hardware... I have a decent PC rig already, minus the video card... was going to do dual 5870's or a single 5970.

I'd say go with the cheaper cards 5850 or 5870 and spend the rest buying bitcoins. But you'll probably be even better off spending all on coins. Expect difficulty to go way up due to the higher price. I think most of the miners who only started the last few months regret not having bought bitcoins with the money instead...

You have to do the math yourself for your situation - if you do, consider difficulty increases of at least 30% every ~11 days and don't count on being able to sell your used mining gear in case Bitcoin crashes completely - you'd be one of very many trying to do so.

Having said that, welcome to the community and I wish you the best of luck!

Also you must realize that when (not if) the $ and € become worthless people will flee to btc.

Whoa - quite some strong predictions you have there - you realize that in the scenario you describe you'd better invest in some ammunition and an atomic shelter instead of Bitcoins?

[Hans0]

you'd better invest in some ammunition and an atomic shelter instead of Bitcoins

I do! I intend to have food reserves for a few hundred bucks. Bitcoin will only become more important in this case.

[shady financier]

I will tell you in numbers what the bitcoin price is going to be: A few days ago all btc were 45m$ worth. Imagine a world where alle currency is based on bitcoin instead of being based on gold >snip<

stopped reading there.

[Hans0]

I will tell you in numbers what the bitcoin price is going to be: A few days ago all btc were 45m$ worth. Imagine a world where alle currency is based on bitcoin instead of being based on gold >snip<

stopped reading there.

Then you missed that my calculation does not depend on bitcoin becoming the standard currency at all. It _cannot_ because it will be illegal. But it will become the standard currency of illegal activity like smuggling or avoiding taxes. That is a big market.

[bitcoinminer]

The question then becomes for me, as a "new guy", do I spend the money buying coins, or buying the hardware... I have a decent PC rig already, minus the video card... was going to do dual 5870's or a single 5970.

I'd say go with the cheaper cards 5850 or 5870 and spend the rest buying bitcoins. But you'll probably be even better off spending all on coins. Expect difficulty to go way up due to the higher price. I think most of the miners who only started the last few months regret not having bought bitcoins with the money instead...

You have to do the math yourself for your situation - if you do, consider difficulty increases of at least 30% every ~11 days and don't count on being able to sell your used mining gear in case Bitcoin crashes completely - you'd be one of very many trying to do so.

Having said that, welcome to the community and I wish you the best of luck!

Awesome, thanks for the input.  Although looking at the next expected difficulty, I think BTC is a bit overvalued at the moment... looks like there's sort of a craze yesterday and today.  I think it will settle in around $15 or so in the next couple of days, which is in line with the last 55% difficulty and the upcoming ~25% difficulty.

I was thinking about the difficulty as far as buying cards, and yes, blocks will be harder to find, but I think the price will balance it out... not much difference finding 50 BTC @ $8 and "only" finding $25 @ $16.

I think you have the right idea though... if I get the cards and the coins I'm covered both ways.  I'm an IT guy and leave my computer on 24/7 anyhow, so it shouldn't be a huge difference for the video cards added in.  The video card I have now is pumping out 28 Mh/s lol.  So pretty much anything would be an improvement.

As far as you guys with the post apocalyptic stuff, BTC is going to be useless if nobody has electricity or internet anymore, if you're hiding in your backyard bunkers   Food, medicine, and ammunition will be the currency, in that order.

[datguywhowanders]

Eh, we're all boned when the zombie apocalypse hits anyway. Enjoy the rally while it lasts

[Jaime Frontero]

The question then becomes for me, as a "new guy", do I spend the money buying coins, or buying the hardware... I have a decent PC rig already, minus the video card... was going to do dual 5870's or a single 5970.

I'd say go with the cheaper cards 5850 or 5870 and spend the rest buying bitcoins. But you'll probably be even better off spending all on coins. Expect difficulty to go way up due to the higher price. I think most of the miners who only started the last few months regret not having bought bitcoins with the money instead...

You have to do the math yourself for your situation - if you do, consider difficulty increases of at least 30% every ~11 days and don't count on being able to sell your used mining gear in case Bitcoin crashes completely - you'd be one of very many trying to do so.

Having said that, welcome to the community and I wish you the best of luck!

Awesome, thanks for the input.  Although looking at the next expected difficulty, I think BTC is a bit overvalued at the moment... looks like there's sort of a craze yesterday and today.  I think it will settle in around $15 or so in the next couple of days, which is in line with the last 55% difficulty and the upcoming ~25% difficulty.

I was thinking about the difficulty as far as buying cards, and yes, blocks will be harder to find, but I think the price will balance it out... not much difference finding 50 BTC @ $8 and "only" finding $25 @ $16.

I think you have the right idea though... if I get the cards and the coins I'm covered both ways.  I'm an IT guy and leave my computer on 24/7 anyhow, so it shouldn't be a huge difference for the video cards added in.  The video card I have now is pumping out 28 Mh/s lol.  So pretty much anything would be an improvement.

As far as you guys with the post apocalyptic stuff, BTC is going to be useless if nobody has electricity or internet anymore, if you're hiding in your backyard bunkers   Food, medicine, and ammunition will be the currency, in that order.

not the people on this forum - we're all traders and speculators.

Food, medicine, and ammunition will be the currency, in that order.

i think we'd all be going with chocolate, whiskey, toilet paper, tampons, perfume and coffee.

i expect you're right about a correction though.  i'm thinking $13-15 for a low, lasting a week or so.  big deal.

20 is the new 10...

[Hans0]

Talking about the price like "is it 17 or 20 next week?" seems irrelevant right now. The potential was not even scratched. I think all bitcoins are worth 90m$ at market prices right now. That's nothing.

[beeph]

TO DA MOON!!!!!!!!!!!!!!!!!!

[bitcoinminer]

I had forgotten the joy of a last 30 second ebay auction snipe is   Just picked up two ATI 5870s for $525.  Not much cheaper than new, but every place seems to have a hard time keeping them in stock.

[Bit_Happy]

TO DA MOON!!!!!!!!!!!!!!!!!!

Huge day today: Semi-rational exuberance might be a good name for it.   

[bitcoinminer]

I just really don't see how over 7 days a 25% difficulty increase results in a 300% price increase... I have a gut feeling if I buy today, its gonna drop, and if I don't, tomorrow its up another 20% lol

[Bit_Happy]

I just really don't see how over 7 days a 25% difficulty increase results in a 300% price increase... I have a gut feeling if I buy today, its gonna drop, and if I don't, tomorrow its up another 20% lol

Already went up almost 20% more since your last post!
Do you still remember when a Bitcoin only cost $19?   

[iya]

Market depth is pretty low right now.
A few moments ago the total asks on MtGox where just 5493 BTC for 183169 USD.
Now it's 6895 BTC for 230739 USD. This does obviously not include the dark pool.
Looks like the big holders are waiting for $50 - $90.

[Hans0]

I just really don't see how over 7 days a 25% difficulty increase results in a 300% price increase... I have a gut feeling if I buy today, its gonna drop, and if I don't, tomorrow its up another 20% lol

This is not how it works. The mining difficulty does not influence the price in a major way because a) it can be anticipated and therefore is already included in the current price b) the market is demand-driven now.

Looks like the big holders are waiting for $50 - $90.

If they are smart they do not sell at that price. The pricing right now is driven by hype, but the fundamentals tell you that the price will increase by 1000x to 5000x still. See my previous post for the reasoning behind that.


What the market does short term is completely dwarfed by the long-term fundamentals. Do not care about the price now, care about the price in 5-10 years. Then buy a house from your coins.