Balls of steel

[Peegasus]

If bitcoin goes up even $600, I will sell. Really, I will sell.

In this way you will miss the rise to 3000$, just howl and wait.

Oh really? You believe that? Bitcoin to $3000? Hmmmm.. 2-3 years maybe..

Overly fanatics.. Come down here.. in reality.. There will be no way bitcoin will rise up to $3000. No way. Dont get your hopes up.

[inca]

If bitcoin goes up even $600, I will sell. Really, I will sell.

In this way you will miss the rise to 3000$, just howl and wait.

Oh really? You believe that? Bitcoin to $3000? Hmmmm.. 2-3 years maybe..

Overly fanatics.. Come down here.. in reality.. There will be no way bitcoin will rise up to $3000. No way. Dont get your hopes up.

Last year no one thought it would reach 266. Then no one thought it could ever reach 1200. Now after the market is working off that exuberance and coins are being distributed from short term speculators to long term holders eventually supply will dry up once again.

How high will it go this time? Hint: most of the forum seems to be expecting it to plummet to 200-350.

[exocytosis]

well WTF am I missing here ebay/paypal announces they are gonna take Bitcoin and usd price has dropped to $466 wtf am I missing here..jeez

What you're missing is that ebay/paypal hasn't announced that they are going to take bitcoin. Once they do actually announce they will be accepting bitcoin it might be a different story, but until it actually happens I wouldnt hold my breath.

A paypal subsidiary called braintree will probably use bitcoin a a mobile phone payment option, but ebay/paypal is not considering bitcoin at the moment.

the ceo of ebay has been considering BTC for about a year, he likes btc a lot. pay pals reluctance is what has kept it from going through. they have a monopoly over ebay they don't want to give up. likely paypal sees its only a matter of time and is trying to position themselves as middleman in the setup.

eBay adopting BTC would result in increased sell pressure, hence falling prices. The PayPal announcement had the same effect. New merchants accept BTC all the time, and price keeps falling.

[inca]

well WTF am I missing here ebay/paypal announces they are gonna take Bitcoin and usd price has dropped to $466 wtf am I missing here..jeez

What you're missing is that ebay/paypal hasn't announced that they are going to take bitcoin. Once they do actually announce they will be accepting bitcoin it might be a different story, but until it actually happens I wouldnt hold my breath.

A paypal subsidiary called braintree will probably use bitcoin a a mobile phone payment option, but ebay/paypal is not considering bitcoin at the moment.

the ceo of ebay has been considering BTC for about a year, he likes btc a lot. pay pals reluctance is what has kept it from going through. they have a monopoly over ebay they don't want to give up. likely paypal sees its only a matter of time and is trying to position themselves as middleman in the setup.

eBay adopting BTC would result in increased sell pressure, hence falling prices. The PayPal announcement had the same effect. New merchants accept BTC all the time, and price keeps falling.

You do understand that consumer adoption follows media exposure, right?

[NotLambchop]

...
You do understand that consumer adoption follows media exposure, right?

So, just to eliminate any doubt in my mind, since last year we had:
1.  Increasing media exposure.
2.  Increasing adoption.
3.  Falling exchange rate.

∴  If (1) and (2) continue, the exchange rate is going to continue on its present trajectory, i.e. falling.

[maker88]

well WTF am I missing here ebay/paypal announces they are gonna take Bitcoin and usd price has dropped to $466 wtf am I missing here..jeez

What you're missing is that ebay/paypal hasn't announced that they are going to take bitcoin. Once they do actually announce they will be accepting bitcoin it might be a different story, but until it actually happens I wouldnt hold my breath.

A paypal subsidiary called braintree will probably use bitcoin a a mobile phone payment option, but ebay/paypal is not considering bitcoin at the moment.

the ceo of ebay has been considering BTC for about a year, he likes btc a lot. pay pals reluctance is what has kept it from going through. they have a monopoly over ebay they don't want to give up. likely paypal sees its only a matter of time and is trying to position themselves as middleman in the setup.

eBay adopting BTC would result in increased sell pressure, hence falling prices. The PayPal announcement had the same effect. New merchants accept BTC all the time, and price keeps falling.

pretty sure i didn't say anything about what ebay accepting bitcoin would do to the price. just pointing out how whatshisface was lying about how ebay was not considering using bitcoin. maybe learn to read before replying?

[inca]

...
You do understand that consumer adoption follows media exposure, right?

So, just to eliminate any doubt in my mind, since last year we had:
1.  Increasing media exposure.
2.  Increasing adoption.
3.  Falling exchange rate.

∴  If (1) and (2) continue, the exchange rate is going to continue on its present trajectory, i.e. falling.

I don't remember using the word price in that sentence.

I would say personally that adoption is lagging compared to merchant integration, and speculators are selling more than buying resulting in us being at the bottom of a bear market. I think merchant adoption is actually largely irrelevant to the price at current levels of trade.

User adoption is rising and once the price turns and heads back up past 800 a new larger tranche of users will discover how easy it is to buy, save and use bitcoin. They and you will drive the next bubble. As you well know it is a price cycle - not a strict mathematical formula.

Your points would have been equally valid last year after the run to 266 and dive to 60, for a time. Shortly afterward they became very wrong indeed, as I suspect they will again.

[exocytosis]

Shortly afterward they became very wrong indeed, as I suspect they will again.

It's different this time, since we no longer have Gox manipulating the price, pulling the rest of the market in its direction. There won't be a new rally.

[exocytosis]

pretty sure i didn't say anything about what ebay accepting bitcoin would do to the price. just pointing out how whatshisface was lying about how ebay was not considering using bitcoin. maybe learn to read before replying?

You're right, and I'm sorry. I should've replied to inca or another bull.

[inca]

Shortly afterward they became very wrong indeed, as I suspect they will again.

It's different this time, since we no longer have Gox manipulating the price, pulling the rest of the market in its direction. There won't be a new rally.

It's different this time, eh? Ha.

[NotLambchop]

...
You do understand that consumer adoption follows media exposure, right?

So, just to eliminate any doubt in my mind, since last year we had:
1.  Increasing media exposure.
2.  Increasing adoption.
3.  Falling exchange rate.

∴  If (1) and (2) continue, the exchange rate is going to continue on its present trajectory, i.e. falling.

I don't remember using the word price in that sentence.

I don't remember using the word "price" in this entire thread.  What made you bring it up?

I would say personally that adoption is lagging compared to merchant integration, and speculators are selling more than buying resulting in us being at the bottom of a bear market. I think merchant adoption is actually largely irrelevant to the price at current levels of trade.

User adoption is rising and once the price turns and heads back up past 800 a new larger tranche of users will discover how easy it is to buy, save and use bitcoin. They and you will drive the next bubble. As you well know it is a price cycle - not a strict mathematical formula.

Are you saying that user adoption is driven by the price (higher BTC exchange rate will cause greater adoption), and not vice versa?  If so, I'd say you're in the minority.

Your points would have been equally valid last year after the run to 266 and dive to 60, for a time. Shortly afterward they became very wrong indeed, as I suspect they will again.

I posted a list of [what I believe to be facts], (1) through (3), and a conclusion following from the premise that BTC exchange rate was in a causal relationship with (2).

Like so:
A -> B
~B
A
∴ ~(A -> B)

...so not sure what you mean by "your point."  What point do you think I'm trying to make?

[inca]

...
You do understand that consumer adoption follows media exposure, right?

So, just to eliminate any doubt in my mind, since last year we had:
1.  Increasing media exposure.
2.  Increasing adoption.
3.  Falling exchange rate.

∴  If (1) and (2) continue, the exchange rate is going to continue on its present trajectory, i.e. falling.

I don't remember using the word price in that sentence.

I don't remember using the word "price" in this entire thread.  What made you bring it up?

I would say personally that adoption is lagging compared to merchant integration, and speculators are selling more than buying resulting in us being at the bottom of a bear market. I think merchant adoption is actually largely irrelevant to the price at current levels of trade.

User adoption is rising and once the price turns and heads back up past 800 a new larger tranche of users will discover how easy it is to buy, save and use bitcoin. They and you will drive the next bubble. As you well know it is a price cycle - not a strict mathematical formula.

Are you saying that user adoption is driven by the price (higher BTC exchange rate will cause greater adoption), and not vice versa?  If so, I'd say you're in the minority.

Your points would have been equally valid last year after the run to 266 and dive to 60, for a time. Shortly afterward they became very wrong indeed, as I suspect they will again.

I posted a list of [what I believe to be facts], (1) through (3), and a conclusion following from the premise that BTC exchange rate was in a causal relationship with (2).

Like so:
A -> B
~B
A
∴ ~(A -> B)

...so not sure what you mean by "your point."  What point do you think I'm trying to make?

I am posting this from an ipad so apologies for formatting.

Exchange rate = price. Hence the mention.

Your argument seems to be: continued bitcoin media exposure together with rising adoption equals a falling price. Therefore bitcoin is going to continue falling.

Now since the price previously topped that correlation exists. Correlation does not equal causation. Simply widening your timeframe tells a different and opposite story where the price has risen instead.

[NotLambchop]

^Gotcha.  Neither one of us thinks that there is a causal relationship between user adoption and BTC exchange rates.
We agree that all arguments extrapolating higher BTC exchange rate because greater adoption are nonsense.

We're good.  Sorry about the misunderstanding.

[inca]

^Gotcha.  Neither one of us thinks that there is a causal relationship between user adoption and BTC exchange rates.
We agree that all arguments extrapolating higher BTC exchange rate because greater adoption are nonsense.

We're good.  Sorry about the misunderstanding.

There may be no direct causal relationship. But a hugely rising (or falling) number of users transacting in bitcoin will obviously exert pressure on the exchange price.

I think my original point was that it is pretty hard to adopt something you have never heard of. Ergo, increasing media coverage of bitcoin, seeing that little b sign at dell or (soon to be) paypal or uber will pique the interest of joe public, eventually contributing to increasing adoption.

You know all this but have a bearish position so argue against it. But that is ok

[NotLambchop]

...
There may be no direct causal relationship. But a hugely rising (or falling) number of users transacting in bitcoin will obviously exert pressure on the exchange price.
...

I'm bearish, but I'm also not shorting.  I honestly haven't been able to read BTC market like I once could.  So if forced to TL;DR, I'd say:

The bulk of BTC users are speculators. 
BTC exchange rate is ultimately determined by their sentiment and trading strategies.<==seems self-evident to me
Over the last year, bigger, tougher, smarter kids started playing in our sandbox.
I can't compete--trading I do now amounts to little more than gambling.

Something like that.

[inca]

...
There may be no direct causal relationship. But a hugely rising (or falling) number of users transacting in bitcoin will obviously exert pressure on the exchange price.
...

I'm bearish, but I'm also not shorting.  I honestly haven't been able to read BTC market like I once could.  So if forced to TL;DR, I'd say:

The bulk of BTC users are speculators. 
BTC exchange rate is ultimately determined by their sentiment and trading strategies.<==seems self-evident to me
Over the last year, bigger, tougher, smarter kids started playing in our sandbox.
I can't compete--trading I do now amounts to little more than gambling.

Something like that.

Do you mind me asking if you are holding bitcoin or sat on the sidelines in cash?

Interesting that you feel the market movements have changed in some way due to new participants, especially as volatility has reduced?

I suppose the price is ultimately determined by supply and demand. That is supply from miners, genuine sellers and speculators, versus demand from new and veteran consumer buying. The shifts in balance determine the short term price trends. In such a thinly traded market my view is also that currently sentiment is hugely important as speculation probably has a major role in price discovery*.

That said, overall mining supply and consumer demand should drive the price in the longer term which is evident in charts going back several years. Will it continue? I think so.

I am not bothered particularly by short term volatility in the price otherwise I would have sold long ago (and been considerably better off from my bitcoin holdings). The very fact that silicon valley is rapidly integrating bitcoin into everything for what is really a tiny global userbase tells me big business wants bitcoin to succeed.

* i am very busy with my day job but i have for a long time wanted to create a script to scrape the this forum and perform some sentiment analysis to generate some statistics to compare with the exchange rate and google trends etc.

[NotLambchop]

...
There may be no direct causal relationship. But a hugely rising (or falling) number of users transacting in bitcoin will obviously exert pressure on the exchange price.
...

I'm bearish, but I'm also not shorting.  I honestly haven't been able to read BTC market like I once could.  So if forced to TL;DR, I'd say:

The bulk of BTC users are speculators. 
BTC exchange rate is ultimately determined by their sentiment and trading strategies.<==seems self-evident to me
Over the last year, bigger, tougher, smarter kids started playing in our sandbox.
I can't compete--trading I do now amounts to little more than gambling.

Something like that.

Do you mind me asking if you are holding bitcoin or sat on the sidelines in cash?

Not at all, but how would you interpret the answer considering that speculation is a competitive, not cooperative, game? (But it's "both," as I'm sure is the case with most people here.)
I hold less BTC than I once did, take that for what it's worth (zilch).

Interesting that you feel the market movements have changed in some way due to new participants, especially as volatility has reduced?

You would expect the volatility to increase?  Why?  It takes a much smarter trader to make money in a market with low volatility.

I suppose the price is ultimately determined by supply and demand. That is supply from miners, genuine sellers and speculators, versus demand from new and veteran consumer buying. The shifts in balance determine the short term price trends. In such a thinly traded market my view is also that currently sentiment is hugely important as speculation probably has a major role in price discovery*.

The problem is the supply/demand relationship is biconditional, A <-> B.  Bitcoin has little intrinsic value.  The value of 1 BTC would be close to nothing if there was no user base, no Bitcoin network.  The network effect cuts both ways--a telephone set's value grows when more people get phones, but it drops when fewer people have them.
Agreed?

That said, overall mining supply and consumer demand should drive the price in the longer term which is evident in charts going back several years. Will it continue? I think so.

If I thought so too, and was reasonably sure of it, holding BTC long-term would be a no-brainer.  It's obviously not (for me).

I am not bothered particularly by short term volatility in the price otherwise I would have sold long ago (and been considerably better off from my bitcoin holdings). The very fact that silicon valley is rapidly integrating bitcoin into everything for what is really a tiny global userbase tells me big business wants bitcoin to succeed.

Big business sees potential profits in Bitcoin.  This doesn't translate into "big business wants Bitcoin to succeed" (for me).

* i am very busy with my day job but i have for a long time wanted to create a script to scrape the this forum and perform some sentiment analysis to generate some statistics to compare with the exchange rate and google trends etc.

Would be neat, any specific ideas on what sort of data you'll be looking for?  I wouldn't know where to start.

[inca]

...
There may be no direct causal relationship. But a hugely rising (or falling) number of users transacting in bitcoin will obviously exert pressure on the exchange price.
...

I'm bearish, but I'm also not shorting.  I honestly haven't been able to read BTC market like I once could.  So if forced to TL;DR, I'd say:

The bulk of BTC users are speculators. 
BTC exchange rate is ultimately determined by their sentiment and trading strategies.<==seems self-evident to me
Over the last year, bigger, tougher, smarter kids started playing in our sandbox.
I can't compete--trading I do now amounts to little more than gambling.

Something like that.

Do you mind me asking if you are holding bitcoin or sat on the sidelines in cash?

Not at all, but how would you interpret the answer considering that speculation is a competitive, not cooperative, game? (But it's "both," as I'm sure is the case with most people here.)
I hold less BTC than I once did, take that for what it's worth (zilch).

Interesting that you feel the market movements have changed in some way due to new participants, especially as volatility has reduced?

You would expect the volatility to increase?  Why?  It takes a much smarter trader to make money in a market with low volatility.

I suppose the price is ultimately determined by supply and demand. That is supply from miners, genuine sellers and speculators, versus demand from new and veteran consumer buying. The shifts in balance determine the short term price trends. In such a thinly traded market my view is also that currently sentiment is hugely important as speculation probably has a major role in price discovery*.

The problem is the supply/demand relationship is biconditional, A <-> B.  Bitcoin has little intrinsic value.  The value of 1 BTC would be close to nothing if there was no user base, no Bitcoin network.  The network effect cuts both ways--a telephone set's value grows when more people get phones, but it drops when fewer people have them.
Agreed?

That said, overall mining supply and consumer demand should drive the price in the longer term which is evident in charts going back several years. Will it continue? I think so.

If I thought so too, and was reasonably sure of it, holding BTC long-term would be a no-brainer.  It's obviously not (for me).

I am not bothered particularly by short term volatility in the price otherwise I would have sold long ago (and been considerably better off from my bitcoin holdings). The very fact that silicon valley is rapidly integrating bitcoin into everything for what is really a tiny global userbase tells me big business wants bitcoin to succeed.

Big business sees potential profits in Bitcoin.  This doesn't translate into "big business wants Bitcoin to succeed" (for me).

* i am very busy with my day job but i have for a long time wanted to create a script to scrape the this forum and perform some sentiment analysis to generate some statistics to compare with the exchange rate and google trends etc.

Would be neat, any specific ideas on what sort of data you'll be looking for?  I wouldn't know where to start.

Thanks for the replies. I am curious. Are you saying you don't think consumer demand is sufficient to drive bitcoin (price) longterm? Why? For me this is still a no-brainer. If only 1 million people are actively using it then even if the project fails to go mainstream it likely will run further than this. It seems to me that infrastucture is only now beginning to blossom and develop. More on and off ramps are appearing all the time which will facilitate adoption potentially.

I am not sure of there being any real distinction between big business seeing potential profits by adopting bitcoin and big business supporting bitcoin and wanting it to succeed. Bitcoin is cheaper per transaction than a credit card, whilst delivering the actual payment within minutes. Isn't it obvious that a company will implement anything that will significantly reduce transaction costs and increase profits? What is amazing is that major companies such as dell, expedia, newegg etc have implemented bitcoin when the userbase is so incredibly tiny - really a speck on their balance sheets. That makes me think that big business actually wants bitcoin to succeed - i could be wrong.

Yes the construction of a sentiment index is a fun concept. Don't have much time to go into it further now but would probably have to be a scraping spider which analysed the threads on the front page and posts within the forum. I know someone who designed a similar tool for another market and sold it to a hedge fund so several probably exist for this forum already. Another poster speculated that could be the reason for the endless trolling accounts on here.

[NotLambchop]

... I am curious. Are you saying you don't think consumer demand is sufficient to drive bitcoin (price) longterm? Why?

Yes, if we start with the following premises:
  A.  The current exchange rate is the product of consumer demand, and not speculation.  By "consumers" I mean the people using Bitcoin as money, not to speculate on its long-term worth.
  B.  The demand will continue to increase.

I'm saying neither (A) nor (B) are necessarily true, (A) partially due to supply/demand being kinda misused in the case of Bitcoin.
Think about it like this:

1.  A baker bakes cakes.
2.  You like delicious cakes, they're delicious.
3.  There are others who like delicious cakes.
4.  The baker keeps raising his cake price until, when he closes up for the night, he has no leftover cakes, but just barely.*

Classic supply/demand relationship, right?

Here's the good part:  (2) above could be seen as a constant.  The cake is just as delicious (and desirable) regardless of what the baker charges.  If the baker doubles his price, you are not going to want the cake twice as much, right?  

Not so with Bitcoin.
To a speculator, 1 BTC is twice as valuable when its exchange rate doubles.  That's why it's important that most Bitcoin holders are speculators and not typical consumers like cake_eaters.
See my point?

TL;DR:  Bitcoin is not goods.  It has neither intrinsic value nor is it subject to the classic supply/demand interpretations.

...*assuming that selling out every day = max profit, not necessarily true if there are cake addicts, let's say, who'll pay anything for their pastry fix.  But that's a tangent.
edits...

[Torque]

TL;DR:  Bitcoin is not goods.  It has neither intrinsic value nor is it subject to the classic supply/demand interpretations.

I would argue that the average user who is interested in buying bitcoin solely to spend, has absolutely no idea what the exchange rate of a bitcoin should be.  It could be $5, it could be $500, they wouldn't know the difference.  They only know that the price has gone up over time. I.E., they (will?  should?) buy at whatever the current rate is, because they assume that the market has set the price correctly.

But the problem is that their speculator friends will say, "Oh, no, you shouldn't buy now... have you see the decline lately?  Wait for a better price."  This 'waiting for a better price' of course defeats the whole purpose of buying bitcoin for its immediate use as a spending vehicle, or currency.  What constitutes a "better price"?  A 5% drop? 10% drop? 30% drop?  If no one knows what the price should be anyway, then it's really ridiculous notion.

It's like someone shopping for a gold engagement ring, and their best friend going "Oh no, you shouldn't buy a gold ring now... have you seen the decline in gold price lately? Wait for a better price."  And then the shopper is like, "Damn dude, I'm getting married here.  How long should I wait?  I can't wait forever.  In fact, I shouldn't even care what the current price is."