.

[fryarminer]

I buyed @1000+ usd/btc. Now, after a year spent by occ as iona lla looking and taking losses, I buyed one more coin because I think they are cheap.

I will never, NEVER, let my coins go for less than the price I payed. I could be not a rational investor, but I think a lot of people in the btc business are thinking like me.

Of couse for a big investor is different, but seems to me there'really lot of amateurs owning btc...

Total respect dude. You have my total respect.

[fewcoins]

The Winklevii ETF will be a game changer, but I'm guessing the market will go 10-20X higher pre-announcement.

I giggle everytime I hear this line... This ETF is NOT coming out lmfao! Everyone on wall st already knows this man, you guys need to catch up!

[pattu1]

I believe markets are efficient and that the market price of a bitcoin reflects its true value.

[fryarminer]

In the end the seller sets the value of bitcoin. Or anything. All the market tells us is the lowest price that a seller was willing to part with his property for.
So for my part, I will not sell any of my bitcoin for less than $2k. And then only a few if I need the money. But if the market was at $3k, and I needed the money, I would sell a coin because it is greater than the $2k that I value my BTC at (now).
On the reverse side of this, buyers always buy at the lowest price possible.
The phenomena of the market is the willingness of sellers to sell at a low price. If every seller were to sit back and say: "I'm not selling my BTC for less than $2k", that will be the price on the market tomorrow. Because there will always be a demand for BTC, at any price.

So in reality, the OP is actually onto something here.

[erre]

I buyed @1000+ usd/btc. Now, after a year spent by occ as iona lla looking and taking losses, I buyed one more coin because I think they are cheap.

I will never, NEVER, let my coins go for less than the price I payed. I could be not a rational investor, but I think a lot of people in the btc business are thinking like me.

Of couse for a big investor is different, but seems to me there'really lot of amateurs owning btc...

Total respect dude. You have my total respect.

Hodlers  hold, love, and want btc to the moon.
Bears go short, hate, and want btc to fall.
Speculators are emotionally unstable and, usually, lose money.

[MrBig]

I buyed @1000+ usd/btc. Now, after a year spent by occ as iona lla looking and taking losses, I buyed one more coin because I think they are cheap.

I will never, NEVER, let my coins go for less than the price I payed. I could be not a rational investor, but I think a lot of people in the btc business are thinking like me.

Of couse for a big investor is different, but seems to me there'really lot of amateurs owning btc...

Total respect dude. You have my total respect.

Hodlers  hold, love, and want btc to the moon.
Bears go short, hate, and want btc to fall.
Speculators are emotionally unstable and, usually, lose money.

You bought btc at over $1000? That sucks man, I hope you didn't lose a lot.

[sakinaka]

between 500-600$ per BTC
and waiting for $1000+

[inca]

The Winklevii ETF will be a game changer, but I'm guessing the market will go 10-20X higher pre-announcement.

I giggle everytime I hear this line... This ETF is NOT coming out lmfao! Everyone on wall st already knows this man, you guys need to catch up!

Where is your evidence? Oh wait..

[bitkanu]

Hodlers  hold, love, and want btc to the moon but current change i want
between 400-450$ per BTC
and waiting for $750+

[vuduchyld]

I don't particularly like the question because it's sort of irrelevant.

When I say "sort of irrelevant," I don't mean that individual opinion doesn't matter, but this is an auction market in which trading occurs across vastly different mediums.  In this thread we've already seen personal valuations at ~200% current market rate, but this means nothing.  The posters don't even believe in their personal valuations because nobody's partaking in the 50% off sale going on all day every day.  There's money up for grabs at half-off and nobody's buying.

I just don't think it's the best interpretation to visualize the market as requiring some Universal price anchor or pricing mechanism, but rather value will be determined by localized factors as it has been.  For example, certain factors make valuation on Bitstamp different from BTC-e, and certain factors also affect valuation of BTC traded on the chain vs. off the chain.  The price of BTC on BTC-e is always lower because it's simply near impossible to directly fund your account with fiat.  The price on Local Bitcoins is simply misleading because the spreads are ridiculous and the depth isn't there.   The prices asserted in this thread are, at best, hearsay because nobody is trading at these prices.

I also don't love the question, but for a slightly different reason.  Markets are forward-looking, so basing a price on today's value doesn't really tell the story.  

My valuation model for BTC involves looking at it as a percentage of M2 money supply.  I know what I believe it will be worth in or around 2020 (probably less than many forumites think at around $2300-$2500) and I am buying now because, even at that price, a 6x return in less than 6 years is amazing.

But it's worth noting that, as with stock purchases, future earnings are "baked" into the price quite a bit.  I'm not buying now because I believe the intrinsic value (based on M2) is all that high, but rather because I'm buying the equivalent to future earnings.  Based on M2 calculations, I'd suspect the snapshot value TODAY using the model is more likely in the range of $20-50.  

The other thing to remember is that price and value are different.  Over time they converge, but there can be many divergences to the high side and to the low side.  It's quite possible that if adoption is strong and use-cases are strong that the value in 2020 will be $2300, but foward-looking markets will set the price much higher.  Or lower.

I really like your distinction about factoring future developments into the price.  Out of curiosity, could you provide any more explanation as to how you arrived specifically at a $20-50 range?

The model I'm using is based on M2 money supply, which is cash, checking deposits (basically M1) and also savings deposits and money market funds.  It does NOT include things like institutional money markets.  I think M2 suits BTC the best because it accounts for use of BTC as a currency and also as a store of value.

Modeling out to 2020, I'm trying to calculate growth rates of non-mining-related transactions (this is not easy data to find) and I'm estimating what percentage of M2-type transactions will be done in BTC.   Also trying to account for velocity increases, which decrease the required M2 money supply.  I believe that BTC velocity is actually very low right now, but that it will increase.  This view of current velocity is not popular, as most BTCers seem to think it is high, but I feel they are including mining.

So basically, BTC will constitute some percentage of the money supply by virtue of transactions and store of value, and whatever percentage of M2 is constituted by BTC, the capitalized value of BTC should equal that percentage of global M2.

As for right now, it is a wild ass guess based on what I THINK is happening.  It's easier to project the data going forward than it is to root around in data stores right now, so I haven't been all that vigilant about doing it.

Sorry...I don't think I explained that very well.  The short story is that I'm guessing about current value because.  I think I have a better idea about where we are GOING (usage, velocity) than where we are.

[bryant.coleman]

I value mine at a million $ each.

Based on what? Do you have any justification for this much market cap? If a single Bitcoin is currently valued at $1 million, the total market cap will reach somewhere around $16 to $17 trillion, which is many times when compared to the market cap of the US Dollar. I am not saying that it will not reach that much value in the very distant future.... but right now, the BTC is probably worth less than 1/1000th of that.

[the joint]

I value mine at a million $ each.

Based on what? Do you have any justification for this much market cap? If a single Bitcoin is currently valued at $1 million, the total market cap will reach somewhere around $16 to $17 trillion, which is many times when compared to the market cap of the US Dollar. I am not saying that it will not reach that much value in the very distant future.... but right now, the BTC is probably worth less than 1/1000th of that.

I'd like to know what he values everyone else's BTC at...

[fewcoins]

Regardless of what you guys value BTC at the "free market" you love and created is valuing BTC at 377 with a severe downtrend continuing... Since these miners are literally creating bitcoin for near double digits Im sure 99.9% of the price targets in the thread will not be hit for a long long time 

[the joint]

I don't particularly like the question because it's sort of irrelevant.

When I say "sort of irrelevant," I don't mean that individual opinion doesn't matter, but this is an auction market in which trading occurs across vastly different mediums.  In this thread we've already seen personal valuations at ~200% current market rate, but this means nothing.  The posters don't even believe in their personal valuations because nobody's partaking in the 50% off sale going on all day every day.  There's money up for grabs at half-off and nobody's buying.

I just don't think it's the best interpretation to visualize the market as requiring some Universal price anchor or pricing mechanism, but rather value will be determined by localized factors as it has been.  For example, certain factors make valuation on Bitstamp different from BTC-e, and certain factors also affect valuation of BTC traded on the chain vs. off the chain.  The price of BTC on BTC-e is always lower because it's simply near impossible to directly fund your account with fiat.  The price on Local Bitcoins is simply misleading because the spreads are ridiculous and the depth isn't there.   The prices asserted in this thread are, at best, hearsay because nobody is trading at these prices.

I also don't love the question, but for a slightly different reason.  Markets are forward-looking, so basing a price on today's value doesn't really tell the story.  

My valuation model for BTC involves looking at it as a percentage of M2 money supply.  I know what I believe it will be worth in or around 2020 (probably less than many forumites think at around $2300-$2500) and I am buying now because, even at that price, a 6x return in less than 6 years is amazing.

But it's worth noting that, as with stock purchases, future earnings are "baked" into the price quite a bit.  I'm not buying now because I believe the intrinsic value (based on M2) is all that high, but rather because I'm buying the equivalent to future earnings.  Based on M2 calculations, I'd suspect the snapshot value TODAY using the model is more likely in the range of $20-50.  

The other thing to remember is that price and value are different.  Over time they converge, but there can be many divergences to the high side and to the low side.  It's quite possible that if adoption is strong and use-cases are strong that the value in 2020 will be $2300, but foward-looking markets will set the price much higher.  Or lower.

I really like your distinction about factoring future developments into the price.  Out of curiosity, could you provide any more explanation as to how you arrived specifically at a $20-50 range?

The model I'm using is based on M2 money supply, which is cash, checking deposits (basically M1) and also savings deposits and money market funds.  It does NOT include things like institutional money markets.  I think M2 suits BTC the best because it accounts for use of BTC as a currency and also as a store of value.

Modeling out to 2020, I'm trying to calculate growth rates of non-mining-related transactions (this is not easy data to find) and I'm estimating what percentage of M2-type transactions will be done in BTC.   Also trying to account for velocity increases, which decrease the required M2 money supply.  I believe that BTC velocity is actually very low right now, but that it will increase.  This view of current velocity is not popular, as most BTCers seem to think it is high, but I feel they are including mining.

So basically, BTC will constitute some percentage of the money supply by virtue of transactions and store of value, and whatever percentage of M2 is constituted by BTC, the capitalized value of BTC should equal that percentage of global M2.

As for right now, it is a wild ass guess based on what I THINK is happening. It's easier to project the data going forward than it is to root around in data stores right now, so I haven't been all that vigilant about doing it.

Sorry...I don't think I explained that very well.  The short story is that I'm guessing about current value because.  I think I have a better idea about where we are GOING (usage, velocity) than where we are.

I think your method of analysis is interesting, and I was particularly pleased to read the bolded selection because I think I would reach a similar, vague conclusion with that method  

What's interesting, and I think clever, is setting M2 analogous to BTC.  I wouldn't have thought of that particularly because I'm fairly clueless as to which types of BTC transactions are the most frequent.  How confident are you in your data?  You're analyzing and estimating several variables here, and allowing a moderate margin for error on each variable might result in either a decent average among all variables and a sensible conclusion, or you could be way, way off.

A few other questions:

1) Did you sample off-chain transactions somehow, or take them into account?

2) How confident are you in likening BTC to M2?

3) Do you actually have a calculated margin of error for any variable as well as the conclusion?

4) At the very end, you stated an assumption that seems to have influenced your conclusion independent of your data.  You mention that you're "guessing about the current value because...[you] have a better idea about where we are going."  When I read this, this says to me that you're imagining some arbitrary ceiling based upon the idea that velocity will increase.  This means that, to reach a specific conclusion, you would need to have some idea of what max velocity could be and where we are relative to that max.  But, since that is all independent of what the price is right now, why couldn't your price be $2000-5000 rather than $20-50?  Does your data *really* narrow it down that much?

5) Any particularly interesting statistics you came across?

Edit:  I have more questions if you don't get sick of these.

[leex1528]

I don't see Bitcoin lasting much longer...I give it another year before value falls below $100 and then after that I think it will drop to less than $10 dollars a coin:(

I am soooooo hoping I am wrong but its just my guess

[ssmc2]

I don't see Bitcoin lasting much longer...I give it another year before value falls below $100 and then after that I think it will drop to less than $10 dollars a coin:(

I am soooooo hoping I am wrong but its just my guess

Doom & gloom

[DeadCoin]

I don't see Bitcoin lasting much longer...I give it another year before value falls below $100 and then after that I think it will drop to less than $10 dollars a coin:(

I am soooooo hoping I am wrong but its just my guess

My thoughts exactly. Couldn't agree more.

[ssmc2]

I don't see Bitcoin lasting much longer...I give it another year before value falls below $100 and then after that I think it will drop to less than $10 dollars a coin:(

I am soooooo hoping I am wrong but its just my guess

My thoughts exactly. Couldn't agree more.

If you could agree more you'd still be wrong lol

[leex1528]

If you could agree more you'd still be wrong lol

Oh wise man who knows the future, will you please tell me the lottery numbers and all that stuff so I can get rich quickly.

[FUR11]

I guess we're at $1400 right now, applying a long-term exponential forecast, based on past performance. I know, there are several attempts to gauge the price using similar techniques, but there's simply no way of knowing which one (if any!!!) of those techniques is right...