Bitcoin or gold? - page 547. | Bitcointalksearch.org

deisik

legendary

Activity: 3514

Merit: 1280

English ⬄ Russian Translation Services

Quote from: RealBitcoin on June 19, 2015, 04:35:39 PM

Gold is not a currency, not anymore. It was, for a long time, but sadly everything comes to an end, it's inconciavable in the 21 centuty to use technology from the 5 millenia BC. It wont happen dude.

Then why are central banks, nevertheless, hoarding it, and the US (claimed to be most technologically developed) has gold reserves that substantially exceed those of other countries following its lead, which also happen to be highly developed (such as France, Italy, Germany)?

RealBitcoin

hero member

Activity: 854

Merit: 1009

JAYCE DESIGNS - http://bit.ly/1tmgIwK

Quote from: deisik on June 19, 2015, 04:09:21 PM

Quote from: RealBitcoin on June 19, 2015, 03:53:46 PM

Quote from: deisik on June 19, 2015, 03:44:36 PM

The data itself may indeed be utterly misleading in the assessment of future risk (actually, any past data, for that matter), but its very existence is a factor that should be counted in. Gold being highly valued as long as humanity knows it has a lot of credibility in respect to its past performance (as a basis for forecasting its future performance). Bitcoin, on the other hand, having been "there" for just 2-3 years (I mean since it got out of total obscurity), doesn't have such basis, thereby any assessment of its future performance (based on past data) is fundamentally erroneous and bordering on sheer guesswork...

Yes but also gold is not a currency (no matter how many gold bugs come bashing at me)

Gold is a currency. And it is not just one such "also-ran" among many others, it is the best currency out there. You may of course turn a deaf ear to what I say, but would you call a gold bug none other than Alan Greenspan himself who confessed that...

Quote from: RealBitcoin on June 19, 2015, 03:53:46 PM

If you were to buy/sell stuff at a shop with gold coins, you constantly need to carry with you an ultrasound detector , an MRI scanner and a scale to measure that the gold coins you get is .9999 purity.

With bitcoin you only need a smart phone and a link to blockchain.info , blockexplorer.com, blockr.io and if you are really paranoid then a few more links just to verify the transaction's authenticity.

With bitcoin you need all the technologies that humankind has been developing since it already started using gold (as money). Gold also needs some technologies, but those of two thousand years old would suffice in the majority of cases

Ok but i`m not planning for nuclear winter. I plan that the internet and electricity will be here for long time, i certainly dont want to go back to stone age.

Thus if those are here, bitcoin wont need any other tool than just your phone and internet. Everything else is already dealth with.

Besides we already have the blueprints, we can restart civilization anytime until the knowledge is here. I dont want stone age or middle age, so i`m sure the new tech will outperform the older.

Gold is not a currency, not anymore. It was, for a long time, but sadly everything comes to an end, it's inconciavable in the 21 centuty to use technology from the 5 millenia BC. It wont happen dude.

deisik

legendary

Activity: 3514

Merit: 1280

English ⬄ Russian Translation Services

Quote from: RealBitcoin on June 19, 2015, 03:53:46 PM

Quote from: deisik on June 19, 2015, 03:44:36 PM

The data itself may indeed be utterly misleading in the assessment of future risk (actually, any past data, for that matter), but its very existence is a factor that should be counted in. Gold being highly valued as long as humanity knows it has a lot of credibility in respect to its past performance (as a basis for forecasting its future performance). Bitcoin, on the other hand, having been "there" for just 2-3 years (I mean since it got out of total obscurity), doesn't have such basis, thereby any assessment of its future performance (based on past data) is fundamentally erroneous and bordering on sheer guesswork...

Yes but also gold is not a currency (no matter how many gold bugs come bashing at me)

Gold is a currency. And it is not just one such "also-ran" among many others, it is the best currency out there. You may of course turn a deaf ear to what I say, but would you call a gold bug none other than Alan Greenspan himself who confessed that...

Quote from: RealBitcoin on June 19, 2015, 03:53:46 PM

If you were to buy/sell stuff at a shop with gold coins, you constantly need to carry with you an ultrasound detector , an MRI scanner and a scale to measure that the gold coins you get is .9999 purity.

With bitcoin you only need a smart phone and a link to blockchain.info , blockexplorer.com, blockr.io and if you are really paranoid then a few more links just to verify the transaction's authenticity.

With bitcoin you need all the technologies that humankind has been developing since it already started using gold (as money). Gold also needs some technologies, but those of two thousand years old would suffice in the majority of cases

RealBitcoin

hero member

Activity: 854

Merit: 1009

JAYCE DESIGNS - http://bit.ly/1tmgIwK

Quote from: deisik on June 19, 2015, 03:44:36 PM

The data itself may indeed be utterly misleading in the assessment of future risk (actually, any past data, for that matter), but its very existence is a factor that should be counted in. Gold being highly valued as long as humanity knows it has a lot of credibility in respect to its past performance (as a basis for forecasting its future performance). Bitcoin, on the other hand, having been "there" for just 2-3 years (I mean since it got out of total obscurity), doesn't have such basis, thereby any assessment of its future performance (based on past data) is fundamentally erroneous and bordering on sheer guesswork...

Yes but also gold is not a currency (no matter how many gold bugs come bashing at me)

If you were to buy/sell stuff at a shop with gold coins, you constantly need to carry with you an ultrasound detector , an MRI scanner and a scale to measure that the gold coins you get is .9999 purity.

With bitcoin you only need a smart phone and a link to blockchain.info , blockexplorer.com, blockr.io and if you are really paranoid then a few more links just to verify the transaction's authenticity.

Not to mention 30.000.000$ worth of gold is 1 ton, you cant carry that on your back, but 30m$ worth of bitcoin fits in your pockets.

And many more.

-----------

Conclusion: Gold is more trustable now, but when people realize bitcoin's potential, nobody will want gold anymore. Atleast the demand for it will diminish significantly. A few jewelry here and there, but not bullion vaults full of gold.

deisik

legendary

Activity: 3514

Merit: 1280

English ⬄ Russian Translation Services

Quote from: johnyj on June 19, 2015, 11:25:54 AM

Quote from: deisik on June 19, 2015, 03:55:02 AM

My point is that you can't satisfactorily gauge the Bitcoin risk at all (let alone set it to some specific value), since risk is a measure of deviation between annual returns of a financial instrument or investment, but you just don't have enough input to reach a conclusion that wouldn't be a wild guess. So how are going to accurately measure the risk of Bitcoin if it is only 6 years old and the majority of these years it languished in oblivion with its price next to nothing (yeah, I know it is painful to see)?

Risk is just measured by historical data. In future, any investment could be ruined to nothing. If you bought Russian government bond before 1998 and suddenly they defaulted, and many MBS/CDS etc... busted in financial crisis, they all looked good before the total collapse

Typically you don't want any data longer than 5 years to analysis, since market condition changes all the time, those old data are most irrelevant and misleading

The data itself may indeed be utterly misleading in the assessment of future risk (actually, any past data, for that matter), but its very existence is a factor that should be counted in. Gold being highly valued as long as humanity knows it has a lot of credibility in respect to its past performance (as a basis for forecasting its future performance). Bitcoin, on the other hand, having been "there" for just 2-3 years (I mean since it got out of total obscurity), doesn't have such basis, thereby any assessment of its future performance (based on past data) is fundamentally erroneous and bordering on sheer guesswork...

RealBitcoin

hero member

Activity: 854

Merit: 1009

JAYCE DESIGNS - http://bit.ly/1tmgIwK

Quote from: deisik on June 19, 2015, 03:10:17 PM

Quote from: RealBitcoin on June 19, 2015, 02:43:35 PM

Quote from: deisik on June 19, 2015, 01:29:28 PM

Quote from: RealBitcoin on June 19, 2015, 01:07:19 PM

Quote from: deisik on June 19, 2015, 11:47:44 AM

Even if you don't get a clearly cut normal distribution, it is still disparate to what bitcoin may reveal. What is risk actually? For the sake of simplicity, it is the difference between an investment's actual return and what you expect from this investment. If you take standard deviation as such yardstick, you make get that the deviation may come close in value to the average itself, due to fat tails. What does it mean? Mathematically, it means that the risk is at maximum possible for that instrument. In reality terms, it means that your losses may equal your investment, that is, it is likely that you will lose all...

So, how fat is gold really?

Well if you measure on monthly ,daily charts then your sample is too big. Because your data only watches the most risky part of the life of bitcoin, its beginning.

I`m not measuring past risk, i`m forecasting future risk.

This statement is self-contradictory. How are you going to forecast future risk, if you don't know the past performance of an instrument? The underlying assumption is that the future performance of an instrument will reflect (to a degree) its past performance...

Otherwise, how do you calculate future risk?

Ok perhaps you are right, let me use other words then.

I am measuring the trend of volatility, and it shows a decreasing trend, even in a day-day basis. Thus we can imply that the future of volatility will decrease. Now i got many explanations to this, but the biggest one is age & confidence, the older the bitcoin the more confidence it has.

I wouldn't be so sure about the future volatility of Bitcoin, or, rather, its effect on Bitcoin price. If you look at the chart I provided, you can clearly see a few downtrend waves, with lows at ~600, ~500, ~400, ~300 and ~200 dollars per Bitcoin. So the next "stop" should evidently be at 100$, and the time seems to be running out...

Alas, day-to-day volatility may actually decrease, but it wouldn't be able to prevent major price movements (so beware)

Well i`m not a day trader, i put my faith in bitcoin for the long term. I`ve also made calculations in bitcoin inflation and valuation, and i determined that the value of Bitcoin is higher than it's price, significantly, and also that the future value of bitcoin will also be higher with a high confidence.

So if not this year, but next year we can see a great increase in bitcoin's price (after the halving).

But i`m not so sure on gold, and the gold % of return is also much lower.

Now if a new economic crisis happens because of the Grexit thats another story, but if everything stays the same then this is the most probable outcome.

deisik

legendary

Activity: 3514

Merit: 1280

English ⬄ Russian Translation Services

Quote from: RealBitcoin on June 19, 2015, 02:43:35 PM

I am measuring the trend of volatility, and it shows a decreasing trend, even in a day-day basis. Thus we can imply that the future of volatility will decrease. Now i got many explanations to this, but the biggest one is age & confidence, the older the bitcoin the more confidence it has.

I wouldn't be so sure about the future volatility of Bitcoin, or, rather, its positive effect on Bitcoin price. If you look at the chart I provided, you can clearly see a few downtrend waves, with lows at ~600, ~500, ~400, ~300 and ~200 dollars per Bitcoin. So the next "stop" should evidently be at around 100$, and the time seems to be running out...

Alas, day-to-day volatility may actually decrease (e.g. due to arbitrage and more vigorous trading), but it wouldn't be able to prevent major price movements (so beware)

RealBitcoin

hero member

Activity: 854

Merit: 1009

JAYCE DESIGNS - http://bit.ly/1tmgIwK

Quote from: deisik on June 19, 2015, 01:29:28 PM

Quote from: RealBitcoin on June 19, 2015, 01:07:19 PM

Quote from: deisik on June 19, 2015, 11:47:44 AM

Even if you don't get a clearly cut normal distribution, it is still disparate to what bitcoin may reveal. What is risk actually? For the sake of simplicity, it is the difference between an investment's actual return and what you expect from this investment. If you take standard deviation as such yardstick, you make get that the deviation may come close in value to the average itself, due to fat tails. What does it mean? Mathematically, it means that the risk is at maximum possible for that instrument. In reality terms, it means that your losses may equal your investment, that is, it is likely that you will lose all...

So, how fat is gold really?

Well if you measure on monthly ,daily charts then your sample is too big. Because your data only watches the most risky part of the life of bitcoin, its beginning.

I`m not measuring past risk, i`m forecasting future risk.

This statement is self-contradictory. How are you going to forecast future risk, if you don't know the past performance of an instrument? The underlying assumption is that the future performance of an instrument will reflect (to a degree) its past performance...

Otherwise, how do you calculate future risk?

Ok perhaps you are right, let me use other words then.

I am measuring the trend of volatility, and it shows a decreasing trend, even in a day-day basis. Thus we can imply that the future of volatility will decrease. Now i got many explanations to this, but the biggest one is age & confidence, the older the bitcoin the more confidence it has.

The same can be said about gold, but gold is starting to become inconvenent, moreso bitcoin is an uppgrade to gold, it just needs more confidence to replace it

deisik

legendary

Activity: 3514

Merit: 1280

English ⬄ Russian Translation Services

Quote from: RealBitcoin on June 19, 2015, 01:07:19 PM

Quote from: deisik on June 19, 2015, 11:47:44 AM

Even if you don't get a clearly cut normal distribution, it is still disparate to what bitcoin may reveal. What is risk actually? For the sake of simplicity, it is the difference between an investment's actual return and what you expect from this investment. If you take standard deviation as such yardstick, you make get that the deviation may come close in value to the average itself, due to fat tails. What does it mean? Mathematically, it means that the risk is at maximum possible for that instrument. In reality terms, it means that your losses may equal your investment, that is, it is likely that you will lose all...

So, how fat is gold really?

Well if you measure on monthly ,daily charts then your sample is too big. Because your data only watches the most risky part of the life of bitcoin, its beginning.

I`m not measuring past risk, i`m forecasting future risk.

This statement is self-contradictory. How are you going to forecast future risk, if you don't know the past performance of an instrument? The underlying assumption is that the future performance of an instrument will reflect (to a degree) its past performance...

Otherwise, how do you calculate future risk?

Amph

legendary

Activity: 3248

Merit: 1070

Quote from: johnyj on June 19, 2015, 11:40:49 AM

Quote from: bryant.coleman on June 19, 2015, 10:24:05 AM

Quote from: HigsonPP on June 19, 2015, 06:53:48 AM

1 BTC: 250$ right now. 20 years later? Much more.
Gold price might fluctuate but it might never reach the level btc will in a matter of 8/10 years.

We can't be certain. But there is a 100% chance that gold will be having some value in 2035 (i.e. after 20 years from now). The same can't be said about Bitcoin, with 100% surety. There is a chance that Bitcoin can become worthless by then. There are a lot of scenarios in which Bitcoin can become worthless, such as the discovery of a better alternative.

But since bitcoin's essential is just a consensus, it is very robust. It is a consensus that some people around the world, being aware of the fatal flaw in current monetary system, voluntarily using a currency with limited supply and widest acceptance. Code can change, infrastructure can be rebuilt, but that consensus stays

this is the primarily reason why bitcoin will not die ever, because there will be wlawys support from non-fiat people, in the worst case it could still be carried forward, from its niche market, that never will die

on the other hand i don't believe that it follow the stagnation of the gold market

RealBitcoin

hero member

Activity: 854

Merit: 1009

JAYCE DESIGNS - http://bit.ly/1tmgIwK

Quote from: deisik on June 19, 2015, 11:47:44 AM

Even if you don't get a clearly cut normal distribution, it is still disparate to what bitcoin may reveal. What is risk actually? For the sake of simplicity, it is the difference between an investment's actual return and what you expect from this investment. If you take standard deviation as such yardstick, you make get that the deviation may come close in value to the average itself, due to fat tails. What does it mean? Mathematically, it means that the risk is at maximum possible for that instrument. In reality terms, it means that your losses may equal your investment, that is, it is likely that you will lose all...

So, how fat is gold really?

Well if you measure on monthly ,daily charts then your sample is too big. Because your data only watches the most risky part of the life of bitcoin, its beginning.

I`m not measuring past risk, i`m forecasting future risk.

Quote from: deisik on June 19, 2015, 11:47:44 AM

You will be measuring noise, not data (if you take minute resolution)

Depends for what you are using it, if you are a daytrader or a merchant (which turns it back into fiat very fast) , then it is very useful.

How much can the price deviate in 10 minutes? If you are a merchant who has to wait 10 min for it to turn it back into fiat.

Then i also know from my research that the volatility is decreasing. So perhaps not now but later on the risk/reward will be much better

deisik

legendary

Activity: 3514

Merit: 1280

English ⬄ Russian Translation Services

Quote from: ?? on ??

Measure it in minutes, of course you wont see the bell curve if you watch the monthly or daily chart.

Tell me 1 instrument that has a clear bell shape distribution after 4 years of existence. Not even gold had that since they begin using it in the iron age.

Even if you don't get a clearly cut normal distribution, it is still disparate to what bitcoin may reveal. What is risk actually? For the sake of simplicity, it is the difference between an investment's actual return and what you expect from this investment. If you take standard deviation as such yardstick, you make get that the deviation may come close in value to the average itself, due to fat tails. What does it mean? Mathematically, it means that the risk is at maximum possible for that instrument. In reality terms, it means that your losses may equal your investment, that is, it is likely that you will lose all...

So, how fat is gold really?

Quote from: ?? on ??

Bottom line: check it on minute charts (plenty of data available on major exchanges).
+ Check the minute/minute deviation, then aggregate that, and you will see anyhow that risk is decreasing

You will be measuring noise, not data (if you take minute resolution)

johnyj

legendary

Activity: 1988

Merit: 1012

Beyond Imagination

Quote from: bryant.coleman on June 19, 2015, 10:24:05 AM

Quote from: HigsonPP on June 19, 2015, 06:53:48 AM

1 BTC: 250$ right now. 20 years later? Much more.
Gold price might fluctuate but it might never reach the level btc will in a matter of 8/10 years.

We can't be certain. But there is a 100% chance that gold will be having some value in 2035 (i.e. after 20 years from now). The same can't be said about Bitcoin, with 100% surety. There is a chance that Bitcoin can become worthless by then. There are a lot of scenarios in which Bitcoin can become worthless, such as the discovery of a better alternative.

Even for fiat money it is not a sure thing after 20 years. A war, government shift, collapse of the monetary system could all happen

But since bitcoin's essential is just a consensus, it is very robust. It is a consensus that some people around the world, being aware of the fatal flaw in current monetary system, voluntarily using a currency with limited supply and widest acceptance. Code can change, infrastructure can be rebuilt, but that consensus stays

BTCevo

legendary

Activity: 1834

Merit: 1008

Quote from: bryant.coleman on June 19, 2015, 10:24:05 AM

Quote from: HigsonPP on June 19, 2015, 06:53:48 AM

1 BTC: 250$ right now. 20 years later? Much more.
Gold price might fluctuate but it might never reach the level btc will in a matter of 8/10 years.

We can't be certain. But there is a 100% chance that gold will be having some value in 2035 (i.e. after 20 years from now). The same can't be said about Bitcoin, with 100% surety. There is a chance that Bitcoin can become worthless by then. There are a lot of scenarios in which Bitcoin can become worthless, such as the discovery of a better alternative.

Of course that people will still invest in gold no matter what because gold is still good on market and I think there are many people that investing in gold rather than bitcoin 20 years later. I dont think gold will be gone in this entire world for a hundred years later Grin

johnyj

legendary

Activity: 1988

Merit: 1012

Beyond Imagination

Quote from: deisik on June 19, 2015, 03:55:02 AM

My point is that you can't satisfactorily gauge the Bitcoin risk at all (let alone set it to some specific value), since risk is a measure of deviation between annual returns of a financial instrument or investment, but you just don't have enough input to reach a conclusion that wouldn't be a wild guess. So how are going to accurately measure the risk of Bitcoin if it is only 6 years old and the majority of these years it languished in oblivion with its price next to nothing (yeah, I know it is painful to see)?

Risk is just measured by historical data. In future, any investment could be ruined to nothing. If you bought Russian government bond before 1998 and suddenly they defaulted, and many MBS/CDS etc... busted in financial crisis, they all looked good before the total collapse

Typically you don't want any data longer than 5 years to analysis, since market condition changes all the time, those old data are most irrelevant and misleading

RealBitcoin

hero member

Activity: 854

Merit: 1009

JAYCE DESIGNS - http://bit.ly/1tmgIwK

Quote from: bryant.coleman on June 19, 2015, 10:24:05 AM

Quote from: HigsonPP on June 19, 2015, 06:53:48 AM

1 BTC: 250$ right now. 20 years later? Much more.
Gold price might fluctuate but it might never reach the level btc will in a matter of 8/10 years.

We can't be certain. But there is a 100% chance that gold will be having some value in 2035 (i.e. after 20 years from now). The same can't be said about Bitcoin, with 100% surety. There is a chance that Bitcoin can become worthless by then. There are a lot of scenarios in which Bitcoin can become worthless, such as the discovery of a better alternative.

Yes but that wont happen overnight, there is no flash crash like with fiat, that stock market crashes 20% in 1 day.

Bitcoin users will adapt, and they will need time to sell their coins. I`m certainly not planning to sell them. In worst case scenario i would buy stuff with it and then resell that in an altcoin because direct transfer could be much more volatile.

bryant.coleman

legendary

Activity: 3766

Merit: 1217

Quote from: HigsonPP on June 19, 2015, 06:53:48 AM

1 BTC: 250$ right now. 20 years later? Much more.
Gold price might fluctuate but it might never reach the level btc will in a matter of 8/10 years.

We can't be certain. But there is a 100% chance that gold will be having some value in 2035 (i.e. after 20 years from now). The same can't be said about Bitcoin, with 100% surety. There is a chance that Bitcoin can become worthless by then. There are a lot of scenarios in which Bitcoin can become worthless, such as the discovery of a better alternative.

BTCevo

legendary

Activity: 1834

Merit: 1008

Quote from: HigsonPP on June 19, 2015, 06:53:48 AM

1 BTC: 250$ right now. 20 years later? Much more.
Gold price might fluctuate but it might never reach the level btc will in a matter of 8/10 years.

Yes bitcoin will go higher may around $300 or $400 or may be higher but it is just for a moment because its volatility, but with gold price is as stable as USD and in every year its price is increasing I dont think bitcoin can be stable as gold and USD. And yes to gold price never reach bitcoin level but its safer than bitcoin if I can say so I will choose gold than bitcoin

dHe_zHiq

member

Activity: 112

Merit: 10

I'm Just Try

Quote from: HigsonPP on June 19, 2015, 06:53:48 AM

1 BTC: 250$ right now. 20 years later? Much more.
Gold price might fluctuate but it might never reach the level btc will in a matter of 8/10 years.

20 years to come, bitcoin could have a lower price or even higher, both have the same risk,
only if gold is likely to be not worth so is small

HigsonPP

full member

Activity: 196

Merit: 100

1 BTC: 250$ right now. 20 years later? Much more.
Gold price might fluctuate but it might never reach the level btc will in a matter of 8/10 years.

Topic: Bitcoin or gold? - page 547. (Read 984460 times)