Topic: Bitcoins vast overvaluation (Read 4932 times)

"I know there are a million considerations and tons of holes in the above statements, don't be a dick and say it can never work. It is just a concept."

If you can't take any criticism of it why even mention it then ?

Proposal sounds a bit like communism where everyone is equal. Sounds great until you discover that some are more equal than others.

Quit crying, jezz.

I'm not trolling you. I'm just pointing out how obnoxious you are being. You're right, you didn't say bitcoin would die. You said bitstamp and coinbase would die. And again, you fail to recognize that the reason there is a month long verification process with coinbase is because they are being extra extra careful so that when the government does regulate that they will be in very good standing.

But until the government regulates bitcoin, bitcoin isn't going to become mainstream, it's too risky.

And all this takes time. So just quit whining about how it doesn't work so great right now. Trade your coins and be happy.

Such a fucking troll.. beat it fagot.

"I know there are a million considerations and tons of holes in the above statements, don't be a dick and say it can never work. It is just a concept."

Can you read? I never said that bitcoin wasn't gonna work. I said something else could work better.

Dont you have something better to do than be a little cock sucker. Hit the fucking ignore button troll! I am

It's kinda hilarious that you have a half baked idea and to deflect criticism you tell us that if we point out the " holes" we are being "dicks". Then you go on to say "that doesn't mean it can't work" after saying bitcoin, with its groundbreaking track record, isn't going to work.. How ridiculous is this?

Wasn't Falkvinge the same jerk that silently bought $200k USD worth of BTC via person-to-person sale with magical tux as a middle man in April 2011, pumped Bitcoin on his blog in May 2011, and then subsequently dumped it en masse to those he pumped it to in June 2011? Why would anyone respect his opinion anymore aside from the fact that the original post where he tried to buy the Bitcoin is likely buried/hidden/deleted on here?

I'm sorry, but this is absolutely not reality. Yes, speculation is driving most of the price, but millions are being invested into getting more of the public and more of the business world online and off, utilizing bitcoin. Again, you are just screaming at an infant about why it can't cook you dinner.

There is personality too. Even if you distribute the world evenly to every person, after a while some of them will lose everything and some others will become super rich. No one can prevent this from happening

"I know there are a million considerations and tons of holes in the above statements, dont be a dick and say it can never work. It is just a concept."

It will not work, since you never can tell if those one hundred new addresses are belong to the same old person, if you can, then there will be no privacy at all, no one will use it

No that is how it should be not how it is. The truth is that there is a base market for bitcoin which it the drug market that has to have coins to operate. So there is some real demand there but the bigger market is speculators who know that if they share their coins and put more of them in the market place then the value of their holdings will drop. So there is an powerful incentive for them to create artificial scarcity pushing the prices higher. They know they have to trickle coin on to the market or the price will crash. 

Bitcoin is like this.

I like your response here it is at least thoughtful, People dont hoard dollars, because they are not money but currency. Bitcoin is worthless as money it is excellent as currency. Gold is money Oil could be money, BItcoin not so much.

If only controlling market forces were that easy.
If you have something is thought to appreciate it will be hoarded, it is the most logical thing to do. If you increase the value of that item each time it is traded to avoid hoarding then you will have to inject more money into the system. But who's money? I like Satoshi's system. It works on the simplest market model of supply and demand. Free markets are brutal, volatile, and fair. Trying to social engineer kindness into the system seems unachievable without centralization. That always ends in gaming the system. For example, fiat currency.

What difference does it make if MtGox is the 3rd biggest exchange or the 1st? I mean, its only been the center of complaints for months now.

I feel much safer dealing with Bitstamp or Coinbase anyway.

If it wasn't for all the early miners and investors using MtGox for so long, the topic wouldn't even be a point of conversation on this forum. Unfortunately, it sorta dominates this part of the forum.

Saving is not hoarding.
Savings is delaying gratification today so you can afford something else tomorrow.
Kind of like the kid who puts coins in his piggy bank so he can afford a yoyo instead of buying jaw breakers.
People in the fed though, want to reward the kids who get jaw breakers or get in debt to get a yoyo.

It's not dead until a) the spread reaches 50% or b) price movements stop generating volume.

This is the same Falkvinge that said he was putting all his savings into Bitcoin, when he first heard about it in 2011, and recommended that others do that as well. Then after the gox 2011 crash, later in the year he admitted that he sold off all his btc.

Around the same time he wrote a series of articles about how Bitcoin would revolutionize the international trade payments...

After all that, it's safe to say that he is just another blow-hard politician, who doesn't really know what will happen, and what bitcoins' real value is any better than we do.

So then, the current valuation is the real one.

MtGox is dead, face it. The ones stuck there will have to find a way out, and we all know there is only one way to do that right now.

BTC-e will have more coin than Gox at this rate. Shit doesn't look good for Gox or the price.

exchange   volume %   volume ฿   last price
bitstamp   42.10%   7001.11   123.69 USD
mtgox   24.66%   4101.21   133.77 USD
btce   21.32%   3546.04   121.63 USD

I see 4,000 24hr volume on Gox... Didn't we peak over 500,000 daily volume in April?

lol.

^^^

You are an idiot fuck off. See the yellow ignore button please hit it.

There are already coins that do a lot of these things.  Which makes me feel you really haven't studied deep into what you are even ranting about.

It seems like your issues with Bitcoin are more personal.

+100

Not in my mind. I know the answer to that question, from dealing with the trolls on bitcoin otc they want you to suck then off just because they have had a few BTC go through their wallets. 

Yeah, there's a chance I'd prefer the world of carebear coin than the bitcoin one. What would sway me one way or the other would be whether hoarding leads to more aggressive egotistical oppression where the hoarder bosses everyone else about or if hoarding helps people lead acceptable lives, the jury's out on that matter.

I love it    I got 5 CBC's to sell with a block reward of .05 CBC's

Let's call it CarebearCoin

I have an idea for a coin that would make bitcoin a thing of the past. One that incentives sharing instead of hoarding. Let someone come out with a coin that pays out a reward the more it is distributed to new market participants and shrinks in value the more centralized it gets. Get a coin that rewards sharing and punishes hoarding. People will forget all about BTC and it would spread like wild fire. 

Now I have no idea how you do that, but you nerds can figure something out  

Maybe instead of mining new coins into existence you share new coins into existence? 

Maybe call it seed money. You have a digital plant that has a dollar(or what ever) value associated with it. As you sell cut-lings or seeds from your plant to other new members your plant grows and so does the the value associated with it. If people start hoarding the seeds or what ever then the plant starts to shrink and along with it the value?.

I know there are a million considerations and tons of holes in the above statements, dont be a dick and say it can never work. It is just a concept.

A coin that has its value tied to the number of new market participants and a reward system for sharing it with new people? just an idea.   
 

Keep waiting.

Dont really expect that. Money is an illusion, just that they will realize that bitcoin is worthless as anything other than a currency. It is not a store of value and is not a retirement plan it is not a finite market either. We have all seen how easy it is to create coins. Let a better coin come out and watch you investment tank.   

No one in their right mind is going to wake up one day and realize that the non-material wealth of a brain wallet must become something physical- such a fetish might belong to a Kardashian, or to a taxman, though.

When there is a sentiment about bitcoin to be overvaluated usually means a rally is coming up.

You used to be fun. Too bad for you.

I'll take a stab at it: Addition (+)

The website seems a tad sparce... I like my political parties to have people I can vote for.

It is not difficult to get bitcoin at all, but I don't believe that any new users would like to throw $1000 directly into it without first understand how a wallet works and make sure their coins are secure (That is very tough even for an IT expert)

The users are lacking of motivation, so far there is no real good reason to purchase bitcoin other than long term saving. But that is also the ultimate area that bitcoin excels (no any other existing financial instruments can compete, not even Apple's stock or gold)

There is a worry that the coins' value might drop to zero, people need someone to back it, but that is very easy to achieve for any middle sized investment fond

This.
What the author illustrated is just a bunch of bots doing automated trading.
Then he went on about the velocity of money which just shows he has a keneysian bias.

Why are you complaining so much?  It's like you don't even realize that the evolution of a thing like Bitcoin is going to take years, like double digit years. Which is probably the smartest thing that was said in the original article.  Bitcoin is still a freaking baby. It is just learning to crawl and stand up.

What did the internet look like in 1996? Yes, and how many people like you were standing around pointing out all the things it couldn't do and how it was going to die? Lots, in case you don't remember. Lots.

Your joking right? unless you live in San Fran. or NYC. There is no real local markets at this point and that is the most expensive way to buy coins.

there's also localbitcoins, in the case where your local market has evolved enough to have a steady flow of customers doing business with you

Never said anything about anonymous or without fees. Without excessive fees yes, but people have to get paid and without the month that mt gox required to verify.

The best option is coinbase at the moment but wont last. 

If ltc crashes with Atlantis coming down, does this support Falkvinge's btc valuation?

Ah, without fees or identity. No, I have no free way to get bitcoins anonymously. I have no problem verifying my identity and paying for a service. When I did cash in the mail it was the only way. There were no exchanges.  As far as the wallet, I have lots. But I don't remember ever having that much in my public one.
If you exclude bank wires, direct deposits (like the Europeans do), fees, AML/KYC verification then it must be hard for you.

Ya that is fine and good, but they will be shut down too. Bitstamp and coin base are pretty good.

It is not P2P. They are just new banks they will either be regulated to death or shut down.  

Centralized institutions.

Coinbase.  Verification takes about a week (Which is the same as paypal or any other service that links to your bank account.  It is a bit longer before you can buy insane amounts, but the default limits give you a lot of room).  Fees are reasonable.

Ya people are not going to send cash via mail. If you know where to buy in 10 min without a month long verification process, excessive fees, or sending bank wire or cash deposited to a stranger's account. Please enlighten us.

That is just your public wallet. I know you have coins because you are a lifetime member to the foundation. I think when I looked it was thousands of dollars that could only be paid in coins  

Bitcoin has to be better than what people already use.


"The revolution will be monetized!"  or this will never happen

Those numbers have nothing to do with my wallet. lol  And to be correct my first BTC took much longer as it was via mail. But normally it takes me about 10mins.

Really the first time you bought was less than 2 hrs.? This statement makes you look like a jack-ass everyone knows how hard it is to get coins.  

BTW 2 hours is a long time.

Your wallet--


Transactions
No. Transactions   0   
Total Received   0 BTC   
Final Balance   0 BTC


My wallet --

Total Transactions   573   

Total Received   449.57005673 BTC   

Total Sent   449.5694786 BTC
Final Balance   0.00057813 BTC

Hmmm. I buy coins all the time. It has never taken me more than 2hrs.

It doesnt matter how many merchants accept bitcoin.. Bitcoin will never matter until people can actually get them! I see that all the time. We need more business to accept bitcoin. WTF does that matter? The problem with bitcoin is the same problem it had a year and a half ago when I got in. NO ONE CAN GET COINS! People are not going to send of their fiat via bank wire in mass.

http://uspirates.org/

The question is how is that 10k figure derived?

So Bit-pay single handedly attaining 10,000 merchant customers is equivalent to your bolded statement above?

So basically what he is admitting after all the backlash is that the calculation of value that he did is worthless, so just focus on his point that the market is being manipulated.

Manipulated?  Bitcoin market?  Say it ain't so!   

Cool guy! Not so good at economics though I guess. I'd still vote for him. I wish there was a pirate party in the US...

For those of you who don't know who Rick Falkvinge is or what he is about....
http://www.youtube.com/watch?v=zsI3-IEWgFg

What? Wtf?
I estimate the market of about a few million usd considering the sales on bitmit, and stuff that like.

Where did he come with this figure?

So where can I buy bitcoins for $4!? In fact, if anyone wants to sell them to me for A WHOPPING $20 a piece (5X more than the article states) I have $4000 with their name on it. No joke.

Seriously, I don't understand how some people come up with these numbers. If the market says they are worth $140 then I will buy and sell them for that much. How do I know that $140 is a pretty good number? Well to use my case above^, If the price drops to a certain level, then people go nuts and buy them!


This is like saying 'If the gold market has $X in sales and lets be generous to err on the safe side, and divide that by the US' money velocity, which is 1.67 on average instead of the 6 estimated above. This gives us a generous gold money supply value of (insert low figure here).'

I think the word we are looking for here is 'Oops'   

I don't really care who this guy is anymore, he can't see the forest for the trees.

An items value is not solely based on the USD price it commands or the volume of business it does. It can also be valuable because people see future value or if it has a utility that someone needs. I am sure someone more versed in economics could explain it better than I.

I totally agree to this. I am also here to make a commitment.

Technically it's already a fourth of the price. If you sell it, no matter how little you have, in most parts of the world, you'll be charged about 70% tax in between VAT and income and other tax and commissions from exchangers and wire fees etc. If you hold you make an agreement with other people that hold money that it's valuable, you get to use it for online investments and for putting it in corporations instead of your easily taxable self, and you get to wait around for the time when there are more people on the streets to exchange it with commission and tax free.

I think he's making a whole lot of assumptions here that you just can't make.

First of all, let's not forget that there is a large degree of automation in bitcoin trading since, you know, there's an awful lot of programmers around. You can also look back and see all trading robots that have been posted to the forums alone where people literally download and let it run so you have a large population of users who don't know what they're doing just letting the bot do its thing. Since this is the same exact bot over many different accounts, they will all notice the same things and make the same decisions.

In fact, I used to use this knowledge to predict what the bots would do in a certain situation. When I saw that scenario playing out, I would take advantage of the bot's mindlessness and it was making me some pretty good profit. The bots have gotten pretty sophisticated now, and the market is large enough that the risk to me is too great. I wouldn't put it past a bigger player to be taking the same sort of reactionary trades against a programmed hive mind.

The best part

"As of this writing, one bitcoin is trading for 142 US Dollars. Readers of this blog will remember that I estimated the endgame value of one bitcoin, if the currency succeeds, to be between 100,000 and 1,000,000 US Dollars. That estimation still holds."

But it's "vastly overvalued"   

You say "reality will set in at some point."  Well, what point will that be exactly?

You think bitcoin miners who have owned bitcoins for years and seen the price go from <$1 to <$265 are going to "wake up" and sell their coins and walk away?

Or perhaps the growing ecosystem fueled by tens of millions of Venture Capital dollars being invested in bitcoin based companies will suddenly just dry up and vanish in the wind?

Or how about the continual increase of global bitcoin transactions in "legal" sectors fueled by companies like Bitpay?

Or is it just the idea that a world ever more influenced, created and led by technology will never give birth to a true technology based currency that will find its way into the global economy in some permanent way?

But, instead you compare a 4 year old Bitcoin market to a 100+ year old bond market and a 200+ year old real estate market?

Do you ever consider that Bitcoin's current "inflated" price might just be the soil it needs to grow an underlying market, by igniting the press, global interest and potential monetary gain to inspire the very investment any currency needs to become a conscious, and ultimately, useful part of society?

I won't argue that Bitcoin's are currently heavily valued in speculation. Or that the US dollar is dying soon (or in our grandchildren's lifetimes). However, as long as the price of Bitcoin is enticing enough for you to be trading it for "fat stacks," it's also attractive enough to be creating an economic infrastructure and ecosystem for true economic utility.

I agree with Falkvinge in general, but I think even he is overvaluing bitcoins and underestimating the extent of manipulation.

 

of course Aunt Jemima. 

I dont hold coins I make money whether the market goes up or down.

The point to me is something he just glosses over and that is that there is not an underlying market supporting the bitcoin price. Basically the whole bitcoin market is speculators with no real demand for coins other than drugs and gamblers and they dont need enough coins to justify the price. I dont really care about the other aspects of the artical.

It is like the housing market and the feds bond buying, The real market is not there for homes so they have to create artificial scarcity and use fed bond buying to prop up the price.  

Reality will set in at some point, but i guess the saying goes the market can stay irrational longer than you can stay solvent.

http://en.wikipedia.org/wiki/Rickard_Falkvinge

He's decently intelligent in his areas of expertise, but he knows shit about markets.

From this link he seems to be an idiot who has no idea what he is talking about. Is there any reason you have to believe anything he says?

No.

Who cares? We are all happy if the price goes up, no?

http://falkvinge.net/2013/09/13/bitcoins-vast-overvaluation-seems-to-be-caused-by-usually-illegal-price-fixing/

If you dont know we are still heading down.