Topic: BTC price volatility (Read 2148 times)

A simple rule (not universal of course) many option traders (including me in the past) use:

If you make more than 1% profit on a good day, you take too much risk.

Following the above approach is indeed very wise, more than many can appreciate.

There are much more efficient ways to solve systems of linear equations.

I agree with much of what was said above.

Earning such high yields would be pretty risky. For example by going to a casino and winning 7% weekly. It could be done.

But actually the question is, how does this affect the BTC price?
Are there suddenly going to appear more BTC on the market? Some BTC that were hidden from everyone so far? I think the only reasons for both the sudden rise and fall are actually in people's heads: Oh, pirateat40, your voice sounding so sure, why do you leave us now? Where do we gamble our money now?!?!

What is the change to the fundamentals? Can you not use your BTC for making transfers as good as you could yesterday? Can you not buy your lama socks? Or have you found some glitch in the Bitcoin protocol? No.

SecondLife's Ginko Bank claimed they did it using leveraged real estate buys. For example, you buy a $100,000 property with $20,000 down. Within a month you resell that property for $120,000, taking out your own $40,000. The property only grew 20%, but your profit is 100%. It was certainly plausible before the housing crash of 2008, but definitely not sustainable, and extremely risky. Not saying that's what pirate was doing; just giving an example of how high yield returns are legally possible.

However, the irrefutable law of any type of investment returns is: higher return = higher risk. Or conversely, risk costs money. The higher the risks he was taking, the higher fee (interest) he had to pay for it. So if anyone if giving you a high rate of return, the first thing you should ask is how much of a risk you're getting into. With The rates f return he was offering, the risk was likely close to winning some small lottery.

Well, it was definitely not a ponzi scheme.

To prove this, I am taking off where pirate40 left off but I will offer 10% per week!

Just send me all of your bitcoins. Your BTC will be safe with me.

No need to disclose how I am able to give such high returns, that is for me to know and you to find out in a few weeks  (or as long as the money rolls in at a +10% rate).

Yes, it does, it takes a long time as it loops again and again and again gradually converging as each adjustment of what each Corp is worth changes what all the Corps owning shares of it is worth, which in turn loops through again if both own shares of each other, etc. So converging to an accurate (to eight decimals) solution takes a lot of computing.

-MarkM-

profit taking as well.  I remember we were at 15 bucks for awhile some times last years.  Could be hitting the resistance ceiling.  The price is now finding its new bottom and getting ready to move up again. 

You know a computer can do that for you

Well, close to A IMHO.

He's for sure behind the yesterday dump, trying to induce panic selling and lower the bitcoin price... so he can later buy them back slowly to repay his lendors. Which lendors will probably sell them right back in panick, which should keep the exchange rate down.

As for volatility, I expect it to be far greater now that he closed his operation down. We badly need some big players and so leveraged trading to lower the volatility.

Meanwhile, cheap coins for the win

It is great that people are getting this extra chance to pick up coins cheap, but its a pain having recalculated all my asset values based on bitcoins being $15 or more only to find almost as soon as I had finished the calculation that the price is back to $10-to-$12 or so.

Since we already saw that we are finally on our way to recovery from the big crash last year, hopefully people who are not panic prone will realise this is a brief respite allowing them to stock up on coins ready for the climb...

-MarkM-

Several months of moderate growth, one week of rapid growth, yesterday one day of big crash. What is the facts behind?

So there was this announcement from pirateat40 yesterday (https://bitcointalksearch.org/topic/m.605957), that he closes his investment fund. Is this it?

I find this pirate thing interesting. I understand he has promised high yields (7%/week? 3000%/year? wow) on bitcoin investments into an undisclosed business, so many people sent him money, and now yesterday he ends this operation and is going repay the investors.

What could have been his business?
A) BTC currency trading - it's somewhat questionable that even a skilled trader with a big wallet could manipulate the market so badly so he could gain such yields.
B) Something seriously illegal like trading arms - which would be a real shame, actually including all those who invested.
C) Something banally illegal like a pyramid scheme - at the moment there is still no proof speaking against this.
D) Something else.

BTC offer before:
I think that in cases A) B) the BTC were available for trading on the market.
In the case C) the BTC were not available and rather held in a wallet.

BTC offer after:
Cases A) B) - If he repays his debts - the BTC will be available on the market.
Cases A) B) C) - If he runs away with bitcoins - BTC will be sold at the speed proportionate to the speed of bank withdrawals from Mt.Gox

I think that traders are very moody when acting on this news. I can't see much extra offer of bitcoins based on anything else than moods. We learn more next week