Could the market cap be intentionally raised by a single party? - page 2.

Piper67

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Quote from: Topazan on February 04, 2013, 02:36:56 PM

How would you go about it?

I wonder if it's possible to derive a formula to determine how much money you'd need to raise it by what percent...

I doubt you could come up with anything too precise, as the number of unknown variables is just too big (how many people out there have large holdings of BTC, for instance, and at what price point would they be persuaded to part with theirs... there's just no way to know). It would also depend highly on how obvious the move is. Presumably, if your intention is to raise the market cap, you'd want to make that intention fully known and then follow through on it.

And again, raise it to how much, and starting with how much?

Too many unknowns.

FreeMoney

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Strength in numbers

Quote from: Topazan on February 04, 2013, 02:36:56 PM

How would you go about it?

I wonder if it's possible to derive a formula to determine how much money you'd need to raise it by what percent...

It requires knowledge of many bitcoin sellers desires to sell or not at various prices. Many times those people themselves do not know until they see the offer and how they feel about it, also their observation of other people's willingness to sell or not will affect them so it is very difficult to predict. Difficult to predict over large scales that is, you can just look at the order book on major exchanges and do arithmetic for small amounts and short times.

Topazan

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How would you go about it?

I wonder if it's possible to derive a formula to determine how much money you'd need to raise it by what percent...

Piper67

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It depends on how much money you have, and how much you want to raise it by. Technically, it is possible. In fact, if I were the economy minister of one of a handful of countries, that's exactly what I would do, but only after solidifying a position beforehand.

Topazan

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Say you were a government or major corporation that wanted to carry out a multi-billion dollar transaction in bitcoin. Would it be possible to raise the market cap up to where it needs to be for you to do it?

The first thing I'd try would be to place a huge order, offering a large amount of money per bitcoin. Say, $10,000 per coin. You'd probably need to invest quite a bit more than you want to transact in keeping the price high.

This would raise the price to where you need it, but then the question is would it stay that high? In addition, would the receiving party be able to cash out? Obviously they can't just sell it back to you, or it would defeat the purpose of using bitcoin. Could the market be counted on to pick up the slack once the original bid is withdrawn?

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