Topic: Crunch time! (Read 3975 times)

I decided to just put the chart together myself. I got the data from the following page: https://www.quandl.com/BAVERAGE/USD-USD-BITCOIN-Weighted-Price
 I filled in occasional missing dates with the previous day's price.

Dates along the horizontal axis represent hypothetical past sell dates following a hold of exactly a year. The vertical axis shows the percentage gain or loss that you would have experienced had you decided to sell your bitcoins that you'd purchased exactly a year prior.

For context: For much of of May-August 2012, you would have taken a loss on year-old bitcoins. This is contrary to the idea going around that if one had simply bought and held for at least a year, he would have always profited. I will be watching to see if we continue to approach 0%, and hoping that we don't.

i agree. i also dont know what to make of these lists. personally, i spread my coins out earlier this year. i am no longer in one category, but rather now represent ~100 entries in lower categories. these lists are addresses that want to be known (ie, large aggregates of many peoples coins) or some big holders. but clearly, the numbers of large individual holders is bigger than we think.

A chart of large holders vs price would be useful (ideally excluding exchanges or businesses)

Nice list of addresses of actors who are too lazy to spread their coins over a lot of different wallets. Also surely coinbase, bitstamp and chinese exchanges have their addresses listed there, which in theory does not make them rich because they are not their coins but their users'.

In a simple model, the on-chain transaction volume is proportional to the square of the number of participants, so yes I subscribe to the Meltcalfe's law. We are offering the same views from different angles and getting to the same conclusion that the network is growing.

But also in my opinion both the number of transactions and the number of unique bitcoin addresses used (which are the indicators cited by the Meltcalfe's law supporters in rpietila's threads) are probably getting inflated by more mixing going on now than in the past, so to me they are not as reliable indicators in order to size an economy as the estimated USD transaction volume is. The latter is calculated by blockchain.info with an algorithm that keeps change addresses into account. The algo can also be fooled with coinjoin, but fooling it is not guaranteed to inflate the numbers.

Like contemporary art:

http://bitcoinrichlist.com/charts/number-bitcoins-owned-by-richest

Marginally more than estimated mining cost at the current diff. But, pricing in another 40% for hodl seems reasonable.

You need to check out Risto's thread -- there's a lot of discussion referencing ML there.  But I'd check out AnonyMint's posts in that thread -- he proposes a number of theories which suggest there are other factors which will negate such an 'easy' assumption of adoption.  Thus far he is being proved correct.

Do any of you peeps subscribe to metcalfes law? If BTC follows that law then it must rise (in correspondence to physical users); its more of a question of when.

Thanks for the perspective.

I was, it feels very similar, and that price just does not seem to want to go any lower... Something gonna give

Amazing chart. One of a few which seems to make sense.
Thanks for sharing.

Not true. A bear market will not undo, destroy or negate the infrastructure (in terms of hash rate, merchant adoption, customer adoption, ATMs, etc) that has been built to date. I don't care how low it dips.

The crash happened before Gox insolvency.
On-chain transaction volume lagged a few days behind the bubble pop.

My assumption is that the on-chain transaction volume (the red line in my chart) is the summation of 2 components:
1. Speculation
    - this includes transactions between personal wallets and exchanges
2. Economy:
    - mostly dark markets because they are the only place where non-cultists need to use bitcoin instead of fiat. These transactions are all definitely on-chain not through payment processors.
    - payment for digital goods (e.g. porn) is our next hope (because of insane chargeback ratios in that specific business)
    - remittances are insignificant atm because bitcoins are way too complicated for e.g. sending money to a wife in Nigeria
    - purchases at normal merchants, for cultists only because using fiat is honestly easier than using bitcoins

During price rises, the blue line leads the red line, because in the euphoria  of the moment, the red line is mostly made of speculation not true underlying economy. During bubble pops, the mania is over and many are reluctant to sell, a bit like real estate markets in some countries in Europe: prices are slowly declining because people are reluctant to sell at a loss and buyers are not interested at high prices, so the volume drops to a trickle. So the speculation component in the red line drops fast and the blue line lags a lot behind the red line. This will keep going until the supply can sustain the non-speculative economy, which as of today is still very slowly increasing in size, my guess mostly thanks to the dark markets.

So we will get there. According to the red line, a bitcoin today is worth 234$.

So, random drunk thought. How many hodlers counting from just after the last top are left by now? 1%?

Bitcoin doesn't have to go to 0 to be considered a failure. Going back to to below $200 would mean the same to most people as going to $10. It would mean the last year of development, among which we had investment funds, ATM's, regulations were worthless.

Don't forget that a very gigh percentage of bitcoin users bought their coins in the last 12 months (for $200+) and will bail out if the price goes lower, causing a massive dip.
I personally don't believe we'll even go below $300.

Would box alter on chain transaction volume? I suppose indirectly yes!

inca, are you seriously wondering what event happened at the beginning of the year that could have affected daily btc/usd transaction volumes in such a massive way?  how soon we forget...