Topic: Distribution of bitcoin wealth by owner - page 25. (Read 153446 times)

You forgot 3. Condition bitcoiners to ignore such flashcrashes, and just not trade on them.
Note that currencies move on the Forex all the time, too, but most currency users don't give a crap, and such movements (and in the future, bitcoin's flash-crashes) will only be something the active trader minority cares about.

Hmm, I wonder how AnonyMint knows that i did something to confirm such a thing, if he has me on ignore?  



Sure, but to incite you first have to sell. And you'll need to sell/risk increasingly larger amounts to move the market as Bitcoin exchange volume grows. And there are a lot of strong hands waiting to buy who are waiting for such flash crashes, who may buy up quicker than you. Think it through: every time you sell and then buy again, a part of what you sell gets picked up by your competitors, and you don't have enough to buy everything you sold back. If continuously repeated in a competitive market, such action typically ends with you running out of money. You could argue that there are enough weaker hands to initiate a price momentum of continued selloffs once you start the sells, but, as has been pointed out by FenixRD, and with established Bitcoin precedent, each such crash only teaches people that these crashes aren't real, and makes people more resistant to such panics.


What would prevent a competitor from buying coins from you on your own exchange. And if the answer is "the exchange owner trying to flash-crash the market," that action will be quickly found out and complained about loudly, likely causing the exchange to be accused of fraud and lose business. Sure, this rich insider will make a bit more money, but they will lose their echange business, and, since they would likely be publicly known (people tend to not trade through anonymous exchanges), they will become a real life parriah. Oh, also, a drop in the exchange they own not only creates a massive arbitrage opportunity with other exchages, one which trading bits will eat right up, but also makes other exchanges follow down, and allows competitors to buy up cheaper bitcoins on exchanged this wealthy insider doesn't even control.
Really, the only method for such a scheme is to create an exchange that is anonymous, does not allow API's and bit trading, and somehow still convinces enough people to join to make the trading volume actually affect the average global bitcoin price. Not likely.

Bitcoin's only intrinsic value is confidence. So "weak hands" will mean strong hands, and vice versa at some point in the future if I am correct.

Flash crashes (and note this recent one was planned along with a DNS DoS against this forum) could serve two purposes at least if I am correct about who created Bitcoin and their ultimate objective:

1. Condition Bitcoiners to try to speculatively time a trade because they don't have more cash flow to buy more with on next flash crash then their BTC holdings decline as they sell lower than they rebuy.

2. Induce those with cash flow to become more fully invested in the ponzi bubble, i.e. less diversified. Log scale is not so meaningful because the cash flow is not increasing exponentially.

This will further the purpose of destroying the libertarian, free market resistance to the NWO.

Reality really depends on perspective. Ultimately we will have more data, i.e. the Bitcoin price in 2020.

The major exchanges have APIs, and I think you could easily spread your sale among all the exchanges with this functionality -- but the question was one of the "terrorist" intending to cash out, period. Definitely impossible, I estimate. Traders destabilizing and capitalizing on weak hands during the destabilization is a different phenomenon, which definitely occurs of course (as it does via collusion in major old-world exchanges). I have also gained a decent bit from selling some during an obvious flash crash (we've now had at least 3 that are statistically good enough to use as predictors) and rebuying at near-bottom.

Presumably the rebuy is subject to strong competition, and each flash crash seems to trend toward creating more confidence and stability, as each one so far has been successively less intense (in log scale).

As for an example why I put the dolt Rassah on ignore (another confirmation that IQ tests are indeed often wrong), the entire point of inciting the weak hands to sell, is that it only risks a small amount of your holdings in order to incite a larger flow of sales from weak hands. So even if there are others waiting to buy, you are also waiting to buy.

Presumably if you are that rich of an insider, you already own the exchange too. You created an exchange because it was insane not to.

So arguing that exchanges are not yet numerous enough to be a free market, is arguing the wrong direction.

While impossible to know for sure at present how many people this would need to be, I think that outside of major collusion (which should be equally impossible, for the same reason -- though I guess keysigning methods could allow an open invite to the top holders to be sent with holders able to prove ownership are admitted to some sort of fraternity...) between enough of the top holders to be at least half of all BTC in circulation, it would be unlikely for a single actor to permanently kill BTC by cashing out, even rapidly (which would be stupid). The precedent was set when BTC was much less widespread than now, during the Mt. Gox hack of 2011. You can't cash out that sort of amount without going through an exchange, and cashing out slowly enough to not mess up the price... is slow enough that it's tolerable to the economy, and will hence have no effect on the currency. Presumably a legitimate (but foolish and selfish) user cashing out that fast would be initially frozen as a probable compromised account, and I'd expect if you tried to contact the exchange and get them to allow it, they wouldn't, for obvious reasons.

While true that Bitcoins themselves must remain individually fungible, it's still a free market, and users and services are free to deny individual trades. We don't deny legitimate major market movements like flash crashes because it's aggregate behavior (inherent to markets anyway, see S&P 500 graphs and extend the timescale for identical patterns). And anyway, exchanges are all limited to some extend by their own cashflow and legislations -- Gox is limited to 3mil Euros per month, or something like that, IIRC. Getting around those limits is what cryptocurrencies are good at. Going in the opposite direction is not going to happen easily, and at the market cap of BTC, we're already well past the point where anyone who has enough BTC to kill it by cashing out, could do so, outside of a Joker attack, which just about every system in the world is susceptible to. Just wanting to watch the world burn, regardless of its effect on you, is basically the definition of suicidal terrorism.

Q.E.D. it would be reasonable and in the interests of the exchanges and the user base to conclude that such an act would be tantamount to economic terrorism, and to deny it. (All without redlisting coins!) See the current craziness regarding the disappearance of 96,000 BTC from Sheep. In addition to a couple redditors who think they'll be able to trail the coins enough to prevent much of it being spent anonymously (the thief retardedly sent it through coinfog all at once, and is supposedly using Multibit, so it seems likely he isn't super bright on BTC as a whole), and them thinking they may already have his dox, one thing you definitely can't do is dump 96kBTC on the exchanges and get much out of the deal.

Big Thanks for this post !

Anony forgot about the prisoner's dillema, where such crashers would actually be competing against each other, and one trying to crash will likely get killed by the other simply buying up his cheap coins. Oh well. 

You actually have somebody on ignore?
Sweet irony!!!!

That sounds like you are referring to the higher probability of collusion and working together given a smaller number of insiders.

Collectively crashing it to get the weak hands to sell and buying more wouldn't be stupid if one had an exit price where they think they can cash out for good or they think there is a never ending stream of buyers because they believe it will become a widespread currency.

I see I forgot to put you back on ignore. Rectified now.

I think most of us agree a few hundred people have actively been crashing USD for many years now, they're just friends with the people (or are themselves the very ones) responsible for controlling it and have successfully Enron'd it thus far.


So the loan offering for APR on the car loan was 1.9% I'm guessing? Pretty good rate. Did we project the "mean gain on BTC holdings, as appreciated against USD" upthread somewhere as 6.3% "DPY"? (Which means I assume you took a loan for the car and left the BTC as BTC, as Rassah was advising?)   Unitless figures confuse me. If I missed a comment that clarifies it I apologize.

If they all stupid, yes. Just like a few hundred people can crash USD price.

So a few hundred people could crash bitcoin price?

So, you are saying we had 930 new millionaires created in the last 2 or 3 years, all of whom have a vested interest in seeing the currency succeed?

December update for the table shows that 0.3 million BTC are distributed from the holders of BTC100 or more, to those having less. Also there is a great increase in the number of bitcoin users. Prior mistakes are corrected.

3. Dec 2013

#People	#Bitcoins	#TotalBitcoins
47	BTC10k+	3.5M
880	BTC1k-10k	2.6M
10k	BTC100-1k	3.0M
63k	BTC10-100	1.8M
210k	BTC1-10	0.6M
350k	BTC0.1-1	0.1M
350k	BTC0.01-0.1	0.0M
210k	BTC0.001-0.01	0.0M

Total: 11.6M bitcoins

1,200,000 people own bitcoins that are valued at more than $1 (BTC0.001 or more)
280,000 people own bitcoins that are valued at more than $1,000 (BTC1 or more), up from 120,000 last month
930 people own bitcoin that are valued at more than $1 million (BTC1,000 or more)
1 person owns bitcoins that are valued at more than $1 billion (Satoshi, estimated to be BTC980,000)

Changes from previous month:
- Bitcoin total number adjusted to account for increase in money supply
- Thoroughly re-engineered the number of bitcoin users from original data of the userbases of several services + blockchain usage. This shows that the last month estimate was probably too small, and perhaps 50% of the growth in number of users can be attributed to correction of a previous underestimate.
- Corrected the highest bracket a little bit (BTC0.6M ) upwards because it was over-corrected downwards last time. Number of holders in this category went down a little but we have better estimate of the holdings. As this is a base case model, we do not assume large, completely anonymous entities without at least circumstantial evidence of their holdings.
- Number of people in each bracket behaves according to binomial distribution as found in another data with the parameters: total=1.2 million users, highest bracket=fixed, #of_coins=fixed.

As a result:
- Bracket 1,000-10,000 saw the greatest loss -20%, bracket 100-1,000 lost 10%. Sub-BTC10 holdings gained a lot.

Fiat (no pun intended) works better for debt based purchases, (provided you can afford the interest)

I did.  1.9% per year vs 6.3% per day...  Hmm...  Let me think about that one for a bit...

Learn from my mistake and get a car loan 

I just bought new winter boots for my wife with BTC profits. Next month I'm going to buy a car.

fyi, based on rpietila's excellent analysis, I made a derivative post here:
https://bitcointalksearch.org/topic/a-perspective-on-just-how-rare-it-is-to-own-01-btc-345228