earliest we will be able to tell if this is a replay of the first bubble?

Impaler

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Quote from: smoothie on May 05, 2013, 07:10:12 PM

Only this time the trickle down of ASIC devices is super slow as opposed to the influx of GPU mining in 2011.

Big difference. We have not even touched 10% of the total mining capacity that ASICs will bring.

This may be the case, I wasn't around in 2011 so this theory is based on what amounts to historical research.

This 2013 bubble clearly did presaed the bulk of the ASIC miners actually coming online even when we consider that some of the ASIC miners planned to mine with them rather then sell them, so the ASICs entering the hands of the general public is going to be slower then the rate they enter the network.

Upon further examination of the coin depth on MtGox it seems we were seeing a slow squeezing of coin supply that goes back to before the start of the year. So it's clear that the trend was going on before any ASIC even existed. Their clearly needed to be some anticipation effect in which the expectation of ASIC mining lead existing GPU miners to hoard coins. Perhaps they wished to accumulate 'nest eggs' before they were squeezed out, this is logical if you expect coins to increase in value, your hardware has been paid off and your not planning to reinvest in new equipment. Their was also the halfing of reward around February, everyone knew that was coming and the predicted result is to double the cost of coins so their is an incentive to build up stockpiles before that point.

SAQ

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Quote from: underground_ on May 05, 2013, 01:37:20 PM

Quote from: blackreplica on May 05, 2013, 01:31:51 PM

My best guess is no, this is not the same.

Many possible reasons, but the one that holds most water to me is simply that with the 2011 crash,every low was followed by a lower low till it hit rock bottom. With 2013, the latest low of 79 is higher than the first low of 50. This to me signals a slow recovery

That's not true. The first crash went to nearly $10. The second went only down to around $13, the third down to around $13.5, and the fourth down to around $12.

After it crashed to 10, it went to around 20, then stuck to 13 and started very slowly going down. It did not go from 13 to say 17 then to 12.

This time though it crashed to 50, then it went to around 120, down to around 60, up to 160, down to 80 and now up to 120 and who knows how much higher.

So it is clearly different. I don't think those who sold bitcoins have withdrawn the money from the exchanges. Unlike in 2011 when the viability of bitcoins was in great doubt.

smoothie

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LEALANA Bitcoin Grim Reaper

Quote from: Impaler on May 05, 2013, 06:50:40 PM

My theory is that it's the same bubble and crash all over again and they are driven by the same cause, mining efficiency.

In 2011 and in 2013 we saw revolutions in mining technology (GPUs and ASICs), these allow miners to liquidate far less of their coins to pay for electricity costs. This reduces the flow of coins into exchanges and creates a price rise which becomes self catalyzing, miners see higher value and sell even fewer coins, media hype over BTCs rising price brings in new buyers that bid up the price still more.

Eventually the bubble pops due to some load-stress in the exchanges and a panic sell off starts, prices stabilize around half the peak. But the slow month long grinding down is caused by miners gradually squeezing out each others profit margins, they gradually have to liquidate more and more of their daily coin mining to cover costs. Along with declining hype the market forces the price down over a period as the new mining tech becomes the standard.

Only this time the trickle down of ASIC devices is super slow as opposed to the influx of GPU mining in 2011.

Big difference. We have not even touched 10% of the total mining capacity that ASICs will bring.

Awhut

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Quote from: Impaler on May 05, 2013, 06:50:40 PM

My theory is that it's the same bubble and crash all over again and they are driven by the same cause, mining efficiency.

Interesting take, I haven't heard this one before. When precisely did we get the new mining tech this year?
(forgive me I'm new here Tongue

)

Impaler

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My theory is that it's the same bubble and crash all over again and they are driven by the same cause, mining efficiency.

In 2011 and in 2013 we saw revolutions in mining technology (GPUs and ASICs), these allow miners to liquidate far less of their coins to pay for electricity costs. This reduces the flow of coins into exchanges and creates a price rise which becomes self catalyzing, miners see higher value and sell even fewer coins, media hype over BTCs rising price brings in new buyers that bid up the price still more.

Eventually the bubble pops due to some load-stress in the exchanges and a panic sell off starts, prices stabilize around half the peak. But the slow month long grinding down is caused by miners gradually squeezing out each others profit margins, they gradually have to liquidate more and more of their daily coin mining to cover costs. Along with declining hype the market forces the price down over a period as the new mining tech becomes the standard.

Anth0n

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Seems pretty similar to me so far. That's why I just recently sold everything, because I don't want to hold my coins through a long, slow slide like I did a couple of years ago. I have even surprised myself with my change in sentiment; it's the first time in about 2 years I have sold any coins. I'm going to continue monitoring things and my hunch is that in 6 months, price per coin will be a lot lower.

For tomorrow, I expect an upside breakout into the 130s, but I don't want to take a risk trading, so I'm not buying anything. However, I would not be surprised to see $60 in the next 2 weeks. This forecast is based on my own amateur TA.

UltimateReaper

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Quote from: ironstove on May 05, 2013, 01:45:19 PM

This is exactly like the 2011 crash, I've been around on these forums since SR first opened its doors.... Speculation is all the same kind of talk as well, so I'd be amused to see a repeat. At the end of the day speculators are speculators and people trying to jump on board to make a quick buck without understanding what the hell is going on are all the same, and hence react in the same ways.

I've noticed this forum is like speculation on oil Cheesy

terrible stuff. I'm personally trying to keep my head on straight.

ironstove

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Possibilities are limitless

This is exactly like the 2011 crash, I've been around on these forums since SR first opened its doors.... Speculation is all the same kind of talk as well, so I'd be amused to see a repeat. At the end of the day speculators are speculators and people trying to jump on board to make a quick buck without understanding what the hell is going on are all the same, and hence react in the same ways.

blackreplica

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Apologies, you're right there. Ive got the candlestick graph open for that period and visually it does look like a series of lower lows but there are isolated exceptions.

I wasnt around to feel the crash of 2011 so my opinions are formed by just (cursory) looks at the charts. Didnt mean to mislead, and i apologise if i have

underground_

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Quote from: blackreplica on May 05, 2013, 01:31:51 PM

My best guess is no, this is not the same.

Many possible reasons, but the one that holds most water to me is simply that with the 2011 crash,every low was followed by a lower low till it hit rock bottom. With 2013, the latest low of 79 is higher than the first low of 50. This to me signals a slow recovery

That's not true. The first crash went to nearly $10. The second went only down to around $13, the third down to around $13.5, and the fourth down to around $12.

blackreplica

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My best guess is no, this is not the same.

Many possible reasons, but the one that holds most water to me is simply that with the 2011 crash,every low was followed by a lower low till it hit rock bottom. With 2013, the latest low of 79 is higher than the first low of 50. This to me signals a slow recovery

notig

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so the first bubble had an initial spike, followed by a second smaller surge... followed by an ensuing crash over months.

do you think it will take months to determine if bitcoin will go down to sub 50?

if by the end of this month bitcoin is above 100 would you consider this to be different than the first bubble and a positive thing?

My thinking is basically nobody will want to buy bitcoins anymore above a certain price after seeing their value can reduce by so much so shortly. So if anyone sees a + 100 price they aren't going to buy.

On tuesday it will be an interesting day because if there is low volume that means sellers will be holding out and waiting for buyers but there are no buyers at that price. Price will plummet.

I think the next 3 days will be the only above 100 days in the next year(s).

the only part of me that thinks otherwise is just sheer numbers. If there are only 11 million bitcoins and now so many people know about them it still makes them very scarce.

Topic: earliest we will be able to tell if this is a replay of the first bubble? (Read 1266 times)