Topic: Fair Price of Bitcoin: $518? - page 5. (Read 4611 times)
The market disagrees. And since only the market counts, the price is about $280 at this point.
Its hard to give a stable price to bitcoin. Sometimes I used to think 100$ would be it. But hard to put a price on it.
A stable price of $5000 would be great to, but we should try to focus on a realstic price, like $350-$550. 
Is it just me, or did this "Fair Price" calculation use the Labor theory of value? That's the discredited Marxist notion that the value of an item is based on the amount of work to produce it. For example, if we could somehow assign my labor a value of $10/hour, and I spent 100 hours hacking at a hunk of rock with a chisel, the resulting sculpture would be supposedly valued at $1000 - even if it was an unrecognizable mess (which is what I would expect).
Assigning value to bitcoin based on the costs involving in mining it is going at it backwards, IMHO.
Assigning value to bitcoin based on the costs involving in mining it is going at it backwards, IMHO.
Might be backwards to you, but the cost of mining is what at the moment determines the value of bitcoins. The miners spend X amount on the mining rigs and expect X+profit for the coins they mine.
Love your take on the Labor theory
$518 would be a great price for Bitcoin, but I think being stabled at $350 would be more likely.
Bitcoin isn't undervalued at all at this point.
Bitcoin is a free market, no matter how many formulas and calculations you throw at it, it are the whales, pools and for a part we that decide the price.
After everything that has happened this year it is safe to say that we are heading towards a price that we agree with that this is the right price now.
Bitcoin is a free market, no matter how many formulas and calculations you throw at it, it are the whales, pools and for a part we that decide the price.
After everything that has happened this year it is safe to say that we are heading towards a price that we agree with that this is the right price now.
Is it just me, or did this "Fair Price" calculation use the Labor theory of value? That's the discredited Marxist notion that the value of an item is based on the amount of work to produce it. For example, if we could somehow assign my labor a value of $10/hour, and I spent 100 hours hacking at a hunk of rock with a chisel, the resulting sculpture would be supposedly valued at $1000 - even if it was an unrecognizable mess (which is what I would expect).
Assigning value to bitcoin based on the costs involving in mining it is going at it backwards, IMHO.
Assigning value to bitcoin based on the costs involving in mining it is going at it backwards, IMHO.
Fair price for 1 satoshi in fiat scrip is this:
It is unethical to endorse violence-backed fiat by accepting it in trade for private keys.
In rational self-interest terms, it is also quite stupid to accept the value of national fiat for everyone except the people printing it and their close friends.
The miracle of fiat is that the governments of these nations have convinced millions of people that they are their close friends. The miracle is that people believe this.
The miracle of bitcoin is that it represents mathematically provable truth based money. This antidote is being injected into a society of deceit.
It is unethical to endorse violence-backed fiat by accepting it in trade for private keys.
In rational self-interest terms, it is also quite stupid to accept the value of national fiat for everyone except the people printing it and their close friends.
The miracle of fiat is that the governments of these nations have convinced millions of people that they are their close friends. The miracle is that people believe this.
The miracle of bitcoin is that it represents mathematically provable truth based money. This antidote is being injected into a society of deceit.
Just came across this article on Coindesk:
http://www.coindesk.com/is-518-the-fair-price-of-bitcoin/
According to Alfaquotes, Bitcoin is currently undervalued, its 'fair price' (using the Benjamin Graham formula as a model) is at $518.59.
Quote
Calculating a ‘fair’ price
Hertz explained that the fair price formula includes two factors.
First, it calculates the changes in the cost of mining equipment and its performance. Next, it attempts to assess the change in difficulty of production, factoring in the electricity costs faced by miners on the network.
In particular, Hertz indicated that the fair value tool should be embraced by miners, as the price today is lower than the fair price – a factor he attributes to the recent string of bankruptcies and closures in the sector.
Hertz predicted that this trend is likely to continue until issues faced by the mining community affect supply to the point it influences demand.
“At the moment, as we can see bitcoin is doubly underestimated and this indicates how good investment attractiveness is toward bitcoin,” Hertz added.
Hertz explained that the fair price formula includes two factors.
First, it calculates the changes in the cost of mining equipment and its performance. Next, it attempts to assess the change in difficulty of production, factoring in the electricity costs faced by miners on the network.
In particular, Hertz indicated that the fair value tool should be embraced by miners, as the price today is lower than the fair price – a factor he attributes to the recent string of bankruptcies and closures in the sector.
Hertz predicted that this trend is likely to continue until issues faced by the mining community affect supply to the point it influences demand.
“At the moment, as we can see bitcoin is doubly underestimated and this indicates how good investment attractiveness is toward bitcoin,” Hertz added.
Considering current price it sounds like a good news, but I'd love to see the detailed calculation.
Related links:
http://www.ibtimes.co.uk/cryptocurrency-round-bitcoin-price-continues-surge-towards-fair-price-1490237
http://en.wikipedia.org/wiki/Benjamin_Graham_formula
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