Topic: Halving Bitcoin Reward Unlikely to Cause Price Surge - page 3. (Read 3466 times)

the main pools own alot of rigs, they wont move to other pools..

the main pools have alot of funds in reserves because their cost of production is dramatically lower than western pools. so not only can they keep mining without worrying about cost, but their reserves can be used to change the price, when they are motivated to do so.

a few of the smaller pools will decrease in their customer base. but the main pools will continue on

if i was to look at the top 3 pools
f2pool
antpool
btcc

i would say the one that would see most effected would be f2pool. (but not as much as the other 15 smaller pools)

No, I'm not assuming that all coins are on the market, but the share of coins that are gained by miners are now significantly less in relation to all coins available.

I never said that miners have no influence on the price; just that events tied to mining are a lot less influential now than they were when the total coins available were under, say, 5M.

Miners need to sell their coins to cover the costs of mining. They have an incentive to sell rather than hold-out for some potential price increase...this incentive to sell their coins only increases with halving.


Sure, and any price jump on such low volume is going to be a temporary spike and not a new normal. BTC have  gained roughly 50% over the last year, meaning 12 months before today. I don't see halving as a catalyst for any major shift up or down, but if there is a shift due to halving it's more likely to be down than up.


It doesn't matter if the coins are all traded or not. The point you are missing is the AVAILABILITY. There are plenty of coins available, even if they are not up for sale right this moment. A surge of new bitcoin buyers would drive the price up; but BTC have already reached their critical mass - the point where they can sort of sustain themselves without the need for external promotion.

Gains in bitcoin usage from new users is going to slow as many new users are already participating. A high price per coin will certainly limit the rate at which participants enter the fray, simply based on psychological reasons. The average person is not going to want to pay $450+ for 1 BTC. Even though fractional BTC are available, it's not quite the same as buying 1...there's a reason why companies on the stock market do splits to keep their share prices down.

It's a really hard thing to model. For instance, if I knew that my major competitor was nearly broke, it would make sense for me to mine at a loss to choke him out, and it would also make sense for me to form consortium/temporary alliances with other mining farms, with (pseudo)enforceable contracts and stuff, to drive out the competition. It gets mindnumbingly complex, and I suspect that it doesn't even work like I expect it does. I mean, all these guys know each other, there's a handful of them. Not a conspiracy theory buff, just one of those "what would I do" things.



Decentralized, p2p closed door meeting between 80% of the mining power and the ruling dev team

I'm not expecting any significant price increase.

That's why I think if that were true, then a lot of miners would drop out [and come back in, due to difficulty changes] and bitcoin would start to become more centralized [even just a little] due to the mighty pools controlling everything. Of course, miners would even things out by going to different places, but maybe the profit there would be worse than the profit in the large one? Who knows what will happen?

But all I know is that the price will not surge. It will increase [imo] but not surge.

BTC  supply is not going down, it's increasing by 25 BTC, every 9 or 10 minutes. It's the rate of increase that's going to be lower, the supply is going to continue increasing.

And, of course, BTC is not a typical commodity.  BTC is never consumed/destroyed (not like oil/consumables, or even durables)


Not unless you're one of the exchanges (with access to *all* the data and zip regulatory interference) you're not. ~3 years ago you probably could, if you had good friends. Now you couldn't. Or, rather, I couldn't.

So, I'm not sure, given bitcoins history of volatility, that we can accurately predict what's going to happen after halving using traditional economic principles.  We all learned things from past experiences here, so might some of those lessons be reflected in the next event?  Will there be many who wait until the actual event to buy?  Will they start moving earlier?  Will they wait for a spike to dump?  Too many non traditional variables....it's starting to hurt my brain cell.  I have resolved myself to the belief that much of the upward movement has already taken place and if there is any upward pressure after halving, it would be negligible. However, I am in position to take advantage of any temporary spikes or dips that I believe will occur due to the hype factor.

the demand is not 3600.. nor is it 16million..

the market demand is a few hundred thousand, divided by a number of exchanges.. so under 100,000 coins a day(once you subtract the fact that the same coins are swapped a few times a day)..

but.
pools own a nice large stake of coins played around on the exchanges. so if they know their daily fresh income from mining is decreasing.
they also know that demand is 100k ish on exchanges ((emphasis) 2 separate bundles of funds)... so they will move lets say 50k of they reserves out.. meaning that the supply of tradable coins on exchanges changes and causes a price rise.

in short the block reward does not directly cause a price rise.. however its the efforts and motivations and reserves held by the pools on the exchanges that help move the price to compensate themselves for the lower incomes they are getting via mining

Halving will attract more users to bitcoin due to media hype.Resulting in high demand for bitcoin, this can lead to price hike and once it triggers price rise,chances are it will touch $1000

@BitconAssociation

1 - I am not sure there is enough information to describe the elasticity of Bitcoin, so the demand may or may not go down in the event that the price of bitcoin were to go up, however simple economics says that when the supply of a commodity goes down, then all else being equal, the price will go up.

Right now the demand for Bitcoin at $450 is ~3,600 BTC per day. When supply goes down, causing the price to go up to say, $460 then the demand for bitcoin might fall to 1,800 BTC per day and the market will be back in equilibrium.   

There are a lot of speculators in bitcoin, however there are real world applications for Bitcoin that is not dependent on it's price. Although it would not be quite as trivial, it would be possible to stop buying oil and to instead buy alternatives when the price of oil gets to be too expensive.

2. There are roughly 15 million BTC "issued" however that does not mean that they are all for sale at any given time. The miners *need* to sell the majority of their mining revenue to pay their bills, as their bills are denominated and and paid in fiat. This is not true for many other bitcoin related businesses. The last 24 hours of BTC/USD volume on bitfinex is roughly 4,800 BTC, on bitstamp it is roughly 2,400 BTC, on btc-e it is roughly 4,600, so althoughthe miners are not the only ones selling, the likely do make up a very large portion of btc sold every day.

1.
2.

2010: price went up in December
2011: price again went up in December
2012: lull because Teh Halvening
2013: price went up skyrocketed in December  

This is true, however you (and others) are overlooking one important fact.

Right now there are sufficient buyers in the market so that the price will ~stay the same when there is ~3,600 additional BTC sold throughout the various markets. After the halving occurs, there is no reason why these buyers will start to want to buy less BTC every day, however the miners will have less BTC to sell every day because of lower block subsidy.

In other words, right now buyers are buying roughly 3,600 additional BTC every day and sellers are selling roughly 3,600 new BTC every day. After the halving sellers will be selling roughly 1,800 additional BTC every day so the buyers are going to need to offer higher prices or else they will not be able to buy what they are wanting to buy.

Miners are the deciding factor in the price. They still most probably make actions to push the price up. I do understand what you are saying. The price won't double, but it will rise about 60-70%.

you are assuming that all 16million coins are ALL on an exchange and ALL being traded to ALL add some significance to the market value..

im sorry but on average only 10k to 100k volume(per exchange) is moved per day and is usually based on about 3k-30k of real coins being moved a few times a day to total the daily volume.

so the reality is that the bitcoin price of all 16million coins is not based on the trades of 16million coins per day.. but usually less then a hundred thousand coins..

remember not all 16million coins are on exchanges.. no where near that many. so when you realise that it is only a smaller amount contributing to the market value, then you see who is hoarding the majority of that market making value.. you will see that pools do have the power to move prices, should they be motivated to.

you are soo ...................

ok some standard psychology...
every year people care about christmas and new year celebrations.. ((emphasis) every year)

but in 2012.. ((emphasis 2012 only) the reward halving cause people to prepare a bit earlier by sorting their finances out early ((emphasis 2012 only)

this explains why there was a lull in ((emphasis) december 2012 only) because they didnt need to use coins as much..

then when january 2013 arrived and people got back to business, bills started arriving.. then the consequences of the halving really started to hit people because there was little noticeable impact during december because no one was really paying bills or cashing out during december.. but now the bills are arriving again and things needed to change.

so the january/february period is where you see the price movements happen due to the reward halving.

Just wanted to point out some things in response to what was said here:

- Miners will sell coins at "double" the price to compensate for drop in reward.

This isn't going to happen. Firstly, because the total BTC is arbitrarily capped at 21 million, as more coins are mined the influence that miners can exert on the price of BTC diminishes substantially. In the early days around 2011 you had around 4-6 M coins in circulation. In Q4 2013 you had around 11M. As of this message you're looking at around 16 M coins, which leaves 5M more to be mined.

The price of bitcoins is now more market-driven by those who already have them, while Q4 2013 was somewhat of a turning point where the advantage shifted away from those mining to the market.

- Fewer coins mined will decrease supply

Nope, the coins already discovered are not going away. Supply was always capped and it never diminishes.

- Big price jumps after previous halving

The price jumps were not due to the halving event itself. There were and still are plenty of other variables with far more influence on the price of BTC, such as how well they are being adopted into the marketplace as a form of payment...which today is a lot more than it was even 3 years ago.

- My BTC will jump to $2,000 per coin and I'll be rich

If there is a sudden price jump like that, don't expect most exchanges to honor sales at those prices. They will not have anywhere near the liquidity to cover a run-on of sell orders for $2K per coin. Even if all exchanges combined together they wouldn't be able to cover it, so while the chart may show $2K you won't be able to sell at that price.

>the 2012 lull.. is not the 2013 rise.. they are totally separate events.
So these "december lull.. people concentrating more on christmas and new year. with funds they already cashed out in november" are not seasonal holiday lulls? They're more of "December 2012 lulls"?
In 2013 people stopped "concentrating more on christmas and new year"?

Are you suggesting that unique events, like that December 2012 lull, are not cyclical, unlikely to be repeated, and therefore worthless for us sage price prognosticators?

Could it be that we actually agree that dumb shit like an exchange going rogue or a 20-something being popped for trying to hirie feds to murder his buddies, that those are the events really driving BTC price?

usually december of each year is active.. people moving funds to cash out to buy gifts. and retailer moving funds for gifts bought. etc.
but in 2012 specifically most of the pools ((emphasis)who are the majority players on an exchange) done all of their financials BEFORE the halving so that they did not have to have to immediately worry about the consequences of the halving impacting them over that specific christmas period.. hense why there was a lull...



the 2012 lull.. is not the 2013 rise.. they are totally separate events. so you saying its the "very same" is rediculous
i never said every december was a boring month.. but the specific december after the halving was..

separately the 2013 spike was due to ASICs coming onto the market. which can be easily seen by the release date of the first asics, and the start of the large rise.. which peaked a couple months later. before speculation bubble then burst due to mtgox issues and other things.

do not confuse the 2013 saga with the 2012 halving saga.

Not to mention that the following year, BTC shot up to $1200 during that very same "December lull."