I bet it has something to do with calculus.
Yes, particularly vector calculus and graph theory. You can figure it out
Topic: How much investment is ACTUALLY represented by the bitcoin "market cap"? - page 2. (Read 1884 times)
March 07, 2014, 06:44:14 PM
Yes, particularly vector calculus and graph theory. You can figure it out
March 07, 2014, 03:53:13 PM
The amount that was paid for all the bitcoins in existence is found by determining what was exchanged for every unused output in the blockchain, somehow accounting for off-chain transactions.
Edit: Now that I think about it, even that doesn't work because simply moving money around gives false information.
Edit: Now that I think about it, even that doesn't work because simply moving money around gives false information.
March 07, 2014, 01:27:55 PM
Imagine the volume is zero, nobody wants to buy and sell at the same given price. So I sell you one bitcoin for 10 000$. How high would the market cap be? Think of the 4000 new coins everyday. So the market cap grows by 2.4mio. So if no miner sells, no money is needed to raise the market cap.
-> The market cap has absolutely nothing to do with the total dollars for which people bought bitcoins. And anyway, when I buy a bitcoin from you fpr 620$, how much dollars are flowing into bitcoin? None! We just make a trade...
-> The market cap has absolutely nothing to do with the total dollars for which people bought bitcoins. And anyway, when I buy a bitcoin from you fpr 620$, how much dollars are flowing into bitcoin? None! We just make a trade...
But what price did you buy it at? Am I paying more than that? If so, money goes into the system.
March 07, 2014, 01:11:34 PM
Imagine the volume is zero, nobody wants to buy and sell at the same given price. So I sell you one bitcoin for 10 000$. How high would the market cap be? Think of the 4000 new coins everyday. So the market cap grows by 2.4mio. So if no miner sells, no money is needed to raise the market cap.
-> The market cap has absolutely nothing to do with the total dollars for which people bought bitcoins. And anyway, when I buy a bitcoin from you fpr 620$, how much dollars are flowing into bitcoin? None! We just make a trade...
-> The market cap has absolutely nothing to do with the total dollars for which people bought bitcoins. And anyway, when I buy a bitcoin from you fpr 620$, how much dollars are flowing into bitcoin? None! We just make a trade...
March 07, 2014, 12:41:29 PM
This isn't exactly what you're after (apart from anything else it includes the alt coins) but might be useful? https://bitcointalksearch.org/topic/total-money-invested-in-cryptocoins-504367
Thanks, that's a useful starting point. We're looking at an orders-of-magnitude difference, then. Rather than the train passenger theory of "if ten times as many people adopt bitcoins the price will go up ten times."
March 07, 2014, 12:15:45 PM
This isn't exactly what you're after (apart from anything else it includes the alt coins) but might be useful? https://bitcointalksearch.org/topic/total-money-invested-in-cryptocoins-504367
March 07, 2014, 12:01:03 PM
I disagree. Someone buys and the price rises. Sell and it drops. Buy and sell and it stays the same. Marlet cap of $8 bn does not mean $8 bn investment.
I bet it has something to do with calculus.
I bet it has something to do with calculus.
March 07, 2014, 11:23:34 AM
People cash in and cash out all the time, there is no way of determining it and I do not think it is relevant. As long as you get someone pay $1500 for BitCoin, it is worth $1500
March 07, 2014, 09:40:00 AM
Simple question, possibly a complicated answer. One for the economists?
Bitcoin's "market cap" is currently around $8 billion = $640/btc x 12.5 million btc in existence.
However, this does NOT mean that $8 billion has been poured into bitcoin. Almost all were purchased at lower prices (or mined). Many coins were bought at a very low price. As more were bought, the price rose, to where it is now. Basic supply and demand.
My question is: roughly what is the total amount of money that was spent in pushing the price up to where it is now? I imagine there's some sort of exponential graph or a standard model that illustrates this, but I've no idea what it would be.
I think this is relevant because it gives an indication of how much the price would rise given further investment, or how much it would fall when people sold.
That would give a much better metric of long-term prospects than I've seen just about anywhere else. It might allow us to say, If xx corporate investor came on board with $yy million, where would the price go?
Or we could just keep talking about the magic train that's going to take us to the moon...
Bitcoin's "market cap" is currently around $8 billion = $640/btc x 12.5 million btc in existence.
However, this does NOT mean that $8 billion has been poured into bitcoin. Almost all were purchased at lower prices (or mined). Many coins were bought at a very low price. As more were bought, the price rose, to where it is now. Basic supply and demand.
My question is: roughly what is the total amount of money that was spent in pushing the price up to where it is now? I imagine there's some sort of exponential graph or a standard model that illustrates this, but I've no idea what it would be.
I think this is relevant because it gives an indication of how much the price would rise given further investment, or how much it would fall when people sold.
That would give a much better metric of long-term prospects than I've seen just about anywhere else. It might allow us to say, If xx corporate investor came on board with $yy million, where would the price go?
Or we could just keep talking about the magic train that's going to take us to the moon...
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