And every sell transaction gives dollars to MtGox. As their dollar goes up, they own a greater % of the supply. They are cornering the dollar market!
See how silly that sounds?
No, not really. China is defintely cornering the dollar market to a large degree and the yuan is undervalued. However, China buys USA debt so the effects have been snuffed out to some degree....but yeah, the fix is in for the US Dollar even without China...its called the Federal Reserve.
The current 30 day volume stat was 1.18 million. That represents a maximum income of about 7000 in the latest month. Because of the discount structure, their real income was probably closer to 3000. For reference, about 7200 bitcoins are added to the system every day. And there was an incident recently where they spent 17,000 BTC. So, it isn't that they are hoarding them, it is just that they don't convert them to dollars.
A max lower volume over time is an expected result of hoarding. Thats one of the criticisms of bitcoins. The 17,000 BTC was an equity investment and not a debt purchase. I doubt that changed their total bitcoin count very much.
Also, if they are creating a false scarcity to drive the price up, they are doing a really shitty job of it.
Lets see them sell those bitcoins and then come back and tell me what kind of job they are doing.
You better hope the frenchie frogs(my apologies to anyone offended) dont say its a currency.
After reading this, I had to go look around to make sure Rod Sterling wasn't lurking nearby.
China can't corner dollars because we can produce them at will in any quantity. I agree with your long term view of the dollar, but it has nothing to do with China and everything to do with Congress. And at any rate, none of this relates in any way, shape or form to bitcoin, far less to mtgox.
Bailout would be a better term than either investment or purchase. But that isn't important in the slightest. What is important is that they spent them, and spending is the exact opposite of hoarding. While you may have plenty of faith in your own doubts, I prefer data. I'm pretty sure that mtgox publishes trade data back to the beginning of time, so if you are interested in replacing your faith with evidence, you should be able to figure out how to come up with a reasonable estimate of how much income mtgox has generated. Until then, I've provided good estimates that suggest that it will take 3 to 6 months of income to replace the 17k they spent, based on current trade volumes.
And that is just a single noteworthy purchase. For all we know, they could be spending their excess coins on socks, porn and profit sharing like the rest of us.
You do know that adding more supply to a market lowers prices, right? And so in your hypothetical example, if they decided to sell, it would make the price go down, and not up.
