Topic: i have a few questions. (Read 1740 times)

thank you every one for the help!
i finally opened a wallet if any one wants to help me see if it works. 
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1. I use bitcoin to make money, but also because it encourages economic freedom, so I use it out of principle too.
2. I neither mine nor day-trade. I make money by investing in bitcoin stocks (I use BitFunder.com and BTCT.co mainly)
3. You can check the historic price of bitcoins by checking bitcoincharts. The price can go up by a factor of ten over a couple months, or it can stay withing a 10% range for months. Predicting the future price of bitcoins is hard.
4. No, there is no official value. A bitcoin is just worth whatever you and another person agree to trade it for. Check the "markets" link on the bitcoincharts.com to see what it is currently trading for at a number of different places.
5. The amount of money you make will be determined by your trading strategies, the movements of the market, and how well you can predict future movements. If you try to actively trade it you might get burned and lose your money. (Like I said, predicting the future price is hard, the price can move suddenly for no apparent reasons.)
6. Bitcoins are a high risk investment. There is a possibility that somebody will crack the bitcoin algorithm and they will all become worthless. There is also a possibility that people will just get bored and stop using them, so their value will drop. Or somebody will invent a competitor which is better, then people will stop using bitcoins and their value will drop.

Hope that helps.

You and everybody else. So this idea won't work, because by the time the price goes down, everyone else will have bought some too (especially automated trading bots that are faster than you), so the price will have gone up already. Or the price will continue to drop, when you thought it was done, and you'd just lose more money. No one can predict the market (or almost no one, since some people get lucky). If you could do that, you'd have more luck on the stock market. That said...


I use it mainly to store up savings that I can take with me when I decide to retire and travel around. That my savings are predictably growing in value is a nice benefit.


Used to mine, but mining isn't really recommended any more, unless you want to set up mining as a professional business instead of a hobby. You could buy&sell and daytrade, but good luck on not losing everything, because everyone else, with way more experience than you, is buying&selling too. Your best bet is just to buy and hold.


Historically? Maybe once a year. In the future? Who knows. If you're talking about nominal value jumps, like $50, they'll be more frequent in the future, simply because a 5% jump when bitcoin is worth $1,000 is $50. 5% is not a big jump though. If you mean percentage jumps, like 100% or 200%, it's been doing that about once a year.


Bitcoin is decentralized, and thus doesn't have an "official" anything.


Since bitcoin is private, most people who make any substantial money wouldn't tell you. But you need money to make more money, and the more money you have the more you can make. Or lose. But if Bitcoin doubles or triples again next year, your 3BTC should be worth double or triple what you paid for them, so.. that's simple I hope.


Extremely risky. There is little to no chance of it plummeting to being worthless at this point, simply because there are so many people and businesses invested in it, plus bitcoin the protocol has a TON of uses and benefits (http://www.whyisntbitcoinworthless.com), but it can still fluctuate unexpectedly, and make you lose 20% or 30% of your holdings within a day or two. That said, if you have enough bitcoins to live just 10% off of, and your holdings fluctuate 30%, you won't really be affected, since you'll still have the other 70%. Also, look into "dollar cost averaging." It's a great investment scheme for things that are generally appreciating in value. Personally, I switched to bitcoins and am using them for all my cash holdings (only other things I hold is USD denominated mutual funds in my IRA/401k), so, to me personally, Bitcoin risk is pretty low.

i saw that there is some other coin called litecoin. and its cheap and can be ,mined with a normal computer. does any of you have experience with it?

Per annum (per year).

No, that's 1300% on top of my original investment. Buy for 10, sell for 140. Of course, such rapid gains are much less likely now that the market is larger and more mature, and in any case Bitcoin should be regarded as a high-risk investment.

Don't start from 3 bitcoins. It's too risky. Start from 300.

The risk is to lose one-in-lifetime opportunity to become rich. In several year's time bitcoin will be worth either nothing or a lot. You've already lost the chances to start from 300,000, from 30,000, from 3,000. While you will be playing with 3 coins you'll lose the chance to start from 300, then - from 30, and then - from 3 (and most of your original 3 coins will be lost in daytrading).

tl;dr: To make money on BTC, buy now, as much as you can, put them on paper wallet and forget for several years.

And this is spot on.

I considered this entire bitcoin thing to be like a game, and the money I set aside to invest and play the markets was essentially game money.

That is certainly worth mentioning.

I tend to buy alternative crytpo-currencies when they are weak and with stocks getting in at the bottom (IPO) has worked out well so far.

When day trading bitcoin with usd I have lost money. That pair (usd/bitcoin) is dangerous because bitcoin can rise and never ever return to a usd value. But trading ltc to btc has worked because historically there was a constant cycle between 0.028 - 0.03 ltc/btc and it was possible to cash in on that (don't try this at the moment as ltc is not doing very well against btc and there is no cycle)

An easy way to answer to most of your questions: replace "bitcoin" with "dollar" or "euro" and then answer. Do you use dollar mainly to make money? how do you make money out of dollar? mining or buy&sell the dollars?

i dont plan on getting rich quick. i understand that there is allot of reading and research to do. and i need to learn how things effect the value of the BTC.
and again. im going small. buying a few coins, wait for a rise in value, sell, and so on. i dont have much to spend and if i could make a few tens of dollars then im good. 
 
BTW, how many coins are you messing with? and how often do you buy and sell? do you wait for a big rise to sell or you sell and buy all the time when its a few bucks differences?

Bitcoin is not a get rich quick scheme.

Three things: FUD, News and liquidity.

My worst day and best day have been because of FUD/News. I make a position I find comfortable that I have made before and then paranoia starts spreading and a exit had to be made, yes I have failed and moved out of a position that If I had left myself in for a long period of time would have gained. But thats emotion for you. Its hard to see lots of hard earned money disappear. Even when things seem predictable shit happens.

Liquidity, if the market has no depth near a position you want and you need out then this really screws you over. You might see a price but that does not mean you can sell hundreds of Bitcoin at that price. Market depth is so important I really wish I had researched this more before I started trading.

I have made mistakes and gains, overall the gains have been worthwhile but to be honest I feel like day trading is a gamble and I have been lucky. Some people have skill but I am not I am one of those people.

The issue is when the value starts to erode away, do you have the guts to hold a losing position for months of lower and lower prices before it rebounds? I got out sometimes early to save even greater loses. Holding is actually the most important thing in trading. Learning patience.

how did you loose that much and earned that much?

the most possible way to loose is if i sell them for lower then what i bought them right? like if i think the value will not increase or if i need the money now and i have to sell. it doesn't sound to risky... am i missing somthing?

I have purchased some services with my Bitcoin, and also invested them on BTC-TC to make some money, its a lot of work though. (Very easy to lose money)

I have mined about $5 worth of Bitcoin, so that is not viable for me. Mainly day trading stocks and Litecoins.

Not very often. When the price starts moving large like that be careful coming in and out of pairs (litecoin to bitcoin and usd to bitcoin)

Value is set by the free market, meaning anyone and everyone sets the value. The equilibrium between what people want to buy and sell defines the current price. As more people want Bitcoin the price will go up because people will start selling it for more knowing that there is more demand. The reverse is also true.

My max loss in a day is 100 bitcoins and my max gain in a day is 100 bitcoins. Be very careful!

You could lose it all day trading, your government might ban it, a fatal flaw might be found, the exchange might be a scam and run with your money, etc... do lots of research.

 Yes.

Useing it, Offering Goods and Services, dividend paying shares etc...

Every month now  

The value is subjective, bitcoin to me looks like a 1000$ item, its head toward that, and eventual were breaking through the wall!

If you're an ok trader with a reasonable strategy, you can make good profits trading. but you really have to be watching and trading the daily action.


Depends,
you can buy bitcoin then buy bitcoin stocks at havelockinvesment.com, all solid bitcoin businesses are booming right now, these are maybe less risky investments, but the returns are likely to be less then simply holding bitcoin...

but the "risk" associated with holding bitcoin can be gr8ly minimized if you 1) know what you're doing ( encrypted money baby!   ) 2) actuly use bitcoin as your "Money" piggy bank wtv you can do to help fulfil the self fulfilling  prophecy that is bitcoin

i just wanted to make sure you guys dont think im on the mining thing. no need for sarcasm.


FOXPUP,
whats PA?
and 1300%? so you buy for 10 and sell for 130 for example? wow!

You shouldn't talk about these plans out in the open. Someone might steal your idea.

Yes, but it's not just about the money, it's about changing the world for the better. Though, to be fair, there aren't many honest ways of making a shitload of money without changing the world. Capitalism's all about incentives.

Buy low, sell high.

Like, $50 in a day? Pretty rare. $50 in a month? Not so rare.

Is there any official value of a gallon of milk? Or anything else for that matter? No, value is just whatever price a buyer and seller can agree on. If a buyer offers too low a price, nobody will sell to him. If a seller charges too high a price, nobody will buy from him. They have to reach an agreement in order to make a trade. The price you see listed on exchanges is simply an indication of what that exchange's users are currently willing to trade bitcoins for.

On average, about 1300% pa. Note that past performance does not guarantee future results. Only invest what you can afford to lose.

It did after June 2011. The price went from from $32 to $2 and took nearly two years to recover. There have also been other crashes since then, though none so massive, and of course the market is a lot larger now, but it's still rather small is the grand scheme of things, so don't assume it won't crash massively in the future.

Then there's also the risk of your bitcoins being lost or stolen, so make sure you encrypt and backup your wallet (in that order) and keep it secure.

My plan is to wait until the value drops and buy some coins. and then sell when the price goes higher on sites like bitstamp.

5. If you mean buying/selling on established, functioning exchanges (Bitstamp, CampBX, etc.), then the above previous answers apply.

But if you mean buying/selling to individuals, then know that the open market is a dog-eat-dog jungle. On the one hand, you will lose money to some very experienced and talented scammers as part of your learning process. On the other, you will face the challenge of persuading potential customers that you are not a scammer. yourself

I now make a modest income selling BTC to individuals on bitquick.co and localbitcoins.com but it took me a long time to learn how avoid being scammed and how to earn the trust of my customers. If this is your interest, I encourage you, but be aware of the learning curve and its pitfalls.