Liquidity problem - page 2. | Bitcointalksearch.org

notme

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Quote from: yvv on July 15, 2013, 03:51:34 PM

Quote from: notme on July 15, 2013, 03:45:31 PM

Quote from: yvv on July 15, 2013, 03:41:20 PM

Quote from: notme on July 15, 2013, 03:36:37 PM

Bitcoin has uses besides trading Roll Eyes

Yes, I know. But this is more in theory than in practise.

So you admit your theory doesn't apply here in reality?

My theory?? Bitcoin business on every corner in the world is not my theory. I do not see any businesses around me. But I see a lot of dreamers who think that they can live just selling forever rising in price bitcoins.

I too see a lot of dreamers who think everyone will be paying for their Amazon goodies in Bitcoin. Which is most likely a misapplication without some sort of intermediary layer.

Rather, Bitcoin will more likely evolve into a sort of SWIFT system for cryptos. Yeah, there will be those with some bitchange swapping it for e-books and VPN serivce, but that will essentially be a backwater of the crypto economy.

I also see this as a likely future, and it fits with my statement that Bitcoin has other uses besides exchanging for fiat. Still, there is a lot going on in the bitcoin economy besides fiat exchange, and if someone is bothered by the dreamers maybe they should quit hanging out in the forum dedicated to dreaming about the future.

Jutarul

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Quote from: yvv on July 15, 2013, 03:13:33 PM

Quote from: Jutarul on July 15, 2013, 02:55:42 PM

Quote from: yvv on July 15, 2013, 02:18:19 PM

Right now, capitalization of bitcoins is $1B. If it continues to appreciate 10 times per year, its capitalization would reach $1T in 3 years. To reach this number, every single person in developed world would need to invest $1K into bitcoins.

false.

No investment is needed at all. Only the time preference for saving vs. dissaving has to change for the price to move. To give you an extreme example - if everybody stops selling bitcoin, the price is infinite. If nobody buys bitcoin, the price is zero. No funding needed. Please study price discovery mechanisms before you make conclusions like that.

Oh yes, money appear out from thin air. Don't you understand that if some miners or hoarders make X USD profit from selling bitcoins, this is just because other hoarders lose exactly the same amount?

You're mixing two things. Bitcoin valuation and mining profits.

If price moves up the opportunity cost for holding purchasing power increases, putting a downward pressure on prices (negative feedback). However, as prices move up and bitcoin hoarders fill their immediate consumption needs by spending, their time preference gets lowered, ie they can tolerate a higher opportunity cost. This leads to a situation in which their purchasing power increases faster then they are spending it (enrichment). This enrichment does not have to match the incoming purchasing power. (Not zero sum)

The influx of new bitcoins from miners puts an additional downward pressure on price because they can arbitrage from the cost of production.

yvv

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Quote from: ?? on ??

Quote from: yvv on July 15, 2013, 03:51:34 PM

My theory?? Bitcoin business on every corner in the world is not my theory. I do not see any businesses around me. But I see a lot of dreamers who think that they can live just selling forever rising in price bitcoins.

You didn't see a computer in every home 20 years ago.
I look forward to times when everyone buys bread with BTC using their smartphone in a grocery store.
Just wait 20-50 years.

You will definitely be able to buy bread in a grocery store using smartphone in nearest future, no questions. I doubt a lot that it will a bitcoin, though. Better technology will come up.

Buy the way, you gave me not bad life expectancy.

Odalv

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Quote from: notme on July 15, 2013, 03:36:37 PM

Bitcoin has uses besides trading Roll Eyes

+1 ... smarter guy will buy Bitcoin and upgrade some service (endless oportunities .. better exchange, better security .. but keep compatibility with Bitcoin 0.1)

yvv

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Quote from: ?? on ??

Quote from: yvv on July 15, 2013, 03:41:20 PM

Quote from: notme on July 15, 2013, 03:36:37 PM

Bitcoin has uses besides trading Roll Eyes

Yes, I know. But this is more in theory than in practise.

Everything is working just fine. http://blockchain.info/charts/tx-trade-ratio

You should expect the currency exchange volume to be some multiple of spending for goods/services.

Does not the same happen if just more and more hoarders are attracted by the rising price?

notme

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Activity: 1904

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Quote from: yvv on July 15, 2013, 03:51:34 PM

Quote from: notme on July 15, 2013, 03:45:31 PM

Quote from: yvv on July 15, 2013, 03:41:20 PM

Quote from: notme on July 15, 2013, 03:36:37 PM

Bitcoin has uses besides trading Roll Eyes

Yes, I know. But this is more in theory than in practise.

So you admit your theory doesn't apply here in reality?

My theory?? Bitcoin business on every corner in the world is not my theory. I do not see any businesses around me. But I see a lot of dreamers who think that they can live just selling forever rising in price bitcoins.

I misunderstood you, so you misunderstood me. I now see you are saying the uses are more theoretical than practical. Now that you have made yourself clear all I can say is this: Maybe you spend too much time on the speculation subforum.

yvv

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Quote from: notme on July 15, 2013, 03:45:31 PM

Quote from: yvv on July 15, 2013, 03:41:20 PM

Quote from: notme on July 15, 2013, 03:36:37 PM

Bitcoin has uses besides trading Roll Eyes

Yes, I know. But this is more in theory than in practise.

So you admit your theory doesn't apply here in reality?

My theory?? Bitcoin business on every corner in the world is not my theory. I do not see any businesses around me. But I see a lot of dreamers who think that they can live just selling forever rising in price bitcoins.

notme

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Activity: 1904

Merit: 1002

Quote from: yvv on July 15, 2013, 03:41:20 PM

Quote from: notme on July 15, 2013, 03:36:37 PM

Bitcoin has uses besides trading Roll Eyes

Yes, I know. But this is more in theory than in practise.

So you admit your theory doesn't apply here in reality?

MonadTran

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Quote from: yvv on July 15, 2013, 03:35:38 PM

The amount of fools who are ready to bring money into system saturates quickly.

Good news! We don't need fools right now, we need intelligent people.

yvv

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Quote from: notme on July 15, 2013, 03:36:37 PM

Bitcoin has uses besides trading Roll Eyes

Yes, I know. But this is more in theory than in practise.

yvv

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Quote from: Kazu on July 15, 2013, 03:17:15 PM

Quote from: yvv on July 15, 2013, 03:14:46 PM

Quote from: carolstreet444 on July 15, 2013, 02:58:54 PM

What? Bitcoin no is pyramid. We great investment are!

It was not mean to be, but it actually is right now.

By that logic any appreciating asset is a pyramid scheme.

No. It depends on how it is appreciating.

notme

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Quote from: yvv on July 15, 2013, 03:35:38 PM

Quote from: Kazu on July 15, 2013, 02:57:59 PM

Its probably not going to reach 1T market cap in 3 years. However do you really think that every single person in the developed world invests aprx. $414 into XOM? Of course not. Don't even get me started on gold. Let me explain to you how things work. Rather than every single person investing $1k, a few rich guys invest 1000 times what the 'average' person would have to. Then, if you're lucky, they'll use use that 1000 times investment they just made as collateral to borrow money to invest another 1000 times more than what the 'average' person would have to. Then there's the whole idea that the market cap is partially 'missing' because it is being held by either wallets with either an unknown private key, or people that aren't spending/selling bitcoins at any given time.

It does not matter if few rich guys invest a lot or many poor guys invest little. It is true that many bitcoins were not in circulation since they were mined. But this does not change anything. If you bought btc last year and sold today at 10x price, this is just because guys who lost their opportunity last year give you their money. They do this because they think that next year some fools will give them 10x more. And this is not going to continue for long. The amount of fools who are ready to bring money into system saturates quickly.

Bitcoin has uses besides trading Roll Eyes

yvv

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Quote from: Kazu on July 15, 2013, 02:57:59 PM

Its probably not going to reach 1T market cap in 3 years. However do you really think that every single person in the developed world invests aprx. $414 into XOM? Of course not. Don't even get me started on gold. Let me explain to you how things work. Rather than every single person investing $1k, a few rich guys invest 1000 times what the 'average' person would have to. Then, if you're lucky, they'll use use that 1000 times investment they just made as collateral to borrow money to invest another 1000 times more than what the 'average' person would have to. Then there's the whole idea that the market cap is partially 'missing' because it is being held by either wallets with either an unknown private key, or people that aren't spending/selling bitcoins at any given time.

It does not matter if few rich guys invest a lot or many poor guys invest little. It is true that many bitcoins were not in circulation since they were mined. But this does not change anything. If you bought btc last year and sold today at 10x price, this is just because guys who lost their opportunity last year give you their money. They do this because they think that next year some fools will give them 10x more. And this is not going to continue for long. The amount of fools who are ready to bring money into system saturates quickly.

Odalv

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Quote from: Kazu on July 15, 2013, 03:25:16 PM

Quote from: Odalv on July 15, 2013, 03:19:32 PM

b) market capitalization
- Apple Inc. $401.83B
- Microsoft $302.06B
- IBM $215.11B
- Facebook $63.54B

You guys sure like tech companies don't you.

Bitcoin is in early stage, only tech guys can understand what is Bitcoin. :-) But this will change in next few years.

Kazu

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Quote from: Odalv on July 15, 2013, 03:19:32 PM

b) market capitalization
- Apple Inc. $401.83B
- Microsoft $302.06B
- IBM $215.11B
- Facebook $63.54B

You guys sure like tech companies don't you.

carolstreet444

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Meaning you gold pyramid scheme is too? No worth is if invest nobody more any? Apple is no pyramid, Apple is apple yummy grateful sunbaked

Odalv

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Quote from: yvv on July 15, 2013, 02:18:19 PM

Quote from: MonadTran on July 15, 2013, 01:37:13 PM

Quote from: yvv on July 15, 2013, 01:22:12 PM

This happens only because each year newcomers pay 10 times more to buy bitcoins from those, who bought them 10 times cheaper last year. This will not happen forever. When inflow of newcomers into the system will stop, the game will be over. This happens with all financial pyramids sooner or later.

Why would the inflow of newcomers stop, in any foreseeable future? Bitcoin has obvious advantages over fiat, its march can easily continue for as long as there is fiat currency left in the world.

You know, the number of people on the Earth is finite. And the number of anarcho-libertarians is even more finite.

Right now, capitalization of bitcoins is $1B. If it continues to appreciate 10 times per year, its capitalization would reach $1T in 3 years. To reach this number, every single person in developed world would need to invest $1K into bitcoins. An this is not going to happen, because 99.9% of people do not even know about bitcoins. And there are altcoins popping up every week.

Bitcoin market is going to reach saturation in couple of years maximum. And after that, depreciation in value is unavoidable, since millions of hoarders will want to sell their btc at same rate as they do now, because they need to pay their bills in fiat, but no newcomers will want to buy this btc at this rate anymore.

a) As of 2008, there were 10 million people around the globe who are classified as U.S.-dollar millionaires.

b) market capitalization
- Apple Inc. $401.83B
- Microsoft $302.06B
- IBM $215.11B
- Facebook $63.54B

c) Bitcoin will not inflate, so even 1 BTC = $100,000 USD (after reach saturation) it will better to hold BTC (keeps value) than USD (loses value over time).

notme

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Quote from: yvv on July 15, 2013, 03:13:33 PM

Quote from: Jutarul on July 15, 2013, 02:55:42 PM

Quote from: yvv on July 15, 2013, 02:18:19 PM

Right now, capitalization of bitcoins is $1B. If it continues to appreciate 10 times per year, its capitalization would reach $1T in 3 years. To reach this number, every single person in developed world would need to invest $1K into bitcoins.

false.

No investment is needed at all. Only the time preference for saving vs. dissaving has to change for the price to move. To give you an extreme example - if everybody stops selling bitcoin, the price is infinite. If nobody buys bitcoin, the price is zero. No funding needed. Please study price discovery mechanisms before you make conclusions like that.

Oh yes, money appear out from thin air. Don't you understand that if some miners or hoarders make X USD profit from selling bitcoins, this is just because other hoarders lose exactly the same amount?

Your statement is only true on the day bitcoin hits a value of 0.

Kazu

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Activity: 168

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Quote from: yvv on July 15, 2013, 03:14:46 PM

Quote from: carolstreet444 on July 15, 2013, 02:58:54 PM

What? Bitcoin no is pyramid. We great investment are!

It was not mean to be, but it actually is right now.

By that logic any appreciating asset is a pyramid scheme.

yvv

legendary

Activity: 1344

Merit: 1000

.

Quote from: carolstreet444 on July 15, 2013, 02:58:54 PM

What? Bitcoin no is pyramid. We great investment are!

It was not mean to be, but it actually is right now.

Topic: Liquidity problem - page 2. (Read 4204 times)