Liquidity problem - page 3. | Bitcointalksearch.org

yvv

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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?

MonadTran

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Quote from: yvv on July 15, 2013, 02:46:59 PM

This is written million times on bitcoin wiki and around this forum.

Repeating the same thing a million times does not add significance to it. An alt-currency might, or might not, become more significant than Bitcoin. As soon as I notice this happening, I would start diversifying.

Quote from: yvv on July 15, 2013, 02:46:59 PM

there are still plenty of dreamers who think that hoarding bitcoins will make them rich, because it will continue to raise in value forever.

It might continue rising in value for my entire life, which is good enough for me. It might drop to 0 as well, but I do not see how this is more likely than a permanent 100x increase in value.

joesmoe2012

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

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

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.

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.

Same point i was trying to make but much better job of explaining it.

carolstreet444

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

Quote from: johnyj on July 15, 2013, 05:19:09 AM

And why new people won't want to spend that much money into bitcoin, if they saw this thing appreciated 10 times per year averagely

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.

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

Kazu

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

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.

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.

Jutarul

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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.

notme

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Quote from: yvv on July 15, 2013, 02:26:08 PM

Of course, everybody contributes different amount. This does not change the fact that bitcoins can not continue to appreciate 10 times every year longer than couple of years more.

Do you mean to tell me the potential upside is no more than 10,000% (10X for 2 years)? Bummer. Here I was thinking I could make some money.

yvv

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Quote from: yvv on July 15, 2013, 02:46:59 PM

Quote from: joesmoe2012 on July 15, 2013, 02:36:11 PM

And for all we know bitcoin could just be the beginning of crypto-currencies. The model T was a great car, but i wouldn't want to commute with one these days.

This is written million of times on bitcoin wiki and around this forum. Nevertheless, there are still plenty of dreamers who think that hoarding bitcoins will make them rich, because it will continue to raise in value forever.

yvv

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Quote from: joesmoe2012 on July 15, 2013, 02:36:11 PM

And for all we know bitcoin could just be the beginning of crypto-currencies. The model T was a great car, but i wouldn't want to commute with one these days.

This is written million times on bitcoin wiki and around this forum. Nevertheless, there are still plenty of dreamers who think that hoarding bitcoins will make them rich, because it will continue to raise in value forever.

joesmoe2012

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Quote from: MonadTran on July 15, 2013, 02:26:55 PM

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

this is not going to happen, because 99.9% of people do not even know about bitcoins

That's a bit like, a guy from 1970 arguing that there can be no Internet, because 99% of the people do not even know what a computer is.
Why the hell does that 99.9% number have to remain static?

And for all we know bitcoin could just be the beginning of crypto-currencies. The model T was a great car, but i wouldn't want to commute with one these days.

yvv

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Quote from: MonadTran on July 15, 2013, 02:26:55 PM

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

this is not going to happen, because 99.9% of people do not even know about bitcoins

That's a bit like, a guy from 1970 arguing that there can be no Internet, because 99% of the people do not even know what a computer is.
Why the hell does that 99.9% number have to remain static?

I did not said that it have to remain static. I said that today, newcomers are still entering the pyramid, that's why bitcoin value increases. But this will be over very soon.

MonadTran

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

this is not going to happen, because 99.9% of people do not even know about bitcoins

That's a bit like, a guy from 1970 arguing that there can be no Internet, because 99% of the people do not even know what a computer is.
Why the hell does that 99.9% number have to remain static?

joesmoe2012

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Quote from: yvv on July 15, 2013, 02:26:08 PM

Of course, everybody contributes different amount. This does not change the fact that bitcoins can not continue to appreciate 10 times every year longer than couple of years more.

This i agree with, its unsustainable.

yvv

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Of course, everybody contributes different amount. This does not change the fact that bitcoins can not continue to appreciate 10 times every year longer than couple of years more.

joesmoe2012

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Ching-Chang;Ding-Dong

In what world do you live in, where any markets capital is based upon every person evenly contibuting...

We just need a few warren buffets of the bitcoin community, and then billions of people never will have to touch a bitcoin.

yvv

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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.

MonadTran

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Quote from: yvv on July 15, 2013, 01:25:26 PM

Believe it or not, there are idiots who invest all their savings into bitcoins.

There are even smart people who invest all their savings into Bitcoin Wink

MonadTran

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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.

yvv

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Quote from: bitcoin44me on July 15, 2013, 06:57:44 AM

You might want to give it a try, and spend 100 USD in bitcoins, but will you spend 1 000 USD or 10 000 USD for 1 bitcoin considering the fact that it can disappear and lost all his value?!

Believe it or not, there are idiots who invest all their savings into bitcoins.

yvv

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Quote from: johnyj on July 15, 2013, 05:19:09 AM

And why new people won't want to spend that much money into bitcoin, if they saw this thing appreciated 10 times per year averagely

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.

Topic: Liquidity problem - page 3. (Read 4204 times)