Topic: Reason for recent price hike - page 2. (Read 3044 times)
I don't think any specific news has caused the hike, but rather a combination of people from all over have recently started buying. Any press is good press as so many people still have not even heard of bitcoins. As the masses start to adapt the price is going to go up.
I understand what you are saying, but in this case it is the number of miners that makes the bitcoins difficult to obtain, not the difficulty. If there are a 10000 miners, each miner will receive an average of 0.0025 BTC per block, regardless of the difficulty. If there are only 1000 miners, then each miner will receive 10 times that -- again regardless of the difficulty.
Look at it this way -- the purpose of the difficulty is to keep the supply of new bitcoins constant. You are saying that keeping the supply constant causes the price to fluctuate.
But to mine something today, they had to buy expensive harware, so they are more likely to not sell cheap, thus hold coins now.
I also believe in this, difficulty going up to fast cause some people buy BTC and hold.
I understand what you are saying, but in this case it is the number of miners that makes the bitcoins difficult to obtain, not the difficulty. If there are a 10000 miners, each miner will receive an average of 0.0025 BTC per block, regardless of the difficulty. If there are only 1000 miners, then each miner will receive 10 times that -- again regardless of the difficulty.
Look at it this way -- the purpose of the difficulty is to keep the supply of new bitcoins constant. You are saying that keeping the supply constant causes the price to fluctuate.
But to mine something today, they had to buy expensive harware, so they are more likely to not sell cheap, thus hold coins now.
Quote
You are saying that keeping the supply constant causes the price to fluctuate.
That's not what I said, but I'll drop it now.
One reason, which will become increasingly more important, is that the difficulty level is skyrocketing exponentially. This means it's harder to mine BTC, which makes them more difficult to obtain (scarce), which makes them more valuable. Supply and demand.
Not true. The supply of newly mined BTC is invariant. It doesn't matter how difficult it is to mine. There is always 25 new bitcoins every 10 minutes regardless of the difficulty.I understand what you are saying, but in this case it is the number of miners that makes the bitcoins difficult to obtain, not the difficulty. If there are a 10000 miners, each miner will receive an average of 0.0025 BTC per block, regardless of the difficulty. If there are only 1000 miners, then each miner will receive 10 times that -- again regardless of the difficulty.
Look at it this way -- the purpose of the difficulty is to keep the supply of new bitcoins constant. You are saying that keeping the supply constant causes the price to fluctuate.
One reason, which will become increasingly more important, is that the difficulty level is skyrocketing exponentially. This means it's harder to mine BTC, which makes them more difficult to obtain (scarce), which makes them more valuable. Supply and demand.
Not true. The supply of newly mined BTC is invariant. It doesn't matter how difficult it is to mine. There is always 25 new bitcoins every 10 minutes regardless of the difficulty.
Yes, there are 25 new BTC every 10 minutes or so, BUT the amount you receive in a given time period is less because your hashing power is reduced, relative to the total hashing power of the network. Another way of saying that is that there are a lot more people (hashing power) competing for the same amount of BTC than there were just a few months ago.
The result is the same: bitcoins, for the individual miner, are more difficult to obtain. I know mine are. If I had kept only the hashing power I had six months ago (or even 3 months ago) I would be generating almost nothing now...although it was a lot back then.
Look no further, here is the definitive answer in 10 easy steps:
1. Stoned, uninformed slave, waiting for the next supply, 0.1 $/BTC
2. Experienced user, they say they cant go down, keeping some BTC for the next shipment: 0.2 USD/BTC
3. You know what? Deflationary! Keep enough BTC for the forseeable future: 0.5 USD/BTC
4. Investior: Gee, this is going to be big - but it can also go to zero! Don't invest more than you can afford: 20 USD/BTC
5 Speculator: Nice graph! Going up! All my 500 dollars in! 10 USD/BTC
6. Buyer and holder: 10000 but - we are too few and don't have big enough guns: 100 BTC
7. Speculator with leverage: To da moon! 300 USD/BTC
8. Speculator speculating on the speculator: This is too crazy too quick! Going down! Sell! 100 USD/BTC
9. Speculator speculating on the speculators speculating on the speculators: 60 USD/BTC
10. Speculator......... 170 USD/BTC
170 in the next few hours is my prediction.
Not 170 yet? 169.99998: But it was rather close, don't you think?
1. Stoned, uninformed slave, waiting for the next supply, 0.1 $/BTC
2. Experienced user, they say they cant go down, keeping some BTC for the next shipment: 0.2 USD/BTC
3. You know what? Deflationary! Keep enough BTC for the forseeable future: 0.5 USD/BTC
4. Investior: Gee, this is going to be big - but it can also go to zero! Don't invest more than you can afford: 20 USD/BTC
5 Speculator: Nice graph! Going up! All my 500 dollars in! 10 USD/BTC
6. Buyer and holder: 10000 but - we are too few and don't have big enough guns: 100 BTC
7. Speculator with leverage: To da moon! 300 USD/BTC
8. Speculator speculating on the speculator: This is too crazy too quick! Going down! Sell! 100 USD/BTC
9. Speculator speculating on the speculators speculating on the speculators: 60 USD/BTC
10. Speculator......... 170 USD/BTC
170 in the next few hours is my prediction.
Not 170 yet? 169.99998: But it was rather close, don't you think?
increased demand
One reason, which will become increasingly more important, is that the difficulty level is skyrocketing exponentially. This means it's harder to mine BTC, which makes them more difficult to obtain (scarce), which makes them more valuable. Supply and demand.
Not true. The supply of newly mined BTC is invariant. It doesn't matter how difficult it is to mine. There is always 25 new bitcoins every 10 minutes regardless of the difficulty.
One reason, which will become increasingly more important, is that the difficulty level is skyrocketing exponentially. This means it's harder to mine BTC, which makes them more difficult to obtain (scarce), which makes them more valuable. Supply and demand.
It seem to me that for good currency flow in a market there needs to be a more stable price. While if bit-coin gets bigger it's price will have more inertia it seem like it won't be that stable for a while. I worded if having a meta currency comprised of multiple methods of "backing" would be better for that. Or it could be as bad as bundling mortgage derivatives and have a horrible delay for matching value with it's component currencies.
I believe the 40% difficulty increase also put some weight...
Sigh. Difficulty does not affect price.
Why not?
First, in contrast to a few years ago, newly mined coins are only a small fraction of the supply of bitcoins in the exchanges. Any argument that mining affects the price is diminished by this fact.
Ignoring that, you might argue that the increasing cost of mining shifts the supply curve because miners try to maintain their operating margin. However, the number of coins mined at a lower margin drops as the margin goes down, so it actually just changes the slope slightly without a significant effect.
Please note that the supply of newly mined bitcoins is fixed regardless of the cost of mining them, and this is different from the effect of higher cost in mining things like gold and silver.
Finally, it is clear that price affects difficulty by placing a ceiling on it. If the price drops, then the difficulty will also drop because miners that are no longer making a profit will stop mining.
This is all about that question again I keep asking.
What is the reason for recent rise in price? How can I find out what people are gauging their buying / selling off or is it pure speculation?
Sorry to keep asking this one.
What is the reason for recent rise in price? How can I find out what people are gauging their buying / selling off or is it pure speculation?
Sorry to keep asking this one.
I think
you need to analyze the market gox,btc-e,cryptsy,etc
what events or mutations both affect the price spikes
When that happens then the price falls
or when there is something useful
for example for the future of the system and its popularity bitcoins in the shops or bars of New York
i cros my finger wont about this stimul
if the mayor many milion metropolis of touts everywhere installed terminals
to pay or receive payments
You can also buy different products and
I think these are the key factors that affect the price
This what i think about this realy my situation
I don't want to wake up and only be able to buy 0.1btc per month!
Get used to it. That day will come
Lol, no one panic about rising prices, but when the price starts falling, a lot of panic sells happens. It is natural for human, when things go better than expected, we dont notice much, but if they turn worse, we overreact
The reason I panic when it's high is because it may get too expensive for me to buy more. I always try to bear it in mind that there's no way Bitcoin is stable and there must be more crashes to come but it's still a little worrying. I don't want to wake up and only be able to buy 0.1btc per month!
So there's a reason not to panic about rising prices at least.
Lol, no one panic about rising prices, but when the price starts falling, a lot of panic sells happens. It is natural for human, when things go better than expected, we dont notice much, but if they turn worse, we overreact
yea agreed its human nature that when going good then nothing panic as any thing going wrong and against then panic starts and many things become wronge
So there's a reason not to panic about rising prices at least.
Lol, no one panic about rising prices, but when the price starts falling, a lot of panic sells happens. It is natural for human, when things go better than expected, we dont notice much, but if they turn worse, we overreact
Thats why we should sell now while its high, or again should we be greed and wait
So there's a reason not to panic about rising prices at least.
Lol, no one panic about rising prices, but when the price starts falling, a lot of panic sells happens. It is natural for human, when things go better than expected, we dont notice much, but if they turn worse, we overreact
Here is the answer you are looking for:
There is a limited amount of bitcoins. Generally, more people are buying bitcoins as it becomes more widely adopted, and that is causing the price to rise steadily. However, when some people see events like the Baidu announcement, they believe that the price is going to rise even more in the future so they buy now before the price rises, and and that drives the price up quickly.
There is a limited amount of bitcoins. Generally, more people are buying bitcoins as it becomes more widely adopted, and that is causing the price to rise steadily. However, when some people see events like the Baidu announcement, they believe that the price is going to rise even more in the future so they buy now before the price rises, and and that drives the price up quickly.
So fixed quantity of coins, plus increased popularity = increased price. So a the general awareness of Bitcoin is just pushing it up as expected. So I suppose what we're interested in is when will more mainstream awareness will hit. So if some law comes in to block Bitcoin then price will probably go down which is likely to happen quite a bit as Bitcoin maneuvers its way in and tries to break down barriers. So there's a reason not to panic about rising prices at least.
I believe the 40% difficulty increase also put some weight...
Sigh. Difficulty does not affect price.
Why not?
Because price affect difficulty, in other words electriciry cost necessary to run minners decide how many are profitable if these exchange mined BTC for USD immediatelly
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