Topic: Recent falloff in transactions (Read 1126 times)

There are different types of currency traders. The professional ones with high volume and bots etc. will most likely have their money at the trading sites most of the time. People like me will not store any coins at 3rd party sites for longer than I have to. That explains something at least.

I've been growing more confident regarding sites such as Mt. Gox, they have apparently increased their security significantly. And the security on my end is as good as it can be, I use a long totally random password and I also have a yubikey. But still I don't keep money there that don't really need to be there, my encrypted wallet at an offline location still beats gox.

I would argue that Mt. Gox is probably these days a safer place to store large amount of coins than your basic desktop computer though. So if one is not tech-savvy it seems a good place to keep those coins. Especially if you use a good password that's not in use anywhere else and a yubikey as well.

I'm wondering when the new version of Bitcoin wallet is released. They have been coding it for months. I'm not on the inside so I have no clue what's happening, do they not have enough volunteers or how difficult can it be to add encryption to the client?

I know the encryption won't solve the security problem entirely but it'll make it a bit more difficult to hack the wallets. You'll probably be safe after that with a small amount of coins regardless of the machine, because it'll require effort to hack and generally a small amount isn't enough to motivate real hackers.

I was not clear if gox could really be trusted so as soon as I purchased my coins,so I sent em to myself.

Everyone was likely moving bitcoins to and from MtGox to sell / obtain them in their wallet.  If people are just sitting on them now, then there are less transactions. 

What I was counting in the graph was transactions in the blockchain - surely speculation remains completely within an exchange and does not enter the blockchain at all? Daily transactions peaked at about 30,000 transactions/day in June, about the same time the price peaked on the exchanges. Right now there are about 13,000 transactions per day. What were the users doing with their bitcoins in June that they are not doing now?

The flip side is that if the growth rate in the mid section of this graph were to continue (63% increase per month) then bitcoin would match visa for transaction numbers (4000/sec) within 2 more years. I suspect it's going to take a little longer than that, so there should be some growth bumps along the way.

Simon

Well, the transactions have been falling ever since the June peak because we didn't really have the infrastructure and real trade to support that amount of transactions yet. It was mostly speculation. Now we are slowly recovering to the level the economy can actually support and the price has moved hand in hand with this reality.

The good thing is that the infrastructure, the services and the tools within this economy have been growing steadily all the time. In fact it has accelerated very significantly in the recent months, after the big surge in interest.

So my advice is to keep building the infrastructure and make it better, while marketing those services so that we get more actual users of Bitcoin, who trade for goods and services with it. This will result in more actual transactions which will make the economy healthier and the price higher.

This will most likely start another massive speculation cycle, but that doesn't matter. What matters is that the underlying economy is growing stronger all the time. And this is where the real focus should be.

Speculation as to why this is happening, when it will reverse, and how to help it reverse?

See graph of bitcoin blockchain transactions per day:
http://www.fileswap.com/dl/s7BpaUs/tx-day.png

http://dl2.fileswap.com/download/?id=uc5c0ivOw%2FFKn1iuhwry2Hs%2BV6kl%2FvLCoxRtwF%2FBJAY%2FTbHniQIEfpERsnqcdNJxWjFt0FhA9Ujfp8o6PbmH94CwJHE0ivoc8lT4EIVQM1Gk%2BCN2LUIsGZQV3N2DNYs7&h=fbafc31069e43186cd24c366569457c7&t=4e76bd57