Topic: rpietila Wall Observer - the Quality TA Thread ;) - page 75. (Read 907212 times)

isolated actors =! the majority, troll

Faggot

I agree but my opinion is that the price situation would need to be catastrophic for large scale miners to resort to dumping their reserve.

As I have mentioned in another post related to this, most of them have other revenue stream atm that certainly generate enough money to cover their operational cost.

You tried that one in the other thread troll. Please go away you stink rotten fish.

Yes it is perfectly reasonable for them to admit they are selling in order to cover the cost of their operations. Some admitted they do so and there are absolutely miners out there who have no problem admitting they sell a large quantity of their coin so that kind of defeats your argument, doesn't it? Troll

If miners sold every coin that they mined and did not believe in the future of Bitcoin, would you expect them to admit it?  That would be a bit like a fishmonger yelling "Fish, not-so-fresh fish!  Stinks to high heaven, I can't stand it, buy my fish!"

Economically, mining is a different business than holding. If a person wants to hold BTC, it is not relevant if the value to be held was created with mining BTC or anything else.

IF mining profitability is down, and consequently miners don't make profit, this could practically be bad for bitcoin IF it is so that miners tend to hold a high % in bitcoin (which is plausible).

The powers that be, indeed wanted -for a long time now- a global, electronic currency that they can issue, monitor and control.

- Issue on demand, and NOT deflationary as you said, because deflation would only lead to an imploding global debt. It is impossible to repay global debt that expands due to interest with a steady or diminishing monetary supply: The money runs out and the economy collapses.

- Monitor all transactions as they happen, so that they can learn everything about our buying habits, or use the mass information for mapping out patterns which are useful to their broader control agenda.

- Control the currency, and by association, its users, through flip-switches like freezing your funds if you do not comply with a government request so that you cannot buy anything (and therefore directly threatening your ability to survive while living inside-the-grid).


Bitcoin is "trolling" their agenda in at least 2 of the 3 fronts:

1) It cannot be issued on demand - it has a finite capacity.

2) It can be monitored but not with 100% success as a centralized system.

3) The currency and its users can't be controlled with "flip-switches". When the centralized digital money system will lock people out from transacting because they were not obedient to the system, people will have BTC or BTC-equivalents - something that preempted their plans. In a cashless society it will be gold, silver, btc and the "official" digital currency of the world - with gold and silver being slightly less practical (or much less practical for remote payments like over the internet).

What they can do though, is to attack Bitcoin due to all the non-reversible scams & hacks, bad PR, price fluctuations etc etc, and say "look, we will give you a digital currency that is all that Bitcoin was and safer, more stable due to government backing" etc etc. We give you safety and stability and we take your freedom kind-of-deal. The masses would take it any day btw with some proper conditioning. The problem is not the masses, it's the states/countries. Why give monetary control to an outside source? It is financial suicide if a country can't issue their own national currency and instead have to borrow it from a central bank which is elsewhere. So they might entice the countries by saying "we'll erase a large part of your debt if you accept this new currency" and that will give the puppet-rulers installed in each country a disguise of "legitimacy" for betraying their countries and handing over monetary control to the over-state of the global central bank.

Such "proof' or links to such is/are missing from your post.
Regardless, if miners DO NOT sell their coins, then this bear market is about to get even worse, because at some point they WILL (when price/cost ratio becomes even more skewed). Don't take me as a bitcoin bear, though. I bought bitcoin, I mine, I am not selling (somewhat irrationally). In my opinion the scenario I outlined is the one that is most likely to occur, but I have no crystal ball.

Miners dumping all dumping a majority of their coin is a myth that I have repeatedly proven to be wrong.

Have you read the DiitalBTC Q3 report?
http://www.asx.com.au/asxpdf/20141020/pdf/42t0mqrygyzd74.pdf

As OP had also posted, only indirectly, of course. High hash power for higher cost producers (miners) causes them to liquidate larger and larger % of their bitcoin, shifting the price equilibrium toward lower BTC cost-in a vicious cycle.


It is difficult to calculate, but from the personal experience, either hosting or home based cost ~10-14c/kwh in US, which makes costs around ~$135-150/BTC for most efficient hosted machines and ~$110-125 for home based miners, so your number is essentially correct. This does not take into consideration the cost of mining equipment, which is unrealistic, of course. In a hosting situation, i have to either sell ~50% of mined BTC or keep BTC and cover costs out of pocket. Every increase in difficulty and stagnating or decreasing price will skew this more and more toward 100%. The option of not selling is not available in most cases for large organizations, although bitfury claimed that they do not currently sell mined BTC because the price is "too low".

yes, I agree. I think it makes sense to look at the percentage of mined coins being sold by miners (I have no idea what that currently is.. maybe 50%?). It cannot reach >100%, so the vicious cycle is broken at that point. I recently guesstimated at what price miners would have to sell 100% of their coins to cover operating cost (captial investment excluded). Came out to very roughly $100. If anyone has better numbers, I'd be interested to see them.

Price obviously affects total hashpower, but I cannot see how hashpower could influence price.   The number of new coins mined per day is pretty much independent of hashpower (except momentarily, between difficulty adjustments).  While miners desperately wish the BTC price to go up, they have no means to influence it.

My reading of what happened in 2011 is: a new large market (drug users? Thailand?) opened in Apr/2011, and, as it adopted bitcoin, the demand caused the 2011 bubble, pushing the price from ~0.6$ to ~14$ in Jul/2011.  But that market then closed (Thailand banned bitcoin?), and its members gradually sold its coins; so that the price started to drop towards the pre-bubble level (~0.6$).  However, in Nov/2011 -- when the price was still at ~2.2$, or +1.6$ above the floor, but still dropping -- another market opened, and its demand bumped the price to ~6.6$ (a +4.5$ increase).  Meanwhile, the first market continued to shrink; by the end of Feb/2012 its demand had vanished, eliminating the remaining +1.6$ overprice and bringing the price down to 5.0$.  Thus the the second market, alone, was responsible for the overall increase from ~0.6$ in Apr/2011 to ~5.0$ in Mar/2012.

The situation now seems to be indeed similar to that of Nov/2011. The Chinese speculators who were responsible for the Nov/2013 bubble seem to be losing interest and selling their coins, and this loss of demand is driving the price down to the pre-bubble level (~140$).  However, in order to get a recovery similar to that of Nov/2011, one would need a similar cause -- namely, another new market of sufficient size.

It's a govcoin. It could be done, and they should do it, because it would enable quick international transactions and anonymity. But they won't, because they would not give away anonymity. If they do, it won't succeed, because they would expand the supply not to stabilize prices, but to suck value out of the system. And if they could keep their hands off, it could only exist in the interim, because bitcoin.

Not sure about the Wild East, but western insulation is mostly non flammable.   Sure, the forced air can do wonders when it comes to sustaining fires, but other than cable insulation (which sorta burns) this was an empty building with concrete floors, metal racks, and SP boxen (there's a pre-fire pic somewhere on this forum). 
Having a hard time imagining how a staffed facility could go up like that.

/Tips "911 was government jews and thermite" hat

Even plastics that are "non-flammable", like PVC and circuit boards, will release flammable gases when thrown into a fire.  Ditto for painted metal. Maybe the fire started in some flammabe material (such as the roof insulation) but was then sustained and amplified by those gases.

your being too extreme and over generalizing... show me a complex society without some community entities (otherwise known as government). 

If the planet only had less than .5 billion people, then maybe we could each be sufficiently independent to NOT have community entities.. but I do NOT see such individual freedom with more than 7 billion peeps... therefore, some kinds of government and community establishments seem to be necessary..   In other words, it does NOT seem possible to throw out all of the bathwater b/c there happens to be a baby in there... 

You are talking about long term equilibrium, but I am talking about short term (1-2 mo) after price dip. Network hashing adjustment is NOT automatic and depends on each miner decision. Price can move faster than network adjusment, but network would eventually adjust-this i agree with.


I am making a historical comparison with 2011 situation when bull market resumed ONLY after the network hashing rate declined ~50%-you can check the charts-they are uncanny.
By the size of network i mean the total hashing rate.
Right now low bitcoin price causes larger and larger bitcoin numbers to be dumped by miners to compensate for their costs. This is a vicious cycle that, in my opinion, will be broken only when higher cost producers are eliminated from mining OR there is a sudden increase in buying with the latter being unlikely.

This wont happen. As opposed to for example with gold mining, with bitcoin mining, the cost of production decreases with price (indirectly by: price decrease -> some miners shut down -> difficulty decrease -> production cost decrease), because production is kept constant artificially, no matter how hard miners dig.

So unless "most miners" are irrational and mine at a loss, what you say can't happen.


What logic are you basing that on? That less fresh fiat needs to be input just to pay for mining?

What do you mean by "size of network"? Total operating cost of mining? Aggregate hashrate?