Bitcoin Forum>Economy>Economics>Speculation
Pages:
Author

Topic: Sentiment in 2011 - page 6. (Read 9438 times)

arepo
sr. member
Activity: 448
Merit: 250
this statement is false
Re: Sentiment in 2011
April 27, 2013, 03:58:59 AM
#36
Quote from: N12 on April 27, 2013, 03:46:27 AM
It's my conviction that things are simply undetermined. A large USD player or a large BTC player or any large event can change everything at the current juncture. So to me, it's most prudent to wait with longer term positions until things crystalize.

it is true that anything could happen at any time, of course Cheesy

my main points were that fundamentals are still net bullish, and while i'm having difficulty determining an up/down percentage at this point based on my analysis, a continuation of the still-intact mid-term trend is definitely possible, if not likely.

i'm thinking the negatives you mentioned (exchanges closing, blockchain bloat, etc) are actually less important than people using it for things like purchasing reddit gold, or porn, or beer, or pizza (all of which you can do in a few places, at least), because these guys are not going to care or even know about technical crises and i'm confident that the community and the dev team can maneuver around any such obstacles relatively smoothly.

this is a new age of distributed, small-scale use -- we're moving out of our 'niche community' status.

--arepo

oakpacific
hero member
Activity: 784
Merit: 1000
Re: Sentiment in 2011
April 27, 2013, 03:48:18 AM
#35
N12
donator
Activity: 1610
Merit: 1010
Re: Sentiment in 2011
April 27, 2013, 03:46:27 AM
#34
Don't sweat it, nobody is constantly right. Or else that person could be infinitely rich. Grin

Quote
but this large influx of money is exactly what i'm talking about -- i'm not sure we're going to see the same kind of 'depression' that occurred last time because i do not think that the market contracted by the same magnitude in percentages as it did in '11.
I think in the end, this is all that counts, will the market be extracting BTC or USD in the coming weeks, or will it be doing not much of either? So far, it is hard to say because both USD and BTC levels have risen since 266. It'll be interesting to see whether it can establish a new high >166 next week, or if it has found a trading range.

It's my conviction that things are simply undetermined. A large USD player or a large BTC player or any large event can change everything at the current juncture. So to me, it's most prudent to wait with longer term positions until things crystalize.
arepo
sr. member
Activity: 448
Merit: 250
this statement is false
Re: Sentiment in 2011
April 27, 2013, 03:31:29 AM
#33
Quote from: N12 on April 27, 2013, 02:59:47 AM
Here's an interesting question: What will happen once Litecoin begins to trade on MtGox as they recently confirmed and share the same pool of USD that Bitcoin currently enjoys? Sure, they already trade on BTC-E, but that is a trivial amount of volume and attention compared to MtGox. Even trivially modified altcoins have grown immensely popular in a way I would have never imagined. What happens once the media starts to report on them?

I don't think I ever owned any Litecoins, but this will certainly be interesting to watch.

@arepo
I thought much the same near the bottom and I agree, we are at a crossroad. One thing to consider is that I believe the risk in Bitcoins is currently far higher than prices justify, in my view.

Quote
Further factors making me more bearish in the mid term: Bitcoin exchanges are being eliminated and MtGox is returning to its monopoly status from years ago. Bitcoin still extremely centralized through mining pools (2 people conspiring can do a 51% attack, and actually have done so during the coin fork), block size limit hindering growth (see SatoshiDice), altcoin popularity rising (LTC soon to be added to MtGox; Ripple emerging as possible alternative).

I'm ready to be proven wrong by the price action. I don't care much missing out here on a measly 20-50% as the immense risk no longer justifies it, I've already played the bottom.

A thought: If you are right and we are at the verge of the next bull market, how much does it really matter if one buys in at 137 at a rather high risk, rather than at 166, 200 or even 266 at a more reduced risk of being wrong?

I acknowledge the possibility, I just think the probability combined with upside is not worth it at the current stage. A good speculator sees that most of the easy money is most probably gone for a while.

these are all good points to temper a bullish attitude.

Quote from: arepo on April 27, 2013, 02:51:26 AM
it's not even that the fundamentals are improving -- the fundamentals are changing. deflation is kicking in.
Man, what a marketing language/buzzword bullshit, I thought better of you. Perhaps the thing to deflate will be the Bitcoin price.

this is a more serious point than it sounds, i admit, but i've been talking about this since February, and i dare say that i was expecting the kind of event that happened on April 10. it wasn't really a bubble, it was growing pains in response to the market cap growing two orders of magnitude in size, quite suddenly.

Quote
PS: I hate to do ad hominems, but why are you getting so certain recently + on the verge of spam with the topics? To sell your reports? I remember you were wrong during the whole rally and then barely said anything. It would be too ironic if the same thing happened now.

... which brings me to this point. i was a bear when the rally started, and it was a spectacularly bad call, i'll freely admit. after three or four calls of 'tops' i realized that there was something terribly wrong with my methods. i took a break from posting publicly and turned a critical eye to my assumptions and methods.

i realized a large part was misreading the 'overbought' signals on the oscillators, because they really only work ideally when the influx of money is small comapred to the market cap, which was not the case during the rally. this recent push to $160 also completely defied the 'normal' behavior of these indicators, but this time i accounted for this fact, and anticipated the movement.

but this large influx of money is exactly what i'm talking about -- i'm not sure we're going to see the same kind of 'depression' that occurred last time because i do not think that the market contracted by the same magnitude in percentages as it did in '11.

[this is a bit OT, skip if you want]

as for a personal note, i apologize for seeming so self-assured.. sometimes i get a little too excited about my projections Cheesy i know that my models are fallible, but the improvements i made during the rally i missed (which included better techniques for quantifying error, and the development of a brand new hypothesis supported by data i had been collecting) should reflect the fact that i was determined to never make so bad of a call again Tongue

i don't mean to spam, and i'm certainly not trying to 'sell my report'. i only published the report because of requests from users in the first place. i am really only motivated to continue improving my methods and models, as i did not know much about speculation at all 2 years ago, before i discovered bitcoin, and now (as a BS in physics), I am utterly fascinated by the complexity of finance and economics. also i've been a tutor for many years, and i tend to retain that mind set in everything i do. i love to teach.

and i hope you can agree that i'm learning a little more every day Smiley

--arepo
just1nmc
sr. member
Activity: 280
Merit: 250
Re: Sentiment in 2011
April 27, 2013, 03:02:26 AM
#32
I just have a question for those that think this will play out like in 2011, with an eventual decline to pre-bubble levels.
Do you think this will still happen if some of the things being worked on right now come through? I'm mostly referring to the projects that will make bitcoins much easier to buy.

These include the ATMs, Coinlab, Coinsetter, and several other exchanges.

Coinlab and the first ATM are coming out next week, and there's plenty of other projects being worked on. Some of these fundamental improvements seem too important to support a decline back to $30. They would also bring back media coverage and increase the user base.




N12
donator
Activity: 1610
Merit: 1010
Re: Sentiment in 2011
April 27, 2013, 02:59:47 AM
#31
Here's an interesting question: What will happen once Litecoin begins to trade on MtGox as they recently confirmed and share the same pool of USD that Bitcoin currently enjoys? Sure, they already trade on BTC-E, but that is a trivial amount of volume and attention compared to MtGox. Even trivially modified altcoins have grown immensely popular in a way I would have never imagined. What happens once the media starts to report on them?

I don't think I ever owned any Litecoins, but this will certainly be interesting to watch.

@arepo
I thought much the same near the bottom and I agree, we are at a crossroad. One thing to consider is that I believe the risk in Bitcoins is currently far higher than prices justify, in my view.

Quote from: arepo on April 27, 2013, 02:51:26 AM
it's not even that the fundamentals are improving -- the fundamentals are changing. deflation is kicking in.
Man, what a marketing language/buzzword bullshit, I thought better of you. Perhaps the thing to deflate will be the Bitcoin price.

PS: I hate to do ad hominems, but why are you getting so certain recently + on the verge of spam with the topics? To sell your reports? I remember you were wrong during the whole rally and then barely said anything. It would be too ironic if the same thing happened now.
oakpacific
hero member
Activity: 784
Merit: 1000
Re: Sentiment in 2011
April 27, 2013, 02:58:11 AM
#30
Quote from: arepo on April 27, 2013, 02:51:26 AM
Quote from: N12 on April 27, 2013, 02:30:41 AM
@arepo
Yes, Bitcoin has a great brand awareness going for it. I don't care for seeds that don't bear fruit. I don't think Seals with Clubs is anywhere as popular as SD or SR, but feel free to prove me wrong. Still, this is arguing over details. My main point is that there's no such thing as a Bitcoin economy, and there are only 2 truly successful Bitcoin businesses apart from exchanges, mining pools and other intermediaries like Bitpay. It's a commodity and a payment mechanism for fiat money, but certainly no currency so far.

who cares what it is, as long as it's being used? ignoring (negligent) inflation, a 20x increase of the volume of demand of bitcoin since $5/btc is the only thing necessary for $100 to be a stable price.

this is why i said it's finding its niches. it's not really being used in one way (it still hasn't figured out what it is), but it's being used in a large variety of small ways, in a manner which creates demand.

not to mention plenty of evidence that its attractiveness as a store of value has inspired some new big players to enter the market.

it's not even that the fundamentals are improving -- the fundamentals are changing. deflation is kicking in.

--arepo

Why I am long term bullish:

1. Digital cash is here to say, face it, the idea itself can be replaced, but can not be killed, the governments/banks cannot just tell people to get back to the old days and live there happily ever after, no chance, no precedence.

2. If someone figures out how to overcome some of Bitcoin's flaws, his best bet of making his idea useful is to try to include it in the Bitcoin protocol/clients, where he gets greatest interest/network support/financial support, as long as it is not disruptive enough to be utterly incompatible.

So if no design exists that can fundamentally triumph over the blockchain, I will stay long term bullish.
BTC Books
member
Activity: 84
Merit: 10
Re: Sentiment in 2011
April 27, 2013, 02:56:13 AM
#29
Quote from: arepo on April 27, 2013, 02:51:26 AM

it's not even that the fundamentals are improving -- the fundamentals are changing. deflation is kicking in.

--arepo

Boom.
arepo
sr. member
Activity: 448
Merit: 250
this statement is false
Re: Sentiment in 2011
April 27, 2013, 02:51:26 AM
#28
Quote from: N12 on April 27, 2013, 02:30:41 AM
@arepo
Yes, Bitcoin has a great brand awareness going for it. I don't care for seeds that don't bear fruit. I don't think Seals with Clubs is anywhere as popular as SD or SR, but feel free to prove me wrong. Still, this is arguing over details. My main point is that there's no such thing as a Bitcoin economy, and there are only 2 truly successful Bitcoin businesses apart from exchanges, mining pools and other intermediaries like Bitpay. It's a commodity and a payment mechanism for fiat money, but certainly no currency so far.

who cares what it is, as long as it's being used? ignoring (negligent) inflation, a 20x increase of the volume of demand of bitcoin since $5/btc is the only thing necessary for $100 to be a stable price.

this is why i said it's finding its niches. it's not really being used in one way (it still hasn't figured out what it is), but it's being used in a large variety of small ways, in a manner which creates demand.

not to mention plenty of evidence that its attractiveness as a store of value has inspired some new big players to enter the market.

it's not even that the fundamentals are improving -- the fundamentals are changing. deflation is kicking in.

--arepo
BTC Books
member
Activity: 84
Merit: 10
Re: Sentiment in 2011
April 27, 2013, 02:47:17 AM
#27
Quote from: arepo on April 27, 2013, 02:41:45 AM
Quote from: N12 on April 27, 2013, 02:30:41 AM
This sounds quite sensible. Most importantly, the bottom should happen following a period of "despair" with very negative sentiment where every price increase is smacked down. First should probably come a period where pretty much nothing happens as price finds its bounds, and most newcomers get bored and go off to chase the next hot thing.

this is ridiculous. this is despair! we're talking about how the coming months will be doom and gloom. don't you understand? the market leads market sentiment, slightly. everyone knows about how bad June '11 was, and now pretty much everyone is expecting a crash. this is the quiet period of consolidation, where most of the money is on the sidelines, and the smart money slowly begins to buy in.

take a look at the all-time price graph, log-scale, again. the pattern we just witnessed looks nothing like the June bubble. it looks more like a small bubble on top of a trend, and then a major correction to the trend.

the June '11 event cannot be compared to this. you can be a bear, but not for this reason.

how can this model account for the recent run-up to $165? nothing like that occurred after the $33 peak, and the proportions are entirely wrong: the run-up was much shorter, and the crash was much longer.

some rough numbers: price collapsed 90% over the course of many months in '11, whereas price collapsed 80% in a few days on April 10.

thoughts?

Yeah, I think this recent crash was totally different than '11.  Aside from everything you've mentioned, I can't help having the sneaking suspicion that there may some Pavlovian grooming going on.  We'll see how the market reacts the next time there's a run-up, huh?
arepo
sr. member
Activity: 448
Merit: 250
this statement is false
Re: Sentiment in 2011
April 27, 2013, 02:41:45 AM
#26
Quote from: N12 on April 27, 2013, 02:30:41 AM
This sounds quite sensible. Most importantly, the bottom should happen following a period of "despair" with very negative sentiment where every price increase is smacked down. First should probably come a period where pretty much nothing happens as price finds its bounds, and most newcomers get bored and go off to chase the next hot thing.

this is ridiculous. this is despair! we're talking about how the coming months will be doom and gloom. don't you understand? the market leads market sentiment, slightly. everyone knows about how bad June '11 was, and now pretty much everyone is expecting a crash. this is the quiet period of consolidation, where most of the money is on the sidelines, and the smart money slowly begins to buy in.

take a look at the all-time price graph, log-scale, again. the pattern we just witnessed looks nothing like the June bubble. it looks more like a small bubble on top of a trend, and then a major correction to the trend.

the June '11 event cannot be compared to this. you can be a bear, but not for this reason.

how can this model account for the recent run-up to $165? nothing like that occurred after the $33 peak, and the proportions are entirely wrong: the run-up was much shorter, and the crash was much longer.

some rough numbers: price collapsed 90% over the course of many months in '11, whereas price collapsed 80% in a few days on April 10.

thoughts?
BTC Books
member
Activity: 84
Merit: 10
Re: Sentiment in 2011
April 27, 2013, 02:39:18 AM
#25
Quote from: arepo on April 27, 2013, 02:15:49 AM
Quote from: N12 on April 27, 2013, 01:50:25 AM
Oh, and of course that there are no popular actually used (ie, by lots of people with lots of volume) economic applications I know of besides SatoshiDice and Silk Road. There is still no Bitcoin economy.

this is not true... bitcoin is finding its niches in many small places, just planting seeds -- no flowers yet, but soon Tongue

i can also tell you from first hand experience that seals with clubs (bitcoin poker) saw a massive influx of new users over the course of the last 6 months.

i think you're underestimating the amount of media coverage we received... bitcoin was all over reddit, tumblr, etc, in a big way. these kinds of things have a gradual effect.

in other words, i think the bitcoin userbase is expanding at an unprecendented rate, even still, though said figure may have taken a hit after the crash.

Yes.

A couple other points...

Firstly, I'm not so sure the correlation between the recent spike in media coverage, and Google Trends, is as easy to parse as Maged has indicated.  I've come to think that media saturation is reinforcement to the immediate cohort of fresh bitcoin users - and given that belief, I'd expect a certain amount of decoupling between that and Trends.  The people who are - right now - interested in bitcoin, have already done their Googling.  They are the third wave of bitcoiners, after the early crypto/anarcho geeks, followed by the idealist and speculator bunch (odd that those two should show up at about the same time...).

The fourth wave won't be along until it's considerably easier to buy, sell and spend.  Still difficult, by grandma's standards - but easier than today.

Also, I somewhat disagree with Blitz about miners.  I don't think difficulty will be going down any time soon at all.  I also don't think miners are selling as much as he thinks - or that they will.  Miners are gamblers - they're betting on the come.  I mined at two and three-dollar bitcoin for a long time; at a theoretical loss.  Didn't sell any.  We'll see how many coins are sold by miners, I guess - but I don't think many...
oakpacific
hero member
Activity: 784
Merit: 1000
Re: Sentiment in 2011
April 27, 2013, 02:37:54 AM
#24
Quote from: N12 on April 27, 2013, 02:30:41 AM
Quote from: oakpacific on April 27, 2013, 02:02:54 AM
But I am curious to know how do you manipulate this metric?
Someone large moves his coins to another address of his, destroying lots of days. Manipulation may not be the right word for that. However, even looking at the graph taking it seriously, the current Bitcoin Days Destroyed peak is nearly identical to the one at the end of june in 2011 with 15 vs. 14 million.

The "weak hands, strong hands" thing is a fascinating new thing. You don't know how bearish I became with that sentiment being normal. I particularly liked the spartan 300 submissions on r/bitcoin that got to the top everytime the price declined. The people who most often cry it out are usually the ones to sell at the bottom. And once they capitulate, Bitcoin can resume its rise. Whether that really happened at 50 remains to be seen.

Only "old coins"(older than 1 year) are counted, that means, you can only play with each coin once per year, so the manipulation would only be effective if you have an exceptionally large holding, at which point I doubt you will try to move your money out of your cold storage just to fool with a metric that not many will check. More importantly, it has nothing to do with my original post as this sort of manipulation increases rather than decreases the days destroyed value.(in June 2011 this statistics didn't even exist)

About the metric value: it has been 2 years since June 2011, so if a similar amount of early coins are moved during the recent crash, the peak value should be 2-3 times as high as the 2011 peak, rather than 80% of it.

I only talked about weak hands, not strong hands, the two don't have to come together, what I emphasized is a lot of lucky guys that joined in the early stage and accumulated an amount of wealth disproportional to their investment and financial management capability must be removed from the equation for us to see the normal dynamics of the market. So the 2013 crash and 2011 crash are not that comparable.
N12
donator
Activity: 1610
Merit: 1010
Re: Sentiment in 2011
April 27, 2013, 02:30:41 AM
#23
Quote from: oakpacific on April 27, 2013, 02:02:54 AM
But I am curious to know how do you manipulate this metric?
Someone large moves his coins to another address of his, destroying lots of days. Manipulation may not be the right word for that. However, even looking at the graph taking it seriously, the current Bitcoin Days Destroyed peak is nearly identical to the one at the end of june in 2011 with 15 vs. 14 million.

The "weak hands, strong hands" thing is a fascinating new thing. You don't know how bearish I became with that sentiment being normal. I particularly liked the spartan 300 submissions on r/bitcoin that got to the top everytime the price declined. The people who most often cry it out are usually the ones to sell at the bottom. And once they capitulate, Bitcoin can resume its rise. Whether that really happened at 50 remains to be seen.

@arepo
Yes, Bitcoin has a great brand awareness going for it. I don't care for seeds that don't bear fruit. I don't think Seals with Clubs is anywhere as popular as SD or SR, but feel free to prove me wrong. Still, this is arguing over details. My main point is that there's no such thing as a Bitcoin economy, and there are only 2 truly successful Bitcoin businesses apart from exchanges, mining pools and other intermediaries like Bitpay. It's a commodity and a payment mechanism for fiat money, but certainly no currency so far.

Quote from: Maged on April 27, 2013, 02:24:36 AM
The question is, how different is this from 2011, percentage wise? If it's about the same, then our target price is around $30 ($15 (pre-current-bubble) * ($2 (post-2011-bubble)/$1 (pre-2011-bubble)).
This sounds quite sensible. Most importantly, the bottom should happen following a period of "despair" with very negative sentiment where every price increase is smacked down. First should probably come a period where pretty much nothing happens as price finds its bounds, and most newcomers get bored and go off to chase the next hot thing.
arepo
sr. member
Activity: 448
Merit: 250
this statement is false
Re: Sentiment in 2011
April 27, 2013, 02:30:27 AM
#22
Quote from: Maged on April 27, 2013, 02:24:36 AM
Quote from: arepo on April 27, 2013, 02:15:49 AM
Quote from: N12 on April 27, 2013, 01:50:25 AM
Oh, and of course that there are no popular actually used (ie, by lots of people with lots of volume) economic applications I know of besides SatoshiDice and Silk Road. There is still no Bitcoin economy.

this is not true... bitcoin is finding its niches in many small places, just planting seeds -- no flowers yet, but soon Tongue

i can also tell you from first hand experience that seals with clubs (bitcoin poker) saw a massive influx of new users over the course of the last 6 months.

i think you're underestimating the amount of media coverage we received... bitcoin was all over reddit, tumblr, etc, in a big way. these kinds of things have a gradual effect.

in other words, i think the bitcoin userbase is expanding at an unprecendented rate, even still, though said figure may have taken a hit after the crash.
The question is, how different is this from 2011, percentage wise? If it's about the same, then our target price is around $30 ($15 (pre-current-bubble) * ($2 (post-2011-bubble)/$1 (pre-2011-bubble)).

this is important, and i don't think it's nearly the same. real growth was much smaller, by my estimates*. i'm not sure how one would go about actually calculating this value, but it seems not only larger, but also increasing. don't we expect a somewhat exponential trend line until the price discovery phase is over?

*estimates based on google trends, /r/bitcoin subscriptions, frequency of first-hand (IRL) exposure, estimates of poker seals userbase growth, estimates of "speculation" subforum userbase growth, growth of the market cap, and other data
Maged
legendary
Activity: 1204
Merit: 1015
Re: Sentiment in 2011
April 27, 2013, 02:24:36 AM
#21
Quote from: arepo on April 27, 2013, 02:15:49 AM
Quote from: N12 on April 27, 2013, 01:50:25 AM
Oh, and of course that there are no popular actually used (ie, by lots of people with lots of volume) economic applications I know of besides SatoshiDice and Silk Road. There is still no Bitcoin economy.

this is not true... bitcoin is finding its niches in many small places, just planting seeds -- no flowers yet, but soon Tongue

i can also tell you from first hand experience that seals with clubs (bitcoin poker) saw a massive influx of new users over the course of the last 6 months.

i think you're underestimating the amount of media coverage we received... bitcoin was all over reddit, tumblr, etc, in a big way. these kinds of things have a gradual effect.

in other words, i think the bitcoin userbase is expanding at an unprecendented rate, even still, though said figure may have taken a hit after the crash.
The question is, how different is this from 2011, percentage wise? If it's about the same, then our target price is around $30 ($15 (pre-current-bubble) * ($2 (post-2011-bubble)/$1 (pre-2011-bubble)).
arepo
sr. member
Activity: 448
Merit: 250
this statement is false
Re: Sentiment in 2011
April 27, 2013, 02:15:49 AM
#20
Quote from: N12 on April 27, 2013, 01:50:25 AM
Oh, and of course that there are no popular actually used (ie, by lots of people with lots of volume) economic applications I know of besides SatoshiDice and Silk Road. There is still no Bitcoin economy.

this is not true... bitcoin is finding its niches in many small places, just planting seeds -- no flowers yet, but soon Tongue

i can also tell you from first hand experience that seals with clubs (bitcoin poker) saw a massive influx of new users over the course of the last 6 months.

i think you're underestimating the amount of media coverage we received... bitcoin was all over reddit, tumblr, etc, in a big way. these kinds of things have a gradual effect.

in other words, i think the bitcoin userbase is expanding at an unprecendented rate, even still, though said figure may have taken a hit after the crash.
smoothie
legendary
Activity: 2492
Merit: 1473
LEALANA Bitcoin Grim Reaper
Re: Sentiment in 2011
April 27, 2013, 02:10:37 AM
#19
RationalSpeculator
sr. member
Activity: 294
Merit: 250
This bull will try to shake you off. Hold tight!
Re: Sentiment in 2011
April 27, 2013, 02:05:49 AM
#18
oakpacific
hero member
Activity: 784
Merit: 1000
Re: Sentiment in 2011
April 27, 2013, 02:02:54 AM
#17
Quote from: N12 on April 27, 2013, 02:01:36 AM
Quote from: oakpacific on April 27, 2013, 01:57:46 AM
http://blockchain.info/charts/bitcoin-days-destroyed-min-year?showDataPoints=false×pan=all&show_header=true&daysAverageString=7&scale=0&address=

What does this graph tell you? Time factor is about twice/thrice as large, yet the days destroyed metric has never been above the 2011 peak.

Unlike in 2011, most of the coins are not in the hands of early miners, the majority of whom had long cashed out, other than real core elites/seasoned loyal believers, there is not an abundant supply of bitcoins on the market.
You have failed to read my post. I was talking about how a larger share of newly generated coins is provided to the market as profit margins go down and its effect on the behaviour of dormant supply.

Also, Bitcoin Days Destroyed is a usless metric that is easily manipulated.

I wasn't replying to you.

But I am curious to know how do you manipulate this metric?
Pages:
Bitcoin Forum>Economy>Economics>Speculation
Jump to: