Topic: Speculation rocks! (thanks for the price drop|please don't destroy it!) - page 3. (Read 7965 times)

I believe in the long run the swings will be lower. But either way any merchant can do what many farmers do in RL: sell short futures/options, in the case of BTC that would be sell short long term options on BTC.

Another question is how merchants are supposed to offer goods and services denominated in BTC when the exchange rate to USD$ swings so wildly.  A few days ago someone was offering a 1989 BMW for 100BTC on this forum.  They would have got US$3000 back then, but only US$2100 today.  Do we expect merchants to adjust their prices daily?  What if the exchange rate swings so widely that the product's price is lower than its cost to the merchant?  That may happen over a period of months with a government backed currency (extreme examples omitted), but in only a matter of hours with BTC.

ok i had to register for this. its getting old people comparing BTC to gold. wtf? gold is traded based on its "value" and its "value" is derived from something physical. it makes great jewelry and decoration. that has always been its value, since the beginning. it makes a half decent conductor as well, but aside from that its value=people's desire for jewelry.

saying BTC is like gold is saying BTC is for decoration only. do you get a stiffy when you see your large wallet? no. you intend to spend your BTC for either A)currency exchange or B)goods and services.

the big spike in BTC was due to people wanting to exchange them for goods/services (see gawker article lol ) people are currently realizing that its a bit more difficult than expected. also, plenty of people seeing the spike have obviously invested as well.

honestly, if BTC is to REMAIN viable and hold a "value" it has to be accepted for goods/services or be exchanged. people are not going to keep trading it if it holds no real use outside of an exchange.

imagine if amazon started accepting BTC. what would the "value" be? plenty more than it is now. that is going to be the long haul. waiting for good penetration into the useful market. not trading it "because its like gold".

and please, dont go on to say that "BTC will hold value because mining costs $$$ in electricity and is difficult". this will only keep the miners from selling at a huge loss IF the currency is still a viable currency. if nobody accepts BTC for any transaction, and someone is willing to exchange their USD for their "useless" BTC, the smart cookies will cut their losses early.

I think Bitcoins can be compared with gold, because gold is mainly used for training and mining gets harder, because it is finite and the density is lowering. That's why I opened another thread to compare it with gold. Price drops usually appear after peaks. That's what peaks are all about. What we see here for this reason is just a peak we reached.

Looking at http://bitcoincharts.com/markets/, the estimated next difficulty level is going up, not down.  It was 720,000 a couple of days ago when BTCs were worth almost $30.  Now it's 791,000 with BTC at $22.  The value of each BTC is likely to follow the difficulty curve, but there is absolutely no certainty that this has to be the case.  Just because it has in the past, doesn't mean it will do so in the future.  Everyone is aware of this fact, and should logically be hoarding BTC until they're worth many hundreds of dollars each (possibly thousands).

Is that likely to ever happen?  I wager it will not.  There are far too many existing BTC users who purchased their BTCs at less than a dollar each, or generated dozens per day last year.  These users will sell up.  How many investments yield 100x returns within a few months and are not a scam?

I just want to point out that the exchange of btc-usd going down is not a recession, its just the exchange of btc-usd going down. Prices change, its normal and positive, not a recession.

Whoever started this recession: Thanks!

It's way easier to make money buying cheap BTCs and sell them at higher prices than it is setting up new rigs. I don't even have to leave the desk!

There is also the nice side effect of lowering the difficulty. It's like a stock exchange, buy cheap, sell at high price and become rich only that it is way cheaper, easier and less restrictive than on a real stock market. It feels like an easy computer game.

I don't even have to add to this, because all the inexperienced people here are overly nervous and paranoid. So it is a great chance for people who have been using BC for a while now (and like me sold them at a low price, because they have been paranoid about the graphs) to use their experience and become rich.

Also, is the bottom reached? I want to invest even more money, but not at once, so I have been splitting it up to lower levels. Half of it has already been used, but this price drop doesn't appear to be over now.  Is there a good reading on this topic or some common practices on how low the buy-price should be?

I read some stuff, but I'm not sure about Bitcoin, because there are quite a few factors which aren't relevant when it comes to the Bitcoin market.

Oh and don't worry! I am not that rich, so I won't be able to buy everything. There are lots of inexperienced kids, so I think there should be enough cheap Bitcoins for all of us.

EDIT: To all others. Please don't destroy it! Don't offer too much money. I know you can make loads of it if you are fast, but we can keep this low prices for a bit longer!

The golden rule for making money: Rely on the stupidity of the masses, it will always pay off!