Topic: Stephen Reed's Million Dollar Logistic Model - page 27. (Read 123218 times)

I have lots of bitcoins. Your claim that when price reaches desired level, those who have lots of bitcoins will sell for fiat, is wrong. If you have maybe few thousand dollars, and are just speculating, then yes, you can sell for fiat. But if you have hundreds of thousands, or millions of dollars of bitcoins, selling means paying taxes, and telling other people that you have so much money. It also means having your money stuck in a bank some where. At some point, it just becomes impossible to sell it all, because you can not live buying expensive cars and houses every week without being noticed. So you have to keep bitcoins in bitcoins, and only sell whatever needed to live, and maybe use some to invest in various projects.

OMG how can you even say something so stupid... even this little sentence totally discredits your analysis. The 80% are not "stores of value" but speculators... When the price reaches their desired level, they will sell or buy something with bitcoin, or yes, try to think of it as a store or value, but i think majority will sell for fiat, but you cannot for god sake tell at this moment that they use bitcoin as a store of value, because its not true, and if you fail to realize this, what else you do you fail to realize or what else do you got wrong :-(?

Coinbase reports that 80% of wallets are buy and hold, the remaining 20% are used for transactions. That supports the idea that when fully adopted, the majority of bitcoin will be held as a deflating store of value, and the smaller portion held as working capital by transacting entities. I do not distinguish intrinsic value aside from the contextual market price. Please enlighten me with regard to the two main uses of bitcoin as partitioned above.

Coinbase reports that 80% of wallets are buy and hold, the remaining 20% are used for transactions. That supports the idea that when fully adopted, the majority of bitcoin will be held as a deflating store of value, and the smaller portion held as working capital by transacting entities. I do not distinguish intrinsic value aside from the contextual market price. Please enlighten me with regard to the two main uses of bitcoin as partitioned above.

Early on, the operator (and also one of the bitcoin devs) of one of the biggest pools secretly diverted the pool's power (a lot) to at least one other sha-256 alt-coin to kill it.

A couple months back the now biggest pool (part of big mining scam to consumers if you ask me) was proven to have used it's majority power of the network to construct and successfully execute double-spendings. They only needed their 29% majority share of the network (and a less-than-secure victim). They now have 33%, no one is doing anything, the news doesn't get out and people keep buying GH at insane prices from them and giving them control over the network.

I assure you, nothing resists corruption.

There is already ample evidence of corruption in Bitcoin, both in the early days and now.

A little deflation because of progress is a good thing but sadly the average consumer often doesn't benefit from deflated prices due to corruption of one sort or another. Bitcoin lowers costs for consumers and merchants and resists corruption.

Edit: regarding price climbing until resources are exhausted, well the target is 'all the money in the world and then some' (due to progress) 

check,
http://b-gat.es/1cnazWY

The Logistic S-Curve



The logistic function F(x) = 1 / (1 + e^-x) was developed to model the growth of a population that multiplies until constrained by exhausted resources. It has the property of exponential growth to the midpoint, followed by exponentially slowing growth.

In my application of the model, the population consists of all speculators who will ever buy bitcoins. That population grows as bitcoin knowledge spreads to new speculators, and that population is eventually limited by the finite number of available speculators. The price series of bitcoin is subject to bubbles and crashes that are ignored by the model, rather the model addresses the price trend.

The S Curve is plotted on my chart using a logarithmic price axis, and thus does not directly resemble the Sigmoid graph above.
  

Yes, I have noticed the same thing, and that is a possibility (less volatile bubbles over time for what I will call your "speculative adoption" logistic curve)

But I'm getting at a different question. As I understand it, your model is tracking "speculative adoption" for lack of a better word. I understand why you are doing this, as the first "ultimate ATH" for BTC will almost certainly be driven mostly by speculation - as we are seeing now. This will take us quickly to some maximum price (eg. $1M). I/we expect that this "speculative adoption" will be far ahead of "utility adoption" which will probably lag significantly. Most new technology adoption models (I've posted a few here over the years) suggest that when the "speculative adoption" gets far ahead of the "utility adoption" a massive speculative correction often takes places over many years to bring the price back into alignment with current fundamental value. This is a different phenomenon than the mini bubbles on the way up the logistic curve. This seems to me would indicate the underlying model stops working at this point. This might suggest that once hitting $1M btc (for example) will drop back tremendously to perhaps 1/10 while "utility adoption" catches up. It might be then several more years before price climbs back to close to ATH - if ever.

As I'm writing, my question becomes more clear.. "How will we know when the logistic "speculative adoption" curve has run its course and a much bigger - long-term, fundamental - correction has begun.?" Several answers spring to mind, but would appreciate your thoughts.