Topic: Stephen Reed's Million Dollar Logistic Model - page 29. (Read 123218 times)

I also have read an argument for currency valuation based on hard-currency experience before paper that suggested equal value of wealth and the currency used to represent it. When I did the analysis, I used $500 trillion as a rough estimate of the total global wealth, including government as well as individual. With 20 million coins that gives each coin a value of about $25 million.

http://www.mail-archive.com/[email protected]/msg10152.html

And how many of them have all this wealth in the form of money at that? What meaning would all that bitcoin "paper" wealth have if you won't be able to exchange that bitcoin for 100 million dollars of goods? How are you going to deprive those billionaires of their property with bitcoins?

What is it, wishful thinking?

If you click on this link: https://bitcointalk.org/index.php?board=1.17280 it takes you back to page 433 of the Bitcoin Discussion forum. When I first started reading this message board I spent a lot of time catching up on old threads. Where in the past, a new registrant with new ideas and new concerns was often cause for a flurry of forum activity, today, it's a new company, a new press release, a new application that stirs up this message board.

It's often difficult to take it all in. There's posturing, maneuvering, attempts at influencing the direction of coders and users but beyond all that there's price. If you read many of the old threads from 2010 you should note a recurrent theme, seemingly protocol ending problems solved over time, again and again. Wallets, exchanges, redundancies, I'm not qualified to list the hurdles and solved problems but there's one thing that's clear for everyone to see and that is the rate of adoption. Through all of that, price trudges along, reflecting the demand for Bitcoin and its protocol.

Personally, I've learned to enjoy these price consolidations, it's an opportunity to debug ones beliefs and pick up a few more Bitcoins along the way. I've discovered there are many avid chartists over at Tradingview and from what I've looked at, the majority of them long term bullish. Many charts from Tradingview are neater in appearance and I don't want to clutter up this thread with a bunch of charts that takes away from the picture drawn by Slippery Slope, but in the near term, I hope the channels on this chart demonstrate to holders of Bitcoin that volatility is to be expected, even welcomed as price seeks its median line. So far I like this chart and I see no reason to adjust the median line plot at this time.

Edit: here's a direct link to the chart where you can make adjustments if you with - https://www.tradingview.com/e/M1ZPd859/

This "amazing adventure" feels as stressful as watching a suspenseful movie sometimes. (Although I watch them with BitChicksHusband I often have to leave the room because I get so stressed out watching them!)

That said, I am still thankful we are involved.  Better late then never.  And I have come to realize that the amount of coins we have might be irrelevant depending on when we decide to use them (with the price doubling at three times a year)  Many of the earlier adopters are using them to purchase expensive cars right now and may be left with the same amount, or less coins than we have if they spend most of them.  Of course, the smart ones will make sure to hold a sizable amount for a long time.

This:


Also, Bitcoin has no utility (except perhaps as the government coin).

I know.  I was the one that asked somebody to do it to begin with because I was busy that weekend. 

I hand fit the million dollar logistic model to place equal weight above and below the trendline. There will be a bias towards a return to mean, and most observers believe that we are well above that mean now.  In the $1M logistic model the masses come rushing in during 2016-2017, when the price climbs from $100K to $1M.


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.

Incorrect assumption.

The Million Dollar Bitcoin S-Curve

I added an S-Curve graph to the bitcoin logistic model for 1 million USD maximum price. The midpoint at $500K occurs in late 2016.

Bitcoin price doubles about three times a year on average, and will keep going up at this rate until the final growth slowdown


You both are so fortunate to completely share this amazing adventure.

When I performed parameter sensitivity analysis on the hand-fitted logistic model, I found that the rate of logarithmic growth is the about the same regardless of the value of the maximum-bitcoin-price parameter. So no matter where it ends up maxing out, the price will get there doubling about three times a year on average.

You can ask Bitchick, we have invested as much as we can afford to lose (and probably a little more than she is comfortable with).

You are right insofar that speculators sell.

To clarify, my model assumes that bitcoin prices climb higher over time to a guessed-at maximum price due to increasing numbers of speculators. The logistic model is justified because eventually the number of new speculators taper off, e.g. limited by the global adult population. The motivation and behavior of these speculators affects price action - but I am abstracting these properties by simply counting speculators as the modeled population. When I guess at a certain maximum bitcoin price for the model, that translates to a certain degree of speculator commitment and resources.

Some Plausible Estimates of Maximum Bitcoin Value


Indeed wishful thinking, but also an acceptance of the most plausible estimates, such as those of Rick Falkvinge circa. 2011, when bitcoin transaction volume was one tenth of today's. . . .

     Bitcoins Four Drivers: Part One - Unlawful Trade - estimates $60 Billion of bitcoin capitalization

     Bitcoins Four Drivers: Part Two - International Trade - estimates another $600 Billion of bitcoin capitalization assuming 10% market penetration

     Bitcoins Four Drivers: Part Three - Merchant Trade - estimates another $600 Billion of bitcoin capitalization assuming 10% market penetration

     Bitcoins Four Drivers: Part Four - Investment - estimates another $600 Billion of bitcoin capitalization assuming 0.1% market penetration

     An estimated total $2 Trillion market capitalization, implies $95 thousand valuation per bitcoin.

Falkvinge shows how bitcoin is superior with regard to current financial practice in four realms, and estimates bitcoin valuation at a 10% penetration rate. He sidesteps the role of bitcoin as a deflating store of value.

I also accept another widely held point of view that bitcoin will either fall to a relatively very low value, or totally disrupt the current financial infrastructure. Thus I extend the probability distribution of maximum bitcoin price to well over one million, covering cases where bitcoin achieves 80 - 100% market penetration.

What is the $100.000,- target based on? Wishfull thinking? Very well possible that 10k is the limit right?

Problem is that speculators sell, and adopters of washing machines didn't (c.f. the linked chart of technology adoptions over the past 100 years).

Wrong model.

If bitcoin went to $100 million, according to the logistic model fitted to that maximum price, that would add only about two more years of exponential growth beyond the $1 million point - to 2018-2019.

100 million dollars per bitcoin is ridiculous, in my opinion. Given that there are 10,000 people with over 100 bitcoins, there would be 10,000 people worth over 10 billion dollars. Today, there are only 1,500 people in the world worth one billion dollars or more.

Not included are all the efficiencies Bitcoin will introduce into the economy if it goes mainstream. A fully internationalized, frictionless division of labor will be an incredible boon to the economy. And there's so much more. I think a price target of $100 million, conservatively, is more realistic.

If Bitcoin goes big, it pretty much has to go whole hog. We are witnessing nothing less than a global transition from physical goods and trust-based money to an unimpeachable universal asset ledger. Anything else will look archaic by comparison, and the value added to the economy in the next 10 years will blow even these first 20 years of the modern Internet out of the water.

Brilliant work yet again.

Just reserving my spot on the first page of this inevitably historic thread.