Topic: The indicator we're all ignoring (Read 3774 times)

Thread necro, but still interesting.



Notice that we've passed the previous recent peak.

Ahh, my bad.  I didn't see the controls under the banner ad.  Carry on.

Reminds me of my tinfoil hat theory last year.

https://bitcointalksearch.org/topic/m.355304

The graphs are definitely averaged. Elux's graph above provides an unaveraged version that shows the raw volatility.

Hmm.  Those graphs do not appear to be averaged at all, or at best daily rather than 7-day.

Since the comeback when folks realized Bitcoin didn't (or cannot) die the bubbles used to be in the $2-4 range. Then the $5-7 range. Now the $9-12 range. Soon the $15-20 range and so on.

POOF!

feels more like an inverted bubble to me.  definitely inverted.

I think we peaked around $15.50  ($15.40?  whatever).  The 7 day average will be quite a bit south of that, meaning that this peak won't be scraping the 150M line like the last peak.  We also seem to have bumped off a 50% retrace in the vicinity of $7.58.  Again, the 7 day average will be quite a bit north of that, so we might not even fall under the 100M line.

This is based on the data so far, of course.  I lost $5 today trying to predict the future, a quick reminder that I'm no good at it.  The target for the $100,000,000 market cap is about $10.25, and the target for $75,000,000 is $7.70.  And the math will get even easier over the next 36 days or so as we get closer to the 10 million BTC milestone.

This week will be interesting indeed.  Personally, I expect a bit of an uptick, probably over $10 and hold for a while.  There is a lot of speculation that money wasn't able to get into mtgox over the weekend, but will be coming online to buy cheap coins as the Japanese banks open for business (happening now).  I don't really buy into such nonsense myself (the facts are probably true, but they don't in any way support the conclusion), but I've read it on here enough to expect quite a few people to believe it, making it trueish retroactively.

I'd most likely call this a bubble too.  I'd want to see a rebound to at least $13 to call it a correction, and I don't think that'll happen this week.  But it wouldn't surprise me too much either.

Tentatively, I will perceive this event as a bubble. Once the next 8 days of data become available, I will be able to classify this event as either a true bubble or a major correction.

A slowing of growth suggests that a correction is in progress, but will not be too severe. A reversing of growth suggests that a bubble is in progress.

...and then the price goes up and what? lol

A very visible slowing of growth on this chart.

New chart for today; the effects of the correction hasn't shown up yet.

nice thread.  just finished it.  i still think what's more likely is that the miners from 2009, as mentioned in the thread, like BitcoinExpress and Artforz are hoarding coins as opposed to them being lost.  i know i do and i'm just a small miner.  miners back then built enormous mining operations b/c they recognized Bitcoin's capabilities right off the bat and are extremely unlikely to just "lose" or "format over" their coins.  could be wrong.

oh and remember, a move in the price from $0.05 to $0.20 still represented a quadrupling of your money so the economic incentives for meticulous care were present then just as they are now.

Language has been too confounded in regards to inflation and deflation to have an intelligible discussion. Just see Mish's Inflation What The Heck Is It.

I tend to define inflation as an increase in the currency supply and deflation as a decrease in the currency supply. Bitcoin, being a little bit more complicated of a monetary instrument than gold but less complicated than FRNs, requires some additional application of monetary science. This is where a sound money background comes in handy because gold in the vault is not the same as gold in the ground ...

In essence, I want to know both the nominal amount and rate of change of new bitcoins and the nominal amount and rate of change of 'lost/destroyed' bitcoins. Then I can start doing some magic statistics and calculus stuffs to better discern the capital landscape.

The information is all there for anyone to analyze in the blockchain. It does require some assumptions, of course, so check your premises.

For over a year to plot the capital landscape I have been doing my own proprietary tracking since it is such an important metric. Seems someone else started a thread about this issue. Perhaps you should take a look at it. To be honest, I am kind of surprised it has not been discussed deeper and more often but for obvious (or not so obvious to some I suppose) reasons I am not really going to bring it up.

That's just people who remember that they lost coins and are still here and are willing to share that fact. it sucks knowing you formatted $100000 but it doesn't suck as much as your wife knowing about it.

The early adopters were still here (some at least) but the early try it and forget it aren't necessarily.

But really I'm not arguing for 1.5M. I don't know.

Maybe by the time the last coin is mined, 1.5M lost coins would be likely, but I don't see it yet.

i still doubt it.  i remember SgtSpikes thread closely and even added my few lost coins to it.  that thread was active during the first parabolic rise when all the early adopters were still hanging around and i would think that anyone who lost a huge chunk of coins would've revealed it there.  38000 or so is a long, long way from 1.5 M.

I don't think that many are totally lost, but it isn't impossible. It was a toy for over a year, 0 value, no market for buying or selling them whatsoever. Hell, it was over a year before someone bought 2 pizzas for 10000BTC.

People downloaded, mined for a few hours or longer, had 50 or 1000 or more coins totally forgot about it, sold the computer, formatted the drive whatever.

the last total from this thread which i thought was the most definitive tracker was 38669.

https://bitcointalksearch.org/topic/m.983065

Assuming he's thinking like me, he likely believes the majority were lost before they had significant value when people tried it out and then got bored and deleted it since at the time you couldn't do much with these fancy internet tokens.


Maybe, maybe not.  There were significant amounts lost before the economy really bootstrapped though.

Nor does his argument make sense. Deflation of the money supply can only lower the market cap now compared to then, not increase it.

there's no way we've lost 1.5 million Bitcoins.

Right, but he quantified his approximation of how many have been lost and used that to adjust the market cap figures...

He made no claim that it is overall deflationary if that's what you're arguing against.

That's dwarfed by created coins at this rate.

He's referring to lost/destroyed coins.

Bitcoin's money supply is hyperinflating, not deflating. USD happens to be deflating, but at such a low rate it doesn't really stack up.

A more important issue I have with the 'bitcoin market cap' is the deflation rate. My best guess puts it around 1.5m bitcoins. That would make the previous record market cap at $101m=(((149m/31.9)-1.5m)*31.9). The current market cap would be about $110.7m=((9.7-1.5)*13.5). Thus, it appears we are at a new all-time high in terms of intrinsic value (Yes, I know the term has all types of issues).

The issue I have with 'bitcoin market cap' is that the inflation rate is known. We all know (generally) how many bitcoins there will be on any specific date in the future. When considering the market cap of bitcoin, I use 20m as a ballpark figure. $50/btc will be $1B cap and quite the milestone.

I've seen market cap talked about quite a few times recently.

Check out this spike:
http://blockchain.info/charts/n-transactions-excluding-popular

Yes. It's more accurate because it factors in the Bitcoin money supply hyperinflation. Even more accurate would be to factor in USD money supply inflation/deflation, but that is very small or even negative.

Is this just the currently available coins? if so, that would explain why we would pass June '11 cap., without the price passing the $31.90 high. We have nearly Three-million more coins than back then.

On a side note, looks like a correction is due! 

I'm going to take snapshots of this frequently, because I suspect that we're surpassing the record high (back in June 2011) soon, at least well before either market cap (non-averaged) or price will. It'll be an interesting milestone for Bitcoin.