Topic: the real, actual, true, accurate reason the price dropped (Read 3177 times)

By the way, for all you former miners, the best thing to do right now is perform services or sell products for BTC.  Then you're slowly causing the amount of BTC available on the exchange to lower since it's going to you instead of an exchange.  Less available BTC on an exchange means higher prices.  That means you're raising the price of the BTC that you just acquired simply by acquiring it and you didn't have to mine anything.  Talk about a good investment!

You know you don't get paid USD for mining, right? it's not a loss until you sell it.  So if you ever think that the price of BTC at any point in the future will rise into the retroactively profitable range, keep mining.

And bitcoins should stay in bitcoin.  I hope to buy vehicles and land with bitcoin when I get the money to buy either.

How much money is spent?  A lot.  The question is, why should bitcoin duplicate the existing efforts?  Credit cards aren't going to disappear now that bitcoin is here.  Bitcoin would require duplicated efforts in cards, processing machines, there are fees in bitcoin (I often can't transfer bitcoins without tossing in at least 0.01).  There is fraud in bitcoins too (mybitcoin, MtGox, negligence like Bitomat, etc). 

Bitcoin isn't free of taxes either.  As soon as funds from your bitcoin activities reach the real world there's a paper trail of capital gains that can be traced.  It's the individual's choice whether they choose to declare this income, or face possible consequences.

How much money is spent on paper and coin money?  On credit cards such as the cards, the processing machines, visa & mastercard fees, the cost of fraud, the cost of internet gateways?  On tax collecting?

The bitcoin network takes about $1000/hour to run.  And that's not even paying for "free cards (and power supplies, and motherboards...)" for miners.  If you think the total amount of $ invested is still the total amount in people's accounts in mtgox... Well, I know for a fact you're wrong.  There's nearly $700 that I've extracted just by myself, with my tiny mining operation over the past 4 months -- and that money is NEVER going back to buy bitcoins.  It's going to AMD, Antec and possibly Xilinx.

Not only do your shares get diluted by 3% a month but money is actively being siphoned out of the pool to pay for power and hardware.  As I've said before, simply breaking even on a $ investment in bitcoin is being ahead of the game.  Long term, sure, greater fools *SHOULD* arrive.  Maybe.  For now you'll just have to sit back and hope they arrive as the total real world currency worth of your bitcoins keeps shrinking.

I've seen a lot of minor reasons why it dropped but the real reason is obvious.  The distance in time from when GPU mining really took off to about a week ago is approximately the time it takes to pay off the average efficient set of cards.  If I mined from April to now, my cards would be paid off too.  So people with lower budget simple rigs are hitting that level and thinking about selling for USD or permanently withdrawing their USD from the exchange so their long term investment ends nicely instead of continuing to risk it.

The majority of miners joined to make money/get "free" cards so if you've made around the cost of your rig and saw the price drop and stay there for a few days then sneak down a little more then stay there and show no sign of raising but you're sitting on like 30-50BTC, you're going to take the opportunity to dump them all on the market just in case it drops to like $2 and ruins your entire mining experience.

Unlike other people, I'm going to actually post evidence.  2 months ago there were about 8 radeon 5830's on ebay with the cheapest at $140.  Now there's 38, almost all used, almost all referencing bitcoins, and the cheapest around $127.  People are definitely selling off their rigs now that the price dropped and they've already "cashed out."

What's not causing the drop is:

- investors because no investor sees it drop like $2-3 and decides to sell.  That doesn't make any sense and if they're as stubborn as me, they won't sell it at a loss even if it takes 6 months of sitting on BTC to prevent it.

- any blog post, news article, or forum post caused it because our opinions on BTC is pretty set in stone and can't be shaken by something so insignificant.

- a massive theft and sell-off because we should have heard about it by now.  It would have been at least like 500,000 BTC to get to this price and that's almost 10% of all coins that exist.

I've seen a lot of minor reasons why it dropped but the real reason is obvious. 

I think bitcoin will get out of this one if:

1. People start protecting their wallets and blindly trusting anonymous services (because if you are dumb and get robbed, you are really hurting us all, the bitcoin economy that is).
2. People don't panic and start selling like sheep.

- investors because no investor sees it drop like $2-3 and decides to sell.  That doesn't make any sense and if they're as stubborn as me, they won't sell it at a loss even if it takes 6 months of sitting on BTC to prevent it.

I think part of reason is problems with various service, one as MtGox, it can not hurt if you find out that company which your holds money is badly run and have some security issues. Increasing dificulty and issues in economy which might have make some persons to cash out and leave the "game".

I've seen a lot of minor reasons why it dropped but the real reason is obvious.  The distance in time from when GPU mining really took off to about a week ago is approximately the time it takes to pay off the average efficient set of cards.  If I mined from April to now, my cards would be paid off too.  So people with lower budget simple rigs are hitting that level and thinking about selling for USD or permanently withdrawing their USD from the exchange so their long term investment ends nicely instead of continuing to risk it.

The majority of miners joined to make money/get "free" cards so if you've made around the cost of your rig and saw the price drop and stay there for a few days then sneak down a little more then stay there and show no sign of raising but you're sitting on like 30-50BTC, you're going to take the opportunity to dump them all on the market just in case it drops to like $2 and ruins your entire mining experience.

Unlike other people, I'm going to actually post evidence.  2 months ago there were about 8 radeon 5830's on ebay with the cheapest at $140.  Now there's 38, almost all used, almost all referencing bitcoins, and the cheapest around $127.  People are definitely selling off their rigs now that the price dropped and they've already "cashed out."

What's not causing the drop is:

- investors because no investor sees it drop like $2-3 and decides to sell.  That doesn't make any sense and if they're as stubborn as me, they won't sell it at a loss even if it takes 6 months of sitting on BTC to prevent it.

- any blog post, news article, or forum post caused it because our opinions on BTC is pretty set in stone and can't be shaken by something so insignificant.

- a massive theft and sell-off because we should have heard about it by now.  It would have been at least like 500,000 BTC to get to this price and that's almost 10% of all coins that exist.