Topic: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion - page 26056. (Read 26611256 times)

Summary of the situation.

Nice video, thanks MM

No, just a messy market.

Chartbuddy glitch or bit stamp glitch?

Explanation

Not sure I agree. I understand the desire to read the market in more fundamental ways, to understand "reasons" for price movements, but most of the time, that line of reasoning goes back to fundamentals and news - and that, in my experience and opinion, misses a big part of what actually drives the market more than half the time.

Anyway, I'm sure there is a narrative for the stagnation period of 2012 that is slightly more explanatory. In essence: necessary consolidation after an extremely volatile period ($1 -> $32 -> $2), together with the fact that no "real world" events took place that were strong enough to overcome that market sentiment (like: Argentinians decide big time to use btc as an inflation hedge).

As for a possible (partial) explanation of the current stagnation, see my point below...



I don't claim I believe with certainty that this is going on, I am submitting that, if a large enough entity (or several) would plan to buy large amounts of coins, and have some patience, this would probably a scenario worth exploring. In terms of tax efficiency, waiting for the ETF would probably be the better choice, but in terms of price control, the method I described would in principle beat a fund that is, ultimately, positive feedback linked to the markets.

I disagree that miners would prevent this taking place. No disrespect to miners, they're the backbone of the network, but amateur miners seem to be not necessarily the most economically rational actors. Go look around in this forum how often the fall for the fallacy: 'It's sunk cost anyway, I'll let my outdated miners run as long as they produce coins', and how often more economically minded users need to tell them that the actual calculation needs to be based on total cost of future production of coins (mainly: energy costs) vs. number of coins bought at market for the same costs.

Larger mining operations are undoubtedly much more economically savvy, but I've argued over and over again that I believe that, with the increasing "professionalization" of Bitcoin and Bitcoin mining, short-term profit opportunity will probably outclass long-term speculative investment. In other words: large miners sell more than they hold, especially considering that we are currently nowhere near a new uncontested bull market (which means the ratio of sold vs. held coins can change if the market sentiment changes, and miners might hold more than they sell if they feel it's a sure thing price will go up.)

Finally, we have plenty of evidence that public market price as determined by on exchange trading is a major reference point for off exchange transactions (just one example: the SR coin auction, where every party that spoke on it refered to "the market price" as if it were the obvious metric). Binding a large mining operation to you in a mid to long-term contract, maybe even offering a premium (although, from hearsay, I've only heard of large holders being made sub market offers, off exchange), then using some fraction of the coins to strategically depress price, would seem like a very good strategy to me, and relatively risk free: if it works, market price stays low, and accumulation proceeds at a low cost. If it fails, and price refuses to be depressed, the account value of coins gained so far appreciates, which is a sweet little consolation price.

Arbitrage by miners could throw a spanner in the works of this mechanism, but profits would be comparably marginal: the goal of the accumulator is not to destroy the on-exchange price, just to keep a lid on it. For the arbitreur miner, the reward is small (sold his coins at market price, is able to buy them back slightly below perhaps), and more importantly: for the large operations, the initial problem would re-appear - what to do with a large amount of coins, when you in reality prefer to hold USD (by my assumption that professional mining operations are short-term opportunistic, and not long-term married to Bitcoin success).

It's a tragedy of the commons style scenario: presumably, miners would be better off selling directly on the exchanges, since the higher volume generated there would ultimately drive up price, but individually, they fear the risk of lower profits because of increased selling pressure on exchange, so they seek arrangements off exchange.

I'll say it one more time: The above is (motivated, I think) speculation. I make no claim this is necessarily happening. I only point out that I believe it is a possible, maybe even probable, mechanism taking place, accounting - at least partially - for the current stagnation period.

I hope the new software paid in thousands of bitcoins is so advance that it will block theymos and bitcointalk itself.

What new forum software is in the pipeline to block out parasites and deprive the trolls of there hard earned income. How cruel.

Huh, very interesting insight so far! Please keep us posted if you've found out more. So that means, it really appears to be a bot that has burned 150 BTC of someone's stash so far? Incredible... I want an AMA with the operator of that bot!

Can I quote you on that?

You've got any tips what I should do now with my BTC holdings?

Hope the new insanely expensive forum software also blocks quotes from people you ignored.

you must have lost $$$$ in this dead cat bounce

Did anyone around here provide an explanation on what is going on on BTC-e at the moment? That crazy bot is still going strong and maybe burning away someone's money while BTC-e is getting stinking rich on fees

oh, i see, "we were at $100 last year" now
guess all the charts /news / analyst reports are showing the wrong data

But it's fun.

It's not like I was bumping one of his threads by posting in it.

Get a sense of humor.

@falllling

go out of this community. Only some bullshit comes out of your mouth!

u are the biggest FAIL!

sorry to break your unrealistic to da moon dream

I tell you what'll get you punched in the face: throwing false info around. Bitcoin was hovering last year around $100+ mark, this year around $400-500.

Brah, you should consider anger management counselling.

Either that or take your meds.