Topic: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion - page 28178. (Read 26710532 times)

Of course I have heard of Enron. And of Worldcom, and Madoff... 

Did you know that a dozen managers of those companies were found guilty of criminal offenses, and many (I don't know if all) of those went to jail?

Perhaps that is why, among thousands of companies of similar size, there have been relatively few such scams.

By "relatively" I mean "compared to bitcoin-related enterprises".  Here is an outdated and incomplete list of bitcoin scams and thefts.  How many of those have resulted in convictions? 

Why would a bitcoin entrepreneur (say, the owners of BTC-e) refrain from doing what those people did?

That's the old "early bird gets the worm, but the second rat gets the cheese" argument. There is merit to that argument, but as long as the successor incorporates the Bitcoin block chain, it will not replace bitcoin. It will become Bitcoin. Green backs did not replace dollars after the U.S. War of Northern Aggression. Greenbacks became dollars.

If you missed the land boom, I suppose you could always wait for the real estate market on the moon, but that wouldn't make terrestrial holdings worthless.

I think you could possibly be correct here. Look at the charts from the past two days. Huge jumps around 12-1AM EST both nights, which would line up pretty much dead on with your chart.

That would be ill-advised:  Bitcoin is likely to be the best or only way to get into the successor, or at the very least, the best or only way to get into it early on.

I just had a chuckle imagining someone trying to martingale the lotto Lol. "I'm on a 16 week losing streak and i'm sitting on 65000 lotto tickets! I'm bound to win next week!"

...and by making this rational choice, people increase the odds of the positive outcome actually happening (the more people in, the higher we go and the nearer we are to the positive outcome).

It is quite marvellous, I don't know the actual invisible mechanism, but the visible proof is bitcoin price and its mind-boggling historical development.

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Anyone who thinks that Bitcoin has anything higher than 0.1% chance of success, should rationally buy bitcoins. The trick is that buying increases the chance of success. With a few iterations you realize that the chance of success is actually something between 25% and 75%. Then you are very willing to buy bitcoins. Which increases the price, rewards previous investors, gets more people interested, and makes the chance go up. In 3-5 years we have everybody using bitcoins, and an ordinary person has 5mBTC in the west and 1mBTC in BRIC.

Why was the adoption of a new technology with network effects never before so interesting?

possible breakout brewing.

I like what that one dude said about buying bitcoin being akin to buying options with no expiry date. It changed my way of looking at things.

just one question, any1 knows how much tradevolume was >500 today?
i was pretty much gone the whole day

That's true provided this is a manageable part of an investment portfolio. It's not entirely unlike drawing to an outside strait or four cards to a flush in poker. You have a ~37% chance of tripling your money or more in a three way pot. I take that bet every time IF I have a bankroll big enough to handle the expected ~63% of hands it loses.

A more extreme example is a lottery ticket. If a lottery ticket costs two dollars, with a chance of winning of One in a Million with a payout of of $1M, then the expected return of any given lottery ticket is 50 cents. A terrible bet.  But if that same lottery ticket with the same odds and the same payout cost 25 cents, it's a good deal, even if the chance of winning is extremely small. Just don't put a large percentage of your portfolio in lottery tickets.

We have a low probability of Bitcoin becoming an important store of value or used for international tranfers or online payments..

There is a low probability that it happens but the reward will indeed be huge if it does

A lot of traders make their trade then incite others to do the same trade by posting here

you are right, one aspect nevertheless: there could be a successor to bitcoin in its current form ... then it's clear that everyone will jump ship. i think, quite a few of those who have "missed" bitcoin so far think, that they'll simply wait for this new incarnation and hold back their investment.

As if professional accounting and financial regulations helped to prevent the tons of scams and failures going on in fiatworld everyday....
Hopefully new layers added on top of the blockchain will be a first attempt to prevent some scams in the future.

Good luck trying to change financial law to become a neutral entity.

You have to love all these butthurt bears in denial

I'm not feeding Fonzie's ego. You are. I've had him on "ignore" for months.

I totally agree. I must admit I was being a bit sarcastic in my analysis because I do believe that the pros have a lot more at stake. The real manipulation comes from people who are able to influence the news. Bad/good news, volume/price manipulation, TA and statements from influential people can all be used to promote a certain point of view. It may be more or less sophisticated, so no matter what one needs to stay sharp and make up ones own mind.

Sorry if this point seems patronizing or insulting, but you need to be aware, in case you are not, of the concept of expected value.   A very large reward at very low probability may have much higher expected value than a modest reward at high probability.  Because the reward for owning bitcoin is so vast, in the fiat displacement case (which I agree is inevitable, albeit perhaps not with bitcoin as we know it today) even at vanishingly small probability it is a "rational" choice.  The concept of rationality is debatable.  But given the standard concept of rationality, the outcome is not really debatable.

Explanation

The government itself *is* Enron.  For example, on 10 Sept. 2001, Secretary of Defense Donald Rumsfeld told the U.S. Congress that the Department of Defense had misplaced 2.3 tn USD.  That is 2.3e12 USD for which they could not account.   The federal government of the U.S. is one of the best, cleanest national governments in the world.  It is also vastly more criminal than any other entity of remotely comparable power.

Difficulties like what? There has never been anything as important to bitcoin before then to step over the threshhold to get the legal framework and instututional funding. Everything before this has been just fun and games.

You are kind of losing me here when you are telling me that you actually believe that Bitcoin could replace fiat. When you want explanations for that, then I give you several.

1. No country with a right mind will replace fiat for a currency that is controlled and owned by anonymous individuals, who have no responsibility over that currency. And who are also in high probability former criminals, when you consider the history of bitcoin.
2. There are no mechanics in bitcoin that enable it to offer price stability. And please don't try to insult my intelligence by telling that wider adoptation will create the stability. As long as bitcoin is very attractive to speculative play, then there will always be strong volatility.
3. If an country would use BTC as legal tender, that is both attractive to speculative play and distributed by an unregulated market system, then it would be extremely easy to cordinate economic attacks by hostile countries.

Fiat isn't just a piece of paper that is printed. The main difficulty for sustaining a quality currency is keeping price stability, and it isn't something that is created by itself. It is created by taking into account the available resources or foreign currencies and by regulating the flow of money according to that information. When the regulation is done right, then prices keep stable and it is possible to make plans with the support of that currency. Bitcoin has fixed supply and therefor it's not able to regulate it's flow to offer price stability. It's all about attracting investors with it's high possibility of deflation.

When you want to talk about BTC replacing fiat, then open your own business and start to use BTC with converting it to fiat only quarterly and try to earn profit with this instability. You can only start dreaming of BTC replacing fiat after services like BitPay would become useless, but I can't how that could happen with fixed supply.
Right now, when someone is asking me "Why couldn't we just use BTC as fiat", then it sounds the same to me as some kid would ask me on why couldn't he just pay with his monopoly money. There are complexities involved that bitcoin is just not able to handle.