Topic: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion - page 29776. (Read 26712310 times)
February 13, 2014, 11:47:03 AM
Cheap coins everywhere, Christmas came early
February 13, 2014, 11:43:41 AM
This slow crash is very annoying, when i want to short, i want to see profits fast. I am not really comfortable to sell for the midterm in this situation that could end up being the bottom, or close to the bottom.
February 13, 2014, 11:40:30 AM
Just had a sick deja vu, almost like a matrix glitch, last time it happened the price went up
The trend is still pointing down, though, it hasn't even flattened out yet...
February 13, 2014, 11:36:25 AM
So if there are fewer bitcoins in China, but the same amount of demand to use bitcoins for the same purpose that the bitcoins that left China were used for, then the price goes up.
Yes, the price of bitcoins will go up (if it is not offset by speculators dumping).
But we were discussing "capital evasion", not price; and I showed that using bitcoins as the Forbes article described does not amount to capital evasion; rather the opposite. That is why the Chinese government has not tried to stop it.
With the current internal restrictions, prices, and mining activity, I believe that bitcoin is siphoning real wealth from the rest of the world to China. But not much - much less than a million dollars per day, I woudl say.
First off, your assumption that the Chinese government understands all the implications of Bitcoin is questionable. 2nd, government policies do not always have their intended effects. Often the opposite is true. Thirdly, capital flows in both directions so the hypothetical scenario could just as easily be someone trying to get wealth INTO China.
February 13, 2014, 11:24:00 AM
Just had a sick deja vu, almost like a matrix glitch, last time it happened the price went up
February 13, 2014, 11:21:55 AM
But since bitcoins have no intrinsic value, the material wealth of China would not change. There would be still the same amount of food and cars in the Chinese market, and the same amount of Yuan in circulation inside China.
Intrinsic value is meaningless in terms of price. Air has intrinsic value. We need it to breath, yet it has no price. Dollars have no intrinsic value, but we use them because they are the most liquid commodity for trade. The reason why dollars are the most liquid commodity for trade is irrelevant. If there was another reason, that reason would suffice. If there was no other reason, something else would be money.
Like gold, bitcoin is recognizable, portable, divisible fungible and scarce. it can be used as a medium of exchange. These properties make it valuable to some people. The fact that it is valuable to some people make it valuable to other people. Intrinsic value is not a useful concept if you want to understand money. It is a harmful distraction.
February 13, 2014, 11:20:10 AM
With this "withdrawals in the air" situation, it so easy for someone to inside trade. Scoop cheap coins, then announce that it works again. 99% sure someone will capitalize on this.
No way , would somebody running a collapsing exchanger , full of troubles , thinking of such scheme?
February 13, 2014, 11:17:38 AM
So if there are fewer bitcoins in China, but the same amount of demand to use bitcoins for the same purpose that the bitcoins that left China were used for, then the price goes up.
Yes, the price of bitcoins will go up (if it is not offset by speculators dumping).
But we were discussing "capital evasion", not price; and I showed that using bitcoins as the Forbes article described does not amount to capital evasion; rather the opposite. That is why the Chinese government has not tried to stop it.
With the current internal restrictions, prices, and mining activity, I believe that bitcoin is siphoning real wealth from the rest of the world to China. But not much - much less than a million dollars per day, I woudl say.
February 13, 2014, 11:12:37 AM
What a silly observation. If more people mined, the difficulty would be forced up to compensate. Zero sum game.
True, but that's not what "zero-sum" means.
February 13, 2014, 11:11:24 AM
With this "withdrawals in the air" situation, it so easy for someone to inside trade. Scoop cheap coins, then announce that it works again. 99% sure someone will capitalize on this.
February 13, 2014, 11:11:00 AM
500 coins on offer on stamp at 651 just got pulled. Thus, a short-squeeze, should one be impending, may begin soon.
February 13, 2014, 11:10:14 AM
To your other points, what will a superior crypto have that Bitcoin lacks?
Are privatized money systems based on trust?
Superior crypto would need a better system for creating new coins, since proof-of-work is not a smart way to create coins. The increase of miners should increase the security of network, and therefor give more value to BTC, but because the miners are pooled together, there is no increase in security. So resources are spent without any new gain. I think that Proof-of-Stake is more advanced, but I don't know any proof-of-stake coin that can hold on it's own. But I do bet that there will be a new wave of better quality coins. What we would need is an software company with experience and financial backing to create a coin. As long as coins are created by students or hobbyists, we won't see any serious competition to BTC.
Of course, money is always based on trust. Trust that you can use money to trade value without any unnecessary loss.
I think that bitcoin won't lose it's trust because of the flaws in software code, but it will lose faith because of the flawed market system. When there are no consequences to create a "scam exchange" that can play the competent exchange role for a year, just to gain trust, and then to run away with their customers money, then the market system is far from being secure. Most bitcoin enthusiasts are religious on the subject, and they actually believe that the market will be fine, since everyone has faith in the future of bitcoin and won't start "scam exchanges" because they can get more profit with legal methods.
But there are people out there who can see Bitcoin just as an temporal phenomenon and those people are motivated to build an exchange just to run away with their customers money. And they can actually do this without "running away", because they can just blame it on being a victim of hacking, lost database or whatever, and they won't see any jailtime.
There would be nothing wrong with proof-of-work as long as all the lazy speculators out there got off their ass and started to help out and do some mining.
That's the big problem with this world...what can everyone else do for me...me me me me me.
February 13, 2014, 11:07:58 AM
And maybe the Chinese guy doesn't want to stay in China and maybe if he leaves, he wants to take his wealth with him. Maybe some other guy wants to stay in China and profit from selling his bitcoins to the guy who DOES want to leave. This seems so obvious to me, that there must be some communication problem we are having or you lack a basic understanding of economics.
Many people break laws if it's in their best interest to do so and the risk/reward ratio is acceptable. It's not wrong to do so if the laws they break are unjust laws. If they can avoid capital controls legally by finding a loophole or if they can evade capital controls illegally that shouldn't justly be illegal, then on the margins, people will do so.
Unjust laws are broken far more frequently than just laws, because most people are good people. That's why victimless crimes like gambling, prostitution, drugs, smuggling, and tax evasion are so difficult to enforce. Most of the time they are even unreported. Theft, assault, murder, etc have victims, real victims, and are actively prevented and prosecuted by the potential victims as well as the government.
Many people break laws if it's in their best interest to do so and the risk/reward ratio is acceptable. It's not wrong to do so if the laws they break are unjust laws. If they can avoid capital controls legally by finding a loophole or if they can evade capital controls illegally that shouldn't justly be illegal, then on the margins, people will do so.
Unjust laws are broken far more frequently than just laws, because most people are good people. That's why victimless crimes like gambling, prostitution, drugs, smuggling, and tax evasion are so difficult to enforce. Most of the time they are even unreported. Theft, assault, murder, etc have victims, real victims, and are actively prevented and prosecuted by the potential victims as well as the government.
February 13, 2014, 11:03:11 AM
February 13, 2014, 11:02:10 AM
Except for a few who can use bitcoin while traveling abroad, most Chinese cannot use their bitcoins as currency, and have no expectation of doing so. So, why would they put their real money into bitcoins, and hold on to them?
Two reasons come to mind: They want to invest in the technology, or they want to hedge against a change in government. Governments often change. Fiat currencies, historically, have always failed. Just as they cannot use gold in commerce, so too they cannot use bitcoin in commerce. Just as they buy gold as a store of value, so too they buy bitcoin as a store of value. Both are free of counterparty risk, unlike fiat currencies. The Chinese national appetite for gold proves that they understand this well, and act upon it, en masse, practically.
February 13, 2014, 10:59:39 AM
Obviously you are wrong, because according to you, 95% of November rally price is from China
...before the Chinese government banned its use in commerce. The "believers" probably left at that point, leaving only the speculators, with the obvious effect on the price.If I lived in China, I'd be a hodler. Moreso than now even. I can do international wire xfers. The Chinese can't. Bitcoin can be spent almost anywhere. The renmimbi can only be spent in China.
Yes, and that is what I mean. Except for a few who can use bitcoin while traveling abroad, most Chinese cannot use their bitcoins as currency, and have no expectation of doing so. So, why would they put their real money into bitcoins, and hold on to them?
February 13, 2014, 10:56:03 AM
Note that the article was written before the Chinese stomped on bitcoin.
But even if nothing had changed, there is one little snag in that article. If a Chinese citizen uses Yuan to buy bitcoins in China and then sells them for dollars in the US, there is no export of Yuan to the US actually. Instead the guy gives his Yuan to other Chinese traders, and the US traders give him a bunch of dollars.
So why would the Chinese government object to a Chinese national receiving a gift from americans?
Sure, after that transaction there would be fewer bitcoins in China and more bitcoins in the US. But since bitcoins have no intrinsic value, the material wealth of China would not change. There would be still the same amount of food and cars in the Chinese market, and the same amount of Yuan in circulation inside China.
If bitcoins could be used to buy things in China, there might be some Yuan inflation as the bitcoins became scarce and the Yuan lost value relative to them. But that is why the government banned their use in commerce.
So if there are fewer bitcoins in China, but the same amount of demand to use bitcoins for the same purpose that the bitcoins that left China were used for, then the price goes up. What is so difficult about supply and demand for you to understand?
February 13, 2014, 10:48:01 AM
Obviously you are wrong, because according to you, 95% of November rally price is from China and it hasn't dropped to 5% of ATH yet, or is that what you are predicting? If I lived in China, I'd be a hodler. Moreso than now even. I can do international wire xfers. The Chinese can't. Bitcoin can be spent almost anywhere. The renmimbi can only be spent in China.
I will happily accept your RMB.
February 13, 2014, 10:45:55 AM
Note that the article was written before the Chinese stomped on bitcoin.
But even if nothing had changed, there is one little snag in that article. If a Chinese citizen uses Yuan to buy bitcoins in China and then sells them for dollars in the US, there is no export of Yuan to the US actually. Instead the guy gives his Yuan to other Chinese traders, and the US traders give him a bunch of dollars.
So why would the Chinese government object to a Chinese national receiving a gift from americans?
Sure, after that transaction there would be fewer bitcoins in China and more bitcoins in the US. But since bitcoins have no intrinsic value, the material wealth of China would not change. There would be still the same amount of food and cars in the Chinese market, and the same amount of Yuan in circulation inside China.
If bitcoins could be used to buy things in China, there might be some Yuan inflation as the bitcoins became scarce and the Yuan lost value relative to them. But that is why the government banned their use in commerce.
February 13, 2014, 10:45:30 AM
To your other points, what will a superior crypto have that Bitcoin lacks?
Are privatized money systems based on trust?
Superior crypto would need a better system for creating new coins, since proof-of-work is not a smart way to create coins. The increase of miners should increase the security of network, and therefor give more value to BTC, but because the miners are pooled together, there is no increase in security. So resources are spent without any new gain. I think that Proof-of-Stake is more advanced, but I don't know any proof-of-stake coin that can hold on it's own. But I do bet that there will be a new wave of better quality coins. What we would need is an software company with experience and financial backing to create a coin. As long as coins are created by students or hobbyists, we won't see any serious competition to BTC.
Of course, money is always based on trust. Trust that you can use money to trade value without any unnecessary loss.
I think that bitcoin won't lose it's trust because of the flaws in software code, but it will lose faith because of the flawed market system. When there are no consequences to create a "scam exchange" that can play the competent exchange role for a year, just to gain trust, and then to run away with their customers money, then the market system is far from being secure. Most bitcoin enthusiasts are religious on the subject, and they actually believe that the market will be fine, since everyone has faith in the future of bitcoin and won't start "scam exchanges" because they can get more profit with legal methods.
But there are people out there who can see Bitcoin just as an temporal phenomenon and those people are motivated to build an exchange just to run away with their customers money. And they can actually do this without "running away", because they can just blame it on being a victim of hacking, lost database or whatever, and they won't see any jailtime.
There would be nothing wrong with proof-of-work as long as all the lazy speculators out there got off their ass and started to help out and do some mining.
That's the big problem with this world...what can everyone else do for me...me me me me me.
When resources are spent without any new gain, then there is something wrong. The arms race in bitcoin mining doesn't make any sense. Electricity and hardware wasted for something that won't actually be useful to the bitcoin network. If increase of miners would increase the security of the network or speed of transactions, only then would the proof-of-work method make any sense.
Satoshis logic was to simulate gold mining, but in my idea it doesn't work anymore because gold does have practical value not just speculative value. If miners could be used for practical work as well, then it would be another thing. Proof-of-Work would only work if mining would be done without pools, and with CPU or at least GPU, that would have other application besides mining bitcoins. Pools and ASICs ruined the entire original concept.
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