Topic: Watching amateur finance types flail - page 3. (Read 35339 times)

One man's speculation is another man's fundamental.

Collapses are usually the result of poor information distribution.  Bitcoin seems to avoid that.

I don't know where the idea that most trading is speculation comes from? That sounds like something you just made up unless you can document it.

I did a quick look over the various exchanges and the trades there today add up to a volume of maybe 6000-7000 BTC.

The total volume traded according to block store is almost 5 million at this moment (last 24 hours). So where did you get your idea that most trades are speculative? If you cannot explain it then I'll assume you just made it up according to your own impression of the world.

Just looking tells you that most trades are BTC -> BTC.

How does trading volume translate into health of the bitcoin economy? If that trading volume is based on speculation and not trade, isn't it liable to collapse at any moment? This is not a rhetorical question, I am really asking because I don't understand the statement.

That is an excellent point. It could easily go up to $200 and then go sideways until the market decided that was fair.

+1

The mistake people make when they look at the Bitcoin price chart and scream "bubble" is that they fail to understand Bitcoin is still in the price discovery phase.

Nothing like it has ever been priced.  This is an awesome experiment and I am glad to be part of it.

PS:  I am a DBA with 25 years experience, a Futures Trader/Advisor in Australia and a merchant who accepts Bitcoin.

Short term, scarcity may or may not be a problem. Medium/long term, invasions of Iraq, at some point Iran maybe, and right now illegal bombing of Lybia should tell you that control of the largest available sources is playing a major role. If you don't think that is motivated by scarcity, here's some recommended viewing.

What about the integrity angle? I'm thinking along the lines that if the calculation does something useful (i.e. other than cryptographic security), there may be an underlying pattern to the result. If there is a pattern, then it can be reduced, and therefore attacked (someone figuring it out will be able to do a lot more of it than everyone else). This might of course be wonderful (figuring out shortcuts to problems improves general use), or not (attacker keeps it to themselves while abusing it).


It may not be realistic to expect Bitcoin to replace everything else, for those cases where the disadvantages outweigh the advantages it could coexist with other systems, perhaps even Bitcoin like ones with tweaked parameters.

You are a true grammarian, aren't you?

Where, where did you see this mistake?

There needs to be an internet poking stick so that every time someone writes "Here here" (it's really "Hear hear!"..as in "you should listen up", not telling your dog to come here or w/e it is people think they are sounding out) or uses "then" instead of "than" (as in "x is better than y") and "their" instead of "they're / they are", "your" instead of "you're / you are" and various other classics they get poked.
In evil places. Painful places.

That's an interesting legal point. Whether funds held by a Bitcoin exchange are debts of the exchange or a shared interest in a custodial account isn't clear. This matters a lot when an exchange goes out of business.

For a bank, a deposit is a debt of the bank. For a brokerage, a deposit not invested in some security is funds held in custody. This really matters when a brokerage firm goes under.  (I've had that happen, with L. F. Rothschild. Founded in 1899, went bust in 1989.  Getting all my assets out took a few weeks of daily phone calls and threats, but I didn't lose anything.)

For a money transfer firm in Japan, which Mt. Gox is, a custodial account is required. Mt. Gox isn't registered as a money transfer firm, although they should be. So we have only rumors that they have all their customer's funds.

Here Here.

I can tell, at this point, that you didn't read the article I suggested to you. Not nice. And yet you prattle on. Frequent flyer miles are a predecessor to bitcoin?!


Here you seem confused as to what "decentralized" means. The policies and protocols coded into software do not make the it centralized (or otherwise).

I'm particularly disappointed that you ignored my point about the morality of the current money system, which you seem to be defending. You are on the wrong side of history. Your Dun and Bradstreet world is immoral. You need to come clean of it.

K


Good way to start of neutrally.


So the price went up, and back down, and a 'bubble' fashion. Big deal. As you said, amateur finance types flailed after the hack and all sold out... while now the price is steadily rising. Bear in mind, the only thing that bubbled here is a very alpha pegging of the BTC to primarily (nearly exclusively), the USD. You seem to be implying that because the price bubbled that it is doomed to not gain value again, thus investors have lost all return. You haven't event attempted to elaborate the consequences you propose from the price flux.


You sound like you have no absolutely no idea.

Firstly, don't pull shit out off your arse. How many merchants have you talked to, have said they have heard about, researched and evaluated bitcoins for themselves (without your horse-shit of course) and speculated that it would fail.

Second, there are infact *many* merchants using bitcoins listed on the wiki, and many more projects, charities etc that go unheard, all which can classify to some degree as merchants. How many people do you really think have looked and researched bitcoins enough to make an informed decision as to whether their business model is appropriate or not.

Third, bear in mind this is an internet cash system and people doing small transactions generally do it by hand, thus physical cash is exchanged and no need for bitcoins is needed. That eliminates thousands of corner stores that have no need for such a system. However in the future when credit card type wallets are used, corner stores would accept bitcoins. Indeed millions of small transactions occur on the internet, however what proportion of those do you think have heard of Bitcoins thus far and is willing to invest 100% (that is all online transactions using BTC)?
There is also variable degrees to which people invest, so its not as black and white as you appear to think. 


Two organizations, by your opinion, are flaky. Bitcoins != Mt. Gox.

You state you dont know much about Tradehill but you say they are flaky, is that not you speculating that they are malicious? not trust-worthy? incompetent?
Flaky is a very general term and is no descriptive. Please choose your words wisely.
Shouldn't one greet others with an open heart? I'm not saying you must follow them blindly, however I am saying you can approach a situation with an open mind yet hold reservations.
Have you actually done business with them? Have they so far wronged you?
Would you not want others to greet you with openness as you yourself approach a new market with reservations?
No one forces you to do business with anyone so if you deem a party 'flaky', don't trade with them.

As for their credentials such as audits, regulation etc.. Do you really think the bureaucratic system as it stands can handle such a request for a Bitcoins based exchange?
Most governments want to eradicate Bitcoins because they fear losing power, they aren't going to say 'yeah here's some credentials for people to trust your Bitcoins exchange..'
If you reply saying that bcuz governderps think Bitcoins is evil, I will have great lulz.

You seem to oversee the fundamental concepts behind Bitcoins. Look from the system itself outward.
It is a beautiful design that could shake lot of peoples core held beliefs.

Have fun flailing.

~ Conf

Maybe John is just a doom-sayer because he's worked out some people are psychologically drawn to negative statements.  (plus I think his web site is hilarious)
I come across experts and their forecasts all the time.  Even this week I was re-reading an informed forecast of oil prices that suggested USD25 was an extreme value for the future (written in 2003).  Similarly, I have forex gurus tell me the cross rate to the USD should mean revert to the ten year average with no basis or likelihood.  If there is a fundamental, that's great, but saying it will crash (or anything else) is speculation on its own - certainly at this point in time.

How about _failure_ of the "central bank", which is absolutely going to be noticed by the end user, as it was in the case of holders of beenz.

Yea.  Decentralization does it.  Its not just a buzzword, it means no central authority can seize an account.

E-gold failed because the Feds took it down.  Bitcoin can succeed because the feds can't take it down (or will at least have a much harder time).

Paypal fails for some because paypal freezes their accounts.  Bitcoin can succeed for them because noone can freeze bitcoin accounts.

...and doesnt answer the question

Anyone who's had their paypal account frozen (rightly or wrongly) understands the value of decentralization.

that's a nice feature and technologically impressive.
do you think this is what makes bitcoin a 1 billion dollar economy within 5 years, while other e-currencies failed completely? decentralization does it?
a feature that isnt even apparent to the end user unless there would be an attack on the "central bank", which AFAIK never happened with any of the previous e-currencies.

(if anything, an end-user who wants to use bitcoin as a form of payment instead of speculation has disadvantages from decentralization)