Topic: Why BitCoin is about to explode again (Read 6571 times)

If your money is in a bank no longer belongs to you, it belongs to them and they can do whatever they want with it. A local bank to me instituted a $200 cap to keep your account free or face a monthly charge if your account balance is under that number. They think it is ok to hold your money hostage, needless to say no one in my family banks there anymore now, we all moved to a credit union instead.

https://bitcointalksearch.org/topic/my-bank-accounts-got-robbed-by-european-commission-over-700k-is-lost-160292

this was the poor guy, can you even imagine what it's like to have 720k euros stolen from you and only being left with 128?? that is unbelievable to me that they could do that. It's one thing to have say 5% or 10% taken, but 84.8% of your balance stolen? really crazy

my mother sold my grandmas house and i urged her to get the money out of the banks in case anything happened, so she decided to buy another house outright where she lives to rent out, so no mortgage, and even if the housing market goes down i still feel better having it like that than sitting in a bank account waiting to get stolen at any time they like

i dont trust banks at all, i always keep minimum amounts in there

Or those with the most hashing power may collectively decide to invest in an altcoin before a planned 51-attack on bitcoin. Afterwards, they can pump up the alt to unprecedented levels as it fills the newly created void left by bitcoin.

You might scoff at the suggestion that the largest miners or pools would collectively decide to do such a thing. But, consider the potential fortunes to be made.

Yeah, miners will either stop mining or continue mining but hoard most of the coins they receive to wait for a higher sell price.

Very, very few miners will actually mine at a loss and continue selling. This is incredibly stupid to do as it means you are actually paying your own money for the privelidge of mining bitcoins, lol.

This means we could see a couple scenarios:
1) A lot of miners (GPU miners, as well as newer ASIC purchasers who will not see a realistic ROI at current BTC/fiat rate) will simply stop mining, for the time being. This will increase profitability of remaining miners.
2) Reduced supply of coins (far fewer miners will be selling their coins right away at this price) will partially contribute to price rally. This illustrates one of the essential roles of hoarders in any healthy economy, per Fekete. Removing and introducing liquidity, i.e. "everyone has a price." Miners hoarding are like a crude version of market-making derived from rational self-interest yet also benefiting the economy as a whole.

I can see both scenarios happening fairly soon.

If price goes down further, it will only compound the effect of (1) and (2) in the long run. More miners will stop, those ASIC miners that continue (and are actually profitable) will have to either sell at a VERY slim profit, or hoard (thus partially contributing to a reduction in supply)

In the end, the demand side has to be taken care of, naturally, via adoption. I don't think this will be a problem. In the meantime, it's pretty easy to speculate as to what this ASIC mining fiasco will contribute in terms of supply.

Mining hardware itself has nothing to do with ROI beyond your starting cost to recoup, it is 100% dependent on the market price if miners make any returns or not. At the moment BTC will need a pretty big rally to support continued profitability, which has already fallen by more than half since beginning of June and still dropping. Right now mining coins is getting more difficult by the day but the market price is remaining the same, which translates into every machine added to the network takes a bite out of the profits of all miners on the network thanks to the difficulty increase, needing more and more gear to yield the same return which just compounds the problem further. Mining is outpacing market value at an insane rate, and it will have to correct at some point

Bitcoin's next moves will be based on the current economic model breaking down bit by bit, we will see more rallies due to bail-ins as people become desperate to leave their crooked banks. Cyprus not only set the standard for the "bail in" procedure (ie robbing their own banks blind to save themselves from insolvency), but the precedent for Bitcoin acting as an escape pod for investors and account holders that want out in a hurry.

Miners should be praying for such events or be stuck with mining machines that will not yield a positive return in a reasonable time frame. It isn't enough to just mine coins, we must foster the adoption of Bitcoin as well to drive up market value and use.

I think these things will play out naturally and probably not as expected, but we're in for a pretty fun (?) ride to say the least.

Love that pic Adrian-x. Seems to be very apt at the moment.

That's what BFL said... last year.

depends which asics, BitFury preorders will give ROI and a lot more. Chip been tested and first batch on schedule for August delivery.

LOL'd made me think of this, and where is the media in your example. - How would you like me to spin the economic meddling  - Democrats or Republicans


But all said and done, I never expected Bitcoin to be profitable to mine with a GPU after halving day.
It looks like the P2P crypto community and the free market unregulated day traders are happy to subsidise the GPU miners, and probably will until the difficulty stabilises.  

Nice thought in the edit.  Now we get to watch the BTC market make corrections and keep on Hulk-Smashing its way along.

You're right... All the sad GPU miners (and late ASIC orderers)will have have to become day traders 

EDIT: If this were any larger industry in any Western country, the government would be subsidizing the GPU miners' underproductivity to help them stay afloat, and to help prevent losing "American Jobs." Who would be paying for GPU miners to not find blocks? The taxpayers, of course. Anyone opposing the financial support of this non-productive industry would be called an "austerity pusher" and someone who threatens job growth and the economy.

again ?  Did greece get out of trouble in the last few years ?  Greece, and many many more country are in big trouble, and it will last for very long, in fact, until total colapse.. Because it is how the monetary mecanics has been designed !

Because ASIC pre-orders are not going to give an ROI so buying is the only option.

Yep this has always been the case, historically cronies get advance notice of major economic actions.  Happened with gold in the USA before 1933, Argentinians before their depegging 2001, Paulson and the banks in 2008.  It's impossible to keep secret economic measures which require systemwide coordination in advance.  Even if people are sternly  mandated and monitored to keep quiet, anyone with a pulse will find a way to hint to their friends and families that something big is coming and to move funds accordingly.

Speaking about markets volatility and overall craziness in the world economy, well...
...prepare for a year of a full moon: http://youtube.com/watch?v=iTAPZIsX0zU at 11:41
and at 12:22 it says that we already won, so just fasten your seat belts and enjoy your ride

if there is one thing we can rely on, it is the unsolved worldwide financial crisis. we had reached peak fiat-credibility in 2008.

Once cyprus happened it was too late (for them).  Think about it.  Who will trade BTC (or gold) for the Argentine peso?  Only people who plan to spend them right away (tourists).

Its good to buy gas before your car goes dry...

I don't think you're likely to be able to use your BTC stash to buy groceries at the corner store in this round of Argentine fiscal disaster.  But you'll be the only person on your block who can buy anything over the Internet from China, Europe, or the USA.  (Unless you guys have got a lot of USD squirreled away)

You're correct there, Matthew. If you look at public withdrawal amounts, they "inexplicably" surged shortly before the bail-in was announced.  It seems to suggest that a few key players were informed ahead of time.

Your argument hinges on Cyprus having not given any notice (legal or otherwise) before taking funds, and I mean anywhere, not even in parliament. I'm not convinced "no one" saw this coming, as "someone" had to enact it.

I understand that businessmen with no knowledge of bitcoin wouldn't have any way to assess the risks of legacy banks vs. bitcoin.

As for the depositor bail-in risk assessment - The problem is, you are saying this after the fact. You say "any other country that doesn't seem to be in ruin like Cyprus" as if you would be able to see that coming. There are plenty of countries that are in financial ruin, taking bailouts, monetary debasement in full swing, housing, stock and bond bubbles galore...

It's easy to say "after the fact" that if you were a business owner in a country not "in ruin like Cyprus" you wouldn't take that risk. All I'm saying is that if you were a business owner in a country that WAS "in ruin like Cyprus," you wouldn't know it.



To clarify, I was outlining a hypothetical situation. There was in fact an IT business owner here who had approximately that sum in his company's bank account, and lost nearly all of it during the haircut (immediately moved his company to another country) and I was sort of echoing his situation. But I thank you for your sympathy

AFAIK, the ECB and other regulatory bodies have signalled that they are ready to take that approach in any Eurozone country to recapitalize banks. So if you are in the Euro and asking for a bailout, if the situation is bad enough, they will make a depositor bail-in a condition of the bailout.
The FDIC and some european agency collaborated on a formal strategy paper that included use of depositor haircuts to reimburse banks' gambling losses. This indicates that the policy is an option in the U.S. if it gets to that point.
Canada, Spain (already in Euro so doesn't really matter) and New Zealand have considered such legislation although I haven't followed through; I just assume that it passed.
Japan has just hopped on board now, it seems.

In the end, it doesn't matter whether it's legal or illegal in a specific country. If it's not explicitly legal, they can simply make it legal in an emergency session. What's important is that the precedent was set with Cyprus. And now Cyprus is scared to release its deposit stats for May because they need to figure out how to boost them back up after all the scared citizens dutifully withdrew 400EUR/day for the entire month.