Topic: Why I think bitcoins are a bad investmen at these high prices. (Read 5053 times)

To amend my post above, I think the total trade volume must come from reading the blockchain, since it appears to be too high for one exchange. If I'm wrong about that, please correct me. It's possible to game these numbers and make them appear high by transferring coins to a different wallet without changing ownership. The using the trade volume within the exchange itself, from which the price was derived, would be more meaningful.

More meaningful metrics can be estimated very simply from the information provided on coinmarketcap.com. I think this information comes from Vircurex, and might not be very comprehensive, as it does not include all exchanges. If I'm wrong please correct me. I think actual sales are a more meaningful measure of market depth than are bids and asks. For example, at the time of this writing, 45,749,635 USD worth of bitcoins were sold in a 24 hour period. The bitcoin price at this instant is 727 USD. I'll use this instantaneous number as a price estimate estimate since I don't know the 24 hour price history. Dividing you get 62,929 XBT sold. Dividing by the total number of bitcoins minted you get 0.52% of bitcoins exchanging hands in a 24 hour period. Now compare that to ripple, ranked number 2 on coinmarketcap, you get 0.0051% of ripple exchanging hands in a 24 hour period. This is 100 times less, and shows how ripple, being premined, has a high market cap due to artificial scarcity. This confirms that market cap is a worthless metric.

More meaninful metrics can be derived by histogramming the age of coins and recording sale price over time. It's much harder for a developer of a scam coin to game those numbers. New metrics will eventually emerge for cryptocurrencies, which differ from those of fiat or physical commodities.

So you see the market cap doesnt make much sence for Bitcoin, yet you still use it to reason all your arguments

To use your logic, I could just as easily say its easier making $20 profit by investing $1000 than it is by making $20 by investing $20 since my $20 needs to give me 100% return in profit while my $1000 only needs to increase in value by 5% (and this is regardless as to whether my $1000 buys me 1 or 1000 BTC). Sure I am risking more but the potential profit on my investment is 20 x higher.

OK, I understand your point, and now agree, market cap is inaccurate.
Of course depth is even more useless, its easy manipulated and huge sells or buys will only result in massive oscilations around a new less extreme price.
There seems to be very few metrics we can apply to bitcoin that give meaningful information.
I guess market cap gives nice media headlines.

My point is stock companies can be bought. All shares may not be present on an exchange, but they are available for purchase. Therefore, calculating their market cap (# of shares * price) makes sense.

Calculating bitcoin's market cap as "# of shares * price" is inaccurate because it is literally impossible to buy all of bitcoin. So many of the mined bitcoins simply are not available for purchase, at any price. They may as well not exist. Don't use them to calculate a "market cap". All we can really work with is market depth. By looking at market depth, we can see that it would not take a very large investment to make bitcoin's price skyrocket to the moon.

This claim that bitcoin is too expensive is based upon flawed logic. BTC is an arbitrary unit. If you think 1BTC is expensive then buy microBTC instead. They are a million times cheaper.


 

What has that got to do with what I said. I'm talking about market depth. The size of all the bids in a market is not relevant when calculating the market cap, and the market cap of any stock can't be obtained by simply selling into the market...its never deep enough.  All the bids willl never add up to the market cap.
In any event a buy-out doesn't cost the market cap, it would only cost just over 50% at most.

No, public companies are purchased all the time, typically for a price not much more than their market cap.

For example, Dell was public for 25 years, before it was bought out just a couple months ago. http://en.wikipedia.org/wiki/Dell#2013_buyout

Bitcoin cannot be liquidated by a leveraged buyout. Bitcoin is not a stock.

Thats the same as a Stock, No market is ever deep enough to allow the liquidation of a stock to the value of the market cap.
Bitcoin is not a stock, but it has similarities in the way it behaves and the way it can be analysed.

Peter R, I think that you have a very good idea, but sadly I see that I am a little too late for that. To take on an project like that, so that it would generally change the bitcoin exchange scene, would take time and effort that I can't afford. There is the time issue, where a new exchange not only has to be built, but needs a proper run in to gain the confidence of traders. When I see that bitcoin has probably 1 or 2 years to live, then that project would be on a very tight schedule. If you have about 2mil.$ to spare on a very risky venture, where there is a possibility of no return, then I'm in and we can start tomorrow.

First thing I would like from the core developers and the community leaders is that the subject should be talked about. People with expertise and experience should start thinking of different options how to improve the integrity of markets. The threat that unregulated markets present to the future of bitcoin is real, and it should be taken as real. Maybe bitcoin can be classified as an product or an brand, then there are always legal ways to set the terms of it's usage. Maybe a public rating system should be made to grade the exchanges in depth... these are just some ideas that popped into my mind. All I am asking is that people who are interested in the growth of bitcoin, would do the same and start throwing ideas around. The market integrity crises will be a big one, but all problems can be solved. The community should start early on thinking of an solution for this crises that will come sooner then most think. If all hell breaks lose, then there is no time to fix anything and confidence fades quickly. Bitcoin only needs a couple of weeks of waves of bitcoin exchange scandals, and the value will be back to single digits and it probably won't rise again.. And this will come in waves and with rapid speed. If one exchange is using dirty tricks in the market, then be sure that the others do the same. Only the level of dirtiness will varie. Soon greed will take hold and one exchange will leak the material that is needed to hurt the integrity of an competing exchange. This will be answered by a counter-attack that will leak shady doings and will probably spice them up a little with some made up stuff. When people are already unsure about bitcoin because of the previous scandal, then the next one will hit even harder. If the exchanges are corrupt, then greed will make them destroy themselves like this.

You need to change your name to either:

UnHappyBitCoinUser

or

HappyBitCoinNonUser

Yes, that's my understanding too, nastybit, and is why I said that "I didn't understand what that would look like or how that could be accomplished."   

But kkaspar feels we need more regulation at the exchanges and I think he had some idea on how that could be achieved.  I was hoping that he would address my last post, as I believe the voluntary free-market system we already have is perfectly sufficient. 

Edward50, you say that $20 > $40 is a better investment than $1k > $2k only because we are well over $40, it's a psychological limit you have.


core developers can't force anybody to do anything really. Consensus drives Bitcoin

Isn't this what we already have, kkaspar?  For example, YOU could choose to form a group (say a bitcoin exchange) and implement the rules and regulations that you see as important (perhaps independent audits).  Anyone that invests or trades with your group would have to follow your rules or you can kick them out.  If other individuals like what your group has done (e.g., the exchange audits) then they will want to work with your group and play by your rules.  If not, then, like you said, they can live by their own rules without the support of your group. 

So I don't understand what you are proposing.  You mentioned something in one of your posts about the core developers forcing the exchanges to behave a certain way, but I didn't understand what that would look like or how that could be accomplished. 

You will fail if you try to build group cooperation on inner responsibility, that is based on subjective understandings of moral and ethics. People are different with different understandings of right and wrong. If different views aren't discussed and middle-ground isn't found on how to do things, so everyone are satisfied, then conflicts emerge that slow down progress. That is the meaning of rules - to establish what is best for the group in general and to guide people to follow this path. Breaking the rules mostly means consequences like banishing the rule breaker from the group. So, rules mostly give people a choice 1) If you want to be a part of an group, then you have to follow the rules that are for the good of the group 2) If you want to live by your own rules, then live by yourself without the support of the group.

Now to more practical maters..

Bitcoin is already flourishing. You can say that bitcoin is in a critical phase where it can shoot off to heights or fall down to rubble. There is no middle-ground on the current phase. There will be growing trust in this system or there will be none.. Trust is the only thing that gives value to bitcoin.
But, like I said, I can't see that anything is done to take care of the markets


Like I said, if bitcoin will continue this path, then it will shrink down to 0,1$ per coin with a small group of true believers. That is the future where no exchanges are needed and people can just trade bitcoins with each other.  
Big things can't be run on just faith that everything will somehow just be ok. Big things need attention and work because too much will be at stake. Without proper markets with rules and regulations, bitcoin will never be big, because it is lacking the main thing that the majority needs - security

I personally wanted for bitcoin to get big. I know that bitcoin can never be an everyday currency, because of it's simplistic macroeconomic properties. I was just hoping that bitcoin will survive long enough to give it's throne away to a better cryptocurrency with more complex properties that modern economics need. But now I see the downfall that unregulated markets cause and I can see that it will cause problems that will make the evolutionary step in finance much longer then it should have been.. and this is sad..

Stop thinking of "market cap" as the total number of bitcoins times the current price. Bitcoin isn't a stock. Take MtGox for instance. It would only take a purchase of about $20 million to take the price to $2000. That's a far smaller number than $12 billion!

MtGox = group of fallible human beings

Government = group of fallible human beings

Regulators = group of fallible human beings

If you are not trying to make jokes here, then this claim is plain old childish. Rules and regulations are there to protect the market, because markets need integrity and trust for any trading to take place. Rules and regulations need to be made so that traders trust is gained, or else the market will just fail. If rules are made for only to protect the few in control, then the market won't get any traders and it will fail. Without rules and regulations there wouldn't be NASDAQ, because without rules there are no agreements and cooperation, and that is what the society is all about.
It's common for teenagers to think that all rules are bad, because they are rebelling against their parents rules and they don't have the experience in functioning in a larger community where rules are necessary for cooperation and stability.

That is exactly it. Without any rules and regulations there are no possibilities to find any proof on the fraudulent actions of exchanges. They are private companies and they can keep the necessary information as private as they like. I can only observe the public information that I can see on the order list and order history, and by that I can tell you that the information rises serious doubts.
The bitcoin dev should actually create an department that deals with auditing the exchanges and enforces certain rules that are needed to keep stability. The bitcoin dev actually has power to set those terms, but I see that they have 0 interest in this. I have been trying to get them to take down MtGox as the main recommended exchange market from bitcoin.org, but this also received 0 attention from the dev and from the community. MtGox is accidentally incompetent at best and probably they are deliberately incompetent to manipulate the market on their own investments. But bitcoin.org still sends all the new interested people straight to MtGox as the main recommended exchange market. To me, this means that they are either in on it or they are totally oblivious of the financial trust issue that will be affecting the usability of bitcoin more and more.


If you know anything about the currency market or the stock market, then you should know that this isn't normal by any means. When unbreakable invisible walls will be lifted just before a new and unstoppable rise/fall will start, then this is not normal. This means that the market is controlled from a single source without any opposition. The market should not do illogical behavior like this without any opposition. There should be stronger ties to the real value of bitcoin, what is calculated by the mining network and by available usability, but most rises and falls don't have much to do with anything real that is happening with bitcoin. "Some mysterious rich people that no one know about" are just selling or buying out of the blue and most regular "investors" are just sheep who are waiting for where the graphs will go.
This is not normal behavior! This is a behavior of an heavily manipulated market and and disaster waiting to happen.
I can predict you what will probably happen to bitcoin if it continues to go down this road. The instability of the markets will rise and the "mysterious figures" get more greedy and careless every month. Soon they won't even try to synchronize their actions with fake news that they themselves will publish from cryptocoin newsportals they themselves own. This carelessness will contribute to all the leaks that will come out, that the exchanges are heavily manipulated and the market data is simulated or all out fake. By that time bitcoin will have a general reputation of being a scam. No one cares about anymore the technical beauty of bitcoin but they only see the scandals that have surfaced about how the people have been tricked by the exchanges. Then this is the end. Bitcoin will cost about 0.1$ and will consist of a small cult of "true believers", who keep chanting "Chooo chooo to the moon".
The rest of the world will move on and new cryptocurrencies will begin to surface that also promise market safety and price stability. It will take time before any new decentralized monetary form will spread, since most of the people are still skeptical because of the history with bitcoin.
So, you see. This stupidity and greed that runs the current bitcoin markets will set back the general monetary evolution that bitcoin could have started. When the community is mostly supported by degenerate gamblers who are only into bitcoin because of the adrenaline rush of unpredictable trading, then nothing good can come of this.

btw. I am not one of those who is angry at bitcoin because he lost big. I bought at 203$ and sold at 1020$. But every day, looking at the current downtrend, I am getting more convinced that I shouldn't invest back even if the trend turns upwards. I invested in bitcoin because I truly believe in decentralized monetary future and I truly believe that monetary services should be private and therefor competition will better the quality of the financial world. But this current situation with bitcoin market is just silly. There is no idealism nor vision in the current direction that bitcoin is going with it's markets. It's just full of stupidity and greed, with excited people creating illusions of wealth without work nor knowledge and are  fueling each others illusions with traded cheers. Feels more and more like an religious cult then a technological and financial community...

I discovered Bitcoin by accident in February 2013. I needed to pay someone USD10. At the time, you could buy Bitcoins easily using block chain.info in the UK I paid GBP25 via bank transfer (approx USD40) and bought 1.7BTC within a few minutes. As you know, the banks have now made this infinitely more difficult and bank transfers take days. Even then, I loved how easy they were to use... and also the fact that (at that time) they kept rising in value and it seemed to be a never ending supply of USD... I kept spending it... but there was always at least $50 in BTC.

Now lets compare it to traditional banking...

I do business in several different countries and several different currencies. In order to transfer GBP to a GBP account in a different country... my bank charges me GBP17.00 (approx USD30) .The transfer is usually instant as its within HSBC. - I then need to ask them via a contact form to convert the funds into local currency (takes a further 24 hours as their business hours are different to mine) - Once converted, I pay various recipients and they charge me around $5 per transfer (and the recipient pays a further $3 to receive)- These transfers usually take 1 to 2 days to get to the recipients banks and exclude weekends.

There is also a limit to how much I can transfer per day using the online system. Anything over their threshold requires me to "contact them directly"

Transferring this way takes around 4 business days and requires me to perform a number of different steps at different times. I pay considerable bank charges each month and I'm restricted by the differing public holidays, working weeks and business hours of the respective countries.

This morning, I realised I needed to make some payments and would need to spread this over two days as I  would exceed my daily maximum.

However - My bank is only open for one more working day until the end of the year as Thursday was already over in that country.


As such, we will be unable to reply to your messages nor process any requests received after banking hours of Monday, 23 December 2013; Friday, 27 December 2013 and Thursday, 30 January 2014, respectively. Normal operations will resume on Thursday, 26 December 2013; Thursday, 02 January 2014 and Monday, 03 February 2014, accordingly. "


Bitcoin is vastly superior. No bank. No fees. No Holidays. No Working Hours. No inflation. No physical storage.

As they become easier to convert, and people become more understanding of what they really are, the 21 million coin limit makes them look seriously undervalued right now....

I particularly like this post -> https://bitcointalksearch.org/topic/why-bitcoin-is-going-to-succeed-the-reason-nobody-is-talking-about-176049

Jesus, Edward50, are you bipolar?  All I ever see are f-ed up retarded rant threads like this coming from you.  Time to darken that ignore.

I'm just going to +1 this post.

Again, this doesn't mean we can't make profits, but right now it's delusional to say these are natural movements. It's making Bitcoin look like a joke.

Buy High, Sell Low, is what some people did.

Who bought coins at $1000+

LOL!

Lost about 1/2 its value.

Just wait for them to go back to $0.01 - $5.00 again.

Soon when all governments and banks disallow any exchange websites, and you can't get your paper money out of it, then value will be $0.00 and you lose 100% of your money.

You would be surprised by how many people "want to get rich without any work"; it's like 99% of the population.

It seems like perhaps you're still thinking in a straight line.

Until the s-curve of adoption goes vertical, it's probably wiser to think logarithmically.

It would be a lot better to  invest that $1m into a starting a support service for bitcoin. A lot more stability and potential for it then just buying low. With 10$mil +. And it you wouldn't have to create a new coin alone but to get together a team of investors to create something better.
Buying bitcoin is mostly for people who want to get rich without any work nor knowledge. Serious investors are very skeptical on these kinds of ventures. That is why I also said before that I think most trading data that is shown in the BTC market is simulated or plain false.

With regards to the OP, yes it is correct that increases in market cap become more difficult, BUT only when we are close to saturation point. We are nowhere near it.

Look at the growth of facebook - it went from 1 million users to 12 million users in 2 years. The next two years it went from 12 million users to 150 million users. Roughly the same rate of growth.

It then took 3.5 years to go from 150 million to a billion. That's because at 150 million users, it was much closer to the saturation point (given that only about 2.4 billion people have internet access).

The point I'm trying to make is that bitcoin can go to $10,000 - $100,000 before getting close to the saturation point.

Risk/reward again. Putting $1m in bitcoin now is a lot safer and easier than using that $1m to make and promote your own coin.

Hard to see why would serious investors invest in buying BTC when they could use their serious investments in creating and promoting their own coin that is more refined. Only grey area capitalist cowboys would invest big sums into bitcoin when the trust in the market is lowering everyday. And these guys use every tirty trick in the book to make sure that they will get their money back.
The "i'll buy low and sell high" game is more for the regular folks who don't have the knowledge to use the crypto scene with bigger perspectives. It's more logical for bigger investors to create their own coin or at least invest in building support services for BTC. "I'll buy BTC low and sell high" is just too simplistic for big investments.

The perceived risk of BTC failing is a lot lower today than it was a year ago, and the price reflects that. Doesn't that make perfect sense to you? A year ago hardly anyone except hardcore geeks knew about bitcoin. Now we see a lot more awareness all around, and many entrepreneurs starting up businesses around it. How is this so hard to see and grasp for some people? If bitcoin truly succeeds then $1000 for a single bitcoin will seem like nothing, you will still be able to make 5000-50000% profit on your investment which is something you can't get anywhere else as a regular person.

Just heavily edited my post from original. lol

At these prices more serious investors will come in investing bigger amounts. One large investor investing $1m is the equivalent of a thousand "normal" people investing $1,000.

This is why, I think, people are going to stop buying whole Bitcoins, and the price will level out..... until the saturation in the market goes up exponentially, and everyone is buying and selling with the stuff. 

People will want to know how to get some.  Nobody's going to buy a $1500 bitcoin.  Most wont want a 1/100th of a bitcoin.  So when the demand increases enough that larger entities, such as companies (to pay salaries), governments, etc. then i can see the pure *demand* for BTC overall start to push the price up again. 

Unless there is a *massive* marketing effort to transition "Bitcoin" to "sub Bitcoin" (mBTC) ... people are going to stop buying in.  And after numerous discussions with everyone including the Bitcoin Foundation, it doesn't seem anyone gives a flying shit and isn't planning on doing anything.  Coinbase has said outright they have no plans to switch to mBTC.

 Nobody wants 0.00001 bitcoin.  So when people start getting paid in BTC or some other method by which to purchase "whole" amounts (think - winklevoss trust - bitcoin shares) which constitute sub-BTC quantities ... I believe we will level off above the $1000-$2000 mark.  And I could be dead wrong.  But I have yet to hear a single person explain to me why the outright purchasing of bitcoins will continue past that which most humans can afford.

The price of buying Bitcoin has exponentially decreased. This is why the price has exponentially increased. It's not rocket science.

Long term Litecoin won't outperform Bitcoin if you buy above 0.03 BTC/LTC. It might even perform worse than that if you buy below that because 0.03 implies LTC has a value of 12% of Bitcoin (4 times higher supply) which I think is an overstatement even if LTC consolidates it's position as second in crypto.

I think he was saying that the risk is not just worth it anymore. The risk in buying BTC is about the same as it used to be, but the reward for success is A LOT lower.

If that's true, then pretty much every major stock investment in the world has been more risky than investing in bitcoin because all of those other investments have returned less reward.  Bitcoin:  The least risky investment.

I have been having doubts that the market is dirtier then it seemed first. Some points that I have been having doubts over:

1) 50%+ of bitcoins are actually held by a group of people who are communicating co-operating with eachother to get the most out of the market. I started having doubts when I saw that during certain times the bots seemed to work together in the same tune. All the bull and beartraps will go through without any solid opposition for some time periods. There are certain periods when the market actually looks like there is a rich vs poor competition, when actually the rich should stay in competition with eachother aswell.

2) The boom in China was simulated for the most part. The demand actually wasn't as big as the numbers show. This could have been done by rich players who bought and sold at the same time to simulate trade and demand to drive the price up. This could have been also done by simply giving out wrong market data.

Most of the community leaders and the dev team has no interest whatsoever to develop rules and regulations to protect the integrity of the market. But with this direction the market will get uglier and uglier every day and eventually it will cross a line when BTC will be called an overall scam. I think that Okcoin simulating the market data is just a tip of the iceberg and more scandals will come out regarding the dirty tricks that are used with the market. I have the biggest doubts about MtGox, since it is not just logical that they are so incompetent with the income they have with fees. It seems more likely that their incompetence is deliberate and a tool to manipulate the market for their own investment directions.

well if so you can buy at 700 and sell at 1000 in a few months. That's still better investment than anything else in the real world.

But then you may be back here whining about how it is too expensive to buy bitcoins at 4000 in a few months later.

It is true that you can more easily double/triple your investment in a new altcoin if you know the pump'n'dump drill, than the bitcoins. That is why we still continue to have new altcoins. I personally find the practice ethically questionable since in the end it's close to a zero sum game.

Now you're just assuming. And no the risk is not greater, two years ago the risk was far greater for you to lose your entire investment since bitcoin was newer and its future way more uncertain. So if you invest $1000 now you run a much smaller risk of losing that amount than if you had invested that same $1000 two years ago. The potential reward is at the same time also smaller, but that's the risk/reward trade-off.

No, it is 'more risk' IMO, and the current 750$ price is sustained only by some late new fiat and low volume.

Good point. You definitely have a lot less reward at the current prices. It will take such a large growth for prices to keep pace with the gains that were made this year.

That is a good question, do you have more risk at say $20 dollars or $700 dollars. I am going to say that you also have more risk at $700 as I do not think the marketcap supports the real current market right now. It has grown too fast and was priced up higher based on huge potential growth in china that has not panned out.
There is a lot more risk of bitcoin falling to $100-$300 levels and staying there than bitcoin at $20 falling to $3.00 to $8.00 in my opinion. Simply $700 dollar bitcoin price is highly unstable at this current time.

EDIT:

Basically, if you get less reward for a given investment, than the investment is more risky??

I think what you mean is "less reward" and not "more risk".

Wrong. What I am saying is that it is a much riskier investment now at $700 than it was at $10 or even $100. The marketcap has to increase so much more to get the same gains as you would at a lower bitcoin price.

Investing $1000 when bitcoins is a $1.00, will give you the same downside risk as investing in bitcoins when they are $1000. You both can lose your entire $1000. However, the potential gains are astronomically higher at $1.00 than they are at $1000. For bitcoins to go from say $1.00 to $20 dollars is so much higher than from bitcoins to go from $1000 to $20,000 dollars.

I think the problem here is many of you do not know how to calculate risk properly.

So you're just trying to say that bitcoin is a risky investment, and yes I agree it still is. But no more risky (less even) than it was at $10, $100 or $300. There are also new bitcoin hodlers coming in each day which helps sustain higher prices and decrease the average volatility. The price swings were much larger when bitcoin was at lower prices so you actually had more to lose back then (but also more to win). If you wait until the risk is almost gone and bitcoin stands rock solid you will be too late.

If you invest what you're willing to lose there shouldn't be a problem. I think the chances of 10,000 are better than 0. But honestly who cares about either of our opinions?
 
Time will tell, and many will most likely regret not buying. More and more people are getting interested in bitcoin, simply due to its superiority to other currencies. Just because it isn't as widely accepted/used doesn't mean it isn't a superior form of transacting. Fiat has been used by many generations before us so we are naturally accustomed to it. Bitcoin is still new and very bizarre to people when they're first introduced. These things take time, crypto is the future, that really isn't a question. The question is which one it will be and when. You should just be happy with however many coins you have and be grateful to be witnessing this. I'm certain looking back will be very interesting however this plays out.

People hodling bitcoins is good, when all the current hodlers decide it's time to "cash out" someone else will buy those coins and become a new hodler. What's wrong with saving bitcoin? Many people believe it will be successful in the future for one reason or another.  

Ed, at what point do you think the big holders will break, 5K ? 10k ? We know it's bound to happen, it's too tempting to not become an instant millionaire with a few mouse clicks.

Just wanted to say, I still think bitcoins can hit $1000. I am not trying to say it can't go up higher.

My point in saying is that the whole price is a house of cards. The only reason it can sustain these price levels and move higher is because so many bitcoin holders do not sell, they do not need to. However, if anything happened which caused just a small increase in bitcoin holders cashing out the whole thing would come collapsing down.

I already have stated that the reason why the price would go higher is simply that bitcoin holders are not selling just holding for a higher price. I never said that bitcoin was a good investment, it is a highly risky one and the potential returns you would get are not worth the risk of paying $700 for a bitcoin. Actually, you would have to be a insanely stupid investor to buy bitcoins to speculate with at the ridiculously price level it is at now.

The price level it is priced in now was based largely on huge growth in china that is not turning out very good.

I do not buy bitcoins to speculate with them, I buy them only to quickly buy other investments with the bitcoins. However, these investments are somewhat tied to the bitcoin price. This is only why I hope that the price at least holds or stabilizes as if that happened I would do very well. I have done well with my non-bitcoin investments even with the price drops that bitcoin has had. This is only because I choose the proper investments.

Thanks guys for not trying to refute my point or support it. Instead you try and attack my reputation. You are obviously bitcoin holders who know that your betting on a house of cards and the last thing you want is it to collapse.

However, I think there are many other who will see my point and understand that what I write makes lots of sense and I wait for someone to counter what I wrote here.

My whole point was not that bitcoin price would go lower or higher, it was simply that the risk to reward ratio does not make it a good investment. It actually makes it a very bad investment. One in which you take on a ridiculous amount of risk for a potential return that will not be very high. This was my point, not what I wrote yesterday saying we could reach $1000. With the low volume and people just sitting back and waiting we could hit $1000. But it would be insanely stupid to buy bitcoins to take this risk of it rising higher with all the downside risk that you may have. 

If you feel bitcoin is bad in terms of roi, I suggest you look at litecoin.there are also other altcoins with some promise.

already activated but I am too pissed of right now and needed someone to say him to fuck off. Edward was good option 

You missed the bottom again didn't you?

alt currencies like quark, nxt, MASSIVE room for boom, /thread

there's ignore button for that. just sayin'

Nobody fucking cares what you think anymore.

Yes, Edward50, I find your posts quite confusing too.  Yesterday you politely responded to my post with this: https://bitcointalksearch.org/topic/m.4131603.  It seemed you had recently purchased bitcoin and were just hoping the volatility would subside and the price would slowly go up.  You seemed pretty sure that bitcoin was destined to hit $1000+ in short order.  

But now, one day later, it seems that you think bitcoin is a bad investment once again.  

Are you talking your book?  Or is it just difficult for you to decide whether or not you believe in the future prospects of bitcoin?

I think this should be common sense.  But maybe my logic is wrong somehow, well here goes.

When bitcoins were  $20 dollars each, and you bought $1000 dollars worth of bitcoins, you would own 50 bitcoins.

Bitcoins at $1000 each, you buy $1000 dollars worth, you have 1 bitcoin.

Now for you to double your investment to $2000. Bitcoins at $20 dollars each would have to rise to $40 dollars each.

To double your investment at $1000, 1 bitcoin would have to rise a whopping $1000 dollars more for you to double your investment.

Now you may think, well the price would have to double from $20 to $40 or from $1000 to $2000 and your $1000 would be worth $2000. Well....

This means, the market cap for $20 dollar bitcoins to increase to $40 dollars would have a market cap increase of $243 million.

For bitcoins to increase from $1000 to $2000, you would have to increase market cap a whopping $12 billion dollars.

Now think about this, if your new to investing in bitcoins, do you really want to risk $1000 when to double your money you would have to risk $1000 dollars and hope that the market cap has to increase 48x more than it would compared to $20 dollar bitcoins. Do you want to gamble on the market cap increasing 12 billion dollars or 243 million dollars, to double your money.

Maybe something is wrong with my logic, but to me buying bitcoins at $700 or $1000 is simply a very bad investment that I simply will not do. I just do not feel the returns are there for the risk you take of the price falling back down and also the risk of the market cap having to increase exponentially more!

Simply bitcoins have grown so astronomically in the last year that to continue this momentum is just a risky gamble at this point. The higher the price goes the less people want to buy bitcoins that are very expensive. The higher the price goes it also takes a much higher market cap increase to get the same returns.

Now think about this. I doubt that there are that many new buyers in the bitcoin market than there were at the beginning of this year when bitcoins were $13 dollars. When bitcoins were $13 dollars a rise form $13 dollars to $23 dollars would have been huge! But in actuality a bitcoin price rise from $700 to $710 seems small now, but it takes the same market cap increase as it did in January. Yet you would think a $700 to $710 increase is nothing now.

Something just does not add up to me with how the prices are and how high they have grown over such a short period of time. The bitcoin market seems like a house of cards and the only thing holding it together is that owners of bitcoins are wealthy enough to not need to cash out their bitcoins and just sit on them. If anything happened where even a small increase in bitcoin holders needed to cash out for what ever reason (like a downturn in the economy), the price would crash faster than you could imagine. Simply put again a house of cards.

My recommendation is that anyone thinking about investing their hard earned money in bitcoins should think about this and stay away. There are simply much better investments out there than investing in bitcoins. You are taking such extreme risk with your money at this point to get the gains you want.

Bitcoin holders who are predominately on this forum already own their bitcoins at much lower prices. They will not let you know these facts and they do not stand to lose nearly as much as you investing at $700 vs them investing at sub $100 prices. This is why I think bitcoin holders are simply crazy for not cashing out at these high prices and let someone else hold the bag for such a risky investment that to me looks like a house of cards waiting to tumble at these ridiculously higher prices that happened so quickly. Just look around for other investments and you can easily have exponential growth just like the current bitcoin holders now have. We have missed the boat entering in at $700 and it will take large increases for the prices to go higher and at any moment you have to hope that there is not a reason why people want to start cashing out as the price would easily fall back down at these high prices.

Please correct me if I am wrong here, or please let me know if I have a point here.