When someone LISTS it UNDER the value, and says "I will buy it for $10 UNDER the current price"... Then someone who has those coins says, "Ok, I'll take that LOSS." Then they SELL under the market price by $10, that lowers the "Value" by $10 under market price.
If that constantly repeats, because MORE are WILLING to ACCEPT that LOSS... (Because to them, they are still gaining. Because they didn't actually earn it, or they originally got them $40 or $80 or $100 under market-price... Then you see this constant decline in value.)
That is what is happening with ASICs... They make money selling at any value over $10. However, they were kind enough to WAIT for US to keep pushing the price up. (US = those who can't accept the loss, trying to make a living, or trying to regain the money we spent on GPU rigs.)
Now, people are getting smart, and realize that the ASIC guys are simply cashing out our earned dollar, so we are also cashing out, to cut our losses, so they don't get them all. Since they are doing it anyways.
The smart thing to do is cash-out now. (Fewer see the charts going up, than those that see it going down, or the price would not keep dropping.)
Then, once the ASICs have lowered it to its value of $10, thus, now they will have LOSSES and add VALUE, by the un-received ASICs they purchased with the money they cashed-in from us... Then they will start saying, Hell no, I am not accepting $10 anymore, I need $20 now, then we start to see it rise again... But not too fast for them to keep cashing-out on us...
Eventually, once this ASIC war starts, fighting for more ASICs, and trying to beat the other guys buying ASICs... then the value WILL shoot up to $1000 per BTC, which may actually still have people interested in the coin...
You think it is going up, and don't mind waiting 6-12 months for it to rise back up to $130... then keep holding on. If not (The majority of us), then cash-out and mine alt-coins with your machines. They are rising above the value of BTC every day. The value follows the LOSSES of the MAJORITY. GPU miners are the MAJORITY, and are moving away from BTC. The few hundred people mining with major ASICs, will be all that remains mining BTC, and that will turn into three top ASIC manufactures, mining all the coins, when we STOP buying ASICs from them. Since they are ALSO producing 100x Asics for themselves, for every 1 they sell us. With our money, with our BTC they cashed out, with our LOSSES.
You can spend an alt-coin just as easy as a BTC, and those values are already settled at a low, and almost guaranteed to rise. Unlike BTC, which is about a 95% chance of crashing due to ASICs now, before it ever sees a gain. Plus, there are more coins available NOW for LESS in alt coins. With BTC, you just get less, both ways. It takes no additional effort for a marketer to add an ALT-COIN "buy/sell" button, than it did to add the BTC buy/sell buttons and gateways.
They go where the money is... and BTC for them, is a loss right now. They sell something for $100 and get 1 BTC, then by the time they wake-up, that 1 BTC can only be cashed-in for $90 or $80 or $70... so they drop it from the market. That is the OTHER reason BTC isn't going up... that "delay" of "doubt"...
Don't fall for the ASIC pump, as they try to juice the market to get more of your value from you. Let them get a loss, cash out now, while it still has some value.
I for one don't agree with your analysis.
Short to medium-term I am a bit bearish at the moment (but long-term bullish obviously
), but I don't agree with your reasoning, if I understand it correctly. My understanding is that you basically say BTC price follows mining costs. I say its the other way around, with the exception that high mining costs (= an expensive network security) may also have an effect on price since it makes the network more secure, therefore making BTC more desirable.
But basically high BTC prices will give miners big profits, which will lead to more people investing in miner equipment, increasing hash rate, increasing difficulty and eventually lower miner profits. Price of BTCs or altcoins will be based on their supply and demand, as is the price of everything. Supply is fixed, so the only variable determining price is demand for BTC.
My guess is we are still in the 'long slide down' after the bubble pop, so demand is down, combined with the fact that bitcoin is still strongly inflationary at the moment, so I am not particularly bullish now (maybe a bit oversold on the very short term), but not for the reasons you mentioned.
