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I've sold and transferred over $800k of cryptocurrencies to a US bank over the course of 3 days. I could probably have done it faster if I tried. This was through Gemini.
How much did the price change from the first coin you sold to the last?
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People don't realize how long it would take to liquidate a large sum of $$.
Why have HN stories on Bitcoin become so noisy in the comments? It's almost as bad as Soylent stories.
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I've sold and transferred over $800k of cryptocurrencies to a US bank over the course of 3 days. I could probably have done it faster if I tried. This was through Gemini.
How much did the price change from the first coin you sold to the last?
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take a look at any bitcoin price chart and draw out 3 days? if you're thinking that 266k/day dump is going to move the market, it's not.
There's not a single market. The volume at a particular exchange matters. Note the disparity Coinbase had recently.
I'll admit that I had a chance to buy BC at $12. And didn't. (That's twelve. Not twelve hundred, or twelve thousand. Twelve.)
That doesn't make me unique on HN by any stretch. But I have kept a watching brief over the years. Here's my gedanken experiment take on all this.
Originally, appealing to IT nerds. Demand grew slowly and the community with it.
Mysterious founders and mining syndicates made a (theoretical-until-sold) motza by hoarding coin. Articles started appearing on the strange new tech.
However, at some point demand crossed over into darknet territory. Demand accelerated. At some point, major crime syndicates started looking at BC as a way to launder significant amounts. Demand really grew as very heavy money entered the market.
Let's pause for a moment and consider the possibility that in the last year, the majority of the market (by volume; excluding the founding hoarders) would have been the "criminal" element. What are their key requirements of this "investment"? Opaqueness, security, ability to trade in volume, low or no "laundering losses". With BC, it's pretty much all green lights. So they kept piling on.
Then a funny thing happened. The financial services establishment, the same folk that have historically made fortunes by fleecing the great unwashed, saw yet another opportunity to part the rubles from the rubes. And so, abetted by the media's voracious appetite for sensation, talked up this strange, "new", "this time it's different", investment opportunity. Highlighting the overnight millions to be made, with stories of people who bought low and sold high. Gushing about the net worth of the mythical Satoshi.
And so the proles started piling on. When your friends and relatives (the ones that call you for IT support), who have never heard about BC before last month, start telling you that they're thinking of buying BC (aided by the handy smartphone apps of the new "pick and shovel makers"), that they're borrowing to by BC, that their friends are buying BC. Then any reasonable person should be hearing "Danger, Will Robinson!".
Criminals aren't stupid. The kind of criminal enterprises that need to wash hundreds of millions of dollars a month or a week are not stupid. So what would they make of the increasing volatility? The prospect of not only washing your money, but growing it in the same transaction would be pretty alluring. However, as the sums increase, so does the risk. What if it goes down as hard as it goes up? What's a fiscally prudent criminal to do? Traditionally, if you get 75% of your money back from the laundry, you're doing well. What if the market turns and insane profits become insane losses?
When you then add the increased regulatory scrutiny on BC, issues with exchanges, questions about security and transaction rate limits - perhaps that makes BC seem increasingly risker than some of the cryptocoin newcomers? As a launderer, maybe something like Monero might be a safer alternative? Or maybe stripe your money across a bunch of coins types? So you start pulling out. In droves.
What happens to a market when some of the biggest players cash out? The rest crash out.
Which is not to say that BC won't bounce around, recover, fall again, recover some more etc. But I believe, in the long term, there are better options out there and historically we'll all look back at BC as a successful failure. Having single-handedly created a new market for crypto-coin, shocked the traditional financial players into a new awareness, and yet fizzled into history as better options come online.
What do y'all think? Possible?
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>Who needs to be reminded that an asset isn’t worth its price until it’s liquidated? Mom & pop class investors who characteristically are the ones left holding the bag when a bubble pops.
Exactly the type of people who read HN then! Wait...
It doesn't literally mean 'stay at home mom and dad that owns a corner store'.
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There's not a single market. The volume at a particular exchange matters. Note the disparity Coinbase had recently.
i just checked 3 relatively legitimate bitcoin exchanges (kraken, gdax, bitstamp). you could put a 300k sell order on any of them and have less than 0.5% of slippage, which is much less than regular trading volatility. plus if you really wanted to, you could spread your trades among multiple exchanges and execute them simultaneously for even lower slippage.
How'd you confirm that estimate, by making a trade?
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Until you successfully cash out, you’ve made nothing.
I'm very curios: whoever downloaded this comment above, could you please tell us, why do you think it's not true?
You can buy several things with bitcoin, as with government-backed currency. Speaking simply, both are "money."
2. Because it annoyingly misses the point.
If I buy a stock and it goes up, I might tell a friend that I "made money" on that stock. If he replies "no, you simply have an unrealized capital gain," then he obviously can't see the forest for the trees and I'm not going to invite him to my birthday party.
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Exactly the type of people who read HN then! Wait...
Be honest, the only thing you might know is who you think comments. You know literally nothing about who just reads the site, none of us do.
Still I don't think general advice like "Until you successfully cash out, you’ve made nothing." is appropriate.
It's like "Don't spend more than you have" - it's true but if people didn't learn it by their 30s, chances are low they learn it by mentioning it once more.
But my specific disliking is elicited by the fact that this looks like virtue signalling. If you're uniquely interested in educating moms and dads, write your general investment advice in the forums they like to frequent. Or write a blog post. If you didn't do that by now, maybe you're only concerned with showing that you're concerned without actually doing anything more effective about it.
Note this is just my interpretation based on what I read and it might be wrong.
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I didn’t downvote it, but it’s so obvious as to be unhelpful. Who needs to be reminded that an asset isn’t worth its price until it’s liquidated? It’s self-evident, and yet you have it following every time someone mentions returns on BTC. You have it at least twice here on this thread, in fact.
For most assets, you can generally assume it will be close to what it currently is priced at. btc is different in that regard because holding onto it for a week or even a day can easily cause it's value to double or half. That's why its different because while you think you have that much money, by the time you actually get around to selling it, the price can be radically different
True with some caveats.
This statement assumes no forward rate. If the risk-free rate is high, then the future price should generally be expected to appreciate.
This statement also requires some assumptions about the probability distribution of future price changes.
Let's take a common example of a multi-modal distribution: court decisions. Imagine companies XYZ and ABC are engaged in a patent dispute. Both companies profit greatly from the production and sale of doodads, and (for the sake of example) we have been told that exactly one company will need to cease doodad production as a result of the decision. The company that ceases production should trade down as a result of its lost future profits, and the other company should trade up. In this case, even though the current prices may be E[XYZ] and E[ABC], the future price is going to be markedly different for both.