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A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

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Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#21

Post by brndnmtthws »

Klathmon wrote: post #19
brndnmtthws wrote: post #15

Earlier quoted context omitted.

Wrong. The market value is only what you get for it when you sell it. It's a subtle but very important difference. A good analogy is comparing the advertised price of a used car versus what you actually get for it. You might think it's worth $5k, but there's only 1 person who wants to buy it and they're only willing to pay $4k, so it's actually worth $4k, not $5k. It doesn't matter if someone else sold theirs for $5k…

I hear this all the time, but does anyone really think that the market cap is what you can really get for an asset? It's a metric, one as "untrue" as an average or median. It's not a contract, and you won't get that if you change the market, which selling and buying does. I don't think that means we shouldn't use it as a metric to use to get information from for comparisons. And I don't think that it's bad journalism…

The point is that no one really knows the actual value of any asset until you've sold it. You can only measure value in the past; future values can only be guessed (excluding things like future contracts).

This is true regardless of whether we're talking about Bitcoin, stocks, metals, houses, chickens, or seashells.

Most of these stupid market movement predictions are equivalent to astrology and only exist because WSJ and others have nothing interesting to say. The daily market fluctuations are pretty much random, and this has been proven many times over.

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#22

Post by supercanuck »

brndnmtthws wrote: post #15
everdev wrote: post #14

Earlier quoted context omitted.

From the title: > $100B in Market Value When the market price of an assets drops, it loses market value.

Wrong. The market value is only what you get for it when you sell it. It's a subtle but very important difference. A good analogy is comparing the advertised price of a used car versus what you actually get for it. You might think it's worth $5k, but there's only 1 person who wants to buy it and they're only willing to pay $4k, so it's actually worth $4k, not $5k. It doesn't matter if someone else sold theirs for $5k…

I'm not exactly sure what you are arguing but the value of these coins were trading about 30% lower, so using your definition above, the market value was clearly lower as can be seen by actual market activity. The price has since recovered.

I don't think anybody is claiming the number on Coin Market Cap is the actual market value because it is simply a metric derived from aggregating across multiple, very volatile exchanges.

EDIT: ok i saw your comment below, and it seems you are arguing, albeit very aggressively, that daily market fluctuations are random and cannot be attributed to an actual event, such as this one?

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#23

Post by everdev »

brndnmtthws wrote: post #15
everdev wrote: post #14

Earlier quoted context omitted.

From the title: > $100B in Market Value When the market price of an assets drops, it loses market value.

Wrong. The market value is only what you get for it when you sell it. It's a subtle but very important difference. A good analogy is comparing the advertised price of a used car versus what you actually get for it. You might think it's worth $5k, but there's only 1 person who wants to buy it and they're only willing to pay $4k, so it's actually worth $4k, not $5k. It doesn't matter if someone else sold theirs for $5k…

Wrong.

https://www.investopedia.com/terms/m/marketvalue.asp

Market value definition:

> obtained by multiplying the number of its outstanding shares by the current share price

The reality of selling has nothing to do with it. It's just a math equation.

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#24

Post by frgtpsswrdlame »

brndnmtthws wrote: post #6

It's facetious (and bad 'journalism') to claim $100B vanished. It was never there to begin with: market cap isn't something you can cash in on. It's merely the result of price multiplied by supply. If you owned a significant portion of all the coins in the world, and tried to sell them all at once, you wouldn't end up with number_of_coins * price, it would (realistically) be a smaller number given the market slippage…

>It's facetious (and bad 'journalism') to claim $100B vanished.

It's certainly not bad journalism, this is how all sorts of assets are reported on. Market Cap isn't a perfect metric but it's pretty good and keeps us from saying things like "AMZN is down 50%" when they do a stock split.

In the sense that yesterday if you summed up what all the individual holders saw when they checked their accounts you'd get $200b and today if you did the same you'd get $100b then $100b did vanish.

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#25

Post by ddebernardy »

everdev wrote: post #14
brndnmtthws wrote: post #6

It's facetious (and bad 'journalism') to claim $100B vanished. It was never there to begin with: market cap isn't something you can cash in on. It's merely the result of price multiplied by supply. If you owned a significant portion of all the coins in the world, and tried to sell them all at once, you wouldn't end up with number_of_coins * price, it would (realistically) be a smaller number given the market slippage…

From the title: > $100B in Market Value When the market price of an assets drops, it loses market value.

There are a bunch of websites that offer to value this or that website. I once plugged an old website of mine in there and it was well over $1M. I was like - please tell me who the buyer is, I'd sell right away.

"Market value" doesn't mean squat if you've no buyer in front.

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#26

Post by Klathmon »

brndnmtthws wrote: post #21
Klathmon wrote: post #19

Earlier quoted context omitted.

I hear this all the time, but does anyone really think that the market cap is what you can really get for an asset? It's a metric, one as "untrue" as an average or median. It's not a contract, and you won't get that if you change the market, which selling and buying does. I don't think that means we shouldn't use it as a metric to use to get information from for comparisons. And I don't think that it's bad journalism…

The point is that no one really knows the actual value of any asset until you've sold it. You can only measure value in the past; future values can only be guessed (excluding things like future contracts). This is true regardless of whether we're talking about Bitcoin, stocks, metals, houses, chickens, or seashells. Most of these stupid market movement predictions are equivalent to astrology and only exist because WS…

I completely agree about "market movement predictions", but market cap is not a prediction, it's a metric, a statistic, a made up value that can help you compare one asset to another.

It is used like a unitless measuring stick, not a prediction on what you can get if you sold.

And I'll argue that it does it's job fairly well. It's difficult to "game", and can help give you some information about an asset. It doesn't say everything, it can't tell you if it's stable, or if it's being used or not, or if it's a scam. It's just a tool, a metric, something that you use with a bunch of other tools to get an idea of the ecosystem.

I would be happy to "rename" it to a unitless value that doesn't imply a "total worth", but that ship has sailed, and it's not going to be possible, so we have what we have.

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#27

Post by brndnmtthws »

everdev wrote: post #23
brndnmtthws wrote: post #15

Earlier quoted context omitted.

Wrong. The market value is only what you get for it when you sell it. It's a subtle but very important difference. A good analogy is comparing the advertised price of a used car versus what you actually get for it. You might think it's worth $5k, but there's only 1 person who wants to buy it and they're only willing to pay $4k, so it's actually worth $4k, not $5k. It doesn't matter if someone else sold theirs for $5k…

Wrong. https://www.investopedia.com/terms/m/marketvalue.asp Market value definition: > obtained by multiplying the number of its outstanding shares by the current share price The reality of selling has nothing to do with it. It's just a math equation.

How can a thing which never existed to begin with vanish? There wasn't $100B sitting around in a bank account waiting to be claimed, which then suddenly evaporated.

Also investopedia isn't exactly a high quality source.

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#28

Post by alistproducer2 »

frgtpsswrdlame wrote: post #3
vthallam wrote: post #2

Well that definitely contributed, but that alone didn't cause the crash. There was irrational price rise in the last few weeks for certain cryptocurrencies(Ripple, Tron) and this is part of the correction. Also, The market as a whole should get away with global averages and depending on one website to track everything. I wrote an article on it if someone is interested - http://coinsocial.io/2018/01/09/its-time-for-cr…

>There was irrational price rise in the last few weeks for certain cryptocurrencies(Ripple, Tron) and this is part of the correction. What makes their increase 'irrational'?

In Tron's (TRX) case, the project's whitepaper is plagiarized [0] from Filecoin's, and the CEO (Justin Sun) dumped 6 billion tokens [1] after pumping the price by announcing "partnerships" that turned out to be him hiring developers. TRX is the literal definition of a shitcoin, yet the price pumped 10x in less than 10 days.

[0]: http://www.trustnodes.com/2018/01/08/trons-whitepaper-copied...

[1]: https://www.reddit.com/r/CryptoCurrency/comments/7oky82/just...

(search page for "buttcoinbanker" to find relevant comment)

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#29

Post by solotronics »

brndnmtthws wrote: post #15
everdev wrote: post #14

Earlier quoted context omitted.

From the title: > $100B in Market Value When the market price of an assets drops, it loses market value.

Wrong. The market value is only what you get for it when you sell it. It's a subtle but very important difference. A good analogy is comparing the advertised price of a used car versus what you actually get for it. You might think it's worth $5k, but there's only 1 person who wants to buy it and they're only willing to pay $4k, so it's actually worth $4k, not $5k. It doesn't matter if someone else sold theirs for $5k…

maybe a more accurate metric be average sell value over period of time or number of trades?

Re: A Cryptocurrency Website Changes Its Data, and $100B in Market Value Vanishes

#30

Post by module0000 »

vthallam wrote: post #5
frgtpsswrdlame wrote: post #3

Earlier quoted context omitted.

>There was irrational price rise in the last few weeks for certain cryptocurrencies(Ripple, Tron) and this is part of the correction. What makes their increase 'irrational'?

When you are betting on Bitcoin or Ethereum, you are betting on the technology, developer community, ecosystem and the adoption. With Tron, there's hardly a product and Ripple while seems to have some successful pilots, is still far from realizing the dream of replacing the FIAT currency among banks.

>> When you are betting

Full stop. You are trading or investing - if the word "betting" passes through your brain, stop now. The public surge of interest in crypto currencies is a redistribution of wealth from retail speculators to professional speculators. You aren't betting on the technology, developer community, ecosystem, or adoption anymore. At this point, you are betting you aren't the last one to the party.

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