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Cryptocurrencies are collapsing

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Re: Cryptocurrencies are collapsing

#61

Post by sethgecko »

jhoechtl wrote: post #55
storafrid wrote: post #44

Earlier quoted context omitted.

How would you define "overvalued"? Is it the current average price compared to a very low price three months from now? What if it recovers a few weeks after that — would that change the fact that it was once "overvalued"? Valuation is not based on nothing, in vacuum. The challenge is to understand the underlying factors. The post you replied to actually tried to shed some light.

The price of energy required to mine 1 BTC. What else? That's its inherent value.

The price of energy required to mine a bitcoin follows the bitcoin price not the other way around.

Re: Cryptocurrencies are collapsing

#62

Post by Klathmon »

fgonzag wrote: post #25
flowctrl wrote: post #19

Earlier quoted context omitted.

The Lightning Network, coming soon to Bitcoin, will solve the performance & fee problems too. Stability will come with increased liquidity.

People keep saying that. I wonder if they have actually read the white paper. The lightning network will only work for exchanges who will keep channels open between them. Getting a graph of every wallet connected to every other wallet is a mathematical impossibility. The lightning network is essentially instituting central banking all over again, this time with bitcoin. "Oh so you want to transfer coins quickly? Bett…

This is so wrong in so many ways...

Not only is the "network" part of LN referring to the ability to chain multiple channels together to make payments several hops away if needed, but why would exchanges be the only one you could transfer to?

Currently on mainnet a VPN vendor is really the only major player, and it's expected that most vendors will have a lighting node, as all it requires is an always online server...

Not to mention that transacting over LN has no counterparty risk, and "keeping a graph of every connected wallet" is not an impossibility... It uses the TOR protocol which runs over IP, which are both the kinds of networks of channels you imply are impossible here...

It sounds like you read the first 2 paragraphs of the paper and decided to stop. Read more, and these details will be explained in excruciating detail.

Re: Cryptocurrencies are collapsing

#63

Post by paulgb »

jhoechtl wrote: post #55
storafrid wrote: post #44

Earlier quoted context omitted.

How would you define "overvalued"? Is it the current average price compared to a very low price three months from now? What if it recovers a few weeks after that — would that change the fact that it was once "overvalued"? Valuation is not based on nothing, in vacuum. The challenge is to understand the underlying factors. The post you replied to actually tried to shed some light.

The price of energy required to mine 1 BTC. What else? That's its inherent value.

This is just the discredited labor theory of value, applied to machines instead of humans.

Re: Cryptocurrencies are collapsing

#64

Post by jacques_chester »

ric2b wrote: post #50
fgonzag wrote: post #25

Earlier quoted context omitted.

People keep saying that. I wonder if they have actually read the white paper. The lightning network will only work for exchanges who will keep channels open between them. Getting a graph of every wallet connected to every other wallet is a mathematical impossibility. The lightning network is essentially instituting central banking all over again, this time with bitcoin. "Oh so you want to transfer coins quickly? Bett…

> The lightning network will only work for exchanges who will keep channels open between them. Getting a graph of every wallet connected to every other wallet is a mathematical impossibility. Transactions can be routed through multiple channels, you don't need to open a channel to every single wallet you want to transact with. That would not be a Lightning network, it would just be payment channels. > The lightning n…

As I understand it, bitcoin is a ledger scheme. There no "coins" per se. Which means it's very much like how banking works in practice: everyone keeps their own books and leaves the credits and debits on them. Real funds don't change hands all that often, it's easier just to keep the running tally if you trust your counterparty.

Of course, trusting your counterparty requires you to know who they are, have stable addresses and so on.

Re: Cryptocurrencies are collapsing

#65

Post by steeleduncan »

jhoechtl wrote: post #55
storafrid wrote: post #44

Earlier quoted context omitted.

How would you define "overvalued"? Is it the current average price compared to a very low price three months from now? What if it recovers a few weeks after that — would that change the fact that it was once "overvalued"? Valuation is not based on nothing, in vacuum. The challenge is to understand the underlying factors. The post you replied to actually tried to shed some light.

The price of energy required to mine 1 BTC. What else? That's its inherent value.

No, the energy required is a function of the price, not the other way around.

The bitcoin network adjusts the block difficulty (effectively the energy required to mine 1 BTC) every 2016 blocks such that the rate of creating blocks is fixed at one block (currently 12.5 BTC) every ten minutes.

If the dollar value of energy required to mine 1 BTC is significantly less than the current dollar value of a bitcoin then it is likely more hash power will be added to the network by the bitcoin farms, further increasing the network's hash rate, and as a consequence the block difficulty and therefore the price of the energy required to mine 1 BTC.

Re: Cryptocurrencies are collapsing

#67

Post by consp »

CPLX wrote: post #56
anonytrary wrote: post #16

Earlier quoted context omitted.

Why businesses might not use Bitcoin: 1. Bitcoin remains speculative and volatile. This will cause it to be adopted by smaller businesses that can "do things that don't scale". We won't see big businesses support mainstream crypto payments until the demand is high enough to justify the risk. 2. Bitcoin itself is a clamped network, as such the fees are very high. You can't sell Lemonade at your stand with Bitcoin if t…

3. Because US dollars work fine

Only if you are in/from the US with a US credit/debit card. Otherwise the fees alone should make you stop using them.

Re: Cryptocurrencies are collapsing

#68

Post by matwood »

Theodores wrote: post #41

They were, but, in the last few minutes the last hour numbers have all gone green. They were definitely all red when I checked this half an hour ago. I think the whole thing is a scam and that it is incredible the willingness of people to be scammed. Yes I see merit in a decent online currency that works like cash but securely, however, these crypto things are speculative tulip stocks in a book-keeper's window and th…

Not that I think it's a scam, but lets ignore that part for a moment. This market is a swing traders dream. 40% swings means there is a ton of money to be gamed off.

Re: Cryptocurrencies are collapsing

#69

Post by teh_klev »

glenneroo wrote: post #58
jhoechtl wrote: post #55

Earlier quoted context omitted.

The price of energy required to mine 1 BTC. What else? That's its inherent value.

This will end very soon since 80% of coins have been mined already. So the energy consumption will only be miners processing transactions.

In my book, 2140 isn't "very soon" (based on the current Bitcoin mining algos).

Re: Cryptocurrencies are collapsing

#70

Post by bby »

shroom wrote: post #37

Novice crypto question... I read a comment here about 1 month ago someone predicted a correction of BTC value to mind january because some coins would "expire" then. I'm trying to find the comment now to learn more. Anyone have any insight what I'm talking about?

Look at the CME/CBOE open interest. It's not significant.

LedgerX and Derivit have shit open interest as well for their futures/options.

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