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Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

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Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#101

Post by agorabinary »

perseusprime11 wrote: post #24
vthallam wrote: post #7

The last time China explicitly banned Bitcoin, it dropped by around 45% to around $6000. It went on to $20K from there. But what's different this time is that there are first time investors in millions who joined in the last 2 months. They didn't read the white paper, they didn't invest in technology, they invested for the monster returns. So I think there will be a more sell off this time before it rebounds back to…

What’s also different is few individuals/entities in South Korea and elsewhere are responsible for driving the value upstream. Anything that is manipulated does not last long. As somebody wise (Buffet) once said this will have a bad ending.

This is naive of Buffet when his only evidence of a "bad ending" is the existence of a massive rally. The entire near-future automated economy depends on programmable money. There is literally nothing interesting happening in FinTech right now apart from the crypto space.

Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#102

Post by justrobert »

JumpCrisscross wrote: post #73
dahdum wrote: post #53

Earlier quoted context omitted.

> Korea may already be at the point where a 50% sustained drawdown plunges a significant fraction of the population into hardship. That, in turn, could trigger a recession. That seems unlikely. Something like 2M of 51M people have any crypto there, and only a small fraction would be overextended significantly. Anyone buying a couple months ago would still be up.

> Something like 2M of 51M people have any crypto there, and only a small fraction would be overextended significantly How do you know that? For traditional securities, we have margin and prudential lending rules. These systems aren't perfect. But they incorporate lessons from crises past. One of those lessons is about how system risk can grow exponentially unexpectedly quickly.

Except almost anyone get get authorization to sell naked puts in the US market.

Margin only handles the expected volatility of an instrument, not the tail risk.

Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#103

Post by bsaul »

nukeop wrote: post #72
spookthesunset wrote: post #59

Earlier quoted context omitted.

Ahh the "time to buy cheap coins" rally of the die-hard bitcoin shysters. Your own post says "It's not liquid enough yet, creates no need to middle men and Bitcoin itself is now being manipulated by futures contracts based on supply being increased artificially." Does that sound like buying now is a good idea? Doesn't to me... Bitcoin is, was and always will be a highly manipulated penny stock. It spiked from $1000 t…

What do you mean "no reason"? Supply and demand are the reasons the prices are shaped the way they are. It's a near perfect market.

Was that sarcasm ??

In case you don't know, things like https://en.wikipedia.org/wiki/Market_manipulation exists..

Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#104

Post by pishpash »

austenallred wrote: post #68
nebulous1 wrote: post #62

Earlier quoted context omitted.

People make bad decisions. While it would be odd to be suicidal if you held bitcoin over the period you mentioned, there will be people who bought in at the top. There will also be a smaller subset of people who overextended themselves and bought in at the top. All I'm saying is that there could be people who are genuinely in trouble now, regardless of how short the time was.

It's more a comment on the volatility than anything. People see that something is up 100% in one month and assume it won't lose 25% of value the next. We humans are not super rational.

It's not like bitcoin hasn't had a record of price history, yet still when people see sh*t shooting up they don't consider it a sign of volatility, but rather return.

Read this: http://www.businessinsider.com/bitcoin-volatility-risk-adjus...

What this is telling you is, if you wanted a lot of excitement for potential gain, you could have always leveraged up your ho-hum retirement account and done better.

Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#105

Post by FLUX-YOU »

JumpCrisscross wrote: post #42
olivermarks wrote: post #26

Earlier quoted context omitted.

Naive speculators are buying cryptocurrencies on their credit cards without understanding the volatility https://www.bloomberg.com/news/articles/2018-01-11/bitcoin-b...

> Naive speculators The problem with this characterization is when enough people lose their shirts on leveraged crypto purchases, a problem of individual finances becomes one of collective policy. I'd be careful with dismissing the problem as one contained to the stupid. There was a thread on the front page, earlier, where multiple commentators were equated the odds of a massive and permanent Bitcoin crash with that…

>The problem with this characterization is when enough people lose their shirts on leveraged crypto purchases, a problem of individual finances becomes one of collective policy. I'd be careful with dismissing the problem as one contained to the stupid.

It's probably worse than that. The collective craze around crypto is likely spurned by social media influence tactics. Most of this is from me just reading the forums as I obviously don't have proof, but along with ICO scams, exchange failures, software vulns, and SEC cautionary notices, there's enough for me to be broadly suspicious that these tactics are at least partly coming from the top owners of bitcoin who are manipulating the price.

You have to make huge efforts to pretend that a currency with virtually no regulation around it that works across borders has only honest actors trading on honest information. And low-dollar investors are certainly not going to band together and run price manipulation schemes.

And this will be utterly dumb if the major banks get involved significantly.

Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#106

Post by dsacco »

wslh wrote: post #60
matwood wrote: post #39

Earlier quoted context omitted.

How much I think is key here. I'll try and find the article from late 2017 but it said that most crypto buyers invested ~3k or less. A large portion of BTC is concentrated in fewer than 1k people. What this means is that for most people when crypto crashes, it sucks but will simply be a cool story. This isn't .com or the housing bubble where many people's lives were ruined. Of course with the craze, the stats could h…

Beyond the concentration, there are a lot of millionaries out there. Much more than 1k. I always tell that I know more crypto-millionaries than startup ones.

And how many members do you know of each, in absolute terms?

Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#108

Post by vthallam »

komali2 wrote: post #94
vthallam wrote: post #7

The last time China explicitly banned Bitcoin, it dropped by around 45% to around $6000. It went on to $20K from there. But what's different this time is that there are first time investors in millions who joined in the last 2 months. They didn't read the white paper, they didn't invest in technology, they invested for the monster returns. So I think there will be a more sell off this time before it rebounds back to…

I love bitcoin and cryptocurrency as potential solutions to problems with gov-controlled currencies (I've used crypto to buy drugs, for example). But I'm still confused why people refer to purchasing currency as an "investment." Obviously the rates are going up now, but doesn't everyone expect them to just come back down? I don't convert my USD to Yen and call it an "investment."

You would call it an investment, if the USD-YEN prices are so volatile and give you 1000X profit in 6 months. Again, this all goes back to whether Bitcoin is a store of value or a medium of exchange.

By now it's very clear, it can't be medium of exchange.

Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#109

Post by jgh »

komali2 wrote: post #94
vthallam wrote: post #7

The last time China explicitly banned Bitcoin, it dropped by around 45% to around $6000. It went on to $20K from there. But what's different this time is that there are first time investors in millions who joined in the last 2 months. They didn't read the white paper, they didn't invest in technology, they invested for the monster returns. So I think there will be a more sell off this time before it rebounds back to…

I love bitcoin and cryptocurrency as potential solutions to problems with gov-controlled currencies (I've used crypto to buy drugs, for example). But I'm still confused why people refer to purchasing currency as an "investment." Obviously the rates are going up now, but doesn't everyone expect them to just come back down? I don't convert my USD to Yen and call it an "investment."

Some people do though (forex traders), but that is not the primary use-case

Re: Bitcoin Fall Extends to 25% as Fears of Crackdown Linger

#110

Post by bsaul »

kinnth wrote: post #67

I always think there will only ever be 21 million bitcoins in existence ever. Ever. So what do you think is a fair price for that?

I'm not sure if you imply the price should therefore be high (because it's rare), or 0 (because it proves its inability to work as a currency).
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