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Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

nytimes.com

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Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#221

Post by cycrutchfield »

jaredklewis wrote: post #169
sbov wrote: post #149

Earlier quoted context omitted.

> Curiously, at the height of the housing crisis homes were about 5.5 times the median national income. In San Francisco right now (another place where supply looks limited by the water) homes there are 17.2 times the median national income. You're comparing national home prices in Japan vs national income in Japan. Then you're comparing local prices in SF to national income in the USA. You're then comparing these co…

In 2016, it seems SF median household income was $96,677 [1] and that the median house price was $1.31 million [2]. Couldn't find more recent number for income. That a 13.6 median price to income ratio. 2018 median house price is $1.61 million, so for wages to keep up the 2018 median income would need to be $118,382 to maintain the 13.6 ratio. Edit: I agree with parent it probably still doesn't make sense to compare…

SF median household income is vastly distorted by rent control and prop 13, which allow very many people to live there who otherwise would not be able to afford to live there. Therefore the above measure is not an apples-to-oranges comparison to the Japan data.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#222

Post by makomk »

partiallypro wrote: post #192
existencebox wrote: post #185

Earlier quoted context omitted.

Probably "bitfinexed". I think I know the article you're talking about, but could only find another quickly peeking through my history, but perhaps it'll serve as a breadcrumb for you. https://medium.com/@bitfinexed/meet-picasso-the-painter-on-g...

That appears to be correct author, all of the pieces are very insightful.

His arguments are pretty terrible to be honest, but people had trouble grasping that cryptocurrency bears can also be wrong. The worst one he successfully pushed on suckers was his claim that institutional investors obviously weren't be paying Bitfinex to create Tether because they could buy it cheaper on one of the other exchanges. There wasn't nearly enough available on that exchange to make this worthwhile, and he clearly knew this because one of his previous arguments was that the shallow order book and low volume there demonstrated Tether was a scam. (I calculated the amount of money the supposed institutional investors were giving up by not using that exchange, and it was around $200 if they bought up every single Tether available for below par. For comparison, Tether was being issued tens millions of dollars at a time.) He knew what he was saying was a lie, said it anyway, and people believed him.

A lot of the other stuff was dubious to outright wrong too, but it was harder to prove he didn't genuinely believe it.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#224

Post by beefield »

pshin45 wrote: post #167
RIMR wrote: post #160

Earlier quoted context omitted.

Seriously, the way people talk about it you would think that a third of the world's energy supply was getting pumped into NVidia cards. The global average energy consumption is 110,000TWh. Every cryptocurrency in circulation collectively uses about 55TWh, or 0.05% of the world's energy usage.

Indeed, as I mentioned in a sibling comment, to put those numbers in context, Bitcoin consumes as much power globally as a single large power plant, and roughly 10% of the world's data centers [1]. To be sure, it's the growth rate of that consumption that is more concerning. But at the same time, there are lots of reasons to believe that Bitcoin's electricity consumption will naturally moderate and flatten over time.…

If there is one percent chance of bitcoin making world somehow better place, I wonder what are the odds bitcoin makes world somehow worse place ( e.g. fostering criminal endeavours, pseudolegal scams,failed monetary policy and environmental problems) and how does those odds change the equation?

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#225

Post by thousandautumns »

pshin45 wrote: post #163
captainbland wrote: post #110

Earlier quoted context omitted.

In either of these situations it seems like hodling until victory pays off. The real loser is, well, the planet as the network continues to consume more and more power.

Bitcoin's absolute power consumption isn't at a critical level yet — Bitcoin consumes as much power globally as a single large power plant, and roughly 10% of the world's data centers. However, I agree that its rapid and consistent growth rate is concerning and can't be ignored. It's an area I'm really interested in and have been reading a lot about, because most of the news and "analysis" of the issue on both sides…

> Bitcoin consumes as much power globally as a single large power plant, and roughly 10% of the world's data centers

Well first of all, according to your own blog post, it is not as much power as a single large power plant, but as much power as the single largest power plant in the entire US. And thats just an estimate. It potentially uses twice that amount.

And 10% of the power of all the worlds data centers is absolutely bonkers. That isn't a small number, its spectacularly large.

And all of this for something that has yet to be adopted by 99.9% of the people on the planet.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#226

Post by Obi_Juan_Kenobi »

davidsong wrote: post #170
RIMR wrote: post #160

Earlier quoted context omitted.

Seriously, the way people talk about it you would think that a third of the world's energy supply was getting pumped into NVidia cards. The global average energy consumption is 110,000TWh. Every cryptocurrency in circulation collectively uses about 55TWh, or 0.05% of the world's energy usage.

A little over two more orders of magnitude price increase before the next two halfenings and it's guaranteed to cause a world energy crisis.

Since Coinbase fees dominate mining rewards, each halving event also halves the equilibrium energy consumption. Since mining is speculative and capital intensive, you don't see a concomitant jump in hash rate, but the overall effect is obvious.

In other words, it's worth remembering that mining is currently massively subsidized through inflation, and as such future market dynamics must account for this.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#227

Post by kaoD »

RIMR wrote: post #160
nyolfen wrote: post #154

Earlier quoted context omitted.

a fraction of a percent is pretty much the definition of loose change

Seriously, the way people talk about it you would think that a third of the world's energy supply was getting pumped into NVidia cards. The global average energy consumption is 110,000TWh. Every cryptocurrency in circulation collectively uses about 55TWh, or 0.05% of the world's energy usage.

And yet it isn't providing value to 0.05% of the world's population. Even if it did, the energy would go up (exponenially?)

I'm not sure the tradeoff is worth it.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#228

Post by gtlondon »

kgwgk wrote: post #28

Today Matt Levine talks about this paper in his daily column: https://www.bloomberg.com/view/articles/2018-06-13/judge-rul... "of these two explanations— 1) Bitcoin’s rapid and sustained rise is due to the fact that it satisfies a real economic need in an elegant way, and people have responded to that; or 2) Bitcoin’s rapid and sustained rise is due to a magical fountain of fake dollars that everyone just decided to…

The original article is a joke. Large buy orders will obviously increase the price, and to describe this as manipulation is completely misleading.

There's also zero evidence that Tethers are a scam. I'm pretty sure it would have been discovered by now, and also unlikely that Circle would pay $400m for an Exchange whose main currency is USDT if that was the case.

Both NYT and Bloomberg seem to love an inaccurate Crypto article, seems like their editorial standards are non-existent in this sector. Sure that will change once they have bought in.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#229

Post by rootusrootus »

josu wrote: post #193
tomkarlo wrote: post #159

Earlier quoted context omitted.

Is the supply really "limited"? Sure, there's finite number of "coins" that can be generated. But unlike physical objects, there's not really any special property of that unit. Also, you can just generate a new currency of more units and similar utility (as has happened many times recently.) Objects in the real world have utility that's directly linked to their unit value. That's not necessarily true for Bitcoin... i…

I'd say that an analogy with diamonds works: There is an infinite supply of lab-made-diamonds, however they are not fungible with real diamonds. Them being substitute goods, lab-made-diamonds may have negatively impacted the price, but real diamonds are still considered scarce.

There is nearly an infinite supply [for all practical purposes] of mined diamonds, for that matter. And lab-made diamonds are real, and aside from the early versions being a little too perfect they are indistinguishable from mined diamonds.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#230

Post by the_mitsuhiko »

gtlondon wrote: post #228
kgwgk wrote: post #28

Today Matt Levine talks about this paper in his daily column: https://www.bloomberg.com/view/articles/2018-06-13/judge-rul... "of these two explanations— 1) Bitcoin’s rapid and sustained rise is due to the fact that it satisfies a real economic need in an elegant way, and people have responded to that; or 2) Bitcoin’s rapid and sustained rise is due to a magical fountain of fake dollars that everyone just decided to…

The original article is a joke. Large buy orders will obviously increase the price, and to describe this as manipulation is completely misleading. There's also zero evidence that Tethers are a scam. I'm pretty sure it would have been discovered by now, and also unlikely that Circle would pay $400m for an Exchange whose main currency is USDT if that was the case. Both NYT and Bloomberg seem to love an inaccurate Crypt…

There is also zero evidence that it’s not a scam.
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