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Bitcoin and cryptocurrency prices have fallen sharply over the last few days

forbes.com

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Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#241

Post by csomar »

OGWhales wrote: post #204
csomar wrote: post #187

I actively trade crypto. Today's crash was due (from what I'm seeing) to a massive Bitmex contract liquidation (probably in the $100m-300m range). The market, with panic, couldn't get the price in sync across all exchanges. At some point the difference between two exchanges is close to $1000/btc. Very profitable if you know what you are doing. You can AMA.

I saw that the large majority today was lost on longs, with shorts being much less active. Do you believe it’s likely that the crash was intentional with the large exchanges pushing the price down on various exchanges to make money off the leveraged longs? Obviously panic plays into this as well. I’m not one to get involved in any type of trading personally, as I don’t trust myself, so this is outside of my space. Pl…

> I saw that the large majority today was lost on longs, with shorts being much less active.

Given that Futures now have the most open interest, I'd say the long/short ratio is practically equal these days in Bitcoin land.

> Do you believe it’s likely that the crash was intentional with the large exchanges pushing the price down on various exchanges to make money off the leveraged longs?

No. Only bad traders will say that! I don't think there is any kind of price meddling from the exchanges themselves. Any exchange that does that will end up burning to the ground eventually (and there were exchanges that did that). The reason is, a single exchange will unlikely be able to move the price to the sought after direction. Given that trading is distributed through multiple exchanges that are in different jurisdiction, I can hardly see them colluding to manipulate the price.

> Some of my family is heavily invested in crypto, so I like to know what is going on.

God help them.

Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#242

Post by SuoDuanDao »

Barrin92 wrote: post #93
lawn wrote: post #79

Earlier quoted context omitted.

What should be considered money is subjective and the value of all money comes from people's perceived future value in it. Even gold coins and dollar notes.

there's a fairly objective definition of a currency. it's a store of value and it's a means of transaction. Bitcoin is not really a means of transaction except for illegal ones where people are willing to accept the high fees. Also, there is a clear difference in underlying value. Bitcoins value is entirely speculative. The US dollars value is guaranteed by the US government, which in turn is underpinned by real econ…

This 'illegal ones' canard again. Unregulated=/=Illegal.

Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#243

Post by SuoDuanDao »

tomp wrote: post #19
zionic wrote: post #3

I have to say, the crypto market's strong ties to traditional finance in this crash surprise me. I understand selling off stock because of expected corporate losses, I don't understand mass conversions to FIAT especially when "print more money" seems to be the fed's response to this.

Say you have an extra tampon and want a banana. I want a tampon but don't have a banana. What would you rather accept from me in exchange for a tampon, $cash or some BTC in your online crypto wallet? What do you believe has better chance of being exchangeable for a banana, from someone else?

What's the window on that question? I believe that QE has baked hyperinflation into the USD cake by now, that doesn't mean I expect it to hit main street by June.

Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#244

Post by imtringued »

xorcist wrote: post #161
sparkie wrote: post #136

Earlier quoted context omitted.

A "rejoin" isn't really possible. People who spent money on the "wrong" chain will simply have to live with the fact that their money is lost on the "right" chain, although it will probably not be an overnight thing. The two forks could exist for a long time after the split simultaneously, and many merchants may accept either form of payment. There will even be arbitrage between the two chains as profit can be made.…

> have to live with the fact that their money is lost on the "right" chain It's not that simple. Transactions can, and will be, replayed on both chains. There would however be many opportunities for attacks such as double spends for a short window of time. > The two forks could exist for a long time after the split simultaneously, That's not realistic. As soon as there is some communications between the chains, the s…

>That's not realistic. As soon as there is some communications between the chains, the system will reconcile.

If you think that is possible then you must not have paid attention to how blockchains work. By definition there is only one chain and it is always the longest chain in the network. The shorter chain will always be discarded and all the data within it is lost. Now we have a problem. Can't everyone just create their own chain with garbage data and then win by being the biggest spammer? (also known as 51% attack). This is why proof of work is necessary. It is basically a cryptographic lottery that ensures that there will only be one winner every 10 minutes. Since there will never be more than 1 winner there will also never be more than one longest chain. If you decide to disconnect from the network and solve the POW offline your chain will always be much shorter than the main chain. Only if you possess 51% of the miners can you do this offline attack and control which chain becomes the new one. It is possible to rewrite past transactions as well. Just start mining 3 blocks ago and remove transactions or add new ones. However, this becomes harder and harder the older the transaction is. Finding e.g. 10 blocks takes such a huge amount of mining resources that it is infeasible if don't control at least a super majority.

Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#245

Post by kuroguro »

glofish wrote: post #22
unhashable wrote: post #10

It's a common misconception that Bitcoin is a safe haven. It's not. Not even Gold is a safe haven during a liquidity crisis. In sharp downturns, cash is king. Think of Bitcoin and Gold as call options on the entire global monetary system. If Govs become insolvent, Bitcoin and Gold is there. If the masses lose faith in central banks, Bitcoin and Gold is there. If central banks debase currencies too quickly, Bitcoin an…

bitcoin is not really "there" the same way as gold is. The whole point of gold is that it is a tangible asset. You can hold gold in your pocket or under your mattress and it costs nothing to store it. You can't prove you have bitcoin if you don't have internet access for example. You can't have bitcoin if miners don't run their nodes. Basically, you are depending on a resource in faraway lands to let you "own" what y…

> You can't have bitcoin if miners don't run their nodes.

If there's less miners the mining difficulty goes down. If there's _really_ no miners left, you can mine alone on an old laptop AFAIK. For mining to completely stop bitcoins price would effectively need to be 0.

Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#246

Post by SuoDuanDao »

edf13 wrote: post #220

Some of this could be you can’t spend crypto to buy food in a crisis... cash is still king. When everything gets locked down cash is what you need

Funnily enough, farmer's markets are some of the few places I've seen 'crypto accepted' signs in my city.

Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#247

Post by ColanR »

unhashable wrote: post #232
ColanR wrote: post #188

Earlier quoted context omitted.

> Do you hold the dollars in your bank account? No, we don't, which is exactly why gold is considered superior.

You missed the point. Holders of gold maintain custody at risk of physical confiscation. Holders of Bitcoin maintain custody (of the password that allows spending said Bitcoin) and are cannot he compelled one way or another. The bitcoin moves when they say so.

I didn't miss the point; this discussion is conflating two separate ideas of ownership: physical ownership of an item (gold, dollars in-hand), and unrestricted (unrestrictable?) use of an item (bitcoin, and to a limited extent dollars in-hand and gold).

There's four things in play in this discussion, and they each fit those ideas differently. Paper dollars in the hand, digital dollars in a wallet, gold in the hand, and bitcoin. This discussion would be over if better definitions of 'ownership' were used.

Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#249

Post by tomp »

SuoDuanDao wrote: post #243
tomp wrote: post #19

Earlier quoted context omitted.

Say you have an extra tampon and want a banana. I want a tampon but don't have a banana. What would you rather accept from me in exchange for a tampon, $cash or some BTC in your online crypto wallet? What do you believe has better chance of being exchangeable for a banana, from someone else?

What's the window on that question? I believe that QE has baked hyperinflation into the USD cake by now, that doesn't mean I expect it to hit main street by June.

Has it? QE has been happening for the last 10 years already, and inflation hasn't (in products; asset prices have inflated though).

Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days

#250

Post by xorcist »

sparkie wrote: post #164
xorcist wrote: post #161

Earlier quoted context omitted.

> have to live with the fact that their money is lost on the "right" chain It's not that simple. Transactions can, and will be, replayed on both chains. There would however be many opportunities for attacks such as double spends for a short window of time. > The two forks could exist for a long time after the split simultaneously, That's not realistic. As soon as there is some communications between the chains, the s…

> It's not that simple. Transactions can, and will be, replayed on both chains. There would however be many opportunities for attacks such as double spends for a short window of time. My point was that a merchant who accepts a payment for some good or service, and later finds out that they were partitioned from the network after they have already released the goods, may find that they don't have any money on the othe…

> they don't have any money on the other (main) chain because it was already spent

Right, the double spend attack. It's feasible under certain circumstances, such as a chain split. That doesn't mean the system breaks down completely, but that it has to be mitigated. In the event of a multi hour long network partition, some participants are likely to take action.

> they would have the incentive to follow the partitioned chain and promote the forked software because their money doesn't exist on the main chain

My point was that their money do exist on both chains as long as transactions are replayed. That may be more or less hard depending on the nature of the split (say, a whole country falls on the Internet completely). Economic participants do have an incentive to replay transactions (for example by following the satellite feed, or a number of other ways).

It is enough that one participant does this to at least give everyone else the possibility to mitigate themselves. Not a good situation to be in, of course, but still. It doesn't require nodes to follow both chains, and certainly not promote minority chains. There is simply no economic incentive to do that should transactions be guaranteed on both chains.

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