Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Bitcoin Hits $1 Billion

spectrum.ieee.org

Post reply on HN
Print view View original

41–50 of 205 posts

Re: Bitcoin Hits $1 Billion

#41

Post by niggler »

cs702 wrote: post #35

As usual on HN, any submission about Bitcoin is met with concerned comments about its high volatility, present impracticality as a currency, disadvantages versus precious metals, current concentration of transactions in a single exchange (MtGox), potential for market manipulation by governments and/or speculators, etc. This is analogous to being present at the creation of the World Wide Web, but instead of getting ex…

I came across this last night: https://www.youtube.com/watch?v=7fvSYT7vhQY (https://news.ycombinator.com/item?id=5459304)

The phrase that really resonated with me was https://www.youtube.com/watch?v=7fvSYT7vhQY#t=404s : "When a few get something for nothing, at some point in a zero-sum game most will get nothing for something". That point may not happen anytime soon, but I think that's a very legitimate concern.

Re: Bitcoin Hits $1 Billion

#42

Post by tocomment »

One thing that hit me recently on bitcoin is I realized that for the first time in history micropayments are 100% possible.

I'm thinking all kinds of startups should spring up from that, but I haven't thought of any yet. What are your thoughts?

Re: Bitcoin Hits $1 Billion

#43

Post by eric_bullington »

niggler wrote: post #36
tocomment wrote: post #31

Earlier quoted context omitted.

I'm not getting an intuitive grasp on what the days destroyed tells you? Is it how many people are holding bitcoins? What does a higher number mean, what does a lower number mean?

A larger number means that people are holding onto BTC for long periods of time, a smaller number means that people are spending BTC soon after receiving it. In a sense, its a more granular way of looking at money velocity.

Can you please explain what you mean by "a more granular way of looking at money velocity"? This is probably a good point, but I'm missing it. I understand "granular" and "money velocity", but am having trouble understanding what you mean here.

Re: Bitcoin Hits $1 Billion

#44

Post by reaclmbs »

zalzane wrote: post #29
reaclmbs wrote: post #20

Earlier quoted context omitted.

OK, let's play a game. Say you had $5mm. How would you manipulate the Bitcoin market and earn a guaranteed return?

A government entity looking to destroy the market wouldn't necessarily care about getting a return. Even if they were, take a look at what happened yesterday when someone dumped 5k bitcoins onto mtgox. http://i.imgur.com/K8T4F0Y.png

He drew an analogy to wall street and called it a "rigged game". So, I'm curious to hear how he'd rig it.

Re: Bitcoin Hits $1 Billion

#45

Post by gyom »

reaclmbs wrote: post #20
mrkmcknz wrote: post #17

I want to be able to get behind Bitcoin I really do. I just don't understand the purpose it serves. As an asset class it's far too volatile even for someone who plays naked options. Imagine putting $10,000 into an asset class that swings 20-30% daily on a regular basis. Trading curbs eat your heart out. As a currency it's too impractical and there are serious hurdles involved with turning central bank currency into B…

OK, let's play a game. Say you had $5mm. How would you manipulate the Bitcoin market and earn a guaranteed return?

My first idea would be to see if it's possible to create massive sell-offs by crashing through many people's "stop on loss" barriers.

For example, let's say that the exchange rate is 100 USD per bitcoin at the moment and that you have tons of people who would absolutely sell their bitcoins if it went below 90. I'm not in the bitcoin game, but I think mtgox offers "stop on loss" features so that people could get out of bitcoins automatically.

If you're sure that you want to be in bitcoins, but you think that there are a lot of scared players who put their "stop on loss" too high, you might be able to provoke some kind of selling avalanche by selling sufficiently many bitcoins at once. The price drops below 90, which triggers a lot of automated selling. This makes the price drop even further, triggering other stop on loss barriers, driving the price to 80 and so on.

With your $5 millions you buy up all those bitcoins at a rate of 50 USD per bitcoin when the avalanche stops. Then people realize what just happened and the price of bitcoins crawls back to 100 because that was more or less the fair market price.

The point is, with $5 million dollars you might have the power to create digital panics, a "flash crash", and use that to your advantage.

I don't know if $5 million is enough for that, and it's not a guaranteed return.

Re: Bitcoin Hits $1 Billion

#46

Post by niggler »

reaclmbs wrote: post #20
mrkmcknz wrote: post #17

I want to be able to get behind Bitcoin I really do. I just don't understand the purpose it serves. As an asset class it's far too volatile even for someone who plays naked options. Imagine putting $10,000 into an asset class that swings 20-30% daily on a regular basis. Trading curbs eat your heart out. As a currency it's too impractical and there are serious hurdles involved with turning central bank currency into B…

OK, let's play a game. Say you had $5mm. How would you manipulate the Bitcoin market and earn a guaranteed return?

Run your own bitcoin exchange:

https://www.youtube.com/watch?v=7fvSYT7vhQY#t=279s

Re: Bitcoin Hits $1 Billion

#47

Post by waffle_ss »

cs702 wrote: post #35

As usual on HN, any submission about Bitcoin is met with concerned comments about its high volatility, present impracticality as a currency, disadvantages versus precious metals, current concentration of transactions in a single exchange (MtGox), potential for market manipulation by governments and/or speculators, etc. This is analogous to being present at the creation of the World Wide Web, but instead of getting ex…

There are some real concerns with Bitcoin. For example, I was going to write an app that accepts Bitcoins as payment. However, the problem is that the amount of time it takes for a transaction to become "verified," i.e. be part of the official block chain, can take up to 10 minutes.

What am I supposed to present to the user during this time? Am I supposed to tell them that their payment may or may not have been accepted, please check back in ten minutes or wait for an email? How would you handle this if it were a real person in a real store, at a register checking out?

Re: Bitcoin Hits $1 Billion

#48

Post by tocomment »

I'm curious, why hasn't anyone implemented a mining client in javascript, so you could in effect has visitors to your website mine coins for you. It might be a create way to fund content instead of advertising.

Re: Bitcoin Hits $1 Billion

#49

Post by maxerickson »

eric_bullington wrote: post #40
tocomment wrote: post #31

Earlier quoted context omitted.

I'm not getting an intuitive grasp on what the days destroyed tells you? Is it how many people are holding bitcoins? What does a higher number mean, what does a lower number mean?

You're absolutely right, Bitcoin Days Destroyed only indirectly tells us about transaction volume. What it's trying to measure is the amount of "hoarding" occurring in the Bitcoin economy. More BDD suggests less hoarding. So it looks like people are spending their Bitcoins more and more.

Shouldn't hoarding be estimated by comparing BDD to total Bitcoin days? Or does the block number roughly reflect Bitcoin days?

The increasing number of bitcoins means that there are more and more days to destroy, so I'm having trouble relating it back to behavior.

Re: Bitcoin Hits $1 Billion

#50

Post by leot »

aneth4 wrote: post #28
tvladeck wrote: post #23

Remember: "What we want from a monetary system isn’t to make people holding money rich; we want it to facilitate transactions and make the economy as a whole rich." - Paul Krugman EDIT: To be clear - this quote is not intended (by me) to be a knock on BTC. It's just an elegant statement of my own opinion that the value of 1 BTC is not all that indicative of its value to the economy.

That's great for us and the economy. Personally, I'd prefer my money to increase in value. I'm not going to avoid a currency for the benefit of the economy, nor would that be consistent with expected economic behavior.

Yes, it would be nice for us all to become rich without contributing anything.

If you're a Good Person, however, you should be interested in becoming rich by creating real value. And you should be interested in promoting an economic system that encourages people to create value rather than hoard assets.

You don't have to be a Good Person, of course. And no one has to like you, either.

Post reply on HN