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Bitcoin hits $200

bitcoincharts.com

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Re: Bitcoin hits $200

#51

Post by gerhardi »

graeham wrote: post #7

Does anyone have a link or justification in anyway for the rise in the conversion rate? I like the idea of an independent (non-government), secure currency - but I can't see this as anything other than a speculation driven investment vehicle. Seems like tulip mania to me [1]. Also, is there any management of Bitcoin to prevent excessive currency fluctuations? Not having this would seem to be a flaw to me - you can't…

I'm along your lines. If I happened to have a stash of bitcoins in my pocket, I'd be very careful about actually buying anything with them today, as the next week they would be more and more valuable. So I think the deflation is the main reason why I don't feel comfortable with idea of using bitcoins as a currency for buying anything - selling might be a different story.

edit: How large volumes of selling bitcoins for USD/EUR/etc. is enough to have significant effect on the value of bitcoin? For example if I had VERY URGENT need to sell 100 000 bitcoins by tomorrow in exchange for USD.

Re: Bitcoin hits $200

#53

Post by betterunix »

aneth4 wrote: post #35
AndrewDucker wrote: post #23

It's fascinating to watch this, largely because Bitcoin has no "natural" value. The only utility it has is as a transfer of value from one place to another, and it can do that equally well with a bitcoin being worth $1 or $200. But it's really interesting to watch the value ratchet up, and easy to see how you can do this - if people will only ever sell a bitcoin for (say) 1% more than they bought it for, and people b…

Gold also has no "natural" value as a currency, and make no mistake gold is traded as a currency, not for it's actual usage.

Where is gold traded as a currency? In what market are weights of gold used as a medium of exchange?

Re: Bitcoin hits $200

#54

Post by midnightsine »

gerhardi wrote: post #51
graeham wrote: post #7

Does anyone have a link or justification in anyway for the rise in the conversion rate? I like the idea of an independent (non-government), secure currency - but I can't see this as anything other than a speculation driven investment vehicle. Seems like tulip mania to me [1]. Also, is there any management of Bitcoin to prevent excessive currency fluctuations? Not having this would seem to be a flaw to me - you can't…

I'm along your lines. If I happened to have a stash of bitcoins in my pocket, I'd be very careful about actually buying anything with them today, as the next week they would be more and more valuable. So I think the deflation is the main reason why I don't feel comfortable with idea of using bitcoins as a currency for buying anything - selling might be a different story. edit: How large volumes of selling bitcoins fo…

Cashing out 100 000 BTC would crash the market down to 0 - right now the MtGox has exactly 105 708 BTC in the order book.

Cashing out 100 000 USD however is a different story. It actually happened a few hours ago, you can see the impact for yourself[1].

[1] http://i.imgur.com/cjI9ZaT.png

Re: Bitcoin hits $200

#56

Post by aneth4 »

betterunix wrote: post #53
aneth4 wrote: post #35

Earlier quoted context omitted.

Gold also has no "natural" value as a currency, and make no mistake gold is traded as a currency, not for it's actual usage.

Where is gold traded as a currency? In what market are weights of gold used as a medium of exchange?

Gold is traded almost exclusively for its liquidity and role as a value store, not for its intrinsic value. Currency traders don't use currency as a medium of exchange either.

Re: Bitcoin hits $200

#57

Post by eduardordm »

This last price fluctuation is doing more harm to bitcoin than a moratory does to a country.

No one can even explain formally why this is happening. Lack of liquidity? Penny stock behavior? Are there sharks driving the prices to make a spectacular exit?

Why isn't mining regulating the prices? Is it too costly?

My personal and completely uninformed opinion is that bitcoin is doomed.

Re: Bitcoin hits $200

#58

Post by xhrpost »

bobsy wrote: post #20

What goes up... The past couple of weeks has shown how easily the bitcoin market can be manipulated. People used to do this with shares. Buy up all the shares to push the price up. Then get out with a profit crashing the value of the share. I don't think this is any different. I wouldn't be surprised if a handful of parties were responsible for the explosion in bitcoin value. You could point to the Cyprus banking cri…

The "price" is whatever the last trade went for. If there are market manipulators buying up "all the shares", it would seem like a big risk as they are relying on there being enough bids within their profit range to sell them back at a profit. Right now for example, you could sell 100 BTC on Mt.Gox for an average price of $203USD/BTC. Try to sell 10,000 BTC and the average drops to about $195, and 100,000BTC would only average $111.

Re: Bitcoin hits $200

#59

Post by aneth4 »

midnightsine wrote: post #54
gerhardi wrote: post #51

Earlier quoted context omitted.

I'm along your lines. If I happened to have a stash of bitcoins in my pocket, I'd be very careful about actually buying anything with them today, as the next week they would be more and more valuable. So I think the deflation is the main reason why I don't feel comfortable with idea of using bitcoins as a currency for buying anything - selling might be a different story. edit: How large volumes of selling bitcoins fo…

Cashing out 100 000 BTC would crash the market down to 0 - right now the MtGox has exactly 105 708 BTC in the order book. Cashing out 100 000 USD however is a different story. It actually happened a few hours ago, you can see the impact for yourself[1]. [1] http://i.imgur.com/cjI9ZaT.png

> Cashing out 100 000 BTC would crash the market down to 0 - right now the MtGox has exactly 105 708 BTC in the order book.

All demand is not reflected in the order book. In fact, most demand is not. The more sophisticated a trader is, the more likely he is to use limit orders to manipulate the market instead of the rather stupid move of telegraphing demand.

If the market went down 10%, a flood of buy orders is not unlikely to appear.

Re: Bitcoin hits $200

#60

Post by imatworkyo »

madaxe wrote: post #41
tomp wrote: post #33

Earlier quoted context omitted.

What's more likely is that a lot of people set their limit sell orders to 200, because the number is easy to come up with and easy to type.

Yeah, but that still basically says "Rank Amateurs", because you should never pick the psychologically obvious point, as otherwise you'll end up in the sell queue behind a gazillion others. Always best to go in a few points below the obvious level for your sell, and a few points above the obvious for your buy. If you look at any "real" market, prices rarely adhere to nice round sticking points, because people are at…

alot of bitcoin investors, up too this point ARE rank amateurs... nothing new there

"real" markets also have computers and algorithms behind alot of what they are doing. Bitcoin does as well.

I'm sure hitting 200 was either someone setting buy/sells at a point of pride because they wanted too, or a coincidence, or people who don't care because they are long-haul investing.

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