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The Bitcoin Report 2 [pdf]

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Re: The Bitcoin Report 2 [pdf]

#61

Post by wmf »

surrealize wrote: post #19
ctbeiser wrote: post #9

Earlier quoted context omitted.

"As the deflationary feedback amplifies the desire to hoard, the exchanges will become illiquid." The rest of it makes perfect sense, but why would we think this, rather than that market forces will drive prices up, and people will sell as a result, fulfilling demand?

If you see it going up, why would you sell? In the deflationary spiral scenario, it'll just keep on going up, so it's in your interest to hold on.

We see people selling at $100 and $200; would we expect people to not sell at $10,000?

Re: The Bitcoin Report 2 [pdf]

#62

Post by waterlesscloud »

polshaw wrote: post #33

The value of BTC just doubled from 60 to 120 in 40 minutes.. wtf is going on there? (looking at btce/USD) (disclaimer: i'm not trying to hype, I expect it will come back down again shortly, it just seems weird to change that much that quickly) Edit: yup.. back down to 80 20mins later.. can anyone tell what kind of volumes were traded in this period? ..I wonder if anyone was able to double a serious amount of money in…

Interesting statistic- Bitcoin Days Destroyed skyrocketed during this crash.

http://blockchain.info/charts/bitcoin-days-destroyed

BDD measures how many "old" coins are being moved around, so it seems likely that a lot of early adopters cashed out this time. Will be interesting to see what that means for the future of the BTC itself.

Re: The Bitcoin Report 2 [pdf]

#63

Post by mattm »

vyrotek wrote: post #7

"There is no capital nor wealth creation to speak of; only as much money as was put in. While somebody may buy a bitcoin for $1 and then sell it for $200, no value was added in this process, so it is simply a transfer of wealth. The people who profit will do so by taking from those who lose. As the deflationary feedback amplifies the desire to hoard, the exchanges will become illiquid. Eventually, buyers will give up…

> Nailed it

Can you point to a specific event in history where this actually occurred? Because so far all I've seen are people theorizing what will happen in this situation. Your argument would carry more weight if you backed it up.

Re: The Bitcoin Report 2 [pdf]

#64

Post by InclinedPlane »

Aqueous wrote: post #57
InclinedPlane wrote: post #31

Earlier quoted context omitted.

Long term? People stop using bitcoin. You theorize that the boom/bust swings will diminish in intensity until eventually bitcoin becomes stable. Others theorize that the boom/bust cycles will grow in severity until eventually everyone just gives up on bitcoin. So far there's very little evidence for the stability option and a lot of evidence (and economic theory) for the speculative bubble theory. Do you have any evi…

I've very rarely seen something with a > 1 Billion market cap and millions of users simply disappear. (To use an unrelated example, even MySpace still exists :) Very simply, the more users are in Bitcoin the more vendors there will be who accept BitCoin. The more goods and services can be bought in Bitcoin during the relatively smooth periods the greater the proportion of people who like to have the currency for curr…

Geocities, lycos, CompuServe, Excite@Home, so many others.

Those were all companies which sold at a billion dollars or many billions of dollars and have sense been shut down or are worth a tiny fraction of that amount today.

And those are just examples from the last 20 years, we could go back to nearly countless examples of other speculative bubbles going back centuries.

Re: The Bitcoin Report 2 [pdf]

#65

Post by zenocon »

InclinedPlane wrote: post #64
Aqueous wrote: post #57

Earlier quoted context omitted.

I've very rarely seen something with a > 1 Billion market cap and millions of users simply disappear. (To use an unrelated example, even MySpace still exists :) Very simply, the more users are in Bitcoin the more vendors there will be who accept BitCoin. The more goods and services can be bought in Bitcoin during the relatively smooth periods the greater the proportion of people who like to have the currency for curr…

Geocities, lycos, CompuServe, Excite@Home, so many others. Those were all companies which sold at a billion dollars or many billions of dollars and have sense been shut down or are worth a tiny fraction of that amount today. And those are just examples from the last 20 years, we could go back to nearly countless examples of other speculative bubbles going back centuries.

If ever there were a textbook example of apples/oranges, this would be it.

Re: The Bitcoin Report 2 [pdf]

#67

Post by dragonwriter »

zenocon wrote: post #26
dragonwriter wrote: post #18

Earlier quoted context omitted.

> Every article that portends doom via deflationary measures trots out the same 'ol tired arguments and examples (great depression, hoarders, etc.) You have to admit this is new ground. In what relevant sense to deflation and its effects is it new? > There are a lot of new ideas here (i.e. divisible to 8 decimal places, de-centralized, etc.) How are any of these relevant to the incentives created by deflation?

Bitcoin is an infant. Hoarders will happen, sure. We'll see what happens in the long term. Gold as a fixed medium may not be practical to slice to 8 decimal places, but then again...the central authority that is in charge of deciding that never tried. They just gave up and Keynes won. Let's see what happens.

Continuing to repeat "Bitcoin is new; Bitcoin is sudividable; Keynes bad; central bank bad" isn't actually an argument as to how any new features of Bitcoin, including its subdivisability, change any of the incentives related to deflation.

If you've got an argument, make it, but as far as I can see there's just conspiracy theories about the status quo and wishful thinking with no coherent basis for Bitcoin.

Re: The Bitcoin Report 2 [pdf]

#68

Post by jebeng »

InclinedPlane wrote: post #64
Aqueous wrote: post #57

Earlier quoted context omitted.

I've very rarely seen something with a > 1 Billion market cap and millions of users simply disappear. (To use an unrelated example, even MySpace still exists :) Very simply, the more users are in Bitcoin the more vendors there will be who accept BitCoin. The more goods and services can be bought in Bitcoin during the relatively smooth periods the greater the proportion of people who like to have the currency for curr…

Geocities, lycos, CompuServe, Excite@Home, so many others. Those were all companies which sold at a billion dollars or many billions of dollars and have sense been shut down or are worth a tiny fraction of that amount today. And those are just examples from the last 20 years, we could go back to nearly countless examples of other speculative bubbles going back centuries.

Oh, the memories seeing those names bring back.

So happy to have been there for the through the 90's.

Re: The Bitcoin Report 2 [pdf]

#69

Post by miami-dade »

InclinedPlane wrote: post #31
Aqueous wrote: post #13

Earlier quoted context omitted.

This describes what happens in the short term, probably repeatedly. But what happens in the long term? Traders learn; they adjust with respect to risk. People will become acquainted with the volatility of the BitCoin currency and adjust their buying and selling practices as a result. People will hold onto the currency longer because they've seen it crash before and recover. The curve will flatten and become a slope.…

Long term? People stop using bitcoin. You theorize that the boom/bust swings will diminish in intensity until eventually bitcoin becomes stable. Others theorize that the boom/bust cycles will grow in severity until eventually everyone just gives up on bitcoin. So far there's very little evidence for the stability option and a lot of evidence (and economic theory) for the speculative bubble theory. Do you have any evi…

What a false dichotomy. So people are either buying Bitcoin purely for its use as a currency or purely speculating? You're missing the forest for the trees.

Do you want to see real political and economic change in your lifetime? Campaign finance reform: not the answer. Term limits: not the answer. Voting Libertarian: waste of time. "Balance the budget": too little, too late. Political activism: occupy my asshole.

The only solution: flip societal power structures upside down, and let us geeks take the reigns.

Now, you may argue that everything is Hunky Dory like tptacky, but I'd beg to differ. We need real social and economic change, right now, to ensure our continued prosperity into the forseeable future, and we're just not getting it from Washington. Make excuses or justify a Big Brother Statist tyranny driven by propaganda and ignorance all you want, ultimately none of that shit works long term and meanwhile we have a lot less freedom.

Let's play a different game now ...

Re: The Bitcoin Report 2 [pdf]

#70

Post by InclinedPlane »

miami-dade wrote: post #69
InclinedPlane wrote: post #31

Earlier quoted context omitted.

Long term? People stop using bitcoin. You theorize that the boom/bust swings will diminish in intensity until eventually bitcoin becomes stable. Others theorize that the boom/bust cycles will grow in severity until eventually everyone just gives up on bitcoin. So far there's very little evidence for the stability option and a lot of evidence (and economic theory) for the speculative bubble theory. Do you have any evi…

What a false dichotomy. So people are either buying Bitcoin purely for its use as a currency or purely speculating? You're missing the forest for the trees. Do you want to see real political and economic change in your lifetime? Campaign finance reform: not the answer. Term limits: not the answer. Voting Libertarian: waste of time. "Balance the budget": too little, too late. Political activism: occupy my asshole. The…

You are so full of yourself and living in a fantasy world it's sad to watch. Bitcoin isn't a revolution, you've been duped. It's just another pyramid scheme being used by those with more power, more money, more information, and fewer morals to take advantage of folks like you who just want to believe.

Do you really want to change the system? Write blogs. Write books. Start a business. Do investigative journalism. Speak at rallies. Work on a campaign. Run for mayor. Run for congress.

There are a million ways to empower yourself and others, using bitcoin isn't any of them.

Imagining that bitcoin is the answer is about as naive as imagining that hitting "like" on your facebook feed is going to magically feed some starving child somewhere.

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