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Bitcoin Value Sinks After Chinese Exchange Move

nytimes.com

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Re: Bitcoin Value Sinks After Chinese Exchange Move

#101

Post by lukifer »

tg3 wrote: post #94
lukifer wrote: post #52

Earlier quoted context omitted.

Is a website a document? It is, sort of, but there's also Gmail. BitCoin is a new thing; it does not map well to preceding concepts, be it "asset" or "currency" or something else entirely.

I think it maps decently well to the concept of a currency. It has no intrinsic value, and the amount of it in circulation is controlled by a central authority. In the case of the US, the Fed constantly adjusts the dollars in circulation to further their monetary policies (typically low inflation, with economic growth), while in the case of BitCoin, the amount in circulation is set by a mathematical curve that is def…

Currencies have additional characteristics in the real world, that are not part of the dictionary definition:

- I can file a police report if my dollars are stolen, and there is a non-trivial chance I could get them back.

- I can store dollars at an insured institution, with a high degree of confidence in retrieving them again. [1]

- I [get to | have to] pay my taxes in dollars.

In essence, for all of our lifetimes, "currency" has always meant "state currency", with all the good and bad that goes with it. Even when precious metals were the norm, states still tended to get involved (stamping the Emperor's face on certain coins and giving those coins preferential treatment).

While BTC meets the definition for currency in some ways, it's probably more practical in our current financial ecosystem to think of them as a highly fungible (and volatile) asset. (As with the stock market, no one should be putting all their life savings into crypto-coins.) As the ecosystem continues to grow, this may change.

[1] This might be the balancing factor to the deflationary issue, to the extent that it matters: that most people might end up keeping their hoard at an insured, well-secured BTC Bank, and paying a small steady percentage for the assurance that their whole pile doesn't disappear.

Re: Bitcoin Value Sinks After Chinese Exchange Move

#102

Post by oznathan »

grey-area wrote: post #93
oznathan wrote: post #68

Earlier quoted context omitted.

One of the greatest investors of all-time, George Soros, made billions betting against the British Pound. A pretty old currency. http://www.telegraph.co.uk/finance/2773265/Billionaire-who-b...

https://news.ycombinator.com/item?id=6927003

I replied on the matter of investing in currency. Shorting is one investment strategy. Buy and hold is another one. I bet a lot of people would short bitcoin if they could.

Anyway this is ridiculous. People try to analyze an new phenomena with the old terminology. It doesn't work like that. You can't understand the change if you don't change your paradigm.

Re: Bitcoin Value Sinks After Chinese Exchange Move

#103

Post by erikpukinskis »

ye wrote: post #75
jackgavigan wrote: post #56

Predictable outcome is predictable: https://news.ycombinator.com/item?id=6818821 Anyone who thought the Chinese government were going to ignore a mechanism that allowed people to bypass capital controls with impunity was pretty naive. Bitcoin fanboys have classic tunnel vision - they're so enamoured of the libertarian ideal of an anonymous crypto-currency that's not controlled by any government, that they ignored all…

China is a big player, but it's just one of many. But even China can't stop bitcoin from being used in China. They just made it harder, that's all. Bitcoin keeps getting adopted, the infrastructure is getting built, better software is being written. Whether you like it or not, it's getting more popular, that's just a fact. I predict it will take Western Union and Money Gram and many smaller money transferers out of b…

In some sense, I think the opposite. Bitcoin will succeed everywhere that PayPal and MoneyGram currently are failing. I suspect Bitcoin will replace a lot of cash and "valuables".

It may someday replace more "developed nations"/consumer-facing stuff like PayPal, but that will be a slow, politicized process fought in the arena of public sentiment. It will spread like wildfire in the arenas where there is currently no good means of transfer.

Re: Bitcoin Value Sinks After Chinese Exchange Move

#104

Post by Greed »

master_shake wrote: post #10

In April, I watched the price of bitcoin every day. When it approached $200 I said "f*ck it," took out a student loan and bought in at $225. The VERY NEXT DAY the price collapsed. I watched bitcoin slide to $50 in a state of complete and utter devastation. I felt so stupid. I decided not to sell, and just considered the loan to be a write-off. Point being, you should assess the quality of your investment in years, no…

I'd like to point out that, as an early adopter, it really pains me when I see people using situations like this to argue for the viability of Bitcoin as a currency.

Bitcoin is going to succeed because anecdotally you risked far more than was responsible on a winning gamble?

Prices don't just increase inexhaustibly. Bitcoin isn't going to 'win' if the only value it has is that people can wake up to find their investment multiplied overnight. These are the elements of a ponzi scheme, and you shouldn't argue for its success because of your kitschy miracle story.

Re: Bitcoin Value Sinks After Chinese Exchange Move

#105

Post by kordless »

vectorpush wrote: post #87
kordless wrote: post #78

Earlier quoted context omitted.

Blaming statements are pretty easy to spot if you know the signposts for them. Indicating a current outcome is 'predictable' because you said it was going to happen is a form of confirmation bias. Making a self referential comment to bolster his opinion sets the tone for the rest of the blaming argument that follows. Also, there the fact he didn't actually publicly call it first: https://news.ycombinator.com/item?id=…

BTW, making a coy remark about his 'intelligence' and speaking for his future actions are blaming statements in themselves. It isn't helping the conversation much by doing that. I admit, that part of my response was intentionally provocative, though, just to clarify, I wasn't being sarcastic when I regarded him as intelligent, my intent was to highlight the fact that intelligent individuals like the GP who are convin…

Right on. I made a blaming statement myself, and for that I apologize. Happens all the time! :) Also, I used the word coy incorrectly. Meh.

Re: Bitcoin Value Sinks After Chinese Exchange Move

#106

Post by spearso »

jackgavigan wrote: post #56

Predictable outcome is predictable: https://news.ycombinator.com/item?id=6818821 Anyone who thought the Chinese government were going to ignore a mechanism that allowed people to bypass capital controls with impunity was pretty naive. Bitcoin fanboys have classic tunnel vision - they're so enamoured of the libertarian ideal of an anonymous crypto-currency that's not controlled by any government, that they ignored all…

Dreamers will dream, the grounded will copy and implement the best of their ideas, and some people will just look for something to claim is broken and stupid and pointless and doomed.

Re: Bitcoin Value Sinks After Chinese Exchange Move

#107

Post by prodigal_erik »

twelvechairs wrote: post #17
grey-area wrote: post #15

Earlier quoted context omitted.

Speculation is not the same as investing. You can speculate in currency fluctuations in any currency, but to refer to a currency as an investment is a huge red flag for it as a currency, and for investment assets you should prefer slow appreciation over wild fluctuations and speculative moves.

investment and speculation are two sides of the same coin (pardon the pun). all investment has risk. bitcoin speculation is a high risk investment. this may not be good for everyone but its an investment nonetheless.

Speculation is not investment. The difference is that investments pay dividends, and buy and hold is a viable strategy. A speculator is relying on appreciation to make flipping the asset pay off, and is screwed if they eventually need a greater fool and can't find one.

Re: Bitcoin Value Sinks After Chinese Exchange Move

#108

Post by prodigal_erik »

LargeWu wrote: post #76
mdemare wrote: post #41

Earlier quoted context omitted.

An investment is productive - buying a share in a company allows that company to increase production, which should increase their profit. Lending money to a company allows that company to invest, and increase their profits. Buying BTC is nothing like that. It's speculation - hoping that the price will go up, nothing more.

FWIW, most "investments" that regular people make in the stock market are also, in fact, speculation. Once the stock has been issued originally, the issuing company receives no proceeds from subsequent sales of that stock. There might be secondary or tertiary effects that eventually lead to real investment, but for the most part, the majority of American's retirement savings are in speculative holdings.

"If you really think of it, when a stock doesn't pay dividends, there really isn't a whole lot of difference between a share of stock and a baseball card." - http://blogmaverick.com/2008/09/08/talking-stocks-and-money/

Re: Bitcoin Value Sinks After Chinese Exchange Move

#109

Post by taspeotis »

ekianjo wrote: post #82
taspeotis wrote: post #11

Earlier quoted context omitted.

It's down to ~480 so it's lost $100 in 30 minutes. Let's just say that my strange way of picking numbers can be described as "flattering" ... at worst.

No, you should pick numbers on a daily average with an indication of the daily variation on the value if you want to be fair, not at a precise instant, because Bitcoin can have as much as 30% variation in a given day, so I too can make up numbers out of thin air by picking up a very biased time during the day.

It ended the day at $582 [1].

> because Bitcoin can have as much as 30% variation in a given day

Hence, "pretty fucked up".

[1] https://coinbase.com/charts

Re: Bitcoin Value Sinks After Chinese Exchange Move

#110

Post by ekianjo »

taspeotis wrote: post #109
ekianjo wrote: post #82

Earlier quoted context omitted.

No, you should pick numbers on a daily average with an indication of the daily variation on the value if you want to be fair, not at a precise instant, because Bitcoin can have as much as 30% variation in a given day, so I too can make up numbers out of thin air by picking up a very biased time during the day.

It ended the day at $582 [1]. > because Bitcoin can have as much as 30% variation in a given day Hence, "pretty fucked up". [1] https://coinbase.com/charts

30% is either "f+++ed up" or a massive opportunity for daily trading, depending on your point of view. I see it rather as the second.
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