Bitcoin crashes over 25% in 24 hours, under $180 • Hacker News Board

Re: Bitcoin crashes over 25% in 24 hours, under $180

#321

Post by tptacek » Wed, Jan 14, 2015, 4:54 PM UTC

jasonisalive wrote: post #314

tptacek wrote: post #272

Earlier quoted context omitted.

So, "you don't".

Um, actually you do. The principal differences are: 1) You can choose your arbitrage provider independent of your payment channel (whereas with Visa/Mastercard you are locked into the arbitrage facility of the payment channel) -> splitting off a feature into a modular component -> more competition among providers -> better products. 2) The arbitrage provider only holds a m-of-n key to confirm your transaction, so the…

Are you saying "it's possible to build a chargeback system on Bitcoin, the technology doesn't preclude it", or are you saying "here's how you would do a chargeback on any given Bitcoin purchase today"? If the latter, can you be specific about an actual set of retailers and middlemen you could use to effect it?

Re: Bitcoin crashes over 25% in 24 hours, under $180

#322

Post by CyberDildonics » Wed, Jan 14, 2015, 4:55 PM UTC

TheDong wrote: post #139

brazzy wrote: post #118

Earlier quoted context omitted.

Do you have any idea how much energy, work and time is being spent on the infrastructure of regular currencies? Minting, ATMs, secure transport, brank branches, all kind of mainframe dinosaurs running 40 year old COBOL code? Even if scaled up to global usage, I very much doubt Bitcoin mining would be worse.

Yes, bitcoin mining would be worse. Provably worse. As computers get better, traditional applications, like databases, perform better and you can either serve more customers, use cheaper (and often more efficient hardware), or do nothing and use your outdated hardware. With bitcoin, your enemy is not the performance of the raw work you are doing (you can hash better), but the fact that everyone else also has these in…

Banking is 8% of the entire GDP of the USA. 8% and it can (almost) all be automated.

Centralized systems could be more efficient if their incentives were in line with the incentives of the people they serve. But their incentives are not and they are not fair.

You are theorizing about something based on how it feels without really looking into the reality of it. Bitcoin mining is so many orders of magnitude smaller than even fragments of current financial infrastructure it would laughable to talk about, even if electricity usage was any sort of a major issue, which it is not.

Re: Bitcoin crashes over 25% in 24 hours, under $180

#323

Post by CyberDildonics » Wed, Jan 14, 2015, 5:05 PM UTC

spiritplumber wrote: post #138

TheDong wrote: post #110

Earlier quoted context omitted.

It's worse than that. To me, the biggest flaw of bitcoin is that you have to constantly spend energy on it (as in computation power / burn coal) for it to remain viable. As soon as enough people get tired of throwing away money at their miners someone can pull a 51% attack, so everyone must put more energy into their miners to protect their investment... forever. Over time the amount of energy wasted by bitcoin could…

I'd like something like Foldcoin where your proof-of-work is actually doing something beside keeping my home warm inefficiently.

So buy some.

Re: Bitcoin crashes over 25% in 24 hours, under $180

#324

Post by CyberDildonics » Wed, Jan 14, 2015, 5:10 PM UTC

It seems that most people still don't fully grasp why bitcoin is valuable or for that matter why fiat or gold are valuable. The best explanation I've seen is actually the series of slide the Winklvoss twins put together (when they were taking a break from creeping everyone out).

https://winklevosscapital.com/value-investors-congress-prese...

Re: Bitcoin crashes over 25% in 24 hours, under $180

#325

Post by logic_geek » Wed, Jan 14, 2015, 5:14 PM UTC

People might want to ask the question why the Bitcoin price goes down so much. One reason might be that keeping up network security is too expensive with Bitcoin (proof of work) and the miners have to sell their bitcoins to cover their electricity costs. Now if there is not enough demand for bitcoins then the price declines since miners continuously have to sell to cover costs. This also has been laid out here https://www.youtube.com/watch?v=_-TLA3j-ic4 As the guy in the video points out there is not only one way realize blockchain technology and proof of work surely is not the least expensive. Proof of stake systems mitigate the "high cost for network security problem". I suspect that one or more proof of stake systems will be part of the next round of innovation (and the next bubble) based on blockchain technology.

Re: Bitcoin crashes over 25% in 24 hours, under $180

#326

Post by mikeyouse » Wed, Jan 14, 2015, 5:22 PM UTC

sanswork wrote: post #219

FatalLogic wrote: post #213

Earlier quoted context omitted.

>Blockchain.info ... a platform that most people in the community have lost faith in That's a remarkably bold claim. Citation definitely needed. You will need to define the "community", and then provide a source for "most". I don't see how you can possibly do that, since both data points are lost in the murky fog that is the world of Bitcoin

"community" /r/bitcoin|/r/bitcoinmarkets|bct "source" the few weeks a month or so back where every second post was about how evil or bad or stupid blockchain.info was and no one should use them anymore. It was around the time the problem was discovered with their keygen and when someone was regularly sweeping coins from wallets on the service.

Someone shared this with me yesterday after someone was pestering me for a source for a benign statement and it feels appropriate for your current discussion:

http://wondermark.com/1k62/

Re: Bitcoin crashes over 25% in 24 hours, under $180

#327

Post by throwawaymsft » Wed, Jan 14, 2015, 5:23 PM UTC

IvyMike wrote: post #65

throwawaymsft wrote: post #43

Earlier quoted context omitted.

When was the last time you transferred money to someone (esp. out of country), how much did it cost, and how long did it take? Now, imagine you're poor, your family lives abroad, and a $20 fee on a $500 transfer is indeed a big issue. There are usability concerns (a bitcoin ATM to deposit money and have it sent to an address would be nice) but the use case of near-zero, same-day money transfers is enormous. In the af…

What happens when my family, let's say in Mexico, receives the $500 and needs to buy food? Is there any way, currently, that they can they do so for less than $20? (Seriously asking, I don't really know.)

Today? Probably not -- changing currencies is expensive. But if merchants realize they won't eat the Visa/MC 3% fee, and bitcoin prices stabilize, it becomes viable. (The Euro has lost over 10% vs. the dollar these past 6 months, let alone the ruble, hard currencies aren't that safe either.)

Re: Bitcoin crashes over 25% in 24 hours, under $180

#328

Post by mikeyouse » Wed, Jan 14, 2015, 5:28 PM UTC

simias wrote: post #108

So I can't find anything in the comments: what's the cause for this sudden crash?

I think the most likely scenario is the Butterfly Labs theory;

http://www.reddit.com/r/Bitcoin/comments/2sdwf8/butterfly_la...

Basically, BFL pre-sold a ton of miners to people, never actually sent them, mined a ton of bitcoin 'testing' them and were then sued when they refused refunds. The FTC got involved and told them to send customers their money so at some point, BFL has to liquidate a large number of coins to meet those obligations.

People have tracked large portions of the sell pressure to known BFL wallets and the rest of the downward pressure is probably just follow-on selling continuing the yearly trend.

Re: Bitcoin crashes over 25% in 24 hours, under $180

#329

Post by vacri » Wed, Jan 14, 2015, 6:36 PM UTC

hueving wrote: post #97

leni536 wrote: post #80

Earlier quoted context omitted.

You can have multiple wallets though. You can have a really secured wallet, maybe signed with a smart card (is it possible? If yes then it's pretty much impossible to steal, unless someone steals it physically.) and have a less secure wallet on your smartphone. Your smartphone plays the role of a "regular wallet" and you only have minimal amounts on it (like what you need for daily purchases).

And what happens when you lose said wallet?

Or the smartcard develops a hardware fault?

Re: Bitcoin crashes over 25% in 24 hours, under $180

#330

Post by politician » Wed, Jan 14, 2015, 6:47 PM UTC

sgt101 wrote: post #293

politician wrote: post #68

Earlier quoted context omitted.

And in the mean-time crush US-based companies investing in fracking and oil stands? We agree on the price going down to $20 per barrel, but disagree that this is some sort of additional sanction on Russia when it's clearly an anti-competitive move by the Saudis to maintain dominance during a time of political transition.

I don't think this is anti-competitive at all ! I think that they are competing really hard! The Saudis can open the taps at any time (for the next 20 years) they are just reminding everyone (especially the banks and equity markets) of this fact and ensuring that it is part of everyone's calculations in the future.

Dumping, the practice of intentionally crashing the price of a commodity and damaging competitors by flooding a market, may be determined to be unfair competition by the WTO.

http://www.investopedia.com/terms/d/dumping.asp