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

bitcoinity.org

331–340 of 348 posts

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

#331

On December 23 a Missouri court ordered a winddown of Butterfly Labs and they began a refund plan.....now here is my theory...I was looking at the blockchain and came across a 5000 btc utxo taken incrementally down to 0....it was sold off continuously. It took me to here. https://blockchain.info/address/12WRnQR85ZUT7dhmaHBNL5dde2QL... Activity on that address started back up on 12/23 the day the courts provided contr…

Gee, almost sounds like Butterfly Labs was a scam on top of bitcoin scam. Sell preorders for a money printing machine, build said machine, and sit on it printing money for yourself.

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

#332

If you truly believe in Bitcoin, this is just one more insignificant blip on a path, driven by inexorable network effects, that leads to Bitcoin becoming the sole world currency and savings commodity, leaving the fiat currency milieu of 2014 in the dustbin of monetary evolution. A chance to buy at a relative discount and nothing more.

are you talking about Beanie Babies?

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

#333
post #293

Earlier quoted context omitted.

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

I would be amazed if the price of oil in Saudi is higher than the price on the world market. I have never been to Saudi, but I have been to UAE and petrol was cheap as I remember it!

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

#334
post #237
post #230

Earlier quoted context omitted.

Bitcoin is the electronic version of "let's buy a lot of gold and stash it somewhere". It's also the electronic version of: Be able to move that gold around the globe near instantly, without a middleman, at almost zero cost. And some other quite neat things. While these features may seem "anecdotical" for many people in the western world, there's also a large number of people in poorer countries for whom e.g. the fee…

> Be able to move that gold around the globe near instantly The biggest advantage of gold is that it's value is relatively stable and has been used as a valuable metal since ancient times. That's quite the opposite of Bitcoin actually.

Did you ever consider why gold has value? It's just shiny metal. Other than jewelry and some electronics uses, no one needs it. At one point it was useful to make coins (for fiat currencies) because it was rare, but now it's just valuable because "it always has been."

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

#335
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…

Look, it's sexy to complain about energy costs, but you are really underestimating the massive inefficiencies involved in the legacy payment system. Because even if bitcoin is less energy efficient in some technical sense, there are enormous efficiency gains it provides by inverting the structure of risk in the payments industry.

One of the first things you realize when you try to setup payment processing is that middlemen would not actually exist in the payment processing industry if it was an efficient market. But these companies do exist because the entire industry structure has developed to pass risk from credit card companies to intermediary businesses whose sole function is basically to manage risk and enforce policy compliance. It is a bit like if Google didn't give email addresses to individuals because it couldn't be bothered policing spam, so you got your email through a third party.

Anyway, even if we ignore the deadweight losses imposed on the economic system by all of the businesses which cannot get credit accounts (merchant accounts), the costs of supporting this credit-centric system are enormous. PCI compliance costs alone are staggering, and serve no purpose except to lower the risk held by credit card companies. And even with this, the inefficiency of central risk management is so great that VISA doesn't even bother to investigate fraudulent purchases of less than 500 USD. And why should they when costs can simply be pushed back to merchants and turned into a profit center by issuing chargebacks.

And this is where bitcoin gets interesting -- by inverting the risk structure and letting anyone accept payments without the need for a payment processor to issue credit, Bitcoin eliminates entire horizontal swathes of the payments industry, while placing competitive pressure on legacy payment providers. If the technology scales to the point you are concerned about, it will decimate the number of people required to be employed managing risk in everyday transactions.

Put more succinctly, you need to shift from thinking about the energy costs of bitcoin as a wasted ongoing expense and start considering them the price of eliminating an otherwise intractable trust problem in finance. It is like paying for a standing firefighting force. Expensive in one way, but a lot cheaper than the alternative.

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

#336

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...

I was hopeful, but it doesn't explain why gold has value. It just starts with the assumption that it does. I'm afraid that sooner or later folks will realize it's just a shiny metal with little intrinsic value, much more abundant than many elements.

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

#337

Earlier quoted context omitted.

I am living abroad and while I'm not truly poor, a couple of months ago I had less that £20 to my name, so I'm quite cost conscious. I needed to send some money overseas and I looked at bitcoin for exactly the same reasons that you described. However, I found that sending the money via bit coin would take longer and wind up costing me more in transaction fees than just using transferwise. While the actual bitcoin tra…

This is due to the fact that bitcoin is not widely accepted yet. An in order for it to be widely accepted, more people have to want it. In order for people to want it, it has to be widely accepted. This is why bitcoin is doomed to fail.

The same could be said for the telephone, fax machine, or any technology that requires network effects.

It might not be bitcoin, but in 20 years do you think no cryptocurrency will be in widespread use?

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

#338

Earlier quoted context omitted.

this is hugely disingenous. > 2014 was meant to be the year of bitcoin You obviously base this off price alone. If you look at startups based around bitcoin or the blockchain, if you consider that regulatory clarity has or is being provided by most major economies, if you look at transaction volume, feature developement etc then 2014 was a good year for bitcoin. >Mining companies are closing left, right, and centre,…

I don't base it off price, I base it off adaption and public interest of which outside of new merchants there has been no indication of any growth(and I'm pretty sure if you started subtracting merchants who no longer take it or who don't have their staff trained on it it would be shrinking as well). Bitpay has shown now growth in processing numbers($1m/per day) for almost all of 2014. Transaction volume is a ridicul…

Luckily though we have the internet now which has accelerated the spread of new ideas and products on it. We're not dealing with a pre-internet world anymore so comparing them is silly.

I think you don't understand. People had no need of the Internet until applications such as online banking, online shopping etc were available to them. They didn't come pre installed on the Internet and whilst they wrre being developed most Internet users were people who got involved with it because it was cool new technology. Your mum and dad only got it when it had already become a mature technology.

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

#339

If you truly believe in Bitcoin, this is just one more insignificant blip on a path, driven by inexorable network effects, that leads to Bitcoin becoming the sole world currency and savings commodity, leaving the fiat currency milieu of 2014 in the dustbin of monetary evolution. A chance to buy at a relative discount and nothing more.

are you talking about Beanie Babies?

No, I'm talking about something which has the potential to be the world currency.

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

#340
post #163

Earlier quoted context omitted.

> a 3rd of the lower end of their claim $5M USD in Bitcoin sales is pretty astonishing, actually. EDIT: 1/5 of $15M is still pretty astonishing. I expected something around 250K in BTC-denominated sales.

$3M in sales is the yearly turnover of a small local bakery chain with a few retail points. Every village of more than 5000 people has several companies with this turnover. $3M is nothing . For a retailer of low-margin goods like Overstock, they must have spend more on implementing bitcoin payments than they made on the sales that were paid with them, and that's not even counting costs of converting back to $ etc.

> and that's not even counting costs of converting back to $ etc.

Even worse, it's not counting the loss of the value of bitcoins. Lots of people dumped bitcoins on overstock when it was worth much more than $200. They need to convert those bitcoins into cash to pay taxes, rent, etc.

Overstock lucked out by not doing more business in bitcoins because they would have lost even more due to the drop in bitcoin price...

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