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Bitcoin Billionaires May Have Found a Way to Cash Out

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Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#11

Post by Torn »

justboxing wrote: post #6

> the approximately 1,000 people who hold an estimated 40 percent of all bitcoin, or an average of around $350 million each. I've seen this statement over and over again for the last few months in various news outlets and blogs, but I'm having a hard time wrapping my head around this statement. I understand these 1000 people are what are popularly known as the "Bitcoin Whales" but how did most of them come in possess…

All bitcoins are created from mining rewards. As the number of coins has increased (and more people started mining), the difficulty goes up and less coins are produced.

These 'whale' entities either ran mining operations early enough, or (more likely) took a huge bet on the direction this was going and decided to accumulate - like the Winklevoss twins did - by buying as many as they could from miners.

Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#12

Post by berberous »

justboxing wrote: post #6

> the approximately 1,000 people who hold an estimated 40 percent of all bitcoin, or an average of around $350 million each. I've seen this statement over and over again for the last few months in various news outlets and blogs, but I'm having a hard time wrapping my head around this statement. I understand these 1000 people are what are popularly known as the "Bitcoin Whales" but how did most of them come in possess…

In the beginning, you could mine tons of Bitcoins on your laptop. They were also close to worthless, so you could buy very many for very cheap.

Satoshi did not pre-mine, I believe. So, if you read his announcement, and started mining right away, you'd be as rich as him.

Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#13

Post by acover »

justboxing wrote: post #6

> the approximately 1,000 people who hold an estimated 40 percent of all bitcoin, or an average of around $350 million each. I've seen this statement over and over again for the last few months in various news outlets and blogs, but I'm having a hard time wrapping my head around this statement. I understand these 1000 people are what are popularly known as the "Bitcoin Whales" but how did most of them come in possess…

The mining difficulty was much lower at the beginning. Satoshi, the creator, has about 1 million bitcoins from this early mining. [0]

[0] - https://en.m.wikipedia.org/wiki/Satoshi_Nakamoto

Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#14

Post by throwaway76543 »

arisAlexis wrote: post #5
adventured wrote: post #3

Anybody that has that kind of gain in the last few years from Bitcoin et al., would be nuts to not be cashing some of it out. More and more headlines by the day are sounding like a rehash of the dotcom bubble type insanity that occurred right before the crash. The lifestyle difference between $300m and $800m, or $1b and $6b, is not meaningful enough to risk giving 50% or 97% of it all back in a serious crypto crash.…

Past bubbles didn't involve an economic paradigm shift

Neither does this one.

Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#15

Post by adventured »

arisAlexis wrote: post #5
adventured wrote: post #3

Anybody that has that kind of gain in the last few years from Bitcoin et al., would be nuts to not be cashing some of it out. More and more headlines by the day are sounding like a rehash of the dotcom bubble type insanity that occurred right before the crash. The lifestyle difference between $300m and $800m, or $1b and $6b, is not meaningful enough to risk giving 50% or 97% of it all back in a serious crypto crash.…

Past bubbles didn't involve an economic paradigm shift

That's exactly what was claimed about the Internet bubble, over and over and over again in every bubble touting story about how it was "the new economy" and "different this time."

Besides the Internet did in fact involve a once in a generation economic paradigm shift. Just ask China, $6+ trillion in annual online payment processing / exchange flow. Their entire economic output was $800 billion circa 1998. Entire vast industries have been and are being reshaped by the Internet. Crypto-currencies can never reach the paradigm shift scale of the Internet, they're sub to it.

There are in fact lots of other examples. The automobile didn't generate an economic paradigm shift? It sure did, massively; amounting to reshaping the entire way people live, travel, and how and where things are built, how commerce is transported & transacted, how food is distributed, and so on. Was there a huge automobile bubble? There sure was.

Paradigm shifts do not banish economic fundamentals / realities, they're ultimately beholden to them, which is what inevitably destroys the bubbles.

Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#16

Post by tempestn »

"In turn, financial investors get a secure, levered exposure to bitcoin that is not hostage to an unproven price-setting and without the expense of setting up a system to hold physical bitcoin."

I realize that securely holding bitcoin at scale isn't completely trivial, but isn't part of the value of bitcoin supposed to be that these costs are not large? Especially the use of the term, "physical bitcoin," seems a bit ridiculous.

Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#17

Post by mtgx »

justboxing wrote: post #6

> the approximately 1,000 people who hold an estimated 40 percent of all bitcoin, or an average of around $350 million each. I've seen this statement over and over again for the last few months in various news outlets and blogs, but I'm having a hard time wrapping my head around this statement. I understand these 1000 people are what are popularly known as the "Bitcoin Whales" but how did most of them come in possess…

People were spending tens of thousands of Bitcoins on stuff like pizza in the early days and there were significantly fewer Bitcoins back then. That's hundreds of millions of dollars today.

So all some of them had to do is keep them around. Others just bought them later on. Winklevoss twins put $100 million in Bitcoin years ago. I imagine many rich Chinese people wanting to evade money transferring rules in China did, too.

Satoshi has a million Bitcoins.

Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#18

Post by adventured »

justboxing wrote: post #6

> the approximately 1,000 people who hold an estimated 40 percent of all bitcoin, or an average of around $350 million each. I've seen this statement over and over again for the last few months in various news outlets and blogs, but I'm having a hard time wrapping my head around this statement. I understand these 1000 people are what are popularly known as the "Bitcoin Whales" but how did most of them come in possess…

You know the famous pizza for bitcoin story?

The media always tells the story this way: Joe Person traded eg 10,000 bitcoins for some pizza, in what is believed to be the first commercial transaction.

You know what they always miss in the story? Joe Person did that same deal several times, which you can see by reading the forum thread that still exists. Joe Person missed out on a billion dollars in Bitcoin value in exchange for maybe a dozen pizzas.

How did Joe Person get tens of thousands of bitcoins? That's how easy it was to mine back then.

Re: Bitcoin Billionaires May Have Found a Way to Cash Out

#19

Post by mv4 »

justboxing wrote: post #6

> the approximately 1,000 people who hold an estimated 40 percent of all bitcoin, or an average of around $350 million each. I've seen this statement over and over again for the last few months in various news outlets and blogs, but I'm having a hard time wrapping my head around this statement. I understand these 1000 people are what are popularly known as the "Bitcoin Whales" but how did most of them come in possess…

wouldn't it be more accurate to say "wallets"? I am sure many of these are owned by large groups of people.
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