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Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

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Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#111

Post by patmcc »

nwh wrote: post #14
yebyen wrote: post #7

Earlier quoted context omitted.

I bought some Jalapeños from BFL after my January order was not shipped until August, in the Black Friday sale. The sale was advertised as "units in stock, ready for immediate delivery" When they came (something like a full month later) they were approximately double the spec of the devices I thought I had ordered, but still for the same price. Thanks, I guess? I can't say if they're shipping any faster now, but if t…

The BFL gear is cute and all, but there's a simple fact with selling Bitcoin mining hardware that is probably never going to be overcome. Why would you sell something you could make profit on if you kept it for yourself? This is pretty much the reason why we have ASICminer, KNCminer and Bitfury all either running or building mammoth sized facilities of their own. I particularly liked this juxtaposition on their store…

>>Why would you sell something you could make profit on if you kept it for yourself?

Anyone building a bunch of good mining rigs could certainly have a decent amount of bitcoins - but lots of people don't want to hold a large amount of a currency that is risky, volatile, possibly illegal, difficult to exchange for their local currency (that their taxes and rent need to be paid in), impossible to pay their vendors in, etc.

If you want gold, mine gold. If you want dollars, sell shovels.

Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#112

Post by politician »

maxerickson wrote: post #91
zanny wrote: post #85

Earlier quoted context omitted.

Integrity of the cryptography. It is the backing value of the currency, after all.

No, bitcoin depends on there being a majority of honest (or whatever you want to call it) miners.

> honest (or whatever you want to call it) miners

"mutually distrustful parties"

Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#113

Post by politician »

nullc wrote: post #68
vtempest wrote: post #32

Earlier quoted context omitted.

Coinbase.com is a great one, and they recently received venture funding

Coinbase recently imposed a kind of ludicrous $3000 a day outbound limit on accounts that had previously been limited to 50 BTC/day. Removing the limit involves buying coin from them, waiting 30 days, and solving some seemingly impossible credit report based identity quiz (some people report passing after 10 tries, you're limited to one try per 24 hours).

We did that back in the online poker gambling days. The casinos would throttle USD withdrawals, so that the players would be forced to wait and end up losing their chips by playing more. Physical casinos do this by attaching hotels next to the slots. This sounds similar.

Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#114

Post by pistle »

logicallee wrote: post #71
minimax wrote: post #37

Consider this a reminder that while Bitcoin may be an interesting technological achievement, as a tradable asset it is still basically a toy. Crappy exchange technology combined with low liquidity is a perfect recipe for this kind of volatility.

The interesting thing about bitcoin is that you can just trade your friends for some p2p, you don't need a central exchange. You don't need a bank account to send someone bitcoins or to get some. You can just hand someone $20 and your address and they can send it to you p2p. No banking infrastructure involved. That boggles the mind. It is impossible for bitcoin to become fully illiquid as long as people believe it ha…

Everything can be traded as long as people believe in its value. Currencies are proxies. Proxies function best with stability in value and wide awareness of relative values for goods and against other currencies.

Bitcoin and its ilk are going to repeat the issues the US had when small and regional banks all printed their own bills. Their info infrastructure were large books, updated monthly that provided info to determine exchange rates/values. People didn't like getting burned everywhere on transaction costs and their value going poof when unsavory characters ran the underlying banks into the ground or rumors about the stability of far off banks were spread.

Centralized. government-backed fiat currencies solve many issues that most Bitbugs are coming to grips with the hard way. It's those issues which are exposed publicly and quickly which will keep it the most amazing speculative financial invention to a group of fiercely, independently minded folks who have the skills and means to gloss over all the failings of such a device being a proxy for fiat currency. It's just another layer of abstraction, not a replacement. And it's a leaky abstraction.

Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#115

Post by dalke »

ForHackernews wrote: post #88
dalke wrote: post #53

Earlier quoted context omitted.

I think your sentence has too much of a tone of inevitability. "... will improve as an asset ..." should surely be "will improve if an asset ..." or perhaps "... in order for ...". There's plenty of new markets which failed to take off, and died after a few years of use. Confederate dollars aren't quite the useful currency they once were, as an obvious example. Otherwise it cuts too close to survivorship bias: is the…

> is there a popular asset where the market has "low liquidity and crappy technology"? Yes, real estate.

Point taken. Speaking of liquidity, water rights are likely another, at least in the southwest where the relevant laws date back to Spanish colonization.

Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#116

Post by logicallee »

ohashi wrote: post #105
logicallee wrote: post #71

Earlier quoted context omitted.

The interesting thing about bitcoin is that you can just trade your friends for some p2p, you don't need a central exchange. You don't need a bank account to send someone bitcoins or to get some. You can just hand someone $20 and your address and they can send it to you p2p. No banking infrastructure involved. That boggles the mind. It is impossible for bitcoin to become fully illiquid as long as people believe it ha…

Funny enough, I can just give my friends cash and it works pretty well too.

That is exactly my point, of course. That it is still cash-like even without centralized exchanges, if for whatever reason such exchanges aren't very accessible (or don't exist.)

Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#117

Post by plg »

plg wrote: post #8

I'm not bitter that when bitcoin was ~ $1/btc I almost bought 1,000 btc ... no not bitter at all :|

so the question of the day I guess is will Dogecoin do the same thing? (it's "cheap" now)

I almost think that it will... in other words a bitcoin-like bubble will happen again, but maybe just once, and then not again (because there are so many people like me who feel like they missed out the "first time" on bitcoin)

Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#118

Post by minimax »

RyanZAG wrote: post #78
kyleblarson wrote: post #76

Earlier quoted context omitted.

I would imagine that similar things happened in the early days of online equities brokerages.

Not even just the early days - Microsoft's fairly recent attempt at providing software for the London Stock Exchange met with disaster and frequent downtime [1]. This from a major tech giant, not just a card game exchange. Running a real exchange is a very difficult thing to do once the scale starts to ramp up. [1] http://www.telegraph.co.uk/finance/markets/4676369/Seven-hou...

It wasn't Microsoft providing the software. It was software running on Windows. The actual software was an in-house developed matching engine called Tradelect. LSE eventually switched away to a 3rd party matching engine with their acquisition of MilleniumIT.

Re: Mt. Gox Halts Bitcoin Withdrawals, Price Drop Follows

#120

Post by mcherm »

maxerickson wrote: post #35
mcherm wrote: post #31

Earlier quoted context omitted.

1. Number of users holding bitcoins 2. Number of users SPENDING bitcoins to purchase goods 3. Number of merchants accepting bitcoins for goods 4. Total $ value of bitcoins being spent to purchase goods 5. Total $ value of bitcoins being spent to perform international money transfers 6. Amount of press (bad press OK, good press is worth much more) that bitcoins are getting as it drives 1 and 3. I'm sure others have th…

Is there anybody publishing reliable numbers for any of those?

I don't know of anyone.

I sometimes estimate (3) and (6) by monitoring news stories. It doesn't give me absolute numbers, but some sense of scale. I sometimes see values reported for (2) or (4) from individual merchants, but they are rarely useful: the merchants report the great response they had in the weekend after first announcing their support for bitcoin, then we never hear numbers again. Occasionally we'll hear from sites like reddit about the total amount of contributions (not exactly goods, but close) being made in bitcoins: these are usually quite disappointing. I can think of no way to monitor (1) and (5) is likely kept secret on purpose.

So these are the fundamentals I care about and that I think affect the long-term value of bitcoin (as opposed to its short-term speculative value). But I don't have a way to measure them, except for guessing based on press coverage.

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