"What’s causing the depreciation is anyone’s guess"
I thought it was obvious, a bitcoin exchange was hacked http://money.cnn.com/2017/12/20/technology/south-korea-bitco...
Bitcoin and almost every other cryptocurrency crashed hard today
201–210 of 426 posts
Re: Bitcoin and almost every other cryptocurrency crashed hard today
#202Re: Bitcoin and almost every other cryptocurrency crashed hard today
#203Earlier quoted context omitted.
There are hundreds of elements, what makes some of them rare?
there could be thousands of crytocurrency next month.
And I could make thousands of kinds of physical coins next month, it doesn't mean physical money is worth less...
I feel like I'm crazy here, how is the ability to make a new "thing" make something else less valuable? A toyota isn't worth less because I can make a new car company next week, Facebook isn't worth less because I could make a clone of it tomorrow, A company stock shouldn't be consitered "worthless" just because I can create a new company tomorrow...
What am I missing? Why would the ability to make something new affect the rarity of an unrelated "thing"? Why isn't the value determined by what that "thing" does, how it does it, the number of people that believe in it's ability to do the thing it says it will do, and more? Why do you think it matters that someone can create a new currency?
Re: Bitcoin and almost every other cryptocurrency crashed hard today
#204Earlier quoted context omitted.
You mean, like the US dollar ?
U.s. dollar has the value of 20 aircraft carriers and enough nukes to glass the planet behind it. But otherwise exactly the same
But it's not like those aircraft carriers are going to show up if someone doesn't take your dollar. State backed currencies (backed by state backed armies) have failed plenty of times. History is dotted with governments who suffered by poorly managing their currencies, no matter what their military power.
Re: Bitcoin and almost every other cryptocurrency crashed hard today
#205Ha! I needed a good laugh this morning. Thanks internet. What I don't get, is how do these prices actually change? For btc or a stock. The mechanism seems very voodoo.
Market manipulation. The prices are really set by the coin exchanges; what they are willing to take/pay. They're all really competing with each other on the best prices for BTC. All of this becomes a feedback loop. A lot of people I talked to really believed prices were being driven by some kind of market manipulation. Either within the coin exchanges or people who were finding a way to manipulate things on the block…
I believe that if you truly understood how exchanges work, you wouldn't hold this belief. I guess I should elaborate. You may know some of this but you likely don't know all of it.
There are two types of orders: LIMIT and MARKET. Limit orders get added to a list. There is a list of standing BUY orders and a list of standing SELL orders. They are standing/LIMIT because no one has taken them up on their offer. For example, I can enter a limit order now: "I offer to buy BTC for $500."
You can only enter a LIMIT SELL order at 1 penny above the highest BUY offer or higher. Conversely, you can only enter a LIMIT BUY order at 1 penny below the lowest SELL offer or lower. This is because when you TAKE an order that already exists on the book (the lists), you execute a MARKET order, not a LIMIT order.
Executing a MARKET order means that you "eat up" the book/list until you have reached your order size. So if I place a market order to buy 3 BTC I will progressively buy BTC at higher and higher rates from the standing limit sell offers until my order is fully filled.
That is how an order book/market actually works. Now enter your claim:"Market manipulation. The prices are really set by the coin exchanges"
What exactly would this entail?
I guess you suppose that Coinbase simply increases the price of Bitcoin on their website, and pockets the difference between what people pay and what they acquire them for. Clever!
But wait a minute, in order to increase the price, they have to eat all of the orders between the starting price and the finish price. Otherwise people would notice that the price moved over their order without filling it, which should never happen, and which would thus prove fraud, which would probably completely destroy the company.
So Coinbase, knowing this, decides to eat up all of the orders from the original price (let's say $15,000) to the new price they want BTC to cost: $20,000.
In order to do this, Coinbase has to OVERPAY for every single coin they buy on the way up. There is a fair market price, which is what you can expect to get when selling a coin, and you would have to agree to pay above this price for every single coin in order to manipulate the market. As a result, your attempt to manipulate the market would almost certainly lose you a massive amount of money. The order book has a lot of orders in it. This appears to me to be one of the stupidest things anyone could ever try to do. It would move the market, but it's not clear that there's any reason to believe that it would be anything but massively unprofitable.
Imagine walking into a gold market and offering to buy all the gold that's for sale at higher than the current fair price. Wow, what a clever strategy! Surely you'll make a killing!
It doesn't really make any sense.
Re: Bitcoin and almost every other cryptocurrency crashed hard today
#206Earlier quoted context omitted.
U.s. dollar has the value of 20 aircraft carriers and enough nukes to glass the planet behind it. But otherwise exactly the same
As well as the whole concept of the petrodollar.
Petro dollar is directly tied to the US military prowess. If you try to create all alternate Petro dollar they kill you. See gaddaffi for example
Re: Bitcoin and almost every other cryptocurrency crashed hard today
#207Downvote me all you want, but HN really needs to cure this bitcoin-jealousy. Yes, people who invested early became millionares and billionares with a single mouse click. I know it feels unfair when you spend countless hours creating and innovating and not being rewarded. But some of you here needs to stop hating and being bitter. I have been watching HN and bitcoin related threads for months now. Same pattern.
Who is buying coin? Like if you seriously found 3 BTC you had on an old hard drive from years ago, remembered that password, who would pay you the $30k? You'd have to try different exchanges, try small amounts first, pay the insane transaction fees and wait for confirmation. Anyone who truly had a huge stash of like 400k USD in BTC would need to grab a lawyer, an escrow company and enter into a pretty strict legal co…
Your numbers are off by more than a factor of 1,000. As of a couple days ago, you could liquidate $30M (not $30K) on GDAX with a market sell order (which would be the worst possible way to sell) for more than 95% of last-quoted price.
Re: Bitcoin and almost every other cryptocurrency crashed hard today
#208Earlier quoted context omitted.
> not rare Interesting. Don't really know how crytos work, but isn't rarity is guaranteed by the BitCoin algorithm itself?
Algorithm is defined by consensus. Changing the algorithm just means gaining consensus amongst the miners. "Would you like to continue printing free money?" sounds like an easy sell to me.
You know what? That's a good point, and a problem with the Bitcoin end game. As Bitcoin mining gets harder and more of the value ends up entirely in the already-mined BTC, those with all this mining infrastructure are going to realize they can maximize this otherwise-stranded-asset by monopolizing mining power and developing a consensus to allow them to continue printing money.
"But transaction fees!" Okay, but if transaction fees go way up, that will encourage people to move away from BTC anyway or find some other way to reduce their exposure to transaction fees.
Once mining draws to a close, miners will consolidate. Just like in every other industry after a bust.
Cryptocurrencies are still, of course, very interesting and powerful.
Re: Bitcoin and almost every other cryptocurrency crashed hard today
#209Ha! I needed a good laugh this morning. Thanks internet. What I don't get, is how do these prices actually change? For btc or a stock. The mechanism seems very voodoo.
The past few instances this has happened tended to follow some big news stories, like China banning ICO's or SK banning cryptocurrency exchanges, or the (falsified rumour) news Vitalik Buterin had died, some inflammatory SEC actions, etc.
People panic sold on a lot of that news. As good news came in, like the reversal of those decisions the price recovered.
This time it's bizarre to see, especially after the Goldman Sachs announcement yesterday. There hasn't really been much other news the past few days. Considering everything is down in almost equal proportions, it certainly looks like something else is at play. Panic selling piled on top of ___?
When it goes crazy, it goes crazy I guess...
edit: Apparently there was a South Korean exchange hacked: http://money.cnn.com/2017/12/20/technology/south-korea-bitco...
So that could be a pretty big influence!
Re: Bitcoin and almost every other cryptocurrency crashed hard today
#210Earlier quoted context omitted.
I think there are three elements contributing to the negativity: (1) People may get hurt. I was in an Uber two weeks ago where my driver talked about taking out a second line on his home to buy Bitcoin. By today's mark, he's lost money. That people who clearly have no idea what they're doing are being preyed on is disturbing to many, myself included. (2) ICOs are a cesspool of frauds. They allow promoters to make mon…
And transaction fees. I saw someone reporting over $30 fee to get processed within 20 minutes. That's why Steam dropped Bitcoin. As a skeptic, people thinking this is a good currency are hilarious. Day trading and making money off them is simple sport.
You are missing the reason the fees are high: it's because Bitcoins it the most widely used cryptocurrency today. Scaling something like Bcash, which doesn't have that many transactions - is easy. The fees can be low because nobody wants to use it. Because there is no real demand for those transcations, and so the price can be low. For a crypto like Bitcoin, which does have high demand for transactions, some of the fees have to be high right now. (Does not mean they will be high in the future.)
Are there scalability problems? Yes they are, it's very evident in the transaction fees. But are technical solutions being developed to mitigate this? Yes they are - that's the real work that actually goes on in the background, by the people who actually work, instead of spending their time on internet posting about the price. It's not an easy task, but it is being done.
When people bring up the transaction fees, sometimes it sounds like they think that real Bitcoin developer's don't know that this is a problem. They do, and they work on it! It's just that regular person doesn't want to hear developers, he wants to hear someone that tells them they can make 3x their money over a weekend.