[deleted]
BTC bubbles
31–40 of 52 posts
Re: BTC bubbles
#32Earlier quoted context omitted.
> particularly its deflationary nature. As far as I can tell, there's no real reason it has to stay deflationary. At some point there could be a consensus that inflation would be good for bitcoin and they could patch the client to start increasing the new bitcoins per block. tbh I don't know why it isn't inflationary, if it was you could remove/reduce transaction fees as miners would always have an incentive
At some point there could be a consensus In theory there could. In practice, the vast majority of the bitcoin users are speculators, and will fight tooth-and-nail against changing away from being deflationary.
Bitcoin users don't call the shots; they have no say whatsoever. Bitcoin miners control the network. What matters for them is their return on mining in BTC, and the exchange rate to their local currency to pay their capital expenses and electricity bills.
If the miners think that they'll get more value out of the system by creating new coins forever, they'll make the change. They have to be careful not to destroy confidence in the system; this will be part of their value assessment.
Re: BTC bubbles
#33Earlier quoted context omitted.
Willingness to pay is someone's valuation. That's not the real value. That's not the inherent value. The inherent value of BTC is nill, except as a speculative commodity. I won't further comment on BTC since both sides are staunchly rooted in their positions.
> That's not the inherent value. Show me your inherent-value-meter, or shut up. Simple, eh?
People here are saying over and over again that there is no such thing as "real value". That's bullshit. Economists have great ways to measure real value. For example, for financial assets real value is net present value of future cash flows. For currencies, real value is parity purchasing power. (Bitcoin is not a currency in this sense.) Things have real value.
Re: BTC bubbles
#34[deleted]
He's not calling the exchanges worthless, he's calling the exchanges presently offering shorts worthless. I actually didn't even knew there were BTC exchanges offering shorts...
Re: BTC bubbles
#35Earlier quoted context omitted.
At some point there could be a consensus In theory there could. In practice, the vast majority of the bitcoin users are speculators, and will fight tooth-and-nail against changing away from being deflationary.
Bitcoin users don't call the shots; they have no say whatsoever. Bitcoin miners control the network. What matters for them is their return on mining in BTC, and the exchange rate to their local currency to pay their capital expenses and electricity bills. If the miners think that they'll get more value out of the system by creating new coins forever, they'll make the change. They have to be careful not to destroy con…
Confidence in the system is more or less exactly the say of the users.
Re: BTC bubbles
#36Earlier quoted context omitted.
Indeed. But with a futures market, they will be able to speculate in both directions. Futhermore, businessmen who rely on the BTC USD price will be able to buy futures, and be able to settle down on a future spot price on BTC. IE: A business expects to get say 10 BTC in 30 days... but wants the money in USD. So he wants to buy a contract to sell 10 BTC 30 days from now. It can even be in the form of call / put option…
Could you say a bit more about how a futures market can reduce volatility in the underlying asset? This is an honest question, not being cynical. To me it seems that assets that have futures markets can be very volatile (say gold or oil), but I guess causation goes the other way?
I wouldn't say that futures markets make the price of a commodity less volatile. They do however let you lock into contracts at certain price levels to let you manage your risk in a volatile market. Which makes all the difference
Re: BTC bubbles
#37Earlier quoted context omitted.
I'd almost be surprised if it doesn't hit that within a few weeks. Not necessarily as a stable value, but in the last few days it's bounced around madly between about 50 and 100 dollars. I think at this point it's fair to say that nobody has any idea of the real 'value' of a bitcoin, and mad speculation is still the order of the day.
> I think at this point it's fair to say that nobody has any idea of the real 'value' of a bitcoin. Nonsense. They have no use, not even as a status symbol or as a practical unit of exchange. The “real value of a bitcoin” is zero, and the fact that this isn’t obvious to everyone is, frankly, astonishing.
Bitcoin has no use? And after saying this, you find yourself qualified to comment on the "real value of a bitcoin"?
Sometimes it is more valuable to accept what you do not know instead of pretending. Bitcoin may drop to $0 or bounce back to $250. I do not know, but I know why it made it this far and that is something that I would suggest you attempt to grasp before making any broad, unsubstantiated statements.
Re: BTC bubbles
#38Earlier quoted context omitted.
> When a worthwhile Futures market hits, then BTC will really stabilize. I agree that a futures market would be a stabilizing force, but other volatile commodities are still highly volatile even with futures markets. The reason most currencies aren't volatile is that they have a central bank behind them actively manipulating their supply to make sure they are stable relative to some other asset or basket of goods. In…
Other commodities are volatile for different reasons. Natural gas is volatile because it's literally volatile, so storing and shipping it is expensive. Grains are volatile because of variable growing seasons. Onions are volatile because US Congress banned futures markets for onions. Even so, none of these are nearly as volatile as BTC has been.
Do you know why Congress banned onion futures? That seems... random.
Re: BTC bubbles
#39Having not heard of this model before, I'm very surprised how tightly the curve fits, to the point of being sceptical (it's even got the "little" ups and downs" it seems). Traditionally, the idea with a bubble is that everyone (well, almost everyone) knows it's a bubble, but no one seems to know when it will pop or how far it will fall. Would this same model have fit the 2008 stock market collapse? Would it have accu…
2008 wasn't a bubble so to speak. It was driven by de-levering contagion.
You'd do better to apply it to a 2001 tech index.
The difference is a bubble is driven by greed, and "greater fool" behaviors turning to fear and panic selling. De-levering contagion is driven by a position going down triggering margin calls which necessitate selling other positions which drive down prices which furthers the cycle.
Re: BTC bubbles
#40Earlier quoted context omitted.
> That's not the inherent value. Show me your inherent-value-meter, or shut up. Simple, eh?
People here are saying over and over again that there is no such thing as "real value". That's bullshit. Economists have great ways to measure real value. For example, for financial assets real value is net present value of future cash flows. For currencies, real value is parity purchasing power. (Bitcoin is not a currency in this sense.) Things have real value.
> Things have real value.
That's dodging the question. And in a rather clumsy way. The "use value" of things depends heavily on epoch, person, even fashion and weather. So what is exactly "real" in real value?
> the present value of future cash flows
You don't say! Sorry but a) future cash flows is an estimation at best b) the present value of future cash flows depends heavily on the circumstances of the valuator.
On whether you have a debt to a mobster to pay, or an angry girlfriend to placate..