Bitcoin falls below $300, lowest in 11 months • Hacker News Board

Re: Bitcoin falls below $300, lowest in 11 months

#31

Post by pron » Sun, Oct 05, 2014, 6:52 PM UTC

bdcravens wrote: post #29

The easier it gets to buy Bitcoin, and accept Bitcoin, the worse it will be. Even if you wanted to spend Bitcoin, you had to think ahead. Now Circle lets you buy within minutes (in most cases) of setting up your account. On the other side of things, Bitpay and Coinbase let merchants convert back to USD (or other currency) right away. So it's possible to do "just in time Bitcoin": Bitcoin is merely the payment protoco…

> like a serious event creating major doubt in USD.

I think you are way overestimating Bitcoin's (current) significance. If something major happens to the USD -- i.e. something major happens to the US economy -- Bitcoin will be the last thing people think about, and there are quite a few other currencies (with much better track records) that people will prefer before betting their money on Bitcoin.

> It's entirely possible, as the protocol becomes more or more utilized, those days of risk and reward are well behind us.

If you have any evidence that Bitcoin is becoming more and more utilized, I'd love to hear. And I mean actual transactions, not services supporting the protocol (which could be publicity stunt, very cheap bets for something that just might take off one day, or simply wishful thinking).

Re: Bitcoin falls below $300, lowest in 11 months

#32

Post by lordnacho » Sun, Oct 05, 2014, 6:53 PM UTC

iowai wrote: post #14

I once was an intern in a venture capital funded startup where the CEO decided to hold most of the companies cash in Bitcoin. I think it was in early 2014 or so, when the price fell like mad and he was in deep shit. Im not sure if anybody up to that date knew about the Bitcoin investment. He was a nervous wreck. Close to suicide. For about a week, he brought a stuffed animal into the office every day. And carried it…

This kind of thing is what investor due diligence is for. This, along with guys like Madoff, would be easily uncovered with an asset test. Basically a phone call to the bank asking how much equity an account has, naturally with the approval of the entity being tested. Surprisingly few investors actually do this.

Re: Bitcoin falls below $300, lowest in 11 months

#33

Post by zanny » Sun, Oct 05, 2014, 6:56 PM UTC

bdcravens wrote: post #29

The easier it gets to buy Bitcoin, and accept Bitcoin, the worse it will be. Even if you wanted to spend Bitcoin, you had to think ahead. Now Circle lets you buy within minutes (in most cases) of setting up your account. On the other side of things, Bitpay and Coinbase let merchants convert back to USD (or other currency) right away. So it's possible to do "just in time Bitcoin": Bitcoin is merely the payment protoco…

If it becomes more utilized and popular, assuming people use it as currency and not as exchange medium, then inherently the price has to go up because demand for bitcoins goes up, and the supply barely changes and does so with algorithmic inputs and constant loss due to lost wallets.

I like to think of bitcoin as cryptogold. The inevitable outcome assuming continued success of the bitcoin protocol is that as more people want it and supply cannot change it becomes a lot like gold, in that it is traded as a resource backing currency. You could still use it for transactions, but a money that is long run appreciating in value is not very conductive of exchange. Something like dogecoin, peercoin, or any cryptocurrency implemented that algorithmically adjusts generation rates to maintain consistent monetary velocity would be much better suited as a day to day exchange commodity.

Also, one of the most prominent uses of bitcoin is in international exchange, in which case yeah, it acts as an intermediary between local fiats, but there is substantial pressure to just use the bitcoin outright rather than constantly converting it back.

Re: Bitcoin falls below $300, lowest in 11 months

#34

Post by pjc50 » Sun, Oct 05, 2014, 6:56 PM UTC

fchollet wrote: post #23

gatsby wrote: post #6

What are the major reasons to be bullish on bitcoin right now? Not sarcasm, totally serious. I've owned a small amount of bitcoin for a while and have followed the market from a far. This observation is highly anecdotal, but I just haven't seen many signs of serious traction over the last six or nine months (i.e. post a ton of the initial retailers partnering to accept bitcoin, Coinbase raising their monster round, e…

Reasons to be bullish on the concept? Bitcoin is a secure public registry backed by a decentralized 300k THash/s computing network (and fast growing). That alone is insanely valuable, and not just as a vector of monetary transactions. It's one building block of our decentralized future. Reasons to be bullish on the BTC/USD exchange price? That would be pure speculation. BTC seems to be now at low levels enough that i…

The network is single-purpose and costs real electricity to run. If the mining cost stays above the value of the coins mined for long enough people will start turning off their miners.

Re: Bitcoin falls below $300, lowest in 11 months

#35

Post by [deleted] » Sun, Oct 05, 2014, 6:57 PM UTC

iowai wrote: post #14

I once was an intern in a venture capital funded startup where the CEO decided to hold most of the companies cash in Bitcoin. I think it was in early 2014 or so, when the price fell like mad and he was in deep shit. Im not sure if anybody up to that date knew about the Bitcoin investment. He was a nervous wreck. Close to suicide. For about a week, he brought a stuffed animal into the office every day. And carried it…

[deleted]

Re: Bitcoin falls below $300, lowest in 11 months

#36

Post by rhino369 » Sun, Oct 05, 2014, 6:57 PM UTC

bdcravens wrote: post #29

The easier it gets to buy Bitcoin, and accept Bitcoin, the worse it will be. Even if you wanted to spend Bitcoin, you had to think ahead. Now Circle lets you buy within minutes (in most cases) of setting up your account. On the other side of things, Bitpay and Coinbase let merchants convert back to USD (or other currency) right away. So it's possible to do "just in time Bitcoin": Bitcoin is merely the payment protoco…

Also, if bitcoin is basically abstracted from the user, there is risk that the middle men will switch a newer protocol. Coinbase and bitpay could easily switch. All the people speculating in bitcoin price would be left holding the bag.

Re: Bitcoin falls below $300, lowest in 11 months

#37

Post by sanswork » Sun, Oct 05, 2014, 6:57 PM UTC

chatmasta wrote: post #2

Last time Bitcoin fell significantly, BitPay announced three days later they were partnering with PayPal. BitPay has a lot of Bitcoins floating in their accounts (since they need to exchange USD BitCoin). They also could predict that announcing a partnership with PayPal would spike the price of BitCoin. It makes me wonder if some of these price drops could be market manipulation by insiders who have a big announcemen…

Bitpay only does Bitcoin -> USD/etc so they really shouldn't have many bitcoins floating around in their accounts unless they are having difficulty finding buyers for them. With a downtrend the longer it takes them to sell the more then lose.

Re: Bitcoin falls below $300, lowest in 11 months

#38

Post by zanny » Sun, Oct 05, 2014, 7:00 PM UTC

pron wrote: post #31

bdcravens wrote: post #29

The easier it gets to buy Bitcoin, and accept Bitcoin, the worse it will be. Even if you wanted to spend Bitcoin, you had to think ahead. Now Circle lets you buy within minutes (in most cases) of setting up your account. On the other side of things, Bitpay and Coinbase let merchants convert back to USD (or other currency) right away. So it's possible to do "just in time Bitcoin": Bitcoin is merely the payment protoco…

> like a serious event creating major doubt in USD. I think you are way overestimating Bitcoin's (current) significance. If something major happens to the USD -- i.e. something major happens to the US economy -- Bitcoin will be the last thing people think about, and there are quite a few other currencies (with much better track records) that people will prefer before betting their money on Bitcoin. > It's entirely po…

> there are quite a few other currencies (with much better track records) that people will prefer before betting their money on Bitcoin.

So I'm in the US. Assuming hyperinflation starts tomorrow, the only money I have, or anyone else will accept broadly enough to keep me able to exchange in the market, is bitcoin. Nobody has Euros, nobody takes them, nobody takes Canadian dollars on the boarder, and nobody would accept or buy the equipment to measure weights of gold or platinum.

Of course, the market would probably broadly move (more due to ignorance than any real justifiable reason not to) towards another states fiat in the event of a gradual loss of faith in USD. You would not have a situation where you woke up tomorrow and suddenly your dollars are worthless, at least if you are paying attention.

> If you have any evidence that Bitcoin is becoming more and more utilized, I'd love to hear. And I mean actual transactions, not services supporting the protocol

Overstock is apparently making like 2% of revenue from bitcoin sales. I know the Subway nearby that takes bitcoin is making money when I spend btc there. I'm exclusively buying computer hardware for customers through tigerdirect / newegg in bitcoin, though they have not released statements on how much revenue is generated through it yet.

Re: Bitcoin falls below $300, lowest in 11 months

#39

Post by danbruc » Sun, Oct 05, 2014, 7:00 PM UTC

gatsby wrote: post #6

What are the major reasons to be bullish on bitcoin right now? Not sarcasm, totally serious. I've owned a small amount of bitcoin for a while and have followed the market from a far. This observation is highly anecdotal, but I just haven't seen many signs of serious traction over the last six or nine months (i.e. post a ton of the initial retailers partnering to accept bitcoin, Coinbase raising their monster round, e…

Wishful thinking. Bitcoin does - at least right now - not solve any interesting problem with the way we currently handle our financial transaction. In consequence there is no incentive to mass adopt Bitcoin which in turn keeps the capitalization low which keeps the price fluctuations high which decreases incentives to adopt Bitcoin even further because now you have to buy Bitcoins for real money, transfer them and sell them quickly in order to protect you against this price fluctuations.

Re: Bitcoin falls below $300, lowest in 11 months

#40

Post by rhino369 » Sun, Oct 05, 2014, 7:01 PM UTC

zanny wrote: post #33

bdcravens wrote: post #29

The easier it gets to buy Bitcoin, and accept Bitcoin, the worse it will be. Even if you wanted to spend Bitcoin, you had to think ahead. Now Circle lets you buy within minutes (in most cases) of setting up your account. On the other side of things, Bitpay and Coinbase let merchants convert back to USD (or other currency) right away. So it's possible to do "just in time Bitcoin": Bitcoin is merely the payment protoco…

If it becomes more utilized and popular, assuming people use it as currency and not as exchange medium, then inherently the price has to go up because demand for bitcoins goes up, and the supply barely changes and does so with algorithmic inputs and constant loss due to lost wallets. I like to think of bitcoin as cryptogold. The inevitable outcome assuming continued success of the bitcoin protocol is that as more peo…

The price right now isn't based on actual demand for usage. It's over priced due to speculation.

But some of these methods of using bitcoin greatly increase the velocity of bitcoin. If demand rises 10x but velocity increases 20x, the price would fall.