The volatility of bitcoin to regulatory announcements is basically sky-high, and I imagine a money making opportunity.
Checked Coinbase right about 30 minutes after it cratered down to 995. Text price alerts don't seem to be working :/
SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
311–320 of 357 posts
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#312Bitcoin just went from a high of 1327.1926 to 995.9575 in the blink of an eye. Wow. From the ruling.... > First, the exchange must have surveillance-sharing agreements with significant markets for trading the underlying commodity or derivatives on that commodity. And second, those markets must be regulated. > Based on the record before it, the Commission believes that the significant markets for bitcoin are unregulat…
> I'm a bit disappointed that there is no ETF but this is pretty darn reasonable.
You can trade the OTC product with ticker GBTC [1]. It is a sponsored note - has quite a bit of volume on OTC markets. AUM is about 230mm. Expense ratio is around 2% (atrocious).
I noted that - before bitcoins drop on Friday afternoon - GBTC was up about 135% over 2 years - versus bitcoins 200% appreciation. So the tracking error is quite bad.
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#313Earlier quoted context omitted.
Woah wait when did the pound lose 25% of its value due to a SEC ruling?
Read about Soros breaking the Bank of England sometime, it's great stuff. Black Wednesday I think is the name of the event in popular culture
Great stuff in the sense that one person can directly profit to the tune of a billion dollars, by manipulating currency markets, at the cost of the taxpayers of an entire nation. So, not great stuff at all.
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#314Earlier quoted context omitted.
>Bitcoin just went from a high of 1327.1926 to 995.9575 in the blink of an eye. That is a loss of 25% of its value. This announcement does nothing to hurt the utility of Bitcoin or its application as a medium of exchange. That drop certainly seems like a speculative investment bubble popping.
Yup. Any "currency" that can plummet in value by 25% because of a minor SEC ruling is not ready to be a store of value.
Not to mention the relative consolidation of players in China. Some reports have suggested that well over 51% of mining hash power is consolidated amongst three organizations in China. My last look didn't agree with that number, but still it appears that it may be much easier to control consensus than was intended.
Thus, "anything can happen" if a few key players agree behind closed doors and change the rules.
I think bitcoin is a quite useful transfer platform, but I think it would be foolish to store much of one's assets in BTC.
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#315Earlier quoted context omitted.
If an official decision from the agency that regulates financial assets for the most powerful economy in the world doesn't count, then when does "something about a currency actually change"?
Anything that prevents Bitcoin from: - being a good anonymous currency - being a truly global currency for irreversible online transactions - being a currency that's easily programmable That's the three main use cases for Bitcoin. There are contenders for #1 (Monero, Dash), and for #3 (Ethereum). For #2 it's still the easiest because of the huge network effect behind it. Traditional currencies can't compete with cryp…
There's nothing that prevents Bitcoin from being a good anonymous currency. It simply isn't.
Its design allows it to be pseudo-anonymous at best, while Monero, for instance, has anonymity built in. Therefore if one seeks a truly anonymous currency they cannot possibly find it in Bitcoin.
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#316Earlier quoted context omitted.
I am not sure why you put the word currency in quotes. There have also been many state issued currencies that have done similar - see Thai Baht, Argentine Peso, Russian Ruble, Venezuelan Bolivar etc.
Volatility isn't the issue. Bitcoin isn't technically a currency because it can't currently be used directly to pay public debts or taxes in any nation state. Bitcoin is just another commodity like copper or crude oil.
Not a public debt or tax, and it's noted that this doesn't "legitimize" Bitcoin in the minds of the authorities, but looks like Norwegian prosecutors recently demanded the penalty for one criminal act to be partially paid in Bitcoin:
https://cointelegraph.com/news/pay-up-in-bitcoins-norway-pro...
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#317Earlier quoted context omitted.
Volatility isn't the issue. Bitcoin isn't technically a currency because it can't currently be used directly to pay public debts or taxes in any nation state. Bitcoin is just another commodity like copper or crude oil.
I understand the quoting now, thanks. I agree with you that its not technically a currency since it's not issued and circulated by a government but I disagree with the OP that it is not ready to be a "store of value" because of a single volatility event. There are many who would argue it is a good store of value since it can't be manipulated by the issuing state's monetary policy or susceptible to the poor fiscal man…
There have been many volatility events. Given that governments have the ability to practically outlaw it if they choose, that makes it quite risky as a store of value.
Several of the major volatility events in the past of bitcoin were related to Chinese government announcements or rumors regarding regulation/legality.
Sure one can transfer bitcoin without governmental approval (or against restriction), but that annoying need to convert to and from fiat in order to trade for other goods and services means that the governments still have a great deal of influence over bitcoin.
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#318Bitcoin just went from a high of 1327.1926 to 995.9575 in the blink of an eye. Wow. From the ruling.... > First, the exchange must have surveillance-sharing agreements with significant markets for trading the underlying commodity or derivatives on that commodity. And second, those markets must be regulated. > Based on the record before it, the Commission believes that the significant markets for bitcoin are unregulat…
>Bitcoin just went from a high of 1327.1926 to 995.9575 in the blink of an eye. That is a loss of 25% of its value. This announcement does nothing to hurt the utility of Bitcoin or its application as a medium of exchange. That drop certainly seems like a speculative investment bubble popping.
It is more a reflection of the instant liquidity available on exchanges. A more accurate description would be that the price went from about $1250 pre rejection announcement and has settled at around $1190-$1200.
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#319This is a pretty big blow. The ETF has been the talk of the town for the last four years, and it is not unreasonable to think that it has been holding the hand under the price, since to a lot of people it represented the coveted inflow of institutional investment into bitcoin. With this gone, the immediate outlook for bitcoin is bleak. There is little market adoption to speak of, in fact bitcoin is probably losing ma…
> since to a lot of people it represented the coveted inflow of institutional investment into bitcoin
I would say coveted inflow of retail investment. I don't think any serious institution would invest in bitcoin. The risk is too high given that the AUM can go to 0 instantly with one data breach.
Re: SEC Rejects Rule Change for Bitcoin Exchange-Traded Fund [pdf]
#320Earlier quoted context omitted.
Yup. Any "currency" that can plummet in value by 25% because of a minor SEC ruling is not ready to be a store of value.
Not to mention the relative consolidation of players in China. Some reports have suggested that well over 51% of mining hash power is consolidated amongst three organizations in China. My last look didn't agree with that number, but still it appears that it may be much easier to control consensus than was intended. Thus, "anything can happen" if a few key players agree behind closed doors and change the rules. I thin…
Note that pools != miners. A pool might set the policy for their blocks, but miners can swap pools whenever they feel like it. Large pools have had individual miners abandon them in masses before.