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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

#51

Post by Stubb »

koliber wrote: post #40
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.

While I am in no position to predict the future of bitcoins, all new markets have these problems. At an early point in their history, stocks also had low liquidity and crappy technology. Both of these conditions will improve as an asset becomes more popular. It is a chicken-and-egg problem.

There's also the question of where the money will come from to improve the technology. One of the benefits of BTC is the low transaction cost. But it might be that those transaction costs are exactly what's needed to fund exchange development.

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

#52

Post by pmorici »

dzhiurgis wrote: post #29
lectrick wrote: post #4

Buy when there's blood in the streets (assuming the fundamentals are still good, which it looks like they are...) http://www.bitcoinpulse.com/

There could be even more blood on Monday. Short term the price will drop even more dramatically, but once recovered, it should increase more, as main exchanges will get more busy. Or is there a flaw in my logic?

If Mt.Gox does implode like a lot of people are expecting then that is going to start a news cycle that is not favorable and probably cause the price to depress for a period. It will be a good time to get in though if you have been looking for a chance to buy at a good price.

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

#53

Post by dalke »

koliber wrote: post #40
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.

While I am in no position to predict the future of bitcoins, all new markets have these problems. At an early point in their history, stocks also had low liquidity and crappy technology. Both of these conditions will improve as an asset becomes more popular. It is a chicken-and-egg problem.

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 there a popular asset where the market has "low liquidity and crappy technology"?

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

#54

Post by icoder »

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…

Well, just as with disk storage, scaling up doesn't mean things get cheaper per unit, because you'll have to pay for infrastructure that you take for granted at low scale (cooling, storage, security, power, network, etc). Many customers mining at different locations could therefore be more profitable as a whole than one company doing all the mining, especially since many hobbyists don't count their hours like a company has to.

Also, BFL will benefit from the share of users that will not use their equipment to the max for whatever reason and they may not have the equity required to do the upfront hardware investment.

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

#55

Post by dzhiurgis »

pmorici wrote: post #52
dzhiurgis wrote: post #29

Earlier quoted context omitted.

There could be even more blood on Monday. Short term the price will drop even more dramatically, but once recovered, it should increase more, as main exchanges will get more busy. Or is there a flaw in my logic?

If Mt.Gox does implode like a lot of people are expecting then that is going to start a news cycle that is not favorable and probably cause the price to depress for a period. It will be a good time to get in though if you have been looking for a chance to buy at a good price.

Might be the best to sell on Sunday then.

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

#56

Post by downandout »

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.

This is more about a crappy exchange that has been crappy for most of its existence than about Bitcoin itself. The sky is not falling. MtGox may fall after this, but IMO that would be a good thing.

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

#57

Post by willis77 »

Torn wrote: post #36

> As to get a better look at the process the system needs to be in a static state. The fact they can't spin up a new MtGox environment with cloned data stores is troubling.

I also hope their technical competency beats their writing competency.

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

#58

Post by fnordfnordfnord »

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?

This question has been answered an immeasurable amount of times.

Several groups organized ASIC production projects. Avalon, BFL, and a couple others I can't remember. None of these initial groups had the capital to finance the NRE (Non-Recurring Engineering) for the ASIC, nor were traditional venture capital sources willing to do so. The ASIC production process has a relatively a high NRE, but low incremental cost. So, Bitcoin folk organized and participated in pre-sales to finance the NRE for these ventures. They had to sell the things or they would never have been able to afford to produce the initial units.

Additionally, even if some group would've had the capital to spin their own ASIC, it would have been a bad bargain for them to monopolize ASIC mining when competing against FPGA miners. Their capacity would have been limited to some fraction of the much smaller total network capacity in the FPGA era. Also, a single party swamping the network would've earned enmity from all of the other miners and Bitcoin users who could possibly have forced them out of the network, rendering their investment useless.

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

#59

Post by crazy1van »

hnnewguy wrote: post #20
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 :|

> I almost bought 1,000 btc Are you just as bitter that you missed Apple, Microsoft, Tesla, Priceline, Intuitive Surgical or CNR? Point being, these opportunities are everywhere, always. You're surrounded by them right now, they're just not obvious. But neither was BitCoin. And with the above you're actually buying into a real company, rather than speculating on a price change.

> Are you just as bitter that you missed Apple, Microsoft, Tesla, Priceline, Intuitive Surgical or CNR?

Great point and one that is easy to lose sight of. I think bitcoin stings a little extra because many people on HN thought at the back of their mind that it might be big, but never acted. Whereas, at the time many of these stocks were cheap, most people weren't even considering buying them.

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

#60

Post by my_username_is_ »

pmorici wrote: post #45
dsjoerg wrote: post #12

Earlier quoted context omitted.

Is there anyplace I can go to get the summary of advice from the Sage Old Veteran Bitcoin Graybeards?

bitcointalk.org or the bitcoin subredit has this info plastered all over the place. Also before you do business with any BTC company you should probably search Google and Pacer for pending lawsuits. BFL has had lawsuits pending against it in state and federal court alleging fraud since at least late Nov. 2013 but no one noticed until yesterday because they named BFL as "BF Labs" which is an uncommon way of referring…

I'd steer clear of /r/bitcoin. It's been declining in quality consistently over the several months. bitcointalk or /r/bitcoinserious or even /r/bitcoinbeginners should give you better advice
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