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Bitcoin is tumbling – Off almost 40% from its high
- redm 9y agoIt's going to be really interesting to see what happens when Ethereum becomes the most valuable coin. It seems to have the momentum. [1] [1] http://www.flippening.watch/ http://www.flippening.watch/
- donquichotte 9y agoOr Stellar, with transaction times in the second range and Stripe behind it.
- fragsworth 9y agoStellar is not a cryptocurrency. It's only partially decentralized (like Ripple) - there is no blockchain, it works with a series of trusted nodes. That makes it very easy to have fast transactions, but also makes people not very confident in it.
- anothercomment 9y agoAlso, they make me sign in with Facebook to claim Stellar (in their latest PR campaign). No.
- runeks 9y agoIf it uses trusted nodes why not just use Chaumian Cash, and have the trusted nodes be issuers, rather than reinvent the wheel? Chaumian Cash is perfect if you don't care about decentralization.
- k-mcgrady 9y agoEthereum has had some pretty wild fluctuations over the past 24 too. Lost about £100GBP/30%(approx) back to where it was a week ago.
- gremlinsinc 9y agoHonestly I think Ardor will eclipse Ethereum-- if they can get to marketing it better, the technology is light years more advanced and more secure. When the ardor chain goes live I'm hoping it is an ethereum/bitcoin killer, being able to exchange assets between child chains just makes good sense, as does some of the other tech built in.
- yueq 9y agoUsually -20% from highest price is considered as a bear market.
- ceejayoz 9y agoIn Bitcoin, it's considered a day that ends in Y.
- biggodoggo 9y agoIs the bitcoin bubble finally popping and will ethereum pop with it or get bigger?
- nannal 9y agowell eth is down against btc (https://cryptowat.ch/poloniex/ethbtc/1d https://cryptowat.ch/poloniex/ethbtc/1d) so it would appear they're both going down but ether is going down faster.
- orclev 9y agoWatching the fluctuations of BTC, ETH, and LTC they seem to be fairly strongly correlated with each other, at least over the last ~month or so, and increasingly so coming to the present time. It will be interesting to see if in the coming weeks and months they continue to track closely to each other or if they once again diverge.
- yebyen 9y agoWatching trends without an analytic platform, I have seen that over any period of time longer than ~1 day, ETH seems to perform better. It is common to see periods of an hour, up to a day, where BTC does perform better. (For this reason, not more than just a few weeks ago, I took most of my tiny collection of BTC blue chips and traded them in for ETH.) It would be hard to believe that nobody has tried writing arbitrage bots. I would probably be overreaching to say that this effect is due to a large number of arbitrage bots (and likely also non-robots), but it seems like there are clear opportunities for arbitrage and likely that there are skilled individuals taking advantage of these chances on the regular.
- psyc 9y agoHow are they getting 40%?
- bpodgursky 9y agoI'm bearish on Bitcoin long term, but I have to admit it's crazy seeing Bitcoin at $2200 after being 25% _off_ peak.
- emodendroket 9y agoNothing says "stable store of value" like wild fluctuations in exchange rates.
- rgbrenner 9y agoIs anyone expecting stability? According to the chart, it went from $1000 to $3000 in 2.5 months.
- 1001101 9y agoLots of weak hands in it right now. More scaling debates, ominous US legislation, Goldman Sachs says it looks "heavy." I got out recently - for me it was the disposition effect [1], but shortly after, one of the more compelling global macro voices that I like to listen to, Raoul Pal, announced that he sold his stake. Makes me bearish long-term. Raoul's reasons were based on the malleability of the protocol and specifically that more than 21M bitcoins can be created at the whim of developers. [1] https://en.wikipedia.org/wiki/Disposition_effect https://en.wikipedia.org/wiki/Disposition_effect.
- sunshinerag 9y ago"malleability of the protocol and specifically that more than 21M bitcoins can be created at the whim of developers". This is inaccurate. Though any developers can modify the code to do such thing doesn't mean it will be adopted by the network. There is a distinction between code written and what the network accepts.
- Rmilb 9y agoIn what scenario would it be in anyone's interest to raise the maximum total of coins to be created?
- serhei 9y agoHypothetically, if miner profits went into freefall, the alternatives would be to raise tx fees even further (making the network less usable), or to change the protocol to mint more coins. You are correct that the latter would massively discredit the project's original goals, and is therefore unlikely (since it would damage the value of the currency). The network relies on having a large ecosystem of miners to prevent anyone from mounting coordination attacks. Those miners are paid either by new bitcoins (out of the finite supply), or by tx fees.
- lwhalen 9y agoOh good, it's on sale now...
- SeeDave 9y agoI've become increasingly risk-averse after realizing how devastating a 50% decline really is. Independent of asset class, you will need a 100% gain to get back to where you were. And that will take a while. Regardless, and apologies for the dumb BTC meme, I am HODLING!
- sevenfive 9y ago> I've become increasingly risk-averse after realizing how devastating a 2^-1 decline really is. Independent of asset class, you will need a 2^1 gain to get back to where you were.
- 0x4f3759df 9y agoI was trying to think of what will stabilize the price, and the best I could come up with is that on a long timeline it should be approximately equal to the amount of money it costs to mine a new one, or get one out of transaction fees. Anyone have a better idea?
- darawk 9y agoThat is probably approximately correct. However, there's a bit of a feedback loop there. The difficulty changes in response to the hash rate. And the hash rate changes in response to the incentive to mine the coins. When the price goes up, the hash rate goes up, so the cost of mining goes up. So, while you are correct, the causality flows in both directions. It's really quite difficult to value any currency. Doubly so for a crypto currency.
- wcoenen 9y agoThe causality goes in the other direction. The bitcoin price determines how much money a miner will spend on electricity to mine one bitcoin.
- 0xfeba 9y agoWell, the price with respect to the difficulty the overall number of miners.
- jessedhillon 9y agoSuppose there was someone who very badly needed to transact anonymously -- to that person, the value would be higher than the price of electricity. I think, therefore, that the price will always reflect the perceived value of the services enabled by BTC.
- dr_win 9y agoWho said that the price must stabilize? bitcoin is a digital commodity with a very unique property: the supply of newly minted coins is pre-determined and does not rely on market forces (because hash-rate retargets to achieve the plan regardless). In general the price of any commodity is determined by supply and demand. Aggregated supply is S0+S1, where S0 are newly mined coins (known) and S1 is market supply (unknown). Aggregated demand is generated by the market (unknown). So in the price equation you have two unknowns which are unlikely to be stable in the future. The cost of mining should not affect the price in the late game. Here is what Satoshi had to say about this: http://satoshi.nakamotoinstitute.org/posts/bitcointalk/65 http://satoshi.nakamotoinstitute.org/posts/bitcointalk/65
- Rmilb 9y agoSpeculation is that this is primarily due to Bitmain's announcement yesterday to hard fork if the UASF soft fork gets any momentum. Jimmy Song has a good analysis on this. https://medium.com/@jimmysong/examining-bitmains-press-release-6b47b0646f15 https://medium.com/@jimmysong/examining-bitmains-press-relea... This forking of Bitcoin is a required trial that the chain must go through to prove how resilient it is to this type of attack. It is unknown which chain will win in the event of a fork, maybe Ethereum will win, probably not PotCoin.
- r0fl 9y agoIs that a good thing or a bad thing? Sorry for the ignorance, I don't know enough about crypto to follow your statement.
- Rmilb 9y agoIt depends on your view point. For Bitcoin to succeed it must be able to withstand what some view as an "attack" on it. If bitcoin is vulnerable to this attack it doesn't deserve to last, it needs to be fixed, tested and tried again. All of these cryptocurrencies are still experiments and advocates equate changing the code consensus code like patching a 787 in mid flight because of how much value is dependent on the network working. The miners fork winning will be a bad thing if you value the decentralized aspect of the currency and want bitcoin to succeed. Not everyone does.
- Gaelan 9y agoCan someone do an ELI5 of this debate? I'm a bit confused.
- Rmilb 9y agoThis may help you out to get started, then read the previous article I linked. https://medium.com/@nopara73/explain-uasf-like-im-five-ae879e71a338 https://medium.com/@nopara73/explain-uasf-like-im-five-ae879... It is not a simple topic with two sides. It has very technical details as well as economic incentives for both sides which leads to a lot of game theory.
- kcanini 9y agoFrom the first paragraph: "The cryptocurrency was trading down 12.9%, at $2,161 a coin, its lowest since the beginning of June. It's now off almost 40% from its high of $2,999.97" The author fails at basic math: this is a decrease of (2999.97 - 2161) / 2999.97 = 28%, not 40%.
- turtle15 9y agoGood catch. I'm guessing the author did (2999.97 - 2161) / 2161 instead.
- elevensies 9y agoThe tyranny of percentages. If you lose 50%, to get it back you have to gain 100%.
- singularity2001 9y agoThat's a nice motivational formula for weight loss
- sillysaurus3 9y agoAlso, BTC has risen in value by 30% since 30 days ago: https://bitcoinwisdom.com/ https://bitcoinwisdom.com/
- hackefeller 9y agoI do not fully understand the cryptocurrency domain but have always wanted to gain a better understanding of it so am hoping for some insight. I thought that one advantage of Bitcoin was that it cannot lose value?
- afterburner 9y agoWhat, its value in dollars? Its value in dollars is however many dollars someone is willing to pay for it.
- test6554 9y agoAn extremely large number of people do not understand this... Take for example people who want to buy a nintento switch for $299. But it's $415 and in stock on Amazon and sold out everywhere else that is listing it for $299. Well I guess it doesn't actually cost $299 then does it? It actually costs $415 or so based on what people are willing to pay.
- Rmilb 9y agoThe majority of cryptocurrencies value is derived from what the market thinks it is worth. The market can deem any coin's value to be worth 0 at any time. The value is extremely volatile and can lose and gain value quickly. There are some projects like Tether and Bitshares who have tried to create a stable digital asset. I don't know how successful they have been. https://tether.to/ https://tether.to/
- quantdev 9y agoYeah, this is definitely false, as the other guy said -- its value in USD is whatever you're willing to pay for it in USD. Maybe what you're thinking of is the fact that it's deflationary unlike fiat: there's a finite number of coins that will ever be created. In other words, if you own exactly one dollar, over time, the percentage of total dollars you own will decrease, whereas with bitcoin, one bitcoin represents a constant fraction of the total bitcoin that will be created. This says nothing about how many gallons of milk one dollar or one bitcoin will buy you though.
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- wakkaflokka 9y agoI have a little BTC and ETH just for fun. It 'tumbles' and then 'skyrockets' quite frequently. Incredibly volatile. I bought in at $16 for ETH right after the EEA announcement, pulled out my principle at $54, and now I'm just watching this crazy roller coaster ride. It's fun. But I sure as hell am keeping my retirement in my 401k. I cannot imagine the stress on people who have a substantial investment in BTC or ETH, but they probably have a totally different mindset than I do when it comes to cryptocurrency.
- tudorconstantin 9y agoI guess it's less stressful once you're at 100x ROI in a few short years to see your ROI at "only" 70x.
- mamon 9y agoI don't know - people get attached to their belongings pretty quickly. In your example, if you invested 1000 $ in Bitcoin, watched it grow to $100k and then back to $70k then you would feel like you lost the cash equivalent of brand new car. It would be very painful, despite the fact that original gains came so easily.
- damnmachine 9y agoThe extreme volatility is why BTC was never intended to be used as an investment tool. @aantonop has stressed this over and over again.
- lettergram 9y agoI actually just sold my stake in Ether and Bitcoin two days ago (happy I did). Still holding onto Litecoin however. A few friends and I also wrote an application to help us invest. We just launched a beta: https://projectpiglet.com/ https://projectpiglet.com/ If anyone's interested, feel free to reach out to me directly: contact-at-projectpiglet.com. We just launched it so it's pretty rough, so we're in a beta testing phase. Thus, we are providing the service for free, provided you fill out a feedback form once a month.
- Animats 9y agoThe price tripled since March, for no good reason. Up from $1000 to $3000, now back to $2000. That's still quite a gain. The fork issue makes it clear that the future of Bitcoin is controlled by about five mining companies in China. Could be worse; at one point two companies had more than half the hash rate.
- nickthemagicman 9y agoTo put it in context though...it was $1000 like two months ago....So even with the crazy drop it's still gained 100% in two months...