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Aren't ICOs more of an altcoin phenomenon? How does this impact upon Bitcoin? To me It looked like Bitcoin just bounced off a psychological ceiling at 5000US
by Lerc 9y ago
Aren't ICOs more of an altcoin phenomenon? How does this impact upon Bitcoin?
To me It looked like Bitcoin just bounced off a psychological ceiling at 5000USD. It has done this with various round number levels in the past. It makes a bit of sense if you consider people are inclined to think something like "I'll sell when it reaches $5000"
There also seems to be a tendancy to use evocative language (collapse,tumble,collapse etc.) to describe what has often been a loss of only a few weeks worth of gains. I guess when people have an agenda to push on the other side they call the same thing a correction.
I don't claim to have any special knowledge of how all this works. It just seems to me that many of the authoritative sounding voices are actually as clueless as the rest of us.
- sillysaurus3 9y agoIt doesn't. The title is clickbait. Nobody knows why Bitcoin goes up and down, but people listen to whoever talks authoritatively on the subject. China's announcement was probably a trigger that caused people to sell, rather than being directly responsible for people selling.
- frutiger 9y ago> China's announcement was probably a trigger that caused people to sell, rather than being directly responsible for people selling. So you're agreeing with the title - the announcement (directly or indirectly) is what caused the fall in price.
- rothbardrand 9y agoIt does seem that consistently this year, every time Bitcoin hits an ATH or psychological price, that the PBOC issues some edict or warning that causes the price to drop. There's even a meme for this phenomena: https://www.youtube.com/watch?v=Ry6PpRXk0dQ https://www.youtube.com/watch?v=Ry6PpRXk0dQ This is from 2014! (I know the link goes to content not typically found on HN, I'm doing it for the purposes of illustrating that this is such a seemingly common occurrence.)
- sillysaurus3 9y agoIt's helpful to remember that BTC has had strong upwards pressure for several months now: http://imgur.com/IWwOgm9 http://imgur.com/IWwOgm9 A graph like that was going to correct, one way or the other. PBOC's decree seems incidental rather than the root cause.
- lend000 9y agoTrue, Bitcoin was already reversing before the announcement. However, NEO was definitely impacted by the news.
- oculusthrift 9y agoIf any other asset lost that much percent of its value that fast it'd be called a crash too. It isn't biased. It isn't the writer's fault that BTC is so volatile. Isn't it at least a little concerning that it could gain or lose that much value in a matter of weeks?
- tinco 9y agoIt already gained that much value in a week so effectively nothing happened. The technical traders might believe we've hit a big ceiling, but ceilings could be just temporary. The article is mentioning bitcoin price just for drama.
- ortusdux 9y agoThis article from Business Insider has a better explanation. http://www.businessinsider.com/initial-coin-offering-china-bitcoin-ethereum-peoples-bank-of-china-law-all-crypto-illegal-etoro-2017-9 http://www.businessinsider.com/initial-coin-offering-china-b... Namely: "However, the wording of the PBoC edict also suggested that trading and usage of all cryptocurrencies, including bitcoin, could now be illegal in China. The PBoC said that virtual currencies that are "not issued by the monetary authorities... do not have legal status equivalent to money, and can not and should not be circulated as a currency in the market use." The PBoC added that "any so-called tokens financing trading platform shall not engage in the exchange of legal currency and tokens." It even goes so far as to ban platforms from "provid[ing] pricing, information, [and] intermediary services.""
- Nursie 9y agoNow that is interesting, and potentially much farther reaching than the headlines have suggested
- turk183 9y agoThe Iron Curtain is alive and well. We should be helping the Chinese break free of these economic terrorists--how hard would it be to watch your meager savings in Yuan be inflated away so badly each year?
- WhiteOwlLion 9y agoWhat does mean for AntMiner and people that sell the hardware for hashing power? SHA256 & scrypt hashers can't take cryptocurrency they are trying to mine with it? Not the end of the world, but ironic nonetheless.
- Vadoff 9y agoThe price of bitcoin was correcting many hours before any news of the China ICO restriction. So yeah probably completely BS correlation.
- vkou 9y agoOr, more likely, informed insiders capitalized on this information.
- Cybourgeoisie 9y agoWhile I'm inclined to believe this, the big sell off triggered by this news started at the same time that the news was made public. You can view the rapid drop in Neo (heavily affected by the ban) started in the same 15 minutes when the news broke.
- sgtnasty 9y agoWhat is an ICO?
- prawn 9y agoInitial Coin Offering. An unregulated fundraising method.
- Gaelan 9y agoEssentially, selling some amount of your cryptocurrency to your investors before you launch.
- Iv 9y agoA new way to fund companies. Instead of selling parts, issue tokens that work like a cryptocurrency and promise they will entitle to some profits. Sell these for bitcoins. Recently some companies raised a billion USD that way (yes, billion) The concern, that I share, is that this system is very vulnerable to Ponzi scheme. And unlike Bitcoin, the crash of the pyramid is not a feature in this system. I think people are right to warn and forbid this thing. Pyramid scheme can have large-scale effect in an economy. I think etherum provides way to do things more responsibly but I understand that authorities moved quickly when they saw anonymous companies with no products receiving a billion USD. Even that will cause ripples when it collapses. You don't want it to grow more.
- turk183 9y agoThe reason a lot of Wall Street finance types are running to these altcoins is exactly what you say--it's the new penny stocks. There's no regulation and so they are free to manipulate prices however they wish. I'm not sure it's a Ponzi, but it's definitely manipulated by the insiders.
- freyir 9y agoIt's an Initial Coin Offering, a unregulated way for a company to raise funds, but which has also been associated with scams and Ponzi schemes recently.
- davidgerard 9y ago
- CryptoPunk 9y ago>>Aren't ICOs more of an altcoin phenomenon? ICOs are an Ethereum phenomenon. Ethereum isn't a fork of Bitcoin's codebase and thus isn't an altcoin.
- kobeya 9y agoIt is an alternative coin. Hence "altcoin."
- atomical 9y agoI think of blockchain currency as coins and currency issued by a blockchain as tokens (i.e. ERC20).
- tylersmith 9y agoThere's no fundamental difference. Currently there are implementation differences but those will go away. Eventually Ether will be ERC20 compliant.
- AgentME 9y ago>Eventually Ether will be ERC20 compliant. Citation? Ether is privileged on Ethereum. It's what mining gets you, it's what transaction fees are paid in, if proof-of-stake comes around, it will be what's staked, and any transaction can include some. I don't expect any of these to change.
- modeless 9y agoPeople don't buy and sell ICO tokens with fiat, they do it with bitcoins. If a bunch of people want to sell their ICO tokens for fiat, they first end up with a bunch of bitcoins, and then they need to sell bitcoins for fiat. This pushes the price of bitcoins in fiat down. It's a temporary phenomenon, but the price going down can make the price fall farther, because there are a bunch of amateur traders who think it's a good idea to buy when the price is rising and sell when it's falling.
- Taek 9y agoMost ICOs actually trade Etherum, Bitcoin plays a role but it's usually secondary.
- atomical 9y agoAre you sure that's the case for non-US crypto startups? Also, there are some ERC20 tokens that have better liquidity with the BTC pairing.
- DennisP 9y agoIt's true of almost all ICOs launching ERC20 tokens because on Ethereum you can write code that automatically turns your ETH into ERC20 tokens. A couple pages of code and it all just happens on the blockchain by itself. If you take bitcoin contributions, you need something offchain to track who contributed what, and issue a bunch of minting transactions. Some ICOs do that, but if it's ERC20 that's generally in addition to automated minting via smart contract, and since the token and ICO are running on the Ethereum blockchain it's predominantly ETH that gets contributed. Liquidity on exchanges later doesn't have much to do with any of that.
- cslarson 9y agoMost SNT trading is against BTC on the Bittrex exchange. It's 5x the trading as against ETH. https://coinmarketcap.com/assets/status/#markets https://coinmarketcap.com/assets/status/#markets
- davidgerard 9y agoThere's weird stuff going on with Tethers, which are supposedly pegged to the dollar and fully backed, being created apparently out of nothing when Tether has no US banking arrangements, and these being used to prop up margin trading on Bitfinex. The price then goes up on Bitfinex, then on other exchanges. The upshot is: every time margin gets too deep on Bitfinex, another batch of Tethers is created out of thin air, and the price gets a pump. Bitcoin's recapitulated the history of finance, and now it's got to Quantitative Easing. It's amazingly tangled, I'm trying to put together an explainer blog post, but Bitfinexed has the best coverage of the pieces: https://twitter.com/Bitfinexed https://twitter.com/Bitfinexed https://medium.com/@bitfinexed/ https://medium.com/@bitfinexed/
- xg15 9y ago> ... which are supposedly pegged to the dollar and fully backed, being created apparently out of nothing ... Amateur here, but how is that not a contradiction?
- Khoth 9y ago"supposedly fully backed" isn't the same as "actually fully backed". If they are being created out of thin air, it would mean the claim about them being backed by dollars was a lie. Edit: Although, whether or not they're backed by anything isn't really all that relevant, considering that their terms of service[1] say: "There is no contractual right or other right or legal claim against us to redeem or exchange your Tethers for money. We do not guarantee any right of redemption or exchange of Tethers by us for money." So backed or not, nobody has any obligation to give you dollars in exchange for your tethers. [1] https://tether.to/legal/ https://tether.to/legal/