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In the last split people who held bitcoins got an equal quantity of "Bitcoin cash", so if you had 1 BTC, after the split you had 1 BTC and 1 BCH. Looking at ht

In the last split people who held bitcoins got an equal quantity of "Bitcoin cash", so if you had 1 BTC, after the split you had 1 BTC and 1 BCH. Looking at https://coinmarketcap.com/ https://coinmarketcap.com/ you can see that each BCH is worth ~$500 (at the time of this comment) and the value of BTC is higher after the split. so in essence $8,154,513,572 of new value was created from nothing with the split. If the next split follow the same pattern, more money appears...

lost_name 9y ago
It's interesting to say that $8B of new value was created, since no one could supply that money if anyone asked for it. How did the cryptocurrency markets handle that, anyway?
- cloakandswagger 9y ago
  >since no one could supply that money if anyone asked for it What does this mean? BCH can be sold for USD, and there are people willing to buy BCH. Therefore BCH created $8B in new value.
  - barkingcat 9y ago
    exactly, if no one wanted to pay for it BCH would be priced at $0. Since it's being priced at an amount above 0, people are willing to pay the amount - thus supplying the money for it.
  - SeoxyS 9y ago
    That's not exactly right. You have to consider the depth of the market and the size of the demand. However many BCH are in existence, there's no way that the market will support liquidating them all for USD. An order of that size would crash the markets instantly. The $8B in value created is entirely nominal, because of the size of the pre-existing supply. In reply the real value created could well be negative or at most in the millions and not billions.
    - cloakandswagger 9y ago
      So what you're saying is that the value of any asset that is not USD (stocks, bonds, commodities, real estate) is completely unknown, and the real "value" would be what that asset would sell for if every portion of it was instantly liquidated tomorrow? That's not how economics work. edit: I suppose all these stocks I'm holding are worth $0, since if every person selling them sold tomorrow the value would drop to that price.
      - stanmancan 9y ago
        actually you’re right, your stocks are worth $0, until you sell them. If the company went bankrupt tomorrow what would happen to the value of those stocks? If there are 100 shares available and someone is willing to pay $500 for a share, but nobody else is willing to pay more than $5, is the company really worth $500*100? Same idea goes for bitcoin cash. Just because there are a few people willing to pay $X00 doesn’t mean every single bitcoin is worth that much.
        cloakandswagger 9y ago
        Of course, but no one that I know of implied that it did. Any grown adult should know that if the price of gold/oz is stated as $X, or the market cap of the stock market is stated as $Y, that it doesn't mean if all of it was sold tomorrow it would generate X or Y amount of dollars. The $8B figure for BCH is using the exact same semantics that every other non-cash asset in the entire world uses. But because it's crypto we get pedantry like this.
        stanmancan 9y ago
        I think the discussion was more regarding the comment: Bitcoin: "I'm going to create $8B out of thin air" That's just really not the case. Sure a bunch of BCH were created out of thin air, but it's not accurate to say $8B was.
      - SeoxyS 9y ago
        If you're going to put a specific value on something, it's be much more accurate to calculate it as the sum of the entire demand for that something divided by its quantity. To take the 100 shares at $500 example from @stanmancan, if one person is willing to pay $500, another 10 is willing to pay $400 for one share each, and one more person is willing to pay $300 for 20 shares, and one large investor is willing to buy up the rest for $100 only, the total demand for the whole company is $14,400 for 100 shares or $144/share. That's the true value. I can guarantee you that there isn't even an order of magnitude close to $8B of demand for the artificially created and restricted BCH, so that value wasn't really created.
  - zeroxfe 9y ago
    You're confusing market cap with market depth, which is a a closer estimate of "new value."
- aodin 9y ago
  Matt Levine wrote a great article about the side effects of the split and how various exchanges handled it: https://www.bloomberg.com/view/articles/2017-08-02/bitcoin-exchange-had-too-many-bitcoins https://www.bloomberg.com/view/articles/2017-08-02/bitcoin-e...
- sp821543 9y ago
  Bitcoin: "I'm going to create $8B out of thin air" Fed: "Hold my beer..."
StavrosK 9y ago
Maybe Bitcoin would be worth $500 more without the split, though.
- raesene6 9y ago
  Maybe although from a passing look at the markets their price swings (after a couple of days after the initial split) don't seem to correlate...
runeks 9y ago
> so in essence $8,154,513,572 of new value was created from nothing with the split. No. The market depth of the various Bitcoin Cash markets is tiny. You couldn’t offload even $10M without crashing the price close to zero. Just because the highest bid is ~$500 doesn’t mean all 16 million Bitcoin Cash coins can be sold for ~$500, thus ~$500*16m hasn’t been created at all — only a tiny fraction of that.
- paulpauper 9y ago
  A common misconception is that coins must be sold on an exchange. If someone has a large amount they could sell it on a secondary market to a private buyer
  - runeks 9y ago
    Sure, if such a private buyer exists. Please put me in contact with the private buyer willing to pay ~$500 for the remaining 15,980,000 Bitcoin Cash coins that the markets of the public exchanges can’t handle. The public exchanges are a gauge of liquidity. A magic private buyer might exist, willing to buy everything you hold, but I see no evidence that one exists for Bitcoin Cash.
- raesene6 9y ago
  I don't doubt that if you tried to convert all BCH to Fiat it wouldn't fly, but surely a lot of people have made money by transferring BCH at one nominal value to other crypto currencies. Now it probably is all a shell game ultimately, but the longer it persists the more hopeful speculators will use fiat cash to buy into crypto currencies, letting crypto currency holders "cash out"...

lost_name 9y ago

It's interesting to say that $8B of new value was created, since no one could supply that money if anyone asked for it. How did the cryptocurrency markets handle that, anyway?

cloakandswagger 9y ago
>since no one could supply that money if anyone asked for it What does this mean? BCH can be sold for USD, and there are people willing to buy BCH. Therefore BCH created $8B in new value.
- barkingcat 9y ago
  exactly, if no one wanted to pay for it BCH would be priced at $0. Since it's being priced at an amount above 0, people are willing to pay the amount - thus supplying the money for it.
- SeoxyS 9y ago
  That's not exactly right. You have to consider the depth of the market and the size of the demand. However many BCH are in existence, there's no way that the market will support liquidating them all for USD. An order of that size would crash the markets instantly. The $8B in value created is entirely nominal, because of the size of the pre-existing supply. In reply the real value created could well be negative or at most in the millions and not billions.
  - cloakandswagger 9y ago
    So what you're saying is that the value of any asset that is not USD (stocks, bonds, commodities, real estate) is completely unknown, and the real "value" would be what that asset would sell for if every portion of it was instantly liquidated tomorrow? That's not how economics work. edit: I suppose all these stocks I'm holding are worth $0, since if every person selling them sold tomorrow the value would drop to that price.
    - stanmancan 9y ago
      actually you’re right, your stocks are worth $0, until you sell them. If the company went bankrupt tomorrow what would happen to the value of those stocks? If there are 100 shares available and someone is willing to pay $500 for a share, but nobody else is willing to pay more than $5, is the company really worth $500*100? Same idea goes for bitcoin cash. Just because there are a few people willing to pay $X00 doesn’t mean every single bitcoin is worth that much.
      - cloakandswagger 9y ago
        Of course, but no one that I know of implied that it did. Any grown adult should know that if the price of gold/oz is stated as $X, or the market cap of the stock market is stated as $Y, that it doesn't mean if all of it was sold tomorrow it would generate X or Y amount of dollars. The $8B figure for BCH is using the exact same semantics that every other non-cash asset in the entire world uses. But because it's crypto we get pedantry like this.
        stanmancan 9y ago
        I think the discussion was more regarding the comment: Bitcoin: "I'm going to create $8B out of thin air" That's just really not the case. Sure a bunch of BCH were created out of thin air, but it's not accurate to say $8B was.
    - SeoxyS 9y ago
      If you're going to put a specific value on something, it's be much more accurate to calculate it as the sum of the entire demand for that something divided by its quantity. To take the 100 shares at $500 example from @stanmancan, if one person is willing to pay $500, another 10 is willing to pay $400 for one share each, and one more person is willing to pay $300 for 20 shares, and one large investor is willing to buy up the rest for $100 only, the total demand for the whole company is $14,400 for 100 shares or $144/share. That's the true value. I can guarantee you that there isn't even an order of magnitude close to $8B of demand for the artificially created and restricted BCH, so that value wasn't really created.
- zeroxfe 9y ago
  You're confusing market cap with market depth, which is a a closer estimate of "new value."
aodin 9y ago
Matt Levine wrote a great article about the side effects of the split and how various exchanges handled it: https://www.bloomberg.com/view/articles/2017-08-02/bitcoin-exchange-had-too-many-bitcoins https://www.bloomberg.com/view/articles/2017-08-02/bitcoin-e...
sp821543 9y ago
Bitcoin: "I'm going to create $8B out of thin air" Fed: "Hold my beer..."

StavrosK 9y ago

Maybe Bitcoin would be worth $500 more without the split, though.

raesene6 9y ago
Maybe although from a passing look at the markets their price swings (after a couple of days after the initial split) don't seem to correlate...

runeks 9y ago

> so in essence $8,154,513,572 of new value was created from nothing with the split. No. The market depth of the various Bitcoin Cash markets is tiny. You couldn’t offload even $10M without crashing the price close to zero. Just because the highest bid is ~$500 doesn’t mean all 16 million Bitcoin Cash coins can be sold for ~$500, thus ~$500*16m hasn’t been created at all — only a tiny fraction of that.

paulpauper 9y ago
A common misconception is that coins must be sold on an exchange. If someone has a large amount they could sell it on a secondary market to a private buyer
- runeks 9y ago
  Sure, if such a private buyer exists. Please put me in contact with the private buyer willing to pay ~$500 for the remaining 15,980,000 Bitcoin Cash coins that the markets of the public exchanges can’t handle. The public exchanges are a gauge of liquidity. A magic private buyer might exist, willing to buy everything you hold, but I see no evidence that one exists for Bitcoin Cash.
raesene6 9y ago
I don't doubt that if you tried to convert all BCH to Fiat it wouldn't fly, but surely a lot of people have made money by transferring BCH at one nominal value to other crypto currencies. Now it probably is all a shell game ultimately, but the longer it persists the more hopeful speculators will use fiat cash to buy into crypto currencies, letting crypto currency holders "cash out"...