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The trend of 15-20% swings is well documented in Bitcoin history, no doubts about that. Crypto is a young economy in general, and it's been thrilling for me (on
by hbosch 9y ago
The trend of 15-20% swings is well documented in Bitcoin history, no doubts about that. Crypto is a young economy in general, and it's been thrilling for me (on the outside, as I don't speculate or hold) to watch.
But I don't know. If you play with the zoom levels on price tracking sites, the $20k peak onward has been a pretty steady downward trend. BTC is down 20% over three days, down nearly 23% over a week. Is that par even for Bitcoin flash-crashes lately? Zoom out further to a month and the price is now down almost 40% at the time of this post.
We zoom out to six months, or a year, or two years, and we see astounding gains then – we are all aware of the blistering rise in price over 2017. But once it dipped after 20k, there were a lot of people who swore it would climb back. And then it dipped further, and further, and the collective memory of Bitcoin's humble recent history was lost in the cacophony of media blitzes and new customers entering the market.
I think the underlying worry for most people isn't the fact that the price goes up and down a lot... I think the worry really is that when growth stops will people still be interested? Can Bitcoin last forever if the price is e.g. <$5000/BTC?
- starlust2 9y agoThis is what happens when mania dies down. Everyone who "invested" at >10K are not seeing the enormous returns. Those people are more likely to have never heard of bitcoin before this year. They didn't put in money because of a financial revolution. They put money in to make an easy buck. Those people also represent a significantly larger chunk of the market capitalization. When they lose money they won't come back.
- oreo81 9y ago>When they lose money they won't come back. Exactly! This is why casinos never make money.
- saas_co_de 9y agoThe interesting thing is that this is what a real free market looks like. This is what any market would look like without being rigged by governments and government backed institutions. Bitcoin may be the best proof yet of how deeply flawed the libertarian free market ideology really is.
- splintercell 9y ago> Bitcoin may be the best proof yet of how deeply flawed the libertarian free market ideology really is. The price of gold isn't stable because the visible hand of the govt has stabilized it, or if there is any law which protects it. If you have convinced yourself that this is the reason why it is stable, then you're drinking your own kool aide. The price of gold, or any currency is stable because its market has been discovered, and huge financial assets have been created which allow people to profit off it's price movements, which results in price stability. Even with that, Gold market can move up and down quite drastically, for instance when in 2009 and 2010 by 25% and 30% respectively, then dropped by 27% in 2013. The reason why price of Bitcoin moves so much up and down because it's true market hasn't realized yet, once it does, it's price will stabilize too. No govt can make it happen.
- xenadu02 9y agoGold and silver aren't stable, they fluctuate all the time just at long timescales compared to humans. When the Comstock Lode was discovered it massively affected the price of silver. Similarly when Spain stole Aztec gold it caused changes in the value of gold. If someone ever manages to mine asteroids for gold or we discover a previously unknown reserve we'll see more price shocks. I don't know where you got the idea that the supply of gold was stable; it is merely inflexible because it depends on physically digging it out of the dirt.
- oreo81 9y agoFlawed? How so?
- specialist 9y agoWhich markets exist without the protections provided by governments? Protections in the form of contract law, fair and impartial judiciary, notions of property (ownership)...
- ric2b 9y agoBitcoin is one of them. It works without government protection.