5 ms·

Having been through that bubble, I'm fairly confident FOMO had a huge effect. Every single person I know was asking how to buy some. You can even see it on Goog

by ftufek 7y ago

Having been through that bubble, I'm fairly confident FOMO had a huge effect. Every single person I know was asking how to buy some. You can even see it on Google Trends[1]. It's possible that the very first initial bump was manipulated (and crypto is definitely manipulated each and every day...), but the crazy increase afterwards probably wasn't due to a single entity. 1: https://trends.google.com/trends/explore?date=today%205-y&q=bitcoin https://trends.google.com/trends/explore?date=today%205-y&q=...

safog 7y ago
Yes, some of it was organic, but towards the end of the bubble, folks were looking at tether printing and using that as a signal to buy / sell. People even during the bull run called out tether for being the biggest risk to crypto markets and understood that without this well-timed injection of cash into the crypto markets, the price would fall flat. Given Crypto markets' propensity to scam, I'd be shocked if finex & co didn't engage in manipulation. Maybe not to the extent that the paper's authors claim - China, S. Korea, India all banned / tried to ban crypto and I think Chinese volume drying up was a major cause for the bubble popping.
cwkoss 7y ago
Next FOMO bubble is going to be exciting: it's getting much easier to acquire Bitcoin, so the conditions seem ripe for the next bubble to be even wilder. Keep an eye out for next spring, when Bitcoin block reward halves again. (don't invest more than you're willing to lose entirely it's very risky, but having skin in the game during a bubble is very fun in my experience and will quickly educate you in the emotionality of trading. Dollar cost averaging weekly seems like the best strategy: easy to feel dread at best entry points and greed at best sell points.)
- ftufek 7y ago
  The way I look at it, Bitcoin is a historical experiment happening during our lifetimes and mid-May (the time of halving) will be a very interesting milestone in that experiment. It could go up or down, but either way, it will be interesting to watch.
  - rauchp 7y ago
    Is there any reason for it to go down because of the block halving? I've heard it might be already priced in, so would the lack of a pump be enough to cause a massive drop? Looking at the performance this year, I haven't seen any real patterns, except maybe the time Tether started printing again.
    - ftufek 7y ago
      There's a lot of other reasons why it can go down and it wouldn't necessarily go down because of halving. But when a lot of people expect something to go up, it can have reverse effects. A lot of people have this assumption that it will always go up after a halving, it very well might, but at the current price point, the average person can't even afford a single Bitcoin whereas at previous halving (in 2016) that was still doable (it was on the order of a few hundreds of dollars). At this stage, you would need big investors and probably that's what companies like Bakkt will allow.
      - Terretta 7y ago
        BTC needs to move its decimal point. Like Berkshire Hathaway: Investors appear to like Berkshire Hathaway stock in the $60s and even the $70s more than they liked it at roughly $3500 a share. Berkshire shareholders approved a 50-for-1 stock split of Berkshire's Class B shares yesterday. Trading began today. The lower price is seen as an opening for small investors who couldn't afford the old four-figure price tag. At yesterday's meeting, Warren Buffett told shareholders that the increased trading volume and liquidity for the Class B shares after the split could make it the key driver of Berkshire's market value. "The B may be the tail that wags the dog now." https://www.cnbc.com/id/34973846 https://www.cnbc.com/id/34973846 On the other hand: https://www.investopedia.com/ask/answers/021615/why-doesnt-warren-buffett-split-berkshire-hathaway-stock.asp https://www.investopedia.com/ask/answers/021615/why-doesnt-w...
        nullc 7y ago
        When the price first went over $1000 some sites switched to using mBTC ... but then the prices went under $1000 and there were complaints about the small numbers being confusing. You can't win. > opening for small investors who couldn't afford the old four-figure price tag. That's an issue that doesn't exist for Bitcoin though-- you can purchase FAR less than one bitcoin at a time.
- sdan 7y ago
  How do you DCA?
  - cwkoss 7y ago
    Pick a dollar amount and (buy|sell) that amount of Bitcoin every week on the same day at same time. By making a 'dumb' plan, you remove the enticement to try and time the market. Perhaps even more than wall street markets, it's hard to day trade Bitcoin successfully: most of the advice you'll read is by people who are either lying, exaggerating or got lucky. The major issue is that there is a TON of non-public information that is much more relevant to price levels than publicly available information. Many smart players who are using 'insider info' will be able to eat your lunch. I fully expect that someone has a very accurate model of the quantity of deposits at some exchanges via address linking, and is watching inflows and outflows carefully. I also expect employees of Bitcoin exchanges are passing data to trader friends. Knowing when a big chunk of Bitcoin is about to be tradable on an exchange is a great sell indicator, and USD a great buy indicator.
  - krallja 7y ago
    // parameters: $520 to invest over 1 year for(i=1; i<=52; i++) { buy(10 usd); sleep(1 week); }
    - sdan 7y ago
      Yeah I know how DCA works. Just wondering on what platform you're doing it on.
      - snodnipper 7y ago
        You can do that on Coinbase. There is a blog post here https://blog.coinbase.com/easier-recurring-buys-and-sells-on-coinbase-9a3cd7ea934e https://blog.coinbase.com/easier-recurring-buys-and-sells-on...
        sdan 7y ago
        Feel like Coinbase fees are too high... even for Pro
- deleted 7y ago
  [deleted]
- zelly 7y ago
  When/if the price goes over 20k again, that's when animal-mode FOMO adrenaline will re-emerge. Even Nouriel Roubini will be buying. At some point, people will genuinely fear they are missing out on the next world currency, even the skeptics. That will either be the best time in the world to sell or the best time to buy, who knows.
- ppf 7y ago
  Do you see what you've become? You're excited about people FOMO'ing into a risky investment (that you happen to hold). You have become the bad actor in this scenario, waiting for new people to hand over their money.
tedk-42 7y ago
Pretty much this. How could one whale pump so much money into the market? It was a societal thing more so than an individual person. People were speculating like crazy to the point where you had grandmas giving investment advice on this new thing called 'bitcoin' for their grandkids to get rich from. Tether's in the spotlight right now and journos will have a nice round of clickbait articles to keep the interest going. Reason will prevail!
- dwd 7y ago
  It's the same as attributing the Sterling crash in '92 just to Soros. He had a large position and enough to move the market but he wasn't the only player, and probably small in comparison to all the retail investors who would have lost out late in the sell off panic.
- jrochkind1 7y ago
  > How could one whale pump so much money into the market? Well, the allegation is, because they were printing it.
andreygrehov 7y ago
Agreed. During the 2017 run up, I had tons of non-technical folks asking me to buy Bitcoin for them. A doctor from Europe was ready to spend $100k, which is what he's making per year. A healthcare specialist from New York, with an annual salary about $40k, was ready to spend $10k. An athlete from Brazil was begging to spend his $300k on altcoins. Many people do not realize how strong FOMO can be.

by ftufek 7y ago

safog 7y ago

Yes, some of it was organic, but towards the end of the bubble, folks were looking at tether printing and using that as a signal to buy / sell. People even during the bull run called out tether for being the biggest risk to crypto markets and understood that without this well-timed injection of cash into the crypto markets, the price would fall flat. Given Crypto markets' propensity to scam, I'd be shocked if finex & co didn't engage in manipulation. Maybe not to the extent that the paper's authors claim - China, S. Korea, India all banned / tried to ban crypto and I think Chinese volume drying up was a major cause for the bubble popping.

cwkoss 7y ago

Next FOMO bubble is going to be exciting: it's getting much easier to acquire Bitcoin, so the conditions seem ripe for the next bubble to be even wilder. Keep an eye out for next spring, when Bitcoin block reward halves again. (don't invest more than you're willing to lose entirely it's very risky, but having skin in the game during a bubble is very fun in my experience and will quickly educate you in the emotionality of trading. Dollar cost averaging weekly seems like the best strategy: easy to feel dread at best entry points and greed at best sell points.)

ftufek 7y ago
The way I look at it, Bitcoin is a historical experiment happening during our lifetimes and mid-May (the time of halving) will be a very interesting milestone in that experiment. It could go up or down, but either way, it will be interesting to watch.
- rauchp 7y ago
  Is there any reason for it to go down because of the block halving? I've heard it might be already priced in, so would the lack of a pump be enough to cause a massive drop? Looking at the performance this year, I haven't seen any real patterns, except maybe the time Tether started printing again.
  - ftufek 7y ago
    There's a lot of other reasons why it can go down and it wouldn't necessarily go down because of halving. But when a lot of people expect something to go up, it can have reverse effects. A lot of people have this assumption that it will always go up after a halving, it very well might, but at the current price point, the average person can't even afford a single Bitcoin whereas at previous halving (in 2016) that was still doable (it was on the order of a few hundreds of dollars). At this stage, you would need big investors and probably that's what companies like Bakkt will allow.
    - Terretta 7y ago
      BTC needs to move its decimal point. Like Berkshire Hathaway: Investors appear to like Berkshire Hathaway stock in the $60s and even the $70s more than they liked it at roughly $3500 a share. Berkshire shareholders approved a 50-for-1 stock split of Berkshire's Class B shares yesterday. Trading began today. The lower price is seen as an opening for small investors who couldn't afford the old four-figure price tag. At yesterday's meeting, Warren Buffett told shareholders that the increased trading volume and liquidity for the Class B shares after the split could make it the key driver of Berkshire's market value. "The B may be the tail that wags the dog now." https://www.cnbc.com/id/34973846 https://www.cnbc.com/id/34973846 On the other hand: https://www.investopedia.com/ask/answers/021615/why-doesnt-warren-buffett-split-berkshire-hathaway-stock.asp https://www.investopedia.com/ask/answers/021615/why-doesnt-w...
      - nullc 7y ago
        When the price first went over $1000 some sites switched to using mBTC ... but then the prices went under $1000 and there were complaints about the small numbers being confusing. You can't win. > opening for small investors who couldn't afford the old four-figure price tag. That's an issue that doesn't exist for Bitcoin though-- you can purchase FAR less than one bitcoin at a time.
sdan 7y ago
How do you DCA?
- cwkoss 7y ago
  Pick a dollar amount and (buy|sell) that amount of Bitcoin every week on the same day at same time. By making a 'dumb' plan, you remove the enticement to try and time the market. Perhaps even more than wall street markets, it's hard to day trade Bitcoin successfully: most of the advice you'll read is by people who are either lying, exaggerating or got lucky. The major issue is that there is a TON of non-public information that is much more relevant to price levels than publicly available information. Many smart players who are using 'insider info' will be able to eat your lunch. I fully expect that someone has a very accurate model of the quantity of deposits at some exchanges via address linking, and is watching inflows and outflows carefully. I also expect employees of Bitcoin exchanges are passing data to trader friends. Knowing when a big chunk of Bitcoin is about to be tradable on an exchange is a great sell indicator, and USD a great buy indicator.
- krallja 7y ago
  // parameters: $520 to invest over 1 year for(i=1; i<=52; i++) { buy(10 usd); sleep(1 week); }
  - sdan 7y ago
    Yeah I know how DCA works. Just wondering on what platform you're doing it on.
    - snodnipper 7y ago
      You can do that on Coinbase. There is a blog post here https://blog.coinbase.com/easier-recurring-buys-and-sells-on-coinbase-9a3cd7ea934e https://blog.coinbase.com/easier-recurring-buys-and-sells-on...
      - sdan 7y ago
        Feel like Coinbase fees are too high... even for Pro
deleted 7y ago
[deleted]
zelly 7y ago
When/if the price goes over 20k again, that's when animal-mode FOMO adrenaline will re-emerge. Even Nouriel Roubini will be buying. At some point, people will genuinely fear they are missing out on the next world currency, even the skeptics. That will either be the best time in the world to sell or the best time to buy, who knows.
ppf 7y ago
Do you see what you've become? You're excited about people FOMO'ing into a risky investment (that you happen to hold). You have become the bad actor in this scenario, waiting for new people to hand over their money.

tedk-42 7y ago

Pretty much this. How could one whale pump so much money into the market? It was a societal thing more so than an individual person. People were speculating like crazy to the point where you had grandmas giving investment advice on this new thing called 'bitcoin' for their grandkids to get rich from. Tether's in the spotlight right now and journos will have a nice round of clickbait articles to keep the interest going. Reason will prevail!

dwd 7y ago
It's the same as attributing the Sterling crash in '92 just to Soros. He had a large position and enough to move the market but he wasn't the only player, and probably small in comparison to all the retail investors who would have lost out late in the sell off panic.
jrochkind1 7y ago
> How could one whale pump so much money into the market? Well, the allegation is, because they were printing it.

andreygrehov 7y ago

Agreed. During the 2017 run up, I had tons of non-technical folks asking me to buy Bitcoin for them. A doctor from Europe was ready to spend $100k, which is what he's making per year. A healthcare specialist from New York, with an annual salary about $40k, was ready to spend $10k. An athlete from Brazil was begging to spend his $300k on altcoins. Many people do not realize how strong FOMO can be.