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I can make the same statement you made about stock price about commodities and coins, in that I have to pay at least shares_outstanding * current_price to acqui

I can make the same statement you made about stock price about commodities and coins, in that I have to pay at least shares_outstanding * current_price to acquire all of a commodity or a coin. The metric works, it's just that people keep making false claims from it.

ceejayoz 5y ago
> I can make the same statement you made about stock price about commodities and coins, in that I have to pay at least shares_outstanding * current_price to acquire all of a commodity or a coin. You don't, though. The price would change if you attempted to do so. You can buy a company because you offer the company a value for all their shares; if enough of their shareholders approve the deal, it's done. You can't do the same with Bitcoin, or copper. Each requires reaching out to individual owners/producers, and the sales affect the price for the next purchase. If you tried to buy all BTC in existence, the price would go up. If you tried to offload a bunch, it'd crash. It's highly unlikely you could sell $1T worth of BTC without driving the price massively downwards.
- wpietri 5y ago
  Exactly. You can't buy all the gold in the world at the imaginary "market cap". Or all of a currency. And if you did buy all of a currency, it would be worthless, because the whole point of a currency is as a medium for exchange. Indeed, that's how they take a currency out of service, as they did when they launched the Euro.
  - dna_polymerase 5y ago
    > Exactly. You can't buy all the gold in the world at the imaginary "market cap" Nobody said that. We clearly acknowledge that it is at least market cap.
  - trompetenaccoun 5y ago
    No. They decreed that the respective currencies stopped being legal tender (against the will of the people in many cases, btw) and so the people had no choice but to swap their money for Euros. The exchange rate was fixed and the currency was never bought on a free market. They couldn't have because many people would not have sold and then you'd have ended up with multiple competing currencies. The government has a monopoly on national currency, it's very different from gold and cryptocurrencies that are properly decentralized and freely traded. The name cryptocurrency is a misnomer for many of the new generation blockchains. They are not just currencies and they're also not a commodity like gold. You can think of a currency like Ethereum more like a decentralized company offering infrastructure services. It also has aspects of a currency and of a commodity. It's a bit of everything.
    - wpietri 5y ago
      People could and did hold onto them. I should know; I have a small collection of defunct notes. But they were in negligible amounts, because a currency isn't intrinsically valuable. What's the market cap of the Italian Lira? It was a meaningless question both before and after the Euro cutover.
- dna_polymerase 5y ago
  If I choose to buy a company the price will adjust upwards as well. The centralization of shares in a system does not change the fact that coins and commodities underlie the same market principles. > It's highly unlikely you could sell $1T worth of BTC without driving the price massively downwards. Same goes for any stock.

ceejayoz 5y ago

> I can make the same statement you made about stock price about commodities and coins, in that I have to pay at least shares_outstanding * current_price to acquire all of a commodity or a coin. You don't, though. The price would change if you attempted to do so. You can buy a company because you offer the company a value for all their shares; if enough of their shareholders approve the deal, it's done. You can't do the same with Bitcoin, or copper. Each requires reaching out to individual owners/producers, and the sales affect the price for the next purchase. If you tried to buy all BTC in existence, the price would go up. If you tried to offload a bunch, it'd crash. It's highly unlikely you could sell $1T worth of BTC without driving the price massively downwards.

wpietri 5y ago
Exactly. You can't buy all the gold in the world at the imaginary "market cap". Or all of a currency. And if you did buy all of a currency, it would be worthless, because the whole point of a currency is as a medium for exchange. Indeed, that's how they take a currency out of service, as they did when they launched the Euro.
- dna_polymerase 5y ago
  > Exactly. You can't buy all the gold in the world at the imaginary "market cap" Nobody said that. We clearly acknowledge that it is at least market cap.
- trompetenaccoun 5y ago
  No. They decreed that the respective currencies stopped being legal tender (against the will of the people in many cases, btw) and so the people had no choice but to swap their money for Euros. The exchange rate was fixed and the currency was never bought on a free market. They couldn't have because many people would not have sold and then you'd have ended up with multiple competing currencies. The government has a monopoly on national currency, it's very different from gold and cryptocurrencies that are properly decentralized and freely traded. The name cryptocurrency is a misnomer for many of the new generation blockchains. They are not just currencies and they're also not a commodity like gold. You can think of a currency like Ethereum more like a decentralized company offering infrastructure services. It also has aspects of a currency and of a commodity. It's a bit of everything.
  - wpietri 5y ago
    People could and did hold onto them. I should know; I have a small collection of defunct notes. But they were in negligible amounts, because a currency isn't intrinsically valuable. What's the market cap of the Italian Lira? It was a meaningless question both before and after the Euro cutover.
dna_polymerase 5y ago
If I choose to buy a company the price will adjust upwards as well. The centralization of shares in a system does not change the fact that coins and commodities underlie the same market principles. > It's highly unlikely you could sell $1T worth of BTC without driving the price massively downwards. Same goes for any stock.