7 ms·

Bitcoin has everything it needs to become a major speculative bubble

52 points by hodgesmr 14y ago

johnmurch 14y ago
MTGox is down? Price jump $40 in a night - things getting crazy!
- niggler 14y ago
  "Database access error, please retry later"
  - alexkus 14y ago
    Which comes and goes. I've got in several times in the last hour.
- killerpopiller 14y ago
  not here http://bitcoinity.org/markets?currency=EUR&exchange=mtgox http://bitcoinity.org/markets?currency=EUR&exchange=mtgo... I really would like to buy more, but I am unsure if it is normalizing soon (back to 100$) or hiking like gold did last year.
  - narcissus 14y ago
    Don't know if we can trust that link at the moment: it's showing the last trade as "an hour ago".
    - johnsoft 14y ago
      It's right; MtGox has been down/frozen for the past hour (at the time of this post). Bitcoinity is a pretty solid site in my experience.
  - beedogs 14y ago
    According to that graph, mtgox stopped responding and they've been displaying the last available price since then.
- kmfrk 14y ago
  @mikko speculates that Bitcoin exchanges are getting DDoS'd.
sturadnidge 14y ago
I like the part about bitcoin 'not having amy fundamentals to fall back to'. As if fiat currencies are any different.
- Nursie 14y ago
  Well, fiat currencies have economies running in them where bitcoin mostly has speculation, so yeah, there's a difference.
  - cinquemb 14y ago
    And they used to be running on bartering, gold and silver. Things change. I wonder how "running" cyprus is now :P I'd say the fundamentals could be found looking in the weaknesses in government/central bank fiat and the controls put in place on how freely people can obtain and receive goods/services. But yeah, this is a bubble, but if you look at the fundamentals that governments/central banks are running on now, it just takes one country with a overly bloated private banking sector and dieselboom to apply his templates… :P
    - nikcub 14y ago
      cyprus doesn't have its own currency, which is why they had to resort to doing what they did they could have otherwise printed a bunch of money and deflated their debt, which is what the US gov does
- Thrymr 14y ago
  The USD has the US government behind it. Whatever you think of that, it's not nothing.
  - willurd 14y ago
    "The USD has the US government behind it" What does that even mean? Also, the US government doesn't really have anything to do with the USD; the USD is managed solely by the Federal Reserve, and the Federal Reserve is not a branch of the US government (it's a privately held bank; look it up). "it's not nothing" It's worse than nothing. The Federal Reserve can and does change the value of the dollar at will (it's called inflation). That's why you can buy a loaf of bread with your 5 bucks now, but in 10 years your 5 bucks probably won't even buy a candy bar. Contrast that with gold. In 1913 (the year the Federal Reserve was created), you could buy a house with 100 ounces of gold. 100 1913 dollars is worth roughly 2 2013 dollars, but 100 1913 ounces of gold is worth exactly 100 2013 ounces of gold, and you can still buy a house with it (100 ounces of gold is $156,740 USD; no, this won't buy you a house in New York, but it will in most other parts of the country). That's what it means for a currency to be backed by something of value. Value doesn't change.
Irregardless 14y ago
I'm sticking to my price target of $2 by late June/early July[1]. Still no sign of adoption by any popular retailers, the majority of demand is coming from speculators, and the exchanges are getting slower every day (MtGox is down as I write this and the queue to open an account is several days deep). At this point, BitCoin is still more of a toy than a currency. [1] https://news.ycombinator.com/item?id=5324722 https://news.ycombinator.com/item?id=5324722
- iSnow 14y ago
  A toy with a 1.4 bn market cap. Of course no one - including you - will remember your prophecy come August, but I am pretty sure you are wrong. Why? Because history does not repeat itself, esp. not when it comes to speculation.
  - pmelendez 14y ago
    "Because history does not repeat itself" Sorry but human history is full of cycles and mistakes repeated over and over. Have you ever heard "Humans are the only animals that stumble on the same rock twice" ?
  - hodgesmr 14y ago
    "Because history does not repeat itself, esp. not when it comes to speculation." See every bubble ever.
  - EliRivers 14y ago
    House prices seem to bubble and crash over and over.
  - matwood 14y ago
    Why? Because history does not repeat itself, esp. not when it comes to speculation. Haha, that's funny. See tulips, housing, Iraqi Dinar, CO Silver industry crash, gold in the 80s, the list goes on.
    - iSnow 14y ago
luckystarr 14y ago
So the author just bought his first bitcoins, eh? :D
wladimir 14y ago
Can we stop with the bitcoin topics that are solely about the price? Sure, if a company starts accepting it it's news, if something happens to bitcoin network it's news, but not this. This is getting crazy. This is not 'pimp your currency' news (yes, I say that as a bitcoin dev). I'm sure everyone one HN has made their mind about it by now anyway...
- hodgesmr 14y ago
  Hacker News: for when all you really want to talk about is Bitcoin and Aaron Swartz.
- garethadams 14y ago
  It's a good job this article isn't solely about the price then, and the headline is revealed as a lie just a couple of paragraphs in
beedogs 14y ago
I'm raising my LOL target to over 9000. Also, mtgox is down; has been for about an hour.
- cinquemb 14y ago
  api is still working… http://data.mtgox.com/api/1/BTCUSD/depth/fetch http://data.mtgox.com/api/1/BTCUSD/depth/fetch
  - beedogs 14y ago
    That's been displaying the same price ($141.32001) for the past hour, though.
    - oleganza 14y ago
      Price doesn't change because mtgox is down and people cannot trade.
Sambdala 14y ago
It seems like a price target of $400 misses the point. Bitcoin is likely making order of magnitude changes in value, one direction or another. Edit: Oops, didn't read the article first, the author isn't actually setting a price target because he doesn't like Bitcoin, but I still stick by my statement.
deleted 14y ago
[deleted]
k-i-m 14y ago
during the first bubble i bought about a hundred bitcoins (2k usd worth), just after few days the bubble unfortunately popped and the price was back to 4-5, and i decided to sell them (it was my first "trading" experience, the stress of the losing was high), after a while (late 2012) i bought back what i had left for $9 and sold them for $13, now I just wish that I kept them instead when i bought them initially :-(
ohwp 14y ago
Noob question: as I understand Bitcoins are linked to values of other currencies. Is it possible to link it to a stable non-currency value/index? (I'm thinking about the Big Mac index here: http://en.wikipedia.org/wiki/Big_Mac_Index http://en.wikipedia.org/wiki/Big_Mac_Index) Or to put it in another way: it it possible to link a Bitcoin value (or any currency) to an index not influenced by greed? Could it be linked to the number of people alive for example?
- hazov 14y ago
  To build a comparison of price indexes you have to have an exchange rate and products that are sold on two markets that use the two currencies separately, there's no Big Mac sold by BTC as far as I know, as such you have to find products that are sold in the market using the two currencies. I can think of pot, and using silk road to build the index for BTC but as I see its prices are pegged to dollar and BTC is only used to maintain some anonymity of the transactions. I'm not sure that if that's what you wanted.
- icebraining 14y ago
  You can only determine the Bitcoin value in another index if there are trades being made of Bitcoins for the item being indexed. So if you want to create a BTC/Number of People Alive exchange rate, you need people trading lives for Bitcoins, which is a bit macabre.
hazov 14y ago
I post about my beliefs relating to bitcoin/cryptocurrency right here: https://news.ycombinator.com/item?id=5486245 https://news.ycombinator.com/item?id=5486245 Would love to see much discussion about the topics. Anyway the post (posted 2 hours ago) is not in the front page anymore.
gokhan 14y ago
Bitcoin price increase lacks the necessary volume element. So little people are buying and selling at this price.
codemonkeymike 14y ago
The number doesn't matter, the experiment was a success.
nicholassmith 14y ago
Slightly away from the crux of the article, I've seen a few people mention hacking as a reason why BitCoin is still risky. Are they talking about hacking of BitCoin at the low level, or hacks on BitCoin repositories?
- ionwake 14y ago
  repos
venomsnake 14y ago
So - if the bitcoins quadrupled in value for a month this means two things: We have 4 times as many goods and services offered for bitcoins or speculative bubble. So unless we have lots of new businesses that accept them ... the market for bitcoins will be as fun as the Apple one.
tlrobinson 14y ago
I'm sure Business Insider's 31 posts about Bitcoin in the last week has nothing to do with it... http://www.businessinsider.com/s?q=bitcoin&vertical=&author=&contributed=1&sort=date http://www.businessinsider.com/s?q=bitcoin&vertical=&#38...

52 points by hodgesmr 14y ago

johnmurch 14y ago

MTGox is down? Price jump $40 in a night - things getting crazy!

niggler 14y ago
"Database access error, please retry later"
- alexkus 14y ago
  Which comes and goes. I've got in several times in the last hour.
killerpopiller 14y ago
not here http://bitcoinity.org/markets?currency=EUR&exchange=mtgox http://bitcoinity.org/markets?currency=EUR&exchange=mtgo... I really would like to buy more, but I am unsure if it is normalizing soon (back to 100$) or hiking like gold did last year.
- narcissus 14y ago
  Don't know if we can trust that link at the moment: it's showing the last trade as "an hour ago".
  - johnsoft 14y ago
    It's right; MtGox has been down/frozen for the past hour (at the time of this post). Bitcoinity is a pretty solid site in my experience.
- beedogs 14y ago
  According to that graph, mtgox stopped responding and they've been displaying the last available price since then.
kmfrk 14y ago
@mikko speculates that Bitcoin exchanges are getting DDoS'd.

sturadnidge 14y ago

I like the part about bitcoin 'not having amy fundamentals to fall back to'. As if fiat currencies are any different.

Nursie 14y ago
Well, fiat currencies have economies running in them where bitcoin mostly has speculation, so yeah, there's a difference.
- cinquemb 14y ago
  And they used to be running on bartering, gold and silver. Things change. I wonder how "running" cyprus is now :P I'd say the fundamentals could be found looking in the weaknesses in government/central bank fiat and the controls put in place on how freely people can obtain and receive goods/services. But yeah, this is a bubble, but if you look at the fundamentals that governments/central banks are running on now, it just takes one country with a overly bloated private banking sector and dieselboom to apply his templates… :P
  - nikcub 14y ago
    cyprus doesn't have its own currency, which is why they had to resort to doing what they did they could have otherwise printed a bunch of money and deflated their debt, which is what the US gov does
Thrymr 14y ago
The USD has the US government behind it. Whatever you think of that, it's not nothing.
- willurd 14y ago
  "The USD has the US government behind it" What does that even mean? Also, the US government doesn't really have anything to do with the USD; the USD is managed solely by the Federal Reserve, and the Federal Reserve is not a branch of the US government (it's a privately held bank; look it up). "it's not nothing" It's worse than nothing. The Federal Reserve can and does change the value of the dollar at will (it's called inflation). That's why you can buy a loaf of bread with your 5 bucks now, but in 10 years your 5 bucks probably won't even buy a candy bar. Contrast that with gold. In 1913 (the year the Federal Reserve was created), you could buy a house with 100 ounces of gold. 100 1913 dollars is worth roughly 2 2013 dollars, but 100 1913 ounces of gold is worth exactly 100 2013 ounces of gold, and you can still buy a house with it (100 ounces of gold is $156,740 USD; no, this won't buy you a house in New York, but it will in most other parts of the country). That's what it means for a currency to be backed by something of value. Value doesn't change.

Irregardless 14y ago

I'm sticking to my price target of $2 by late June/early July[1]. Still no sign of adoption by any popular retailers, the majority of demand is coming from speculators, and the exchanges are getting slower every day (MtGox is down as I write this and the queue to open an account is several days deep). At this point, BitCoin is still more of a toy than a currency. [1] https://news.ycombinator.com/item?id=5324722 https://news.ycombinator.com/item?id=5324722

iSnow 14y ago
A toy with a 1.4 bn market cap. Of course no one - including you - will remember your prophecy come August, but I am pretty sure you are wrong. Why? Because history does not repeat itself, esp. not when it comes to speculation.
- pmelendez 14y ago
  "Because history does not repeat itself" Sorry but human history is full of cycles and mistakes repeated over and over. Have you ever heard "Humans are the only animals that stumble on the same rock twice" ?
- hodgesmr 14y ago
  "Because history does not repeat itself, esp. not when it comes to speculation." See every bubble ever.
- EliRivers 14y ago
  House prices seem to bubble and crash over and over.
- matwood 14y ago
  Why? Because history does not repeat itself, esp. not when it comes to speculation. Haha, that's funny. See tulips, housing, Iraqi Dinar, CO Silver industry crash, gold in the 80s, the list goes on.
  - iSnow 14y ago

luckystarr 14y ago

So the author just bought his first bitcoins, eh? :D

wladimir 14y ago

Can we stop with the bitcoin topics that are solely about the price? Sure, if a company starts accepting it it's news, if something happens to bitcoin network it's news, but not this. This is getting crazy. This is not 'pimp your currency' news (yes, I say that as a bitcoin dev). I'm sure everyone one HN has made their mind about it by now anyway...

hodgesmr 14y ago
Hacker News: for when all you really want to talk about is Bitcoin and Aaron Swartz.
garethadams 14y ago
It's a good job this article isn't solely about the price then, and the headline is revealed as a lie just a couple of paragraphs in

beedogs 14y ago

I'm raising my LOL target to over 9000. Also, mtgox is down; has been for about an hour.

cinquemb 14y ago
api is still working… http://data.mtgox.com/api/1/BTCUSD/depth/fetch http://data.mtgox.com/api/1/BTCUSD/depth/fetch
- beedogs 14y ago
  That's been displaying the same price ($141.32001) for the past hour, though.
  - oleganza 14y ago
    Price doesn't change because mtgox is down and people cannot trade.

Sambdala 14y ago

It seems like a price target of $400 misses the point. Bitcoin is likely making order of magnitude changes in value, one direction or another. Edit: Oops, didn't read the article first, the author isn't actually setting a price target because he doesn't like Bitcoin, but I still stick by my statement.

deleted 14y ago

[deleted]

k-i-m 14y ago

during the first bubble i bought about a hundred bitcoins (2k usd worth), just after few days the bubble unfortunately popped and the price was back to 4-5, and i decided to sell them (it was my first "trading" experience, the stress of the losing was high), after a while (late 2012) i bought back what i had left for $9 and sold them for $13, now I just wish that I kept them instead when i bought them initially :-(

ohwp 14y ago

Noob question: as I understand Bitcoins are linked to values of other currencies. Is it possible to link it to a stable non-currency value/index? (I'm thinking about the Big Mac index here: http://en.wikipedia.org/wiki/Big_Mac_Index http://en.wikipedia.org/wiki/Big_Mac_Index) Or to put it in another way: it it possible to link a Bitcoin value (or any currency) to an index not influenced by greed? Could it be linked to the number of people alive for example?

hazov 14y ago
To build a comparison of price indexes you have to have an exchange rate and products that are sold on two markets that use the two currencies separately, there's no Big Mac sold by BTC as far as I know, as such you have to find products that are sold in the market using the two currencies. I can think of pot, and using silk road to build the index for BTC but as I see its prices are pegged to dollar and BTC is only used to maintain some anonymity of the transactions. I'm not sure that if that's what you wanted.
icebraining 14y ago
You can only determine the Bitcoin value in another index if there are trades being made of Bitcoins for the item being indexed. So if you want to create a BTC/Number of People Alive exchange rate, you need people trading lives for Bitcoins, which is a bit macabre.

hazov 14y ago

I post about my beliefs relating to bitcoin/cryptocurrency right here: https://news.ycombinator.com/item?id=5486245 https://news.ycombinator.com/item?id=5486245 Would love to see much discussion about the topics. Anyway the post (posted 2 hours ago) is not in the front page anymore.

gokhan 14y ago

Bitcoin price increase lacks the necessary volume element. So little people are buying and selling at this price.

codemonkeymike 14y ago

The number doesn't matter, the experiment was a success.

nicholassmith 14y ago

Slightly away from the crux of the article, I've seen a few people mention hacking as a reason why BitCoin is still risky. Are they talking about hacking of BitCoin at the low level, or hacks on BitCoin repositories?

ionwake 14y ago
repos

venomsnake 14y ago

So - if the bitcoins quadrupled in value for a month this means two things: We have 4 times as many goods and services offered for bitcoins or speculative bubble. So unless we have lots of new businesses that accept them ... the market for bitcoins will be as fun as the Apple one.

tlrobinson 14y ago

I'm sure Business Insider's 31 posts about Bitcoin in the last week has nothing to do with it... http://www.businessinsider.com/s?q=bitcoin&vertical=&author=&contributed=1&sort=date http://www.businessinsider.com/s?q=bitcoin&vertical=&#38...