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This look eerily familiar to the NASDAQ in February/March of 2000. Plus there's no recent financial news to justify such a huge jump in value in such a short ti

by Oculus 14y ago

This look eerily familiar to the NASDAQ in February/March of 2000. Plus there's no recent financial news to justify such a huge jump in value in such a short time. This bubble will burst. It will burst soon and it will burn the people who just jumped in and bought the new mining-specific machines that recently came on the market.

ISL 14y ago
"In the short term the market is a popularity contest; in the long term it is a weighing machine." - Buffett If you'd like to hold BTC for 10-20 years, they may be quite cheap at the moment, as most of them have already been made. If you're looking for returns/stability/growth over the next six months, look out. As a medium of exchange, the BTC is presently sub-par; it's just too volatile. I can't be certain that, if I exchange USD for BTC in a wallet on my phone, that it will be worth within 1% of what I paid by the time I walk to a store to spend it.
- betterunix 14y ago
  "If you'd like to hold BTC for 10-20 years, they may be quite cheap at the moment, as most of them have already been made." That fact that most have already been computed has little bearing on the future price of BTC. What matters in the future is whether or not people will actually use Bitcoin as a currency (it has no other use); I am still not convinced that it will ever become mainstream. I hear about all sorts of places that accept Bitcoin payments, but I have yet to see anything that matters -- I cannot buy diesel with it, I cannot pay rent with it, I cannot pay utility bills with it, my local supermarket does not take it, and I cannot pay taxes with it. Even for black market transactions (drugs, guns, etc.) Bitcoin is obscure; even with all the sales that happen on Silk Road, you are looking at a tiny fraction of the market for illegal drugs. Bitcoin is in a very precarious position. Most of the cost of buying in is the result of speculation about its future use, which is fueled by the media coverage it receives on tech news sites. A lot of the hype is based on questionable assumptions about Bitcoin's security and about the lack of authorities in the system. Bitcoin's ability to survive when the hype dies down and the assumptions are challenged is doubtful, at least from where I sit.
  - rockyleal 14y ago
    Rome wasn't built in a day
  - ISL 14y ago
    The day the assumptions get challenged, especially when the Man steps in, is the critical one. Something like BTC, however, just seems convenient. In a thread yesterday, I needed to express the price of tools in a country-independent way. For giggles, I expressed it in BTC instead of USD; afterward, it felt right. A country-invariant store of value has real value on its own. It might not be BTC, but I don't think cryptocurrency is going away.
    - jdotjdot 14y ago
      It may have felt right, but by tomorrow it will be inaccurate, since BTC/USD will have continued to shoot up. There really is no country-independent way yo express price, even those with the same currency have different prices for the same basket of goods based on a myriad of conditions. That's what Happy Meals don't cost the same everywhere.
- miles 14y ago
  If you'd like to hold BTC for 10-20 years, they may be quite cheap at the moment, as most of them have already been made. Just over half have been mined at this point: http://blockchain.info/charts/total-bitcoins http://blockchain.info/charts/total-bitcoins https://en.bitcoin.it/wiki/FAQ#How_are_new_bitcoins_created.3F https://en.bitcoin.it/wiki/FAQ#How_are_new_bitcoins_created....
  - zvrba 14y ago
    But they are getting exponentially harder to make.
    - nicpottier 14y ago
      They are made at a constant predetermined rate. They are only harder to make because more people are trying to make them. The way bitcoins work is that the difficulty of the proof scales with the CPU power. If half the computers currently mining decided to move on to do something else tomorrow, bitcoins would continue to be made at the exact same rate.
  - ISL 14y ago
    On a log plot, half and one are very close together. In my view, this is the way to look at BTC: http://bitcoincharts.com/charts/mtgoxUSD#tgSzm1g10zm2g25zvzl http://bitcoincharts.com/charts/mtgoxUSD#tgSzm1g10zm2g25zvzl BTC has only just begun to experience volatility. The natural price is somewhere between $10^7 and $10^-7 (I'd pay $1 to own all the BTC, just for kicks). The future will sort it out. For as long as coins are still being made, there's direct connection to reality. Someone, somewhere, will have a few integral BTC, and they'll probably want to exchange them for something else of value. After the coins run out, I can't figure out what happens; it might be bad.

by Oculus 14y ago

ISL 14y ago

"In the short term the market is a popularity contest; in the long term it is a weighing machine." - Buffett If you'd like to hold BTC for 10-20 years, they may be quite cheap at the moment, as most of them have already been made. If you're looking for returns/stability/growth over the next six months, look out. As a medium of exchange, the BTC is presently sub-par; it's just too volatile. I can't be certain that, if I exchange USD for BTC in a wallet on my phone, that it will be worth within 1% of what I paid by the time I walk to a store to spend it.

betterunix 14y ago
"If you'd like to hold BTC for 10-20 years, they may be quite cheap at the moment, as most of them have already been made." That fact that most have already been computed has little bearing on the future price of BTC. What matters in the future is whether or not people will actually use Bitcoin as a currency (it has no other use); I am still not convinced that it will ever become mainstream. I hear about all sorts of places that accept Bitcoin payments, but I have yet to see anything that matters -- I cannot buy diesel with it, I cannot pay rent with it, I cannot pay utility bills with it, my local supermarket does not take it, and I cannot pay taxes with it. Even for black market transactions (drugs, guns, etc.) Bitcoin is obscure; even with all the sales that happen on Silk Road, you are looking at a tiny fraction of the market for illegal drugs. Bitcoin is in a very precarious position. Most of the cost of buying in is the result of speculation about its future use, which is fueled by the media coverage it receives on tech news sites. A lot of the hype is based on questionable assumptions about Bitcoin's security and about the lack of authorities in the system. Bitcoin's ability to survive when the hype dies down and the assumptions are challenged is doubtful, at least from where I sit.
- rockyleal 14y ago
  Rome wasn't built in a day
- ISL 14y ago
  The day the assumptions get challenged, especially when the Man steps in, is the critical one. Something like BTC, however, just seems convenient. In a thread yesterday, I needed to express the price of tools in a country-independent way. For giggles, I expressed it in BTC instead of USD; afterward, it felt right. A country-invariant store of value has real value on its own. It might not be BTC, but I don't think cryptocurrency is going away.
  - jdotjdot 14y ago
    It may have felt right, but by tomorrow it will be inaccurate, since BTC/USD will have continued to shoot up. There really is no country-independent way yo express price, even those with the same currency have different prices for the same basket of goods based on a myriad of conditions. That's what Happy Meals don't cost the same everywhere.
miles 14y ago
If you'd like to hold BTC for 10-20 years, they may be quite cheap at the moment, as most of them have already been made. Just over half have been mined at this point: http://blockchain.info/charts/total-bitcoins http://blockchain.info/charts/total-bitcoins https://en.bitcoin.it/wiki/FAQ#How_are_new_bitcoins_created.3F https://en.bitcoin.it/wiki/FAQ#How_are_new_bitcoins_created....
- zvrba 14y ago
  But they are getting exponentially harder to make.
  - nicpottier 14y ago
    They are made at a constant predetermined rate. They are only harder to make because more people are trying to make them. The way bitcoins work is that the difficulty of the proof scales with the CPU power. If half the computers currently mining decided to move on to do something else tomorrow, bitcoins would continue to be made at the exact same rate.
- ISL 14y ago
  On a log plot, half and one are very close together. In my view, this is the way to look at BTC: http://bitcoincharts.com/charts/mtgoxUSD#tgSzm1g10zm2g25zvzl http://bitcoincharts.com/charts/mtgoxUSD#tgSzm1g10zm2g25zvzl BTC has only just begun to experience volatility. The natural price is somewhere between $10^7 and $10^-7 (I'd pay $1 to own all the BTC, just for kicks). The future will sort it out. For as long as coins are still being made, there's direct connection to reality. Someone, somewhere, will have a few integral BTC, and they'll probably want to exchange them for something else of value. After the coins run out, I can't figure out what happens; it might be bad.