Major fall in BTC price (16th Jan)

Discussion in 'Alternative Investments' started by jhegarty, Jan 16, 2018.

  1. Sunny

    Sunny Frequent Poster

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    That's not what they are saying. Tell me one central bank that takes deposits from individuals or 'punters'?
     
  2. jman0war

    jman0war Frequent Poster

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    Brendan i have on more than one occassion presented to you why anything including Bitcoin has value.
    It's called "Subjective Theory of Value".
    You on the other hand, have repeatedly refused to offer any sort of theory or reasonings behind your valuation.
     
    Last edited: Mar 13, 2018
  3. TheBigShort

    TheBigShort Frequent Poster

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    That's a fair point, granted. There is a lot of noise at both ends, at the zero end and at the €100,000 end. But I'm referring to its potential

    Non-traditional ways banking ways that are using the banking infrastructure as a trusted system? Would that be fair?

    The purpose or use for bitcoin in my opinion is its potential to hold my money outside of this system. Not all of my money, not today anyway, but the having the option to do so is a great idea imo.
    Granted, it has a long, long way to go if ever, to achieve this. But ultimately I think the concept has now been bedded and is more likely, than not, to gain traction. If that occurs, it may be through bitcoin, or some other crypto, we will have to wait and see.
     
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  4. TheBigShort

    TheBigShort Frequent Poster

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    But you have taken out a short bet on bitcoin? You have even put a stop-loss on its price rising way above where it is now? What analysis did you use to choose the stop-loss limit that you did - or is it just a hunch you have?
     
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  5. TheBigShort

    TheBigShort Frequent Poster

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  6. jman0war

    jman0war Frequent Poster

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    Whether punters move their digital funds from their local bank, into a Central Bank or just into to a larger commerical bank, the net result remains the same.

    There are other articles in the recent past that have mentioned Central Banks issuing digital currency that could result in Central Banks also holding deposits and basically taking over some of the roles of commercial banks handle today.

    Cut out the middle-men if they aren't doing anything useful.
     
    Last edited: Mar 13, 2018
  7. Brendan Burgess

    Brendan Burgess Founder

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    Hi Shortie

    Bitcoin is worth nothing. A bag of air is worth nothing. Fairy dust is worth nothing. If you want to argue that Bitcoin is worth €x, you have to show some analysis to support that value. I can't prove a negative. I can't prove that a bag of air is worth nothing. Someone who asserts that it is worth something, has to do that.

    I chose my stop-loss limit purely on the basis of what I am prepared to lose. Bitcoin is worth nothing and that is its potential. Unfortunately, there are enough faithful out there that they might push the price up to more than I can afford to lose. That is how I chose my stop-loss limit.

    Brendan
     
  8. jman0war

    jman0war Frequent Poster

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    A bag of air can be worth absolutely everything if you're underwater.
     
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  9. TheBigShort

    TheBigShort Frequent Poster

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    Plenty of posters have given you lots of detail as to why they believe bitcoin has value. You are not convinced and as such you value it at zero.
    Plenty of posters can give me lots of detail as to why gold is valued at $1,300 today. That does not stop me from considering those reasons and thinking that it is under-priced or over-priced, or even that is has had its day and only holds token value now.
    Value is subjective, in the eye of the buyer and seller.

    You appear to be making the mistake of comparing bitcoin to a profit producing asset, it is not.
    There is a high amount of speculation attached to it no doubt, but ditto Bransons Virgin Galaxy, Elon Musks Space X or Solar City, or the Mars One project. All of these projects are high risk, highly speculative and with a lot of money invested in them and non-profit making. Why would anyone back them? There is no guarantee that any profit will ever be made from these projects.

    Are they worthless?

    Hardly, something good might come out of them? Is that a possibility? Perhaps not what they originally hoped for, but its possible that new concepts, new boundaries of aviation science and space science are being tested here, leading to future projects that will hold value.

    Is it possible that the bitcoin concept has the possibility to disrupt, or to provide an alternative to the current monetary system? If you think yes, like I do, then that has value.
     
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  10. Brendan Burgess

    Brendan Burgess Founder

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    People invest in them because they think that they will get a return on their money. They expect those projects to make profits. There is no such expectation in Bitcoin. You are prepared to pay $8,000 for it only because you believe a "bigger fool" will be prepared to pay you more in the future.


    There are some reasons for spending money when you don't expect a return:
    1) A vanity project
    2) A worthwhile service to humanity

    But these are spending and not investment.

    Brendan
     
  11. TheBigShort

    TheBigShort Frequent Poster

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    Not always the case. These are highly speculative projects and anyone investing in them will be aware that there is a good chance they wont make a return.
    However there is also a sense of being part of something that may produce breakthroughs in science and engineering, that may ultimately transform the way we live. Being part of that holds value.
    Investing time and money does not always have to equate to profit. That is why a 'worthwhile service to humanity' can also be an investment, even if it costs you financially.
     
  12. jman0war

    jman0war Frequent Poster

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    Owning Bitcoin is claiming a stake in that open source project.
    There are no promises of dividends or profit-making made to anyone.

    Let's just see where this technology goes and how it progresses.

    The fact that regulators, G20 leaders and the Bank for International Settlements (BIS) are talking about it means it's disrupting them.
    Or at minimum they recognize the potential disruption and are reaching for the panic button.
     
  13. Duke of Marmalade

    Duke of Marmalade Frequent Poster

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    How many times has it to be emphasised that there is a complete disconnect between blockchain technology and the bitcoin it transfers. These Central Bank mutterings are about using blockchain to speed up international transfers of securities. They are not about issuing a new currency. Transactions will still be in Fiat. In fact if it was a new currency sponsored by Central Banks that would be anathema to the disciples of Shortie Syndrome.

    So to repeat earlier comments, if the Fed do enable blockchain transfers of $ it will have no impact whatsoever on the value of the $. Bitcoin is a nothing safely transferable by blockchain technology. Wherefore does that give bitcoin an exchange rate of $20,000 or $10,000 or $1,000 or anything at all.
     
    Last edited: Mar 13, 2018
  14. jman0war

    jman0war Frequent Poster

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    Actually Duke, we don't know.
    BIS could just as well use a blockchain-based digital currency of their own, modeled exactly like Bitcoin.
    Perhaps pegged to the US dollar if that makes you feel better about it.


    Away from the public eye, change may also be happening and perhaps sooner. The BIS report canvasses a second, complementary, model of CBDCs (Central Bank Digital Currency) aimed at financial institutions that would build on the blockchain technologies underlying bitcoin. Such tokenised forms of digital central bank money could potentially help streamline many of the cumbersome clearing and settlement processes that are currently needed to complete securities and foreign exchange trades. So far, however, central bank experiments with such forms of CBDCs have not shown conclusive benefits for wholesale payments and beyond, but technology and design are evolving quickly.

    https://www.bis.org/review/r180313a.htm

    A general purpose CBDC could have wide-ranging implications for banks and the financial system.

    General purpose 'Central Bank Digital Currency'?
    If it were a USD, why wouldn't they just call it an eDollar or something.
     
  15. jman0war

    jman0war Frequent Poster

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    This central bankers speech is quite interesting.
    It's from the Vice Governor of the Czech National Bank, speaking to BIS (a cartel, i mean, an organization of central bankers).

    He discusses what's driving central banks issuance of digital money and then gets into some scenarios.

    But instead, I will stress - and this is my point today - the positive philosophical influence of bitcoin on the conservative world of central banking. True, it is far from clear that anytime soon a full-fledged digital currency (be it blockchain based or not) will be created by a central bank (some of you may be following the debate in the Riksbank in Sweden), but the last three years have seen an explosion of research on this idea in many central banks. Bitcoin must be credited for this powerful intellectual stimulus. When so many professors at the most esteemed universities of the developed world are not thinking about potential reforms of the current monetary order, we have received a stimulus from the libertarian IT guys instead. Fine.

    "Helicopter money" is an interesting idea, instead of quantitative easing.
    Basically air dropping all deposit holders x amount of new digital coins during recession.
    Discusses some problems with this, and then there's this little Orwellian bit:

    If the central bank allowed transfers from bank accounts to the digital currency, it would have to cap the amount a single individual could hold in the digital currency, perhaps at the level of the median monthly salary. In the absolute extreme, the central bank could also determine what goods the helicopter money could be spent on.

    https://www.bis.org/review/r180308a.htm
     
  16. Duke of Marmalade

    Duke of Marmalade Frequent Poster

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    jman I agree that this BIS stuff is confusing, indeed to me a tad disturbing. What I feel they cannot possibly mean is illustrated by the following fictional press release.

    "Today the BIS has launched biscoin. It is based on blockchain technology. It has no objective valuation basis and it is not linked in any way to any conventional currency. The protocol will only allow 15 million units to be created so look guys this is even more scarce than bitcoin. Its exchange rate will be determined by supply and demand so, ready, set , go let the brawl begin to establish its price."
     
    Last edited: Mar 13, 2018
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  17. jman0war

    jman0war Frequent Poster

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    Bitcoin has got them thinking, imagining, and inventing the future.
    BIS wants to put themselves firmly at the centre of that future, which is not surprising.
    But the fact is, it's happening.

    They casually mention 'the next recession' like it's a surety.
    Let it play out, Bitcoin looks long term bullish from where i'm sitting.
     
  18. TheBigShort

    TheBigShort Frequent Poster

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    This makes no sense to me. The whole purpose behind blockchain, as presented in the form of bitcoin, is to provide trustless financial transactions.
    What point a Fed Res backed crypto if they can devalue it, like in 1933, or abandon the system altogether like in 1971 or mass produce like with QE?
    As jman0war quotes above, the mindset is of central control;

     
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  19. jman0war

    jman0war Frequent Poster

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    Anyway, BIS is one to follow on your twitter feed Duke.
    It's good to know what the enemy is thinking. ;)
     
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  20. tecate

    tecate Frequent Poster

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    When has banking been disturbed in how they do things? If nothing else, can those either opposed to cryptocurrency or who don't have any belief in it understand that at a basic level, if it can light a fire under them and get them to offer an improved value proposition to consumers that in itself is a win? Of course, I believe it can achieve a lot more but we will have to see how it plays out.

    My immediate concern right now is the Tether issue. Can't justify holding any crypto until that is truly outed and dealt with...which could be some time.
    It's ironic but if what we think is at play with Bitfinex/Tether, it's completely averse to what bitcoin is all about.
     
    Last edited: Mar 14, 2018