Does anyone know the actual value of the money put into bitcoin so far vs this market cap of recent sale price x count? I'm keen to know actually how many people could withdraw at similar sale prices to now before it evaporated.
Because it's so exponential, I would imagine a rapid sale of 5% would remove 90% of the value, but I'd love to know the specifics.
Money isn't "put into" Bitcoin. Every USD "put into" an exchange in exchange for Bitcoin was simultaneously taken out by the person on the other side of the trade.
The future value of Bitcoin in USD is entirely dependent on people in the future wanting to buy Bitcoin for USD; if no one wants to, it is not worth any USD.
I guess the question should be rephrased then as "how much have the current owners of bitcoin collectively exchanged for their coins?" This question also becomes more interesting when you factor in every coin that has been mined but not yet exchanged for money. I believe the GP is correct in guessing that the number will be much smaller than the current market cap of BTC
The number is without question much smaller than the current market cap of BTC. The current price and number of shares traded on the exchanges is not very meaningful since exchanges are unregulated and you have behavior such as wash trading where you can manipulate the price and inflate volume.
What I would like to know is how much money has actually been transferred into the exchanges. That is what matters. If Coinbase has 12 million accounts, and on average only $100 was invested (I'm assuming there are MANY opened yet unfunded accounts), then we're talking about $1.2billion at play moving back and forth on that exchange. (this is just a hypothetical number, I would love Coinbase to produce statistics, but know they have no incentive to.)
If no new accounts get opened and no more money flows in, That $1.2b will slowly drop to zero as Coinbase and the miners eat up that pool with fees.
You do put money into a company when you buy its shares ... during an IPO. Meanwhile, owning shares of a company convey fractional ownership of it, its assets, and its future earnings. People will consider the stock price of a company relative to its assets and earnings (P/E) as an indicator of whether the company is overpriced or under-priced.
No one really notes the "total volume" of the trades of stocks, which is what you're asking for for Bitcoin; it isn't really a meaningful number. If people pass a stock
- or a Bitcoin - back and forth for 10 trades for [$99, $101] or for 100 trades for [$99, $101], it isn't really meaningful.
The best you can do for Bitcoin is to try to gauge the "depth of the market" right now, ie, how many "buy" and "sell" orders are out at what prices, how much Bitcoin you could buy or sell right now and what the average price you could buy or sell a large quantity of Bitcoin at. (Eg, if you wanted to sell X Bitcoin, you might be able to sell X/2 Bitcoin at $PRICE and X/2 Bitcoin at $PRICE/2, for an average price of $PRICE*3/4.)
AAPL buying/selling itself is a direct link between the assets inside AAPL and its stock price. Money can literally be "put into" and "taken out of" AAPL.
Those "assets inside" AAPL are still dollars. User payed dollars for AAPL share which ended up in a dollar account or a treasury bond. Stop being so obtuse.
Otherwise I can also say the same thing, that you can literally put dollars into Bitcoin by buying GBTC shares, since the dollars become "assets inside" the Bitcoin Investment Trust company.
Sure, the Bitcoin Investment Trust is no different than any other stock. Buying shares of GBTC entitles you to a share of its assets and earnings, same as any other company.
But what are those assets worth? AAPL owns patents, inventory, raw material, real estate, subsidiaries, investments (stocks, bonds, commodities, T-bills, the whole shebang) and straight-up cash. You can add all those together and you can evaluate each of them based on how their value can change over time and under different market conditions.
What assets does GBTC hold? If the answer is "Bitcoin", you've just recursed on "What is the value of a Bitcoin?"; if the answer is "Bitcoin, cash, other cryptocurrencies, and a whole lot of other assets", great, you can evaluate each of them independently and add them all together. But again, you're recursing on the value of cryptocurrencies without really coming any closer to an answer.
I was never discussing what AAPL or Bitcoin is worth or not.
Just the claim that "you can't put dollars into Bitcoin, because there is a seller on the other side which takes the dollars" somehow applies to Bitcoin in a special way. My claim is that this is true for most assets out there, stocks, commodities, or financial contracts.
So let's imagine you buy $1000 worth of AAPL, $1000 worth of pork bellies, and $1000 worth of BTC. Then, simultaneously, AAPL decides to close up shop, no one is interested in buying pork bellies anymore, and the Bitcoin network shuts down.
What do you now own in each case?
AAPL liquidates all of its assets, pays off its debts, and distributes the balance to its former shareholders. You probably don't get $1000, you probably get something like $50 or $100.
Someone delivers some number of physical, frozen pork bellies to you.
And from Bitcoin you get nothing.
This is what I mean when I say all of the buying doesn't actually "put money" into Bitcoin: it is an investment with no underlying value. With all other markets, what you think of as a two-party trade, between the buyer and the seller, is actually a three-party affair, between the buyer, the seller, and the company or asset being traded. "Putting money" into a company ultimately results in that company having more money to build out their business with; "putting money" into a commodity ultimately results in more producers producing more of the commodity. "Putting money" into Bitcoin ultimately results ... in nothing.
That applies to currencies too. I can "put money" into USD (from AUD) which actually does generate X for Y (for example, it creates more purchasing power for all importers in the USA).
One thing we know is that the USD exchange volume for the last 30 days was about $295 billion [0] (or almost 100% of the market cap). However, a lot of this volume is due to the same group of traders circulating the same coins back and forth.
Ultimately and as other commenters pointed out, it doesn't really matter. It is possible that people who bought BTC with "hard earned cash" are statistically more unwilling to sell at a loss but that's about how much you could infer from that statistic in my opinion.
Bank of America and Bitcoin both have market caps of ~$290 billion. Bank of America usually sees huge trading volume for a stock and it traded about $1.8 billion of volume today. BTC/USD alone has done $3 billion today.
I realize it's not a perfect comparison, but I think it highlights the fact that large sales aren't going to just decimate bitcoin's value.
Given those figures come from the completely unregulated, unaudited, incredibly sketchy exchanges themselves, I would take that with a huge grain of salt. Odds are good a vast majority of that $3 billion is trades using funny money or, for all you know, made up out of thin air. Easy to just trade with yourself all day...
Because it's so exponential, I would imagine a rapid sale of 5% would remove 90% of the value, but I'd love to know the specifics.