

Supply, Demand, and Bitcoin - Kinnard
http://blog.inbitbox.com/post/50543316452/bitcoin-is-not-a-donut-supply-demand-and-bitcoin

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anologwintermut
" The more they’re worth, the more you think you’ll be able to sell it off for
in the future. The more you want" Seems to be precisely the some larger fool
theory that denotes a bubble, regardless of supply, demand, or donuts.

That aside, one can readily check if people mining bitcoins were actually
selling them in that time period. Given the frenzy, I doubt it. But it's
probably worth checking

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Centigonal
Kind of obvious, but worth explicating: If this model for Bitcoin price is
accurate, then there are going to be a lot of very interesting market-timing-
related implications.

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nos4A2
Nice article. I am a miner, and I made this observation, the dollar value that
I mine any given day has been almost constant since a year (except the brief
$200 spurt, which the author explains by accounting for the difficulty upgrade
delay). When the value goes up the number of BTC mined goes down (because more
people are mining). Its quite a beautiful correlation actually.

~~~
Kinnard
Beauty indeed. Architecture this elegant is more appropriate for an organism
than a currency.

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Kinnard
[http://www.reddit.com/r/Bitcoin/comments/1eq3v1/bitcoin_is_n...](http://www.reddit.com/r/Bitcoin/comments/1eq3v1/bitcoin_is_not_a_donut_supply_demand_and_bitcoin/)

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rjvir
This article makes bitcoin sound like a ponzi scheme

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brazzy
That's because it has some characteristics of one.

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gailees
Why isn't everyone just quitting their day jobs and becoming Bitcoin miners?
It's like the modern day Gold Rush!

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erikpukinskis
Because difficulty increases to the point where the folks with the cheapest
electricity are breaking even. And the cheapest electricity in the world is
free (dorm rooms, cubicles, etc).

The only money to be made in Bitcoin mining is in making fairly strategic
investments during the leading edge of advancements in efficiency, or changes
in miners' understanding of the economics.

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Kinnard
It's getting more complicated than that. Expect financial deepening to occur
when it comes to mining. [http://jpkoning.blogspot.com/2013/02/financial-
deepening-and...](http://jpkoning.blogspot.com/2013/02/financial-deepening-
and-currency.html) I would also keep in mind that lots of people are thinking
about harnessing the bitcoin network for a plethora of applications.
[http://qz.com/84056/the-bitcoin-network-is-now-more-
powerful...](http://qz.com/84056/the-bitcoin-network-is-now-more-powerful-
than-the-top-500-supercomputers-combined/)

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waterlesscloud
One notable point is that one mining company, Asicminer, has a bitcoin-
denominated stock that dramatically increased in value over the last several
months.

It IPOed at 0.1 btc per share, now trading at about 2.5 btc.

Along with the increase in the value of btc relative to the US dollar,
Asicminer now has a market cap (on paper) of about $125 million, from an IPO
that raised about $200k.

They're based in China, Shenzhen I believe, and have been making the most of
their self-designed asics. They currently represent about 18% of the entire
bitcoin network, as measured by hashrate.

<http://www.asicminercharts.com/live/>

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jebeng
Yes, quite the success story.

Only possible because of the ineptitude of other market participants utterly
failing in deploying ASICs.

