
Bitcoin Reaches 1000 USD - wallzz
https://www.mtgox.com/?Currency=EUR
======
seanalltogether
It's now been over 5 weeks since I sold all my bitcoins on mtgox and still
haven't received any of my money from them.

~~~
csmuk
This is the thing that worries me.

I have 2 BTC and was hoping to sell to grab a MacBook but I get the feeling
turds and fan are going to impact each other soon.

~~~
danielweber
There is an old stockbroker joke about penny stocks.

Broker: "This stock is at 1 cent and could keep on going up."

Client: "BUY!"

The next day:

Broker: "Good news, the stock is at 3 cents and is showing no signs of
slowing."

Client: "BUY!"

The next day:

Broker: "Awesome news, the stock is at 10 cents and people think it could hit
50 cents in a week."

Client: "SELL!"

Broker: " . . . to whom?"

~~~
nezza-_-
Which is why you look at market depth indicators.
[http://bitcoinity.org/markets](http://bitcoinity.org/markets) or
[http://bitcoincharts.com/markets/mtgoxUSD_depth.html](http://bitcoincharts.com/markets/mtgoxUSD_depth.html)
for example.

------
rescripting
Hopefully someone can clear this up for me: With the price rising so quickly
what incentive is there to actually use BTC as intended, as a currency?

Because the maximum number of coins is fixed it's pretty easy to project where
the valuation is headed, and so anyone in their right mind should just hoard
their BTC instead of spending it, which in turn should drive the price down,
no?

~~~
vinhboy
Bitcoin worshippers will tell you, "no it does not matter, why would you not
spend bitcoins, it's better than fiat", blah blah blah...

Yet if you look at /r/BitCoin, there are dozens of "OMG!! I spent all my
bitcoins on Pizza instead of holding on to them, look at this gif of me being
sad"

So to answer your question, it's just insanity.

I miss the days before this month when BitCoin prices were stable for a couple
of months. Spending it was actually pretty cool.

~~~
snitko
I spent bitcoins on many things and intend to do so in the future. The thing
is, if you need something, you'll buy it, either with USD or Bitcoin. If you
buy it with USD, then that is the amount of Bitcoins you haven't bought
instead. So it doesn't matter. Bitcoin in no way stops you from spending it
when you really want.

~~~
JamisonM
This is true, but the definition of "really want" changes if everything you
can buy is subject to deflation in your currency of choice. If you believe
Bitcoin will keep rising you will defer every expense until the last possible
second and many transactions you will defer and later find that you do not
need to engage in them, thus there is less commerce ongoing. How does a
rational consumer justify going out for dinner on Friday if on Sunday they
expect the date to be 15% cheaper, and Tuesday to be 20% cheaper, and so on?
It is like the pain of finally biting the bullet and buying a new computer in
the 90's knowing it will be cheaper in 3 weeks, but on every transaction you
make.

~~~
snitko
Yet people still bought computers knowing full well they are going to be
cheaper in a couple of months. Why? Because they needed them. Same thing with
Bitcoin. Of course, you won't be buying stupid stuff you really don't need.
And you know what, that's a very good thing for the economy, because it will
make people very responsible when it comes to buying things and investing
their money. Bitcoin is an ultimate cure for consumerism and excessive
spending. Economy as a whole and people in it don't really profit from
investing into useless hole digging, even though it may look good on the
paper.

~~~
john_b
Honest question, what do people "need" Bitcoin for that cash or other payment
systems can't do? The only unique advantages I see are those that are illegal
in many jurisdictions and those that are related to speculation. The number of
people who need currency for illegal activities plus those who speculate in
currencies is finite and not a significant portion of the population, so I'm
just not seeing how regular people are going to derive any use from Bitcoin
that couldn't be achieved by other means.

~~~
snitko
Liquid store of value. USD is liquid, but inflationary. Gold is a good store
of value, but you can't really spend it like you can spend Bitcoin.

------
shawabawa3
Can people _please_ stop reporting MtGox prices? The real[1] price is closer
to $950

    
    
      [1] The price on exchanges where you can actually withdraw USD, e.g. bitstamp

~~~
drcode
I agree mtgox prices are borked, but historically mtgox prices were used as
the "official" price, and I think this is going to continue well into the
future. Since these price milestones are arbitrary anyway, does it really
matter?

~~~
makira
That, and MtGox is often a leading indicator for the other exchanges.

~~~
drcode
No, if that was true there would be an easy arbitrage that would cancel this
effect.

~~~
blhack
Only if it was really easy to get USD out of gox. It isn't.

------
carbocation
I think bitcoin is extremely interesting, but price reports like this are not
intellectually stimulating. 1,000 is an arbitrary number. Let's talk about
bitcoin, but for a volatile currency, let's not fire off news articles every
time it crossed another arbitrary threshold?

~~~
wwwtyro
I don't think it's fair to say that it's entirely arbitrary. The 1000$ mark
holds significant psychological impact. When the price rises, it's going to be
reported on, and it makes sense for it to be reported on when it hits a
psychologically important value like 1000$ rather than 947.13$

~~~
boon
I don't understand this. "1" BTC is an arbitrary amount as well. Perhaps in
the long run, mBTC or uBTC will be the perspective we hold of Bitcoin. From
some of what I've read, that was sort of the point of the high divisibility.

~~~
kristofferR
It's like birthdays, completely arbitrary - yet we instill it meaning.

------
downandout
It's either ridiculously underpriced or ridiculously overpriced. Not exactly
sure which yet.

~~~
wahsd
Not sure which makes me more sick to my stomach..... having not jumped on
BitCoin when it first started and was around a single dollar, or the fact that
putting hundreds (or thousands, by the time you read this) of dollars of my
hard earned money into a non-existent, unsecured, irrational "currency" of
bits that inherently are biased towards inflationary pressures due to its
fixed nature.

This is a bubble, clear as day! Some are not going to have a good time at some
point, whenever that point comes.

There is seriously something wrong with an economy when millionaires are made
for nothing but being first.

~~~
stinkytaco
>There is seriously something wrong with an economy when millionaires are made
for nothing but being first.

Tell that to every land speculator or homesteader who struck gold, oil or
fertile land (but ignore the natives, they only complicate this). Being first
is a _huge_ part of any economy. They took the risk with their cpu cycles,
electricity or money, if it's successful, they will get the payout.

~~~
samolang
And venture capitalists. The earlier you invest in anything, the bigger the
risk, the bigger the returns if it pans out.

------
cs702
Wow -- $1030 per BTC as I write this. This is happening _way faster_ than
anyone ever expected.[1]

All else being equal, the more people who decide to use or hold Bitcoin, the
higher its price will be, because the maximum number of bitcoins that can ever
exist is permanently fixed. It's a scarce commodity by design.

So, greater adoption = higher price.

\--

[1] In early 2011, I speculated it could take _a decade_ for price to reach
the thousands of US dollars per Bitcoin:
[http://cs702.wordpress.com/2011/05/29/on-the-potential-
adopt...](http://cs702.wordpress.com/2011/05/29/on-the-potential-adoption-and-
price-appreciation-of-bitcoin-in-the-long-run/)

~~~
eterm
If BTC did become a de facto currency, what's to stop a government printing "I
promise to pay the bearer 10BTC" notes, and just carry on "printing money" (I
know it's not literally done these days but it's the effect) as they always
have done?

The gold standard was broken, can they not have a "bitcoin standard" and then
break that in the same way?

~~~
mseebach
Nothing could keep them from doing that, except the unwillingness of users to
use the government paper money instead of the real thing.

Gold has to be "converted" to paper to be practical. Bitcoin is already a
whole lot more practical than almost any aspect of the modern money
infrastructure, so there's no "killer app" for Bitcoin-backed currency.

~~~
yapcguy
Gold has survived for thousands of years as a store of wealth. It has
intrinsic properties, it is one of nature's unique elements. It cannot be
synthetically created.

Bitcoin's scarcity is based on a completely fictional and arbitrary hard limit
of 21 million which can be changed in a trivial fork such as Litecoin.

Furthermore, given that there is no intrinsic physical difference between a
Litecoin, Freicoin, Bitcoin etc. there is an argument that a P2P currency is
the ultimate fiat. The printing presses have just been handed to the public
rather than being held by a select few.

Bitcoin is a great electronic currency, and a real challenge to money
transmitters like Western Union, but it is not a store of wealth (in my
opinion).

~~~
modeless
Saying that bitcoin isn't scarce because someone could fork the blockchain is
like saying that gold isn't scarce because everyone in the world could
suddenly agree to start using silver instead.

~~~
fat0wl
Um... what?

Limited resource physical commodities vs. a few bytes on your filesystem? This
is a ridiculous comparison.

But what people mean when they say you could fork libcoin or something like
that is not that Bitcoin isn't scarce. It's more along the lines of "We are in
no way beholden to this psychotic black market pyramid scheme currency. We can
just start anew with a better dispersement/capping scheme."

~~~
brainburn
They are just a few bytes yes. But it's rather hard to generate the correct
bytes.

Referring to the bytes that constitute a valid block in the blockchain.

------
edubart
Back in 2010 I did mine 160 BTC in 3 days just with my average CPU, however at
some point I stopped caring, because 3 years ago there weren't much blabling
about bitcoin and everyone that I told at that time did't care. Months later I
had to format hard disk because ArchLinux did a great job breaking the whole
system in a update, in the moment I just didn't remember that there were a
BitCoin wallet in my system. Now about 2 years later I am hopping to recovery
the wallet using a recovery program, but I already know that there is almost
no chance. Today I just can't stop thinking about what happened.

Damn ArchLinux, I really hope you die in hell. At the moment around USD160000
lost. Anyway I am still sticking with you, in sickness and in health, in
poverty or in wealth. Because you know, despite what you have done, you will
be always by my side.

~~~
brainburn
Don't blame archlinux for your forgetting of the wallet, you did that.

Think of it like you're losing 3 days of cpu cycles, not 160K.

------
brador
Remember kids, it's only real once you sell. Until then it's paper money. With
a price rise, either there's more demand from speculators or more people
holding.

~~~
oleganza
Unless it becomes world money. USD is a promise paper like stocks. Bitcoin is
like a gold coin. You can fully own the real thing without trusting someone to
store it for you.

~~~
brador
You really think Bitcoin will make it as a usable currency?

You know deflationary = hold and never spend, right? Not much use as a
currency if there's no flow or will to exchange for goods.

~~~
gnerd
Well for a reserve currency, deflation is positive as a hedge for inflation.
China have bought more gold than anyone else in the world for that reason, to
mitigate holding foreign reserve currency (which they limited just last month)
or debt priced in foreign currency that inflates beyond their control or
liking. One would expect this is the role BitCoin would take, just like gold
except a lot more convenient to move around.

It is a solution to the Triffin Dilemma, which in 2009 the Governor of The
Bank of China wrote about. That same year Russia proposed a new international
reserve currency backed by precious metals and a currency basket to solve the
same problem. In South America there have been proposals for a petro dollar,
backed by oil for the same reason.

Deflation is good for a reserve currency, in some ways it is fairer than gold
because you don't have to rely on the geographical distribution of gold in the
ground.

~~~
dragontamer
Massive deflation is terrible for an economy.

When the Wii was making record sales in the USA, Nintendo was reporting record
losses. Why? Because the Yen to USD exchange hit 80 to 1, and all of a sudden
Nintendo was making 20% less revenues on all US sales.

Deflation is BAD BAD BAD for companies who work with your currency.

~~~
oleganza
So Nintendo was losing money why exactly? Because Japan was not printing money
as fast as US? Maybe the problem is in printing money at all?

Do you see a symmetry of products vs. money? Both are assets that some people
need and some other want to give. If one is in deflation, then another is in
inflation to another. Why don't you buy MacBook 2 years from now, when it'll
cost the same, but will be more awesome? Because you have non-infinite "time
preference": you want certain things today vs. tomorrow.

Why people want to hold money? Because it gives them ability to spend it
anytime on anything - it's most liquid, most desirable commodity. This is big
value in having something in your wallet - freedom to make decisions in face
of future uncertainty. If you can freely choose between money which loses in
value and money which doesn't, which one every person would put their savings
in? Then, everyone spends according to his own time preference - amount of
desire to enjoy stuff today vs. tomorrow.

[http://blog.oleganza.com/post/43378777734/on-circulation-
of-...](http://blog.oleganza.com/post/43378777734/on-circulation-of-money)

Here's also a thought experiment on deflationary spiral:
[http://blog.oleganza.com/post/66215430631/deflationary-
spira...](http://blog.oleganza.com/post/66215430631/deflationary-spiral)

~~~
dragontamer
> So Nintendo was losing money why exactly? Because Japan was not printing
> money as fast as US? Maybe the problem is in printing money at all?

Because Japan's currency deflated, while the US currency inflated. Printing of
money is simply a means to control deflation or inflation.

All of the "thought experiments" on deflationary spirals ignore the fact that
one happened: the Great Depression of 1930s. And back then, the US Monetary
system was pegged to the Gold Standard.

We fixed the problem by getting off the Gold Standard. It turns out, basing
your country's economy on a deflating commodity was not a good idea.

~~~
gnerd
Did someone propose that BitCoin serve as the peg for a national currency? I
must have missed that part.

Deflation is bad, we know its bad and when its bad. So should you peg a
national currency to a deflationary commodity like BitCoin or gold? No. Can I
use gold right now as a means of exchange? Yes. Does it happen all the time in
regular life? No, because that would be a pain in the ass but if it were more
convenient, it might. Well that is what BitCoin is, its gold but convenient to
transfer.

Stop thinking of BitCoin as a national currency or a replacement for a
national currency. It is a commodity like gold which can serve as a
supranational currency or store of value, your national economy can still be
inflationary.

~~~
dragontamer
People want BTC to be a currency. You clearly don't have that goal.

But when you see websites saying "Pay for stuff here using BTC", it is clear
that they are trying to make BTC into a currency.

Those who wish to use BTC as a currency are discouraged from doing so, as long
as this stupid hyper-deflation is occurring. No one wants to spend BTC on
anything anymore.

~~~
gnerd
> People want BTC to be a currency.

It is a currency. It satisfies the Coincidence of Wants, it is used as a means
of exchange, that makes it a currency. Cigarettes have been used as a currency
(in WW2 concentration camps, prison, times of famine or war etc.). But nobody
suggested cigarettes or tobacco be the thing we pegged our national currencies
on, its just a thing that represented value that people traded for goods and
services. That's a currency, not a national currency though (because as you
mentioned earlier, that's probably a bad idea which we know from history with
gold).

------
snorkel
As someone who witnessed the dot-com boom, I always tell the kids nowadays:
sell. sell it all. now.

~~~
JabavuAdams
As someone who sold shares for $8 that I got through my employer at $2.50, I
always tell the kids nowadays: I should have waited until it hit $80. There
are no easy answers.

~~~
snorkel
A bird in the hand is better than two in the bush. Don't get greedy, just take
the profit and be thankful for it.

------
saalweachter
Anyone know what is driving the price?

My supply-side model, which I felt pretty smug about for the last couple of
months, only calls for a price of $450-500, so it clearly can't account for
the current price. So much for that.

Seems likely then that this is coming from an increase in demand. Does anyone
have any good guesses about where that increase in demand is coming from?

~~~
makira
China

~~~
saalweachter
Is there a surge in Chinese speculators or users?

I remember a few years back there were stories about how broken the savings
system was in China; something like the only two legal investments were state
banks, which gave 1% interest when there was double-digit inflation, and real
estate, where you could buy apartments in empty cities on the premise that it
was really hard to do worse than the negative 10% real rate of return you got
from banks. In that environment I could see how an investment vehicle like BTC
could really take off.

~~~
dragonwriter
> Is there a surge in Chinese speculators or users?

Probably both, though its probably not simple to figure out the ratios.

------
granfalloon
man, this has been fascinating to watch (and not just because i have a little
skin in the game).

the tech and theory underlying the currency; its mysterious founder; the idea
of massive "mining" operations where people are essentially printing their own
money; the fact that one of the major exchanges was orginally a MTG exchange;
the senate hearings; the tor black markets and FBI "seizures"; the absurdly
juvenile chatter in the "troll box" on BTC-E, a major exchange; and of course,
the goldrush-like nature of the skyrocketing prices.

i'm looking forward to hearing what people have to say about all this a few
years down the line

------
EGreg
My thesis is simple.

The value of any currency to someoneis how much real stuff they need that they
can exchange it for.

Any cryptocurrency that is effectively limited in volume and viable to be used
will grow. Because of the growing number users of the currency, some are
developers who will make it easier for sellers to accept it.

What bitcoin had going for it is that it DIDNT have mass adoption - it had a
long way to go. Now the same is true of peercoin and litecoin - they are where
bitcoin was a year ago. There's no reason they can't go to 1000 also.

In short there are a few factors determining the price of a currency:

Short term fads:

1\. being newly listed on an exchange as exchangeable for the local currency
of the country

2\. news stories about the currency

Long term fundamentals:

3\. The increase in acceptance by merchants and metcalfe's law (I think n log
n is more realistic than n^2 though)

4\. Limit on new currency being produced.

In this respect I feel litecoin beats peercoin in #4 and peercoin beats
litecoin in #3, it has a longer way to go but it is more sustainable and is
further behind so it has a longer way to grow from now.

------
eegilbert
Has Bitcoin been subjected to serious academic research? Quickly scanning this
bibliography [1], at least, I don't see many top ACM conferences.

[1]
[http://users.encs.concordia.ca/~clark/biblio.html](http://users.encs.concordia.ca/~clark/biblio.html)

~~~
oleganza
Academics hate Bitcoin for 51% attack and lack of formal proofs. Theoretically
it's not cool invention. Practically, it can change the whole world and be
viable economically for a very long time.

~~~
mafribe
Many academics are deeply fascinated by Bitcoin.

The lack of formal proofs has many reasons, not the least of which is that
there is no security definition that one could base a proof on. Coming up with
a good security definition is going to be a major undertaking. Last year's
Turing award was given for the security definition of something much simpler.

------
gerhardi
Could someone explain how is the blockchain going to maintain integrity and
the transfer lag is taken into account "when" bitcoin is globally used
everywhere and thousands if not millions of transactions are happening every
single second?

~~~
00rion
I'm curious about this too. Miners who maintain the blockchain will have to do
more work for less bitcoins. If miners are earning less bitcoins, the value
will have to continue increasing in order to encourage the miners to maintain
the blockchain. At what point is this unsustainable?

------
lifeisstillgood
holy cr!9 - I was thinking of trying to mine some to get a handle on the whole
thing - last week when it was 800 bucks.What the hell?

If I understand it, there is a upper limit to number of bitcoins available
ever - what is that number and when will it be equal to the total asset value
of the planet? I mean is it feasible that bitcoins could really work?

Edit: ok there is a limit of 21million bitcoins by 2030, and a world
assignable wealth of ~210 trillion USD. So, _if_ bitcoin works and can be the
repository for all worlds currency, it would have to be worth 10,000 USD per
bitcoin.

Then any growth in value.

So ... this might just work folks. And if not it still makes for a great DHT

~~~
gnerd
There will be just under 21 million in 2140, but you have to remember many BTC
private keys have been destroyed over the last few years so those can never be
spent (unless they used a deterministic wallet, in which case they will
probably be able to be cracked eventually).

I don't think it will ever be equal to the total world asset value. If it
succeeds it will be in the short term as an online currency, in which case if
it were to have a market cap the size of APPL, it would be around $36000 per
coin. If it were to get long term use as a deflationary reserve currency to
mitigate inflation and the Triffin Dilemma (which is what China was pushing
for in 2009 when Zhou Xiaochuan released his paper[1]) then the price could
easily clear $1000000 but keep in mind that is far from guaranteed as BitCoin
still has some major scaling issues to sort out.

Too much growth too soon might be a bad thing.

[1]
[http://www.bis.org/review/r090402c.pdf](http://www.bis.org/review/r090402c.pdf)

EDIT: In response to your edit, it is 2140, not 2030. The block reward (what
miners get for solving a block) halves every 4 years and we are at a 25BTC
reward (made every 10 minutes) with about 12 million BitCoins in existence, so
it will take longer than this century to hit the 21 million mark.

~~~
lifeisstillgood
Thank you - will get stuck into that paper.

So it seems ridiculously unfair that 50% of bitcoins now exist and it will
taper off for another 130 years. I think the _idea_ of a digital currency is
here to stay. Bitcoins as a specific implementation seems so off kilter due to
that one fact alone that I really don't see how to start it "fairly". it may
not be possible (it's not "fair" that the queen has all the money - but that's
now a stable equilibrium)

~~~
gnerd
It does seem unfair but that's just how it goes. For instance consider that a
third of the worlds gold ever mined comes from one country, South Africa.
That's a bit geographically unfair. Since South Africa was in the empire (and
now still in the CommonWealth), it means the mining rights for that gold went
to Britain and other friendly countries. That's a bit politically unfair.

Or consider when gold became the gold standard in the 19th century, a lot of
that gold was controlled by a single family, the Rothschild's because of
success 100 years earlier though Mayer Amschel Rothschild. That is a bit
unfair.

Economics has never been fair. Say you bootstrapped a new digital currency and
gave it out to all the people in the world evenly and they all recognised it
as holding value, eventually through luck, and intention, some people will
have more of that currency than others.

The way BitCoin was bootstrapped took into account that the earlier someone
got on board, the higher the risk they took. So if you think of it that way,
its not completely unfair.

------
bottled_poe
What makes bitcoin special? It's not like we've seen widespread adoption of
this particular cryptocurrency. Do litecoin, feathercoin, et al. use the same
algorithm with different seeds? I dont't understand why bitcoin is gaining so
much value. It seems that an identical cryptocurrency could be created with or
without the coins already mined. It seems to me that $1000 per bc can only be
speculation by the wealthy at this point. It is surely a bubble waiting to
implode.

~~~
unethical_ban
Bitcoin is special because it has more users and recognition than litecoin,
and it has more users and recognition because it's special.

A currency gets its value from the recognition by others of its use for trade.
Bitcoin has more of that than the others.

------
gnister
Bitcoin is not a traditional currency.

It's more like gold or another scarce commodity.

Bitcoin is an electronic commodity with _no intrinsic value_ that has been
rigged to be perfect for speculation.

What would a national bank do if the value of its currency exploded like this?

It would print more money, regulate interest rate or take other actions to
keep the currency value more stable compared to other currencies.

There is no "bank" supporting Bitcoin.

Comparing Bitcoin to traditional currencies make people think about Bitcoin
the wrong way.

------
ck2
It seems to be lifting all boats too, litecoin broke $25

~~~
kclay
Why on earth did I sell off my litecoins

~~~
broolstoryco
To buy bitcoins, right? RIGHT??

~~~
kclay
Yes :'(

------
giarc
I was following BTC when it had hit $200-300 and was in the news quite often.
I considered buying some but after reading lots of opinion pieces, decided
against it. Many people were showing graphs comparing the dot com bubble and
the bitcoin bubble and warning others that BTC would settle nicely into a
lower price. Those people were obviously wrong, wish I hadn't listened to
them.

~~~
brandong
These people may have not been wrong, just early. Keep inflating a balloon -
it's hard to say _when_ it's going to pop, but still accurate to say that it
will at some point.

If I had money invested in bitcoin, I would pursue a strategy that kept in
mind that it very well could be a bubble- and one that could lose most of it's
value before you have a chance to get out.

The wisest plays aren't the ones that make the most money, but the ones that
concrete gains by taking the profit off of the table: Sell out X% every time
it hits a new arbitrary high.

~~~
drcode
Protip: You can only argue something was a bubble if the current price is
lower than the price at which you said it was a bubble.

------
gagege
I'm afraid of Bitcoin becoming the world's only currency. Someone with enough
computing power can massively game the system. I'm not saying that that can't
happen with today's government driven currencies, but that there are at least
other options right now. Maybe we shouldn't _all_ switch to Bitcoin.

~~~
swalsh
I'd be afraid of it becoming even a common currency. The problem is bitcoin
does not encourage economic growth. It is smarter to hold then to spend. In a
good currency, the demand for the money itself should not cause prices to
fluctuate.

I think this could be solved if instead of the difficulty target being
determined based on a steady release, was instead determined in someway based
on the quantity theory of money (MV = PY) so as there is greater demand for
coins more coins would be produced, and the opposite, when we have enough
coins, less are produced.

------
nkuttler
There are so many uneducated comments that I'll link to the bitcoin FAQ:
[https://en.bitcoin.it/wiki/FAQ](https://en.bitcoin.it/wiki/FAQ).

Really, anybody trying to argue for or against BTC should at least have read
that.

------
tokenadult
In other news, tulip bulbs can be had for $9.99 for a dozen,[1] a decline (for
some varieties) from the historic high price.[2] The history of commodity
prices provides some interesting insights into human behavior.[3]

[1]
[http://www.brecks.com/category/Tulip_Flower_Bulbs](http://www.brecks.com/category/Tulip_Flower_Bulbs)

[2]
[https://en.wikipedia.org/wiki/Tulip_mania](https://en.wikipedia.org/wiki/Tulip_mania)

[3] [http://www.amazon.com/Extraordinary-Popular-Delusions-
Charle...](http://www.amazon.com/Extraordinary-Popular-Delusions-Charles-
Mackay/dp/0486432238)

------
drzaiusapelord
Is the success of cryptolocker raising the value of this currency?
Essentially, we have quite a bit of proof now that it is truly an untraceable
currency and previously shy buyers might feel emboldened by this. More demand
== higher value.

~~~
base698
It is not untraceable, and in fact it's the most traceable currency ever. I
can't imagine what a forensic gold mine it will be about spending patterns and
who spends money where, especially when coupled with the online activity
already used.

~~~
drzaiusapelord
Right, the ledger is public but the ledger doesn't have my name on it. Big
difference there.

~~~
quasque
The ledger may not have your name on it but merchant and payment processor
metadata may well link your identity and Bitcoin addresses.

------
AndrewDucker
Are there any decent estimates for how much one bitcoin will be worth if it
ends up being a generally used currency for international transfers?

i.e. if it becomes the new Paypal, how much would one bitcoin need to be
worth?

~~~
foxhill
paypal claim to have done $44 billion of trade in Q3 2013(1). so lets assume
paypal do $4x44 billion of trade for the year.

there will only ever be 21 million BTC in existence* , there are much less
than that right now (12 million ish).

4x44,000,000,000/21,000,000 = $8380/BTC

this assumes of course, that Bitcoin totally replaces paypal and nothing else
(which is already not true).

* - this ignores the fact that there are already thousands, if not millions of BTC that have been lost due to lost wallets, forgotten coins, invalid transactions, etc.

(1) - [https://www.paypal-media.com/about](https://www.paypal-media.com/about)

------
BenjaminN
When it will be as easy to buy a bitcoin as it is to buy, say, an ebook, it
will go up significantly.

For example, I tried to buy some last monday and realized that I had to
justify my address, my bank account, my identity and so on. I still can't
figure out why it's so complicated to buy a bitcoin. I've been waiting for my
bitcoin-central account since then, and received confirmation for my account
on bitstamp last saturday. I still have to transfer some money there.

My question is: why is it so complicated to buy bitcoins?

~~~
nikolak
Because it doesn't have chargebacks.

A lot of services that allowed its users to purchase bitcoins without having
to verify their identity and buy bitcoin using PP or CCs were abused by people
using stolen PP and CC info. So they lost money if the real owner issued
chargeback and bitcoins were already transferred.

~~~
BenjaminN
I actually never realized the banking system was not trustful. Obviously, I
thought that when I entered my credit card number, you can easily check I have
enough money, switch the money from one account to another, and let the store
knows the money is now in his account. But it's obviously much more
complicated.

------
judk
If bitcoin concept gets popular, why would the next set of adopters buy into
btc instead of trying to be early adopters in a different technically
equivalent cryptocurrency?

~~~
drcode
Network effects. It's easier to perform transactions if both parties prefer
the same currency. This will always put Bitcoin in a class by itself.

------
blackdogie
I was surprised that there wasn't a dip when it hit 1000, I'm sure that there
must have been quite a few people will sell orders at this round, but
arbitrary point. If this was the case there would have been some dip, is it
just being overly inflated by some rich backers who are slowly taking the cash
out, but backing it up when it dips ?

------
AKifer
I'm afraid
[http://en.wikipedia.org/wiki/Tulip_mania](http://en.wikipedia.org/wiki/Tulip_mania)
will again happen, wikipedia should already prepare an entry for
[http://en.wikipedia.org/wiki/Bitcoin_mania](http://en.wikipedia.org/wiki/Bitcoin_mania)

------
Aqueous
It is still around $950.00 on CoinBase. Mt. Gox is usually ahead of CoinBase
and BitStamp.

~~~
gnerd
Right but this demand is coming from China (for the last 3 hours) and the
other markets are just closing the gap as they catch up (some nice arbitrage
opportunities if you have a CNY account).

If the trade spikes were on MtGox for USD I would agree that it is an
inaccurate price but as MtGox has more trade volume than CoinBase, I think
they just close the gap sooner.

------
thisiswrong
And meanwhile altcoins (alternative cryptocurrencies) are booming like never
seen before - even more so than bitcoin.

Litecoin just hit 30usd, Peercoin nearly at 4usd.

[http://coinmarketcap.com/](http://coinmarketcap.com/)

~~~
crististm
This may be the weak point of these crypto-currencies. The proponents market
them as scarce commodity but in reality you can just think today of another
scheme like that.

So why is it booming? It is booming because it is booming. It's a positive
loop that will end when the new comers stop coming.

------
crististm
The price should be based on what people are able to _cash out_. Is this the
case? Are people getting $1000 money in the hand for 1BTC or is it just the
"valuation" we're talking about here?

~~~
samolang
Right now you can sell you bitcoins for $979.74 on coinbase (minus 1%
commission + transaction fee). So pretty close to $1,000.

~~~
crististm
What other markets are there besides coinbase? If the market is not liquid
enough then the $1000 value is just smoke.

I have a hard time believing that the price is not rising artificially because
of low transaction count with the outside world (people holding to BTC instead
of cashing them out).

~~~
samolang
I think there are a bunch. Here is another one that I was looking at earlier
today:
[https://btc-e.com/exchange/btc_usd](https://btc-e.com/exchange/btc_usd)

------
wallzz
The price is in EURO if you want the USD try
[https://www.mtgox.com/?Currency=USD](https://www.mtgox.com/?Currency=USD)

------
PinkBunny
Why does the bitcoin price differ on different exchanges?

~~~
mbeattie
There are delays trading between dollars and bitcoins so as the different
exchanges vary, people can't easily arbitrage it and close the gap.

------
guilamu
Now it does: [http://uppix.net/Cv5mZP.jpg](http://uppix.net/Cv5mZP.jpg)

------
xedarius
Can someone please answer me this.

If a Bitcoin is worth +$1000 and I want to buy an item worth $50. How does one
receive change?

~~~
TomGullen
They are divisible into 100,000,000 parts. So you can pay for a $50 item with
0.05 BTC and still have 0.95 BTC in your wallet to spend.

~~~
xedarius
Thank you, I did not know that.

So once split I guess the likely hood is that the coin will never be whole
again.

~~~
TomGullen
If you get sent another 0.05 BTC to your wallet, you will have a 1 BTC balance
again.

The single unit (1 Bitcoin) is just an arbitary measurement.

------
borplk
How easy is it to sell bitcoins now? Especially for large amounts, can someone
just cash 1000BTC on mtgox now?

~~~
crististm
Nobody has an answer for you, but this is a very legitimate question. If you
can't cash out at any time, the market is not liquid and the $1000 value is
just smoke.

I believe that the BTC valuation is based more on newcomers expectations of
growth and less on anything tangible - like trading it for goods or cash.

We will probably see the facebook scenario where everybody -before IPO- was
shouting the incredible 100billion valuation while secretly hoping enough
fools will jump to buy shares to raise the price so they could cash out in
profit.

------
relaxedricky
[http://preev.com/](http://preev.com/) \- 963.1 USD at time of posting

------
paweld
What if mtgox is buying bitcoins for money which doesn't have. Could that
drive prices up.

------
wil421
What happens in 5 years?

~~~
oleganza
In 5 years Bitcoin will replace almost all world currencies and cause massive
reallocation of wealth in EUR and USD territories. USD and EUR will
hyperinflate and lose value dramatically and eventually become abandoned.

~~~
pakitan
Don't forget about the coming of Cthulhu

~~~
oleganza
Wanna bet?

~~~
pakitan
Of course I'd bet. I'd bet all the money I have + my firstborn child + my
future income for the next 30 years. Only someone without the faintest
understanding of economics can think bitcoin will become USA/Europe's official
currency.

There are just 2 problems with this bet:

1\. There is no escrow I'd trust to hold my money for 5 years.

2\. The bet is obviously ridiculous for you to take. If you really believe
what you say, then your bitcoins will be worth billions in 5 years and the
money you win from me won't matter. Hence in this bet there is only downside
for you. Hence, either you're crazy if you take it or you're just talking big
trying to manipulate the crowds. I'm betting on the latter.

~~~
oleganza
First, it's you, not me who is talking big. I suggested (to another guy) fixed
amounts to bet while you bet your unborn children.

Second, who said Bitcoin must get some official stamp of approval from any
government? People will use Bitcoin wether governments want it or not. And
government will have to milk bitcoin economy, not USD economy.

Third, Bitcoin is valuable precisely because there's "no escrow to trust money
for 5 years". You can split your BTC private key in 10 parts via SSSS 6-of-10
and give to your trusted friends. They individually can't steal from you and
if 6 of them are still around in 5 years, you get your money. Bitcoin makes
some things possible which are not possible otherwise.

Forth, I'm serious about formal bet and confident in what I say. My identity
is public and I publish all my thoughts on subject frequently and honestly
here: [http://blog.oleganza.com](http://blog.oleganza.com)

If you are so certain that Bitcoin goes nowhere in 5 years, give me your
conditions.

~~~
pakitan
I'm cool with the bet even if it doesn't involve "official stamp of approval"
from any government. You say USD/EUR will hyperinflate. We can probably agree
that gold price is a good measure if something has hyperinflated. So, if a
troy ounce of gold is worth less than $100K USD/EUR after 5 years, you pay me
$10K and if it doesn't, I pay you 1 BTC (the terms you offered below). Escrow
is John K from bitcointalk. Deal?

EDIT: fine, you don't want gold. Pick any commodity you fancy - grain, corn,
rice, oil, copper, coffee...whatever. It rises 100 times in USD value, you win
the bet. Just don't tell me nobody will want these either and we'll live just
on bitcoins and fresh air :)

~~~
oleganza
I bet gold at some point will go down massively too. Why hold gold somewhere
in the vault of a bankrupt banker when you can hold bitcoins? I wouldn't bet
on what happens to the gold. I only feel like it will go very low over the
next 20 years. Shorter term - have no idea.

------
adrianwaj
Wait 'til Wall Street gets on board.

I've setup a simple webpage (with @btcprice) for displaying prices:

$1,022.90 mtgxUSD

$943.00 bitstamp

$943.00 bitpayBBB

[http://btcpricenow.com](http://btcpricenow.com)

~~~
bottled_poe
I think it's naive to think that stokebrokers have not been paying attention
for the last few years.

~~~
adrianwaj
The narrative around bitcoin is changing. It can be seen more of an investment
now than a bet.

Up until now I think bitcoin has been an "as yet proven, volatile, geeky,
alternate, viral internet currency with network effects."

And the conservative are left wondering if it's a fad or a bubble.

Now it's just an emerging asset class with unique fundamentals that could have
real utility within the financial services community itself... eg to settle
trades.

~~~
simplemath
The "unique fundamental" is a built in pseudonomous chargeback-less, ACH-less,
nearly instantaneous global transaction system that has proven extremely
difficult to cheat. This fundamental alone gives BTC tremendous value.

------
dmix
In Canada our biggest market is $924.

------
broolstoryco
to the moon.

~~~
dagge
Exactly what bitcoinity had in mind:
[http://i.imgur.com/TjKN8DP.png](http://i.imgur.com/TjKN8DP.png)

------
guilamu
Wrong, did not reached it yet.

~~~
Aqwis
According to [http://bitcoin.clarkmoody.com](http://bitcoin.clarkmoody.com),
it is now well above 1000$/BTC.

------
snake_plissken
BTFATH?

------
knodi
I hope there is a crash coming.

~~~
TomGullen
Why? You got a large position on Gold?

