
Bitcoin heading towards $200, new bubble forming - paps
http://bitcoinwisdom.com/markets/mtgox/btcusd
======
pearjuice
\- _Bitcoin? Sounds interesting but I am not going to waste CPU cycles on it.
This will never be of any real value!_

\- _Bitcoin seems to be steadily growing. Well, as soon as they realize it is
worth nothing, it will return back to non-existency._

\- _Yeah, this is definitely a fad. It is growing too fast. No way I am going
to mine._

\- _So, mining at home is redundant now. Well, don 't picture me buying into
it! It can collapse any second._

\- _Haha, it collapsed. Good grief. No way I am buying all the leftovers. This
will never recover._

\- _Recovering? This will be temporarily. Bitcoin has no future._

\- _A new peak? Well too late to step in, now. Just wait for the new burst._

\- _Yet another peak!? This is the last one. Buying now would be stupid._

\- _Bitcoin heading towards $(peak of some arbitrary rounded number), new
bubble forming_

Every time.

~~~
M4v3R
Very relevant - Market emotions cycle:

[http://cuffelinks.com.au/wp-content/uploads/AO-
cycles.png](http://cuffelinks.com.au/wp-content/uploads/AO-cycles.png)

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neals
$200? Hardly. Maybe if you look at Mt.Gox, it might look like you could get
$190 per bitcoin. Howerver, there is no way to actually get that money to your
bank account, since Mt. Gox hasn't been doing any banktransfers for months.

The price is high on Mt.Gox because people that have money on there can only
get it out by buying Bitcoins and transfering those to other exchanges. This
drives the Mt.Gox price up.

If you look a the exchanges that are actually solvent, the price is more
around $160.

~~~
waterlesscloud
People have been saying this for the last $100 or so of rise.

And yet here we are.

~~~
neals
Yes indeed, people have been saying they can't get their money out of Gox for
quite a while. Thanks for backing me up on that, I guess?

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pmarca
Oh no, something is showing the slightest glimmer of working, it must
immediately be a bubble!

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spindritf
Could we ban the words "bubble" and "disrupt" from submission titles?

~~~
wtvanhest
Disrupt is fine. Its basically a quick way of saying a company is in a
specific industry.

disrupt industry x.

Bubble, lets lose that. People are so bad a predicting bubbles it is
laughable.

~~~
DennisP
That's what disrupt means now. It used to mean a company is changing the way
an industry does business. But then everybody started claiming they would do
that, no matter how trivial the change, so now it means "there's a new company
in this industry and it has a hip website."

~~~
wtvanhest
Yeap, it definitely has changed definitions. I would never use the term, but
it definitely has changed definitions.

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doctorfoo
I'm going to sell when I can retire on it. Which won't be for a couple orders
of magnitude yet. Some of us are holding for the longest time...

I apply this same logic to my startup attempts. If anyone offers me enough to
retire, I'll sell with no doubts.

~~~
jafaku
By that time you won't need to sell. Besides, are you seriously gonna risk
your money like that? Switching back to a currency system that can be
frozen/confiscated, inflated, etc.?

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Sagat
I wonder who Satoshi is and how much he's worth now. Not many people can put
on their CV that they created a new currency.

~~~
hannibal5
Wrq ZpPnyro with high probability. Look at what he has done, where he lives
and how he writes.

~~~
Sagat
Who is that? There are no google results.

~~~
Geee
ebg13 ftw

~~~
Sagat
Why waste people's time like that?

------
nolok
I know you can sell your coin when the price is high; but can you trade
quickly enough to profit from such temporary surges (buy low then sell high
only a dozen hours later) ? What is the average request processing time if you
want to buy, say, 10 BTC on mtgox ?

~~~
citricsquid
An exchange will allow you to trade instantly; the moment your sell/buy orders
go through, the btc/usd is available in your account for usage, however
getting USD into the exchanges can take some time and in the case of mtgox,
getting USD _out_ is almost impossible (it's why the price at mtgox is about
10% higher than elsewhere). Your location matters most, if you're in Europe
you could get money into Bitstamp within a couple of hours if you pay for a
fast transfer and once it's in you can trade instantly.

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mediocregopher
It's better to not use MtGox as a baseline price anymore, it's at about $20
higher then any other exchange due to the fact that you can't actually get
your money out of it ATM. Check the btc-e graph for a better view:

[http://bitcoinwisdom.com/markets/btce/btcusd](http://bitcoinwisdom.com/markets/btce/btcusd)

(They both show the same trend, I'm just being pedantic)

~~~
dwaltrip
One cool thing that has happened over that several months is that Mt Gox has
drifted down to a market share of around 30% of the total trade volume
(generally speaking; ocasionally this trend weakens on days with huge swings,
but less often than before). It is good to see more healthy exchange
competition.

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c0ldfusi0nz
"New bubble forming" \- LOL. Yes, there will be volatility, but the long term
trend is UP.

------
joelthelion
I'm still hesitant to sell my (smaller) stash. The probability that bitcoin
will explode is fairly low, but trading a small but real possibility of
becoming a millionaire against a few thousand dollars is a difficult decision
:)

~~~
peteretep
So take a decision now about when you'll sell, write it down, and stick to it.
Mine has a 5 year timeline, or a specific value (a few orders of magnitude
more than today) at which I'll sell.

~~~
yafujifide
If bitcoin replaces the dollar as the unit of account, currency of
international trade, world reserve currency, and so on, it might be better
simply to spend the bitcoins than to "sell" them.

~~~
jafaku
If that ever happens, our homes are gonna be visited by flying drones. But you
don't need that to happen for Bitcoin to make you rich. It could very well
just stay as a high value, scarce commodity. A few whales buying in can make
it happen.

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peteretep
Why does this imply a bubble?

~~~
bayesianhorse
Because nowadays any exponential growth is called a "bubble in forming". And
because all stochastic exponential process eventually crash, or
"underperform", it sounds really smart to "predict" a crash months or years in
advance. Especially when using non-logarithmic axes, the predictions and the
crash look really impressive.

You don't, however, often see these prophets of doom profiting from their
predictions, because the exact timing of crashes isn't that easy at all.

~~~
Choronzon
Its actually generally a lot easier to profit buying a bubble than shorting
it.There are a lot more points of increase than points of collapse. Paulson
made a fortune shorting the housing market,plenty of people predicted the
collapse but Paulson picked the peak correctly. The interesting thing is given
his shocking trading performance since then he appears to have been lucky
rather than smart.

Didier Sornette has some interesting theories(and dubious models) about
bubbles,well worth a read.

~~~
matwood
Exactly. On shorting a bubble: _the market can stay irrational longer than you
can stay solvent._

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kken
What is the reason? Can't find any news.

~~~
Choronzon
Its inherently deflationary anyway (which is a terrible idea for a currency).

~~~
LinaLauneBaer
I know too little about currencies but to me it looks like that our "real
currencies" are inherently deflationary as well... At least this is how it is
supposed to work - right? I mean what if governments weren't printing new
money all the time? Then there would also be a limited amount of money
available in a big pool... Wouldn't it depend on the growth rate of country to
determine weather or not a currency is deflationary?

\- Number of people is growing, same amount of money for the people, no new
money is printed => deflationary?

vs.

\- Number of people is shrinking, same amount of money for the people, no new
money is printed => inflationary?

~~~
Choronzon
Printing money is basically intrinsic to our "real currencies" so if you
remove that you have something quantitively different,effectively a new type
of currency. Technically currency is a medium of exchange and can be linked to
anything,industrial production,gold,number of cows,someones else's currency
etc ,so whether it is inflationary or deflationary depends on its social
framework and design.

Now what is a deflationary currency inherently bad?Say I am Mr Big with my 2
million bitcoins, I can invest in your new business with a variable prospect
of success or I can sit on my arse and watch the value of my money go up due
to deflation,which am I more likely to do? How do you deal with exiting debits
in a deflationary spiral? In deflationary systems money does not circulate and
that is the death knell of commerce. But bitcoin is circulating! Well yes,but
its value is due to it being traded for speculation and extralegal activities
(a lot of which Im actually sympathetic to) ,not as an actual replacement
currency.

~~~
Tichy
But why does a fixed supply make it deflationary? What happens when all BTC
have been mined, will the price still go up all the time?

I guess it could go up if the Dollar goes down at the same time. The actual
price is staying the same, but the Dollar is worth less, so it takes more to
buy X. Not sure why that would be bad.

Also I suspect banks will create virtual bitcoin, as they do with money
(lending BTC that they borrowed). Perhaps that will affect the price as well.

~~~
maxerickson
Well, if you assume economic growth, a fixed number of counting tokens will
have to represent larger values over time.

The real trick is to read 'deflationary' as 'will create deflationary
pressure', not as 'will inevitably cause deflation at every moment in time'.

~~~
Tichy
You mean, assuming there was only one Bitcoin: if a VW Beetle costs 1 BTC this
year, and next year a Porsche is published (growing the economy by replacing
cars with better cars), the Porsche would also have to cost 1 BTC because
there isn't more than 1 BTC?

That seems incorrect. While impractical, there might be other solutions, for
example the Porsche could cost 1 BTC+ 1 Carrot, or maybe it could cost 2 BTC
anyway. The buyer just wouldn't be able to pay in one go.

~~~
maxerickson
Marginal effects don't really reduce well to narrow examples like that.

What I mean is that if you assume a healthy trade in something of limited
abundance, you should be prepared for demand to drive up the value of that
thing. It might not, but given the simple dynamics of supply and demand
(microeconomics isn't really controversial), it is prudent to be aware of the
possibility.

(I do sort of assume that people are mostly using bitcoins to complete
transactions and speculate, I don't assume there is a healthy trade in them)

------
MarcusBrutus
How many legitimate real world services and products currently accept
Bitcoins? I understand it is only the Chinese search engine. I also take it
for granted that any major Euro/US-based organization (be it Google or
Domino's Pizza) that starts accepting Bitcoins will instantly face very
serious political repercussions. Given these facts it is astonishing that
Bitcoin seems to be heading from strength to strength.

~~~
elux
> _How many legitimate real world services and products currently accept
> Bitcoins? I understand it is only the Chinese search engine._

The hundreds (thousands now?) of (mostly) small businesses accepting bitcoin
for goods and services include gift card vendors. [1]

You can spend your bitcoins on gift cards (a form of virtual currency in
itself) which you can use at some of the world's largest retailers, for
example Amazon[2] or Walmart [3].

It's a two-step process, but you can use your bitcoins at Amazon or Walmart,
today.

[1]
[https://en.bitcoin.it/wiki/Trade#Gift.2FDebit_Cards](https://en.bitcoin.it/wiki/Trade#Gift.2FDebit_Cards)

[2] [http://www.gyft.com/shop-for-gift-cards/](http://www.gyft.com/shop-for-
gift-cards/)

[3]
[http://www.reddit.com/r/Bitcoin/comments/1om2jm/egifter_now_...](http://www.reddit.com/r/Bitcoin/comments/1om2jm/egifter_now_sells_walmart_gift_cards_buy/)

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tjaerv
Editorialized title much?

------
lma21
i see they're updating their market data with socket.io. but the graph bit is
nicely made. Anyone knows how they're doing it with canvas?

------
etherael
not a bubble, just reversion to the mean exponential trend that has been
consistent since genesis.

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r0muald
by 2015 google will be accepting bitcoin

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hannibal5
For a more clearer picture, look at this graph:

[http://bitcoincharts.com/charts/mtgoxUSD#rg1460zig12-hourztg...](http://bitcoincharts.com/charts/mtgoxUSD#rg1460zig12-hourztgWzm1g10zm2g25zvzl)

Bitcoin is deflationary and has enough actual use to support small trading
volume even without speculators. It's perfect vessel for speculators and
bubbles, but the long trend is pretty obvious. I suspect that it will grow
until it has reached all of it's potential users and potential speculators.

It has actual use as currency for bad stuff, money laundering and avoiding
currency restrictions like in China for example, so I think the exchange rate
will grow for some time. I suspect that grey economy might support money
supply worth of 200-300 billion at least. Government interventions might cut
it into much smaller number though. Virtual currency has little value if you
can't interact with the rest of the economy.

It's not path to cyberanarcist-utopia, but it's not clearly useless either. I
think it might find it's niche or be replaced with something similar.

------
notdrunkatall
I've said it before and I'm sure I'll say it again: the biggest risk to
bitcoin is a government (specifically the US government) deciding that they
don't like it. Barring that, its growth will likely continue.

~~~
snitko
You don't need to be a prophet to guess that. Of course they don't like it. To
me, it's not even a question. The question is, what are they gonna do about it
and for how long will they manage to delay Bitcoin adoption.

~~~
notdrunkatall
My thinking is along the same lines. They're tacitly accepting it now, not
because they accept it, but because they think it might collapse on its own.
When they realize that it's not going to go away, I'm almost certain that the
government will step in somehow and try to put the kibosh on bitcoin. How long
that will be is anyone's guess.

