
Researchers find that one person likely drove Bitcoin from $150 to $1,000 - middle1
https://techcrunch.com/2018/01/15/researchers-finds-that-one-person-likely-drove-bitcoin-from-150-to-1000/
======
thisisit
Wow, this paper's conclusion is delayed by 3 years. Willy and Markus bots are
old news for anyone who has been following bitcoin closely. The source of all
these allegations was this blog appearing in 2014:

[https://willyreport.wordpress.com/2014/05/25/the-willy-
repor...](https://willyreport.wordpress.com/2014/05/25/the-willy-report-proof-
of-massive-fraudulent-trading-activity-at-mt-gox-and-how-it-has-affected-the-
price-of-bitcoin/)

~~~
agumonkey
Any recent manipulations ? especially in 2017 end ?

~~~
arcticbull
Most recently, there's the tape-painting bot Picasso:
[https://medium.com/@bitfinexed/meet-picasso-the-painter-
on-g...](https://medium.com/@bitfinexed/meet-picasso-the-painter-on-
gdax-c478ff8f50e5)

If you were paying attention in the week that followed this post, the spread
between GDAX and the other major US exchanges narrowed from $1000+ per coin to
just about $11 right now, and trade volumes on GDAX plummeted. Maybe theres's
some other reason, though there's some crazy correlation there at least. I'm
surprised more people aren't talking about that.

~~~
fpgaminer
Looks like that article was written on the 23rd of December.

That's the same time period around which Coinbase abruptly released Bcash.
That time period was a barrage of negative kerfuffles for them.

Historically Coinbase/GDAX has enjoyed "inflated" BTC/USD prices because of
their trustworthiness. Contrast with Bitfinex which does not serve US
customers, has been hacked in the past, and is (last I heard) in debt from
said hack. Or contrast with any of the other exchanges which are either
questionable or located outside the U.S. Gemini is the only other state-side
trustworthy exchange besides them.

(I say inflated, but it's probably more appropriate to say that the price is a
discount on all other exchanges; a discount which accounts for the
counterparty risk and difficulty moving USD in/out of them.)

The late December fiascos that Coinbase suffered has likely shaken that sense
of trust, at least in the short-term, resulting in both reduced trading volume
and reduced prices relative to other exchanges.

So the question is, which theory is more likely? That a single trading bot has
complete control over Bitcoin's price and its discovery has resulted in the
dismantlement of the program? Or that traders are reacting to the news of
"insider trading" by Coinbase employee's? Or maybe it's as simple as being the
end of December. The winter holidays slow down markets.

~~~
__blockcipher__
Serious question: Why does hackernews seem to be biased towards BTC over BCH?

In my opinion, any honest examination of the tradeoffs between block size,
orphan block rate, cost to run a non-mining node (which do not contribute to
network security except indirectly via serving SPV wallets), and mining fees,
will show that a 1-1.7MB block size limit is just too low for current tx
volumes.

The current BTC network is unusable due to the massive fees. Even worse, those
who actually used the currency (sorry, I mean store of value?) get penalized
for having so many UTXOs. UTXOs directly increase the size in bytes of the
transaction, increasing the fees you pay.

I've paid probably an average of $30 fees over the last 2 months, with the
highest fee being $100 on a $4000 transaction (fee is related to size in
bytes, not dollar value transmitted, I'm giving those numbers just to show how
ridiculous it is)

EDIT: Also worth mentioning that the Coinbase CEO does not like blockstream
because they censored Brian Armstrong (the CEO) for supporting BIP 101.
Bitcoin Core has used a lot of heavy handed and very sketchy tactics to wrest
control of the ecosystem in Satoshi's absence. They view themselves as the
sole guardians of "consensus".

~~~
davej
Increasing block size is not a sustainable solution for scaling transactions.
Transaction fees are too high and BTC should move to 2MB as a short-term fix
but the long-term fix is off-chain solutions like Lightning.

~~~
needs
Then why is even a harmless increase to 2 or 4 refused? The current
confirmation time and fees are beyond any worst case scenario, but yet there
are still people completely brainwashed to argue that Bitcoin Core is
perfectly fine.

Bitcoin Cash scale what it can scale, that is, blocksize. That's it, it is a
pragmatic approach absolutely obvious for anyone with more than 2 year of
experience in programming.

~~~
cesarb
> Then why is even a harmless increase to 2 or 4 refused?

A side-effect of SegWit is a partial increase to up to 4; the average block
size is already above the previous limit of 1.

------
randomdrake
Study: Price Manipulation in the Bitcoin Ecosystem

Citation: Neil Gandal, JT Hamrick, Tyler Moore, Tali Oberman, Price
Manipulation in the Bitcoin Ecosystem, Journal of Monetary Economics (2017)

Link:
[https://doi.org/10.1016/j.jmoneco.2017.12.004](https://doi.org/10.1016/j.jmoneco.2017.12.004)

DOI: 10.1016/j.jmoneco.2017.12.004

Abstract: To its proponents, the cryptocurrency Bitcoin offers the potential
to disrupt payment systems and traditional currencies. It has also been
subject to security breaches and wild price fluctuations. This paper
identifies and analyzes the impact of suspicious trading activity on the Mt.
Gox Bitcoin currency exchange, in which approximately 600,000 bitcoins (BTC)
valued at $188 million were fraudulently acquired. During both periods, the
USD-BTC exchange rate rose by an average of four percent on days when
suspicious trades took place, compared to a slight decline on days without
suspicious activity. Based on rigorous analysis with extensive robustness
checks, the paper demonstrates that the suspicious trading activity likely
caused the unprecedented spike in the USD-BTC exchange rate in late 2013, when
the rate jumped from around $150 to more than $1,000 in two months.

Highlights:

• Suspicious trades on a Bitcoin currency exchange are linked to rises in the
exchange rate.

• A single actor likely drove the USD/BTC exchange rate from $150 to $1000 in
2 months.

• Trading volume on all exchanges increased greatly on days with suspicious
activity.

• Unregulated cryptocurrency markets remain vulnerable to manipulation today.

~~~
krisives
To be fair regulated markets are vulnerable to manipulation today

~~~
xenadu02
That’s like saying the recent California wildfires are equivalent to the Great
Chicago Fire.

Both are tragedies and both have a certain element of scale to them, but the
Chicago fire was actually much much worse. It killed far more people, made far
more people homeless, and destroyed far more economic value (adjusted for
inflation).

Yes the current regulated markets have serious problems and are in need of
reform. But the scale and scope of fraud and manipulation on all crypto
currency markets is vastly larger and far more pervasive.

~~~
swimfar
Just some interesting trivia. Two days after the Chicago fire which killed
~300 people, there was a much bigger fire in Wisconsin that killed 1200-2500
people. Over 300 people just from the town of Peshtigo died. It was a town
with only about 1700 residents. It didn't get much media attention, however,
because of the Chicago fire.

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

------
astund
I suspect this is going on today. Cryptocurrency traders place a lot of faith
in the exchanges. A bad actor at an exchange could manipulate a price upwards:

\- Create a ton of volume and potentially and upward trend (two bots trading
with one another, increasing the price each time)

\- Generate hype around a coin

\- Let FOMO take over

If things start to go south, disable withdrawals, deposits, or freeze the
market until you can get it under control.

I doubt any of this manipulation is even illegal?

~~~
module0000
>> I doubt any of this manipulation is even illegal?

That was my first thought also... in stock/futures trading world, this is 100%
normal business as usual. The idea of buying all the available XYZ to run up
prices is a valid move for a hedge fund with sufficient capital to do so.

~~~
nrb
In the MtGox case, the exchange was (allegedly) fraudulently buying BTC with
cash that didn't exist, which could theoretically continue for as long as they
have enough cash on hand to satisfy withdrawal requests. IANAL but in the US
that sounds like blatant wire fraud at the very least; I'm not sure about the
relevant Japanese law.

~~~
fjsolwmv
Of course the cash existed. It was their depositors cash and cash from their
depositors Bitcoin

~~~
nrb
Right, I'm saying the exchange isn't actually solvent. The "cash balance" on
the fraudulent buyer account wasn't backed by any actual cash deposit or
proceeds from BTC sale, it's just a column in a database table.

Theoretically, the exchange buys up a bunch of BTC with non-existent cash,
raising the price tenfold, until their real cash deposits are too low to meet
withdrawal requirements, then they do as the grandparent post says and disable
withdrawals, deposits, or freeze the market until they can get it under
control.

------
sambe
The paper is written rather... colloquially. Not necessairly a problem. But it
seems mostly concerned with telling the story, and that a huge buyer in the
market causes prices to go up. That's not market manipulation.

However, there is also the claim that the buyer did not actually have to pay
for the BTC they bought. Well, that's certainly a (very strong!) form of
manipulation, but it's not what people traditionally mean when they use the
phrase. There is normally an expectation that you have real money and are
following exchange procedures, but simply behaving in a way that is frowned
upon or considered unfair/detrimental to the reputation of the market. As far
as I can tell, people are still worried about traditional manipulation in
Bitcoin markets, for things like marking the close. The behaviour described
here is more akin to hacking/traditional fraud - it is not zero-sum.

~~~
barbegal
I agree, the version of the paper published for the Workshop on the Economics
of Information Security [http://weis2017.econinfosec.org/wp-
content/uploads/sites/3/2...](http://weis2017.econinfosec.org/wp-
content/uploads/sites/3/2017/05/WEIS_2017_paper_21.pdf) has a large number of
small mistakes and the statistical analysis performed is pretty poor and badly
explained.

And you're right, it is not really market manipulation, it is blatant fraud by
Mark Karpeles and he will almost certainly be found guilty of that charge in
Japan. It is strange that the paper makes no mention of his conviction for
fraud.

------
gtcode
Bitcoin topped out as soon as the futures went live. Massive contango on a
regulated futures market may have been a factor in "reeling in" price. The
spot market is so thin that it didn't seem to take much open interest in the
futs to whip the underlying.

It's conceivable that some spot exchanges are or were still from 2017 to now,
either malicious and/or incompetent, which would facilitate the continuation
of such behavior, likely by more players than one or two.

~~~
sklut
On contango: I would not call what the futures market is experiencing
"massive" contango. There is a very slight premium to further dated futures
($35/btc Feb over Jan, and $5 Mar over Feb contracts on CME), but this is very
normal for a commodity and logically in place for exchange/spot holding risk.
I would call the average settlements over the past month of futures being
listed very normal contango. And I don't think the contango itself had
anything to do with "reeling in" price. The futures finally being listed
perhaps.

"The spot market is so thin" I also think is incorrect. GDAX is normally 0.01
USD wide (albeit for small amounts) and often-times under $1 wide for many
BTC. I would call the spot market very thick, if anything. You can get off
what appears to be very large amounts of BTC with minimal slippage most times
of the day.

"didn't seem to take much open interest in the futs to whip the underlying"
\-- are you saying a futures move would lead the market? I respectfully
disagree. All the entities I know price futs from spot and are generally
putting on the arb in this order, not the other way around.

~~~
runeks
> You can get off what appears to be very large amounts of BTC with minimal
> slippage most times of the day.

I wrote a script[1] that pulls down the public order books for Bitstamp, GDAX
and Bitfinex, because I was interested in seeing the depth of the BTCUSD
market, and right now you can offload:

258, 301 and 325 BTC on GDAX, Bitfinex and Bitstamp, respectively (total: 884
BTC), at 1% slippage for 3,544,921, 4,152,783 and 4,452,134 USD, respectively
(total: $12.1m).

[1]
[https://github.com/runeksvendsen/orderbook](https://github.com/runeksvendsen/orderbook)

~~~
hendzen
Those market depth numbers are probably thinner than they seem, there is no
regulation of spoofing/layering and it would be instructive to look at the
cancellation rate of passive orders originally placed deep in the book when
market price subsequently approaches the resting limit price.

Of course if you want to move larger amounts there are specialized OTC markets
that handle large block trades, e.g. Cumberland Mining. Of course the lit
exchanges are important for price discovery.

It would be interesting to compare the BTC market depth as a percentage of
market value to other exchange traded assets.

------
barbegal
The paper is available online at [http://weis2017.econinfosec.org/wp-
content/uploads/sites/3/2...](http://weis2017.econinfosec.org/wp-
content/uploads/sites/3/2017/05/WEIS_2017_paper_21.pdf)

I wouldn't call it a particularly rigorous analysis and it provides no more
incite than what has been published about Willy before.

Mark Karpeles fraudulently buying up $112 million worth of bitcoin in two
months when there was no fiat on the other side of the trade pushed the
Bitcoin price up. It's as simple as that.

------
seannyg
If you haven't read the recent NYTimes article on the topic of
cryptocurrencies, you should check it out:
[https://www.nytimes.com/2018/01/13/style/bitcoin-
millionaire...](https://www.nytimes.com/2018/01/13/style/bitcoin-
millionaires.html)

At the end of an article is an anecdote about an older (for Silicon Valley)
woman who states "And maybe I’m going to lose [my investment of $12k].. Maybe
I’m going to keep cleaning houses. But something is telling me I can trust
this generation."

My worry is that (1) people like this woman who don't understand markets, let
alone cryptocurrencies, will get burned by this, and (2) some small set of
people who do understand markets will take advantage of those who don't.

This could result in a situation in which techies are blamed, like Wall
Street, for causing lots of people to lose money (and -- let's face it -- lots
of people will lose money, if not now then at some point).

~~~
_hardwaregeek
When my 70 year old neighbor who can barely operate an iPhone wants to buy
crypto, all I can think of is that scene in the Wolf of Wall Street where
they're selling people penny stocks. I do think there is a utility for crypto
and I do think some cryptocurrencies will be good investments long term. But I
also think the hype is outpacing the utility and a lot of people will be left
holding the bag

------
zebraflask
Explains a lot. A casual review of many coin price histories gives you the
sense that something might be "off," although that is just my subjective view.

Another one: coins in general would have been far better off without this
current pricing bubble.

~~~
avenoir
I invest long-term into a couple of interesting projects and you're absolutely
right. Most popular alt coins suffer from near daily pump and dumps and and a
casual look at hourly charts will easily reveal this. I can't even imagine
what a nightmare it is trying to do technical analysis and make sense of the
market for those who day-trade cryptocurrencies.

~~~
lawn
Yup. The worst thing is that coins are pumped without any technical backing at
all. For example look into Ripple, Cardano, Tron or Verge.

------
cronenberg
Is this serious scientific research? Looks like a joke to me, or very bad
journalism:

>During both periods, the USD-BTC exchange rate rose by an average of four
percent on days when suspicious trades took place, compared to a slight
decline on days without suspicious activity.

So price action happens based on trading activity, wow what a shocking
conclusion. Here I was thinking prices went up and down randomly for no
reason!

>The team found that many instances of price manipulation happened simply
because the market was very thin for various cryptocurrencies including early
Bitcoin.

Hmmm this seems to imply supply and demand also have some sort of effect on
price movement. Another shocking discovery!

>As mainstream finance invests in cryptocurrency assets and as countries take
steps toward legalizing bitcoin as a payment system (as Japan did in April
2017), it is important to understand how susceptible cryptocurrency markets
are to manipulation.

And they came to this final fantastic conclusion about the present (2017/2018)
based on alleged manipulation that happened 4 years ago on an exchange that no
longer exists. Fascinating research indeed. /s

------
perseusprime11
Interesting. I am curious to know who drove up the Bitcoin price to $18K.

~~~
notsrg
You can see on a regular basis that South Korean exchanges are always paying
25-50% more than Western exchanges.

The Bitcoin pump to 20k, the entire history of Bitcoin Cash, and recently the
Ripple pump to $3 were all pumped by Bithumb, Upbit, etc. Hence the
controversy with Coinmarketcap removing Korean exchanges for a second
resulting in the marketcap dropping 50 billion.

Even right now, almost 50% of XRP volume is in SK all paying > $2, but there's
no Western exchange trading above $2. See:
[https://coinmarketcap.com/currencies/ripple/#markets](https://coinmarketcap.com/currencies/ripple/#markets)

~~~
perseusprime11
That's interesting. Why would they buy it for more than $2? Is it because the
exchange is selling for more or just problems with international currency.

~~~
peterjlee
There's a high demand in S.Korea (mostly FOMO) and it's a bit hard to transfer
a large amount of money out of S.Korea for some legal reasons, which makes
arbitraging hard.

------
dlwdlw
It's interesting to imagine this being "good" from the chains point of view.
It is "using" predictable human greed to create a situation where it absorbs
more and more value. The game Go's complexity cascades from very simple rules
and has a "life" to it sustained by human energy. Blockchain's may be the
first of games that are tied into reality via economic effects. Games do this
already, but not at these levels of global mindshare and value.

------
Alex3917
As an interesting thought experiment, consider that VC is a tiny asset class.
Now consider that if the amount invested in crypto were the same as is
invested in VC, the market cap of crypto would be over 100 trillion dollars.
At least if you assume a fixed ratio of dollars invested to market cap.

~~~
SwellJoe
And, it would produce literally no value (unlike VC investment in companies).
There are so many ways to look at crypto that makes it seem like it's
incredibly undervalued and this kind of thought experiment has been done many
times in different ways (with the example for the thought experiment changing
over the years as the crypto market cap has grown to surpass the
example...e.g. gold, Western Union money transfers, etc.). But, unless and
until crypto provides value to justify it, it's all just speculation.

Right now, BTC is a basically useless asset. You can't buy things with it
(without paying more than using dollars). You can't cost-effectively transfer
money with it (fees are too high and transaction times are too long). What can
you do with it? Sit on it, and hope it goes up. (Which is what I'm doing with
the small amount I still hold.)

I'm vaguely optimistic about cryptocurrency, in general, but the current state
of things makes me think there's too much money chasing too little value...all
that money could be going into companies that make or do useful things. But,
instead, it's just burning electricity.

Not directly a Bitcoin issue, but 99% of ICOs are blatant and obvious scams,
most small altcoins are blatant and obvious scams. Even some major altcoins
are blatant and obvious scams. I feel like there's a more than even chance of
this whole thing ending in tears in the next couple of years, even if
cryptocurrency _eventually_ (like five, ten, twenty, years down the road)
wins.

I don't mean to say you're wrong. More money will likely pour into
cryptocurrency as people with money either fall for the ponzi schemes that
surround it, or as it actually begins to produce some kind of value and
becomes a useful tool for normal people to do normal things with it. We can't
begin to compare crypto to the internet (as I've also seen people
do...suggesting crypto adoption is now where the internet was 5, 10, years in,
or whatever, just because the same number of people are hoarding coins as were
on the internet at some early point) until you can actually buy pet food using
it (or do something else of value). It isn't a revolution if it just sits in a
vault like gold.

~~~
rubber_duck
>Right now, BTC is a basically useless asset. You can't buy things with it
(without paying more than using dollars). You can't cost-effectively transfer
money with it (fees are too high and transaction times are too long). What can
you do with it? Sit on it, and hope it goes up. (Which is what I'm doing with
the small amount I still hold.)

Illegal activity, dodging capital controls, etc.

------
happy-go-lucky
Not to sound pedantic, but the singular verb _finds_ in the title needs an
edit please :)

------
wyldfire
What's the nature of the suspicious trades?

~~~
KasianFranks
For example, 10mil shares decided between market makers sitting on both sides
of the bid that goes at a price they agree on which is not in the interest of
fairness or the public. Another reason for the crypto movement.

Source: Me, former hedge fund algo dev

~~~
RickHull
Can you elaborate? Say Alice and Bob are market makers. They are colluding on
some target price, say $10k. What's the spread, how does the trading proceed,
and what is the effect on fairness and the public?

~~~
module0000
I'm not the OP to your question, but I observe what you are asking about each
day. Here are the steps that can facilitate your example. If you are imagining
stocks(instead of futures), replace the word "contract" with the word "share"
in the example below.

1) The last trade price is $9950

2) Alice calls Bob, confirming she wants to close 500k long contracts by
selling them to Bob

3) Bob bids up the price to $9999

4) Alice says "Ok Bob, let's go", and offers the maximum limit offer quantity
at $10,000. This maximum varies by instrument(example 5000)

5) Bob bids 5000 at $10,000, consuming all of Alice's offers

6) This process repeats(very, very quickly) until 500k has been exchanged, or
until another participant with size starts knocking out Alice's offers.

Edit: When you see this behavior on the volume profile, it looks like a long
horizontal bar that doesn't belong. When you see it live as it happens, it's
pretty scary if you have a position open. That's when you realize that you are
a rubber life raft, and there are 2 gargantuan oil tankers colliding in the
space you occupy.

The other way these happen(in futures at least) are called "upstairs" deals.
It's when you want to exchange a quantity of contracts large enough to disturb
the market, and the exchange will facilitate the trade to avoid Bob or
Alice(accidentally) knocking the market several ticks. I don't know how crypto
currencies could have a similar scenario for those deals, but since CME is
involved with BTC futures, it might be possible.

Source: me, active futures trader in NQ/ZB/CL land.

~~~
fjsolwmv
How does Bob raise the price $49 without actual paying a lot of people and
creating a real new price?

Or is that the entry price of the scam? And the profits come from everyone
else willing to buy at 10k (instead of 9950) because they are placing market
orders and don't know what the real price is? Seems like this "scam" is just
taking money from people who have no idea what price they want, which gets us
back to what investors think they are entitled to 8% /yr for purely passive
investments backed by no loan contract.

~~~
module0000
No one is really getting scammed in the example. Bob buys whatever liquidity
is available between 9950-10000. Keep in mind, Bob's goal is to buy _at_ 10k.
If he is able to get 100-200 of those contracts on the way up to 10k, he's
buying at a _lower price than he intended_ , which is a great deal for Bob.

------
imron
Right. Now to drive it from $14,000 to $100,000.

To the moon! /s

~~~
Simon_says
Please don't post unsubstantive comments here.

~~~
imron
It's partly substantive. The 'too the moon' part was snark, but Bitcoin went
from $400 to $1,000 in 2016, then from $1,000 to $14,000 in 2017, and I guess
the same people driving the market who enjoyed 1,000% returns 2 years in a row
will attempt to do it again this year too.

This time next year if Bitcoin hasn't imploded it will be up around $100,000.

------
plg
Winklevoss?

------
yters
Good ol' pump and dump.

------
bduerst
The number of seemingly throwaway accounts (created in the last few days)
commenting on this thread is interesting too:

\-
[https://news.ycombinator.com/threads?id=astund](https://news.ycombinator.com/threads?id=astund)

\-
[https://news.ycombinator.com/threads?id=simplemath__](https://news.ycombinator.com/threads?id=simplemath__)

\-
[https://news.ycombinator.com/threads?id=zhjansbnas](https://news.ycombinator.com/threads?id=zhjansbnas)

\-
[https://news.ycombinator.com/threads?id=barbegal](https://news.ycombinator.com/threads?id=barbegal)

~~~
Balgair
Thanks for the info. To me, just about any HN post about XYZcoin is a
minefield these days. The sentiments seem to all be unrealistically positive
and the derision of the glaringly insane XYZcoins are just swamped in
whataboutism and thread-derailing. I know it's a hot market and there is a lot
of stuff going on, so these threads themselves are warranted, yet the comments
in them are just clownshoes.

~~~
dang
There have been a lot of low-quality comments posted on both sides of this hot
topic. That's because hot topics attract low-quality comments. It's certainly
not true that "the sentiments" are all positive, and I guarantee you that
people who hold the opposite views to yours see "the sentiments" here as all
the other way. We really need a name for this cognitive bias.

Also, "whataboutism" has become the worst internet cliché in recent memory and
I'm starting to feel like we should add software to just autokill comments
that use this word, since it's such a strong signal of unsubstantive
bickering.

~~~
Balgair
Thanks for the reply dang.

Upon further reflection, maybe it is just the 'top' comments in a thread that
have the unrealistically positive sentiment. Yes, down-threads do tend to be
more nuanced, but those also tend to have less comments and sub comments. I
don't have the data, and I do have my own biases of course, but I feel that I
see large comment blocks of thread derailing and bickering at the top. The
more 'reasonable' comments then get shoved to the bottom (in XYZcoin threads).

The bias is the Semmelweis reflex
([https://en.wikipedia.org/wiki/Semmelweis_reflex](https://en.wikipedia.org/wiki/Semmelweis_reflex))

------
simplemath__
All crypto markets have always been shallow and rife with manipulation.

It's still almost a total free-for-all.

~~~
ouwen
It is a bit nerve racking seeing the distribution of coins to such few
addresses: [https://bitinfocharts.com/top-100-richest-bitcoin-
addresses....](https://bitinfocharts.com/top-100-richest-bitcoin-
addresses.html)

I wonder if there is any collusion among the top 2000 addresses. Mind you one
person can even have multiple addresses.

~~~
michaelchisari
What's interesting is the rhetoric around cryptos as a populist movement.
There's so many people on reddit that claim that trading cryptos is how
they're going to get out of the 9-5 working man grind. That it's a way to end
the dominance of the wealthy banking elites.

And yet, the wealth inequality in cryptos, especially bitcoin, makes our
current economic situation seem like child's play. If bitcoin ever does go "to
the moon", we will have a small, few mega-wealthy elite who did hardly
anything to build that wealth, while the rest of the world missed the boat.

~~~
b1daly
That’s one reason Bitcoin won’t “go to the moon.” Real currency represents a
claim on current production in the economy. If Bitcoin were to continue its
exponential price rise, we would have a situation where the people who amassed
Bitcoins early could claim wildly disproportionate amounts of the current
wealth of society.

There is simply no reason wealth holders are going to turn over real wealth to
folks who happened to get in early to Bitcoin.

This reflects that Bitcoin is not real currency. It’s a digital token, with
artificial scarcity. Since the core protocol has remained relatively secure,
it allows it to serve as a pure commodity for the purpose of market
speculation.

That’s the only thing driving the increase in price. Exponential gains (in
dollar price) cannot continue. Therefore, the speculative motivation will
leave the market. Probably the price will fall very soon.

Once the price resets to a lower price point,speculative demand could pick up
again.

I suspect that there is massive, almost indefinite amount of demand for this
type of speculative gambling. So, unless government steps in, we will see this
constant, churning rise and fall distributed between the population of digital
tokens suitable for this purpose.

You can see that attempts by early crypto coin holders to “cash out” and lay
claim to their nomitive wealth in the real world, in any significant amount,
hasten the “break” in the speculative mania cycle.

I’ve called the top here for Bitcoin, I don’t think it will break $20k.

People active in Bitcoin find this hard to believe, but as an example from
“meat space,” the price of Beanie Babies never climbed after its big crash.
(My to the shock of these “beanie bag” holders, I presume.)

~~~
Retra
There's a lot of people who think it's a way to get rich... and I'm just
wonder where the money would come from? You can't just withdraw $1M from a
bank account for doing nothing and have nobody suffer for it. You're either
duping ignorant people or you're the ignorant person being duped. Which looks
is predictably like a pyramid scheme.

------
FLUX-YOU
>The bottom line is simple: if Bitcoin wants to be taken seriously it probably
should be this easy or legal to manipulate the markets.

wat

~~~
da_chicken
Who needs copy editors in the age of new media?

~~~
rhizome
Doesn't the spell checker take care of that?

------
ecoqba11
Why is this news? Back in the early stages of Bitcoin this was the reason
people bail on bitcoin.

------
KasianFranks
People do not realize how manipulated the traditional financial markets are
otherwise known as Wall Street. Cryptocurrency is less manipulated as it's run
by a different culture of people.

~~~
gtcode
It's not technically incorrect to say there is manipulation in the US markets,
but comparing bitcoin exchanges to US exchanges is a bit laughable.

The US Federal Reserve has (had) what amount(ed) to a printing press,
associated with "working groups" a.k.a. PPT. However, major US exchanges
themselves, whether stock, futures, etc., are far more regulated and mature
compared to a bitcoin exchange. The manipulation to which you're referring is
far more indirect.

~~~
KasianFranks
Lets talk about QE-1-4, the printing of money and bankers being bailed out.
Your argument does not stand by any measure of reason or logic. Lets also talk
about investment bankers and VC's who are completely being disrupted.

~~~
AnimalMuppet
We know about that. Let's not bother to talk about it; it smells like trying
desperately to change the subject. We're talking about how, with all that you
said about financial markets, bitcoin is _worse_. Saying "but the financial
markets are manipulated" doesn't refute the claim we're talking about
whatsoever.

