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Bitcoin hits a new record high above $5,100 (cnbc.com)
55 points by sAbakumoff 8 days ago | hide | past | web | 33 comments | favorite





It seems that no matter what goes wrong with Bitcoin the price hardly reacts at all. It's been practically banned in China, its community is centralised, riven with censorship and infighting, the ledger split in two, it is presumably about to split again, fees are sky high, the network is saturated and unreliable, the innovation has gone to Ethereum, Lightning Network is nowhere to be found and actual usage can't increase due to the block size cap. Overall it's just a constant stream of bad news.

Yet the price keeps going higher. Where is this money coming from and where is it going? Is it really all coming from speculators who don't actually use the system at all or even read about it?


Most of the drama around Bitcoin doesn't change the fact that Bitcoin seems to be the best store of value in the history of humanity.

For us who take it seriously and trust the Core team to be a great team of cryptographers and cautious programmers, Bitcoin is maintained well and doesn't need any new feature to be good as a store of value. It's great that it can scale somewhat, but I consider all those improvements as an extra.

If we look at fiat currencies actually, they are a low bar as a store of value to hit.


This is probably due to an imminent hard fork. People are buying up bitcoin to get automatic profit when the fork gives them 2 coins. It happened recently with Bitcoin Cash. It will be interesting to see which fork wins out and what the aggregate price will be after the fork.

Is it actually the case that it'll work out like that, similar to Bitcoin Cash? Or is it more complicated. Asking for a friend who has some ether...

How many people did get rich by investing in bitcoin? it blows my mind that it went from virtually nothing in 2010 to $5000 a bitcoin. Is it accurate to say that 200 bitcoins in 2010 (a couple of dollars) makes you millionnaire today?


What blows my mind is the massive wealth transfer this represents.

Bitcoin has no intrinsic value. It's simply an abstract asset with no value other than what someone else is willing to pay for it. And there are no fundamentals that justify its price. So it's just pure wealth transfer from later arrivals to early arrivals. It's a zero sum game.

It'd be fascinating to chart the transfer of wealth in Bitcoin across the globe to identify the big winners and losers.


I dont think this captures the value of purchasing bitcoins. If its true that a large part of the volume is people moving the money out of china, its like a banking service to them, even if they take a hit with a large cut by playing the ponzi.

Even at its downs, bitcoin has found demand still. That is a very interesting signal. If it were just the ponzi as you say, it would have come crashing down on its downturns.


Even at its downs, bitcoin has found demand still. That is a very interesting signal. If it were just the ponzi as you say, it would have come crashing down on its downturns.

That is profoundly faulty reasoning.

For a lot of people, a drop in bitcoin is just a signal to buy because they have an irrational belief that it can never really go down permanently (which, to anyone who remembers 2007, should sound familiar).

A ponzi scheme can go on as long as you can find new market entrants, and what makes Bitcoin remarkable is that it can tap into revenue sources throughout the entire world, and in particular in places where socioeconomics and geopolitics makes something like Bitcoin extremely attractive. That's a lot of fuel for this particular fire to burn before it fizzles out (presuming fundamentals aren't established before then).

The world has never really seen anything quite like this, and it'll be fascinating to see what happens over the next 10-15 years. And, meanwhile, again, there is a lot of wealth being transferred, and I'd love to see where it's going...


> That is profoundly faulty reasoning. For a lot of people, a drop in bitcoin is just a signal to buy because they have an irrational belief that it can never really go down permanently (which, to anyone who remembers 2007, should sound familiar).

Its not faulty at all. When a ponzi stops paying out it crashes. Bitcoin had long periods of not paying out. The never ending demand for it signals the opposite of a ponzi: all assets with demand have a floor where people stary buying again.

I also dont see bitcoin's value as most people. I sold most at 60, figure that out. Who knows where this ends..


Which is why this isn't as simple as a direct Ponzi scheme where actual cash payments are passed around (and why I never actually called it one).

It's more like a MLM where sellers are buying their own product for resale with the expectation of future returns.

This breaks the normal dynamic of a Ponzi scheme since there's latent inventory lying around that can be bought, sold, or held until another sucker comes along. And that delays the crash.

Of course, the big difference is a normal MLM at least offers a product with some nominal base value, whereas the base value of Bitcoin is precisely zero.


>there are no fundamentals that justify its price.

Bitcoin is the currency of choice for most international/domestic drug trade. This is a well known secret.


I struggle to believe that's enough to drive a 400+% increase YoY for 2017.

The fundamentals are there, your mistake is believing that markets are somehow rational.

Eh, I've heard that before. And yet, no one can seem to put a finger on what, exactly, those fundamentals are that might justify the magnitude of price movement, aside from "someone else will buy it from me for more than what I paid for it"...

As usual, this recent move is China related. I had a feeling that the exchanges were shut down in the first place because they were too porous and were acting as a new method for Chinese citizens to move their money out of the country. I wonder if the government will force the exchanges to report on the movement and quantity of Bitcoins that are moved to addresses outside the exchanges.

Not long ago, a bitcoin was worth less than a dollar. Uncanny.

in January 2013, it was $13. I bought for $50 worth of bitcoins when one bitcoin was $1000 (I remember comments on HN saying it reached the top of the bubble). Today my "investment" is worth $250. I suppose I'll never sell it anyway and I'll lose my initial $50 eventually but it's pretty fun to see it growing.

I don't think there ever has been an asset in the history of mankind that has appreciated so fast and so high like this.

Tulip bulbs...

Is there a real market? Are there any known cases where someone has sold $100,000,000 in bitcoin over, say, 3 months?

So far no one has advertised that they have completed that sort of liquidation. But they might just be being quiet as smart rich people do. We just don't know.

Bitcoin pizza, 10000

Bitcoin for me is one of those big indicators that asset prices being high could really be because china is outflowing massive amounts of money to the world.

It might actually be a canary in a coal mine that if it went bust, then all other assets could promptly follow.


I would guess that Bitcoin is only a tiny fraction of the capital flight from China. I could imagine a few scenarios where China's access to Bitcoin gets cut off somehow, tanking Bitcoin, but leaving the other more utilized capital flight methods intact.

Of course, I agree, you can always scare the canary to death by yourself.

The big question is what is actually happening with china: is the outflow of money permanent, increasing or decreasing? If china was strangled by a crisis and devaluated internally, for example, and money came back into china, that could be devastating for the world.


Bitcoin is now valued a little higher than a major shoe company.

The cognitive dissonance around Bitcoin was understandable during the first move to $1000 but anyone yelling bubble now really needs to consider how tiny 86 billion actually is.


It can't be "valued" higher. It's a token of exchange at an agreed price not an intrinsic return generating asset.

I disagree.

Let's take the American real estate bubble. According to Wikipedia:

"Total home equity in the United States, which was valued at $13 trillion at its peak in 2006, had dropped to $8.8 trillion by mid-2008 and was still falling in late 2008."

Two years, a 5 trillion dollar haircut.

The Bitcoin Bubble? For an asset that taps into capital markets across the entire globe, $86B is adorably small.

IMO, the bubble is still inflating and there is a long way to go, yet. To me, the real test will be when the next major worldwide recession sets in...


Sorry. What don't you agree with? I think we're saying the same thing here.

LOL, so I read this statement:

but anyone yelling bubble now really needs to consider how tiny 86 billion actually is.

As a statement that the current price means the bears were wrong and that this isn't a bubble.

I probably misunderstood! I'm still working on my first coffee...


I remember reading people on Reddit that were saying 2000 by the end of the year. I didn't believe them and it turns out they were wrong just not in the way they expected. Makes me wish I had held onto more.

HODL!



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