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[flagged] Bitcoin (BTC) is up by +22% in a single day, valued at over $14,600 (wallmine.com)
65 points by jurajmasar on Dec 7, 2017 | hide | past | web | favorite | 92 comments

This is a farce. There's only been negative news today and yet prices jump higher than ever. There's no conceivable way this doesn't end badly. I guess people are gambling on being lucky enough to exit before then.

Edit: removed unnecessary hostility. If you have money to spare on a high risk gamble like this then by all means. But in general there's just no way everyone jumping in is fully aware of the risks.

I suspect some of the money that chased dotcom stocks in the 90's is chasing bitcoin and alt coins. There hasn't been a stock bubble since the 90's, so I guess bitcoin fills that need to speculate, that the stock market is not providing.

I wonder if my stock market portfolio has any real exposure to Bitcoin tanking.

Have a look at NVDA and AMD -- crypto mining is most of the reason why they went up so much.

This is provably (and factually) incorrect.

Crypto mining has been a portion but in no way “most of” the reason NVDA and AMD have risen. Machine learning, AI, and self driving are completely reliant on the products provided by the aforementioned.

I would think miners are purchasing ASICs now, not GPUs.

There are coins that can't be mined on ASICs and they're only profitable to be mined on GPUs - Ethereum and zCash are 2 examples, but there are many more.

Indeed we are.

You definitly are not speaking on behalf of everyone...

I've got friends and colleagues who don't even know how to setup their mobile phone wanting to buy in to BTC. They are actually managing to do it because of the proliferation of new, simple, exchanges. What makes matters worse is they have no idea what a wallet is - leaving everything in the exchange.

>There's only been negative news today

Maybe that's part of it. Things seem dire for a lot of folks now (even if they aren't) so a little short-term game or gambling high isn't so bad.

It's the first in a new asset class that provides things that never existed before, mainly being the ability to quickly transact value over great geographic distances and national borders with zero interference from third parties. The value of that is extremely underestimated by most people, and shouldn't be so hard to grasp. Analogous examples are the Internet and Google, which provided very straightforward and simple value propositions that most people did not get, could not predict, and decried until they actually grew to enormous and important positions in society. Cryptocurrency is very possibly in the same vein, making valuations like this seem less absurd.

I wish I had the time and motivation to go back over the last 6 years and create a timeline of people making the same tired statements as yourself. The same types of statements were made when it hit 10 dollars.

> quickly transact value

Well now it takes hundreds of minutes, in which time the value of your bitcoin has changed, given its current volatility.

I remember a time when my modem had to dial up to internet, and everything was slow. And I remember that whatever you searched on google, there was at least 1 porn result in the top 10. I also remember when electric cars were not nearly as good as gasoline cars.

Technology advances. If you're stuck looking at what is inferior now, you will not see what is possible in the next few years.

You are talking about a technical problem, which can be fixed.

Not all technical problems can be fixed.

Sure but that's a general statement not applicable to the current situation. There are already known technical solutions to the scaling problem. The issue is social, i.e. getting everyone to agree to a protocol upgrade, not technical.

Kindly note I made no claims about whether bitcoin is or isn't novel technologically. Or whether it has a purpose. I said it was irrational that prices increase when the only news is negative. You're clearly being emotional about this.

the only problem is that btc is broken and it's become a "store of wealth". digital gold if you will.

I anticipate that a lot of comments about "bad bubble" and "bad bitcoin" will emerge like on every thread about bitcoin on HN.

I think people just don't understand that most participants in "Bitcon boom" knows this is a bubble. Every major news outlet says it's a bubble every couple of weeks. This is a common knowledge, everyone are saying it's a bubble.

I know it's a bubble too and I have bitcoins but I don't care that it's a bubble. I am holding BTC from the time it was worth couple of times less when everyone was saying it's a bubble also. Even if it goes down a lot below 10k now I will still make money.

I think a lot of people yelling "you morons don't buy bitcoin!!!1111" need to understand that people are aware of the risk, like they are aware when going to casino that they can lose money and there will be people that will lose their money for sure. The last one in the game takes the highest risk, that's all.

"I am holding BTC from the time it was worth couple of times less when everyone was saying it's a bubble also. Even if it goes down below 10k now I will still make money."

It sounds like you haven't been through a bubble before.

In the dot-com bubble, the losing stocks didn't see their value cut by 3-5x. That was the winning stocks - Amazon lost 93% of its value between 2000 and 2001, EBay lost 75%, Cisco lost 80%. The losers saw it cut to zero. In a very short period of time, too - slower flameouts took a matter of months, quick ones were literally overnight. One day a company would have 3000 employees and be worth $5B, the next day the company would be bankrupt and everyone would be laid off.

I've got a few grand in Bitcoin too (a remnant of the last Bitcoin bubble in 2013 that I never bothered to dispose of), and it's been a fun ride, and it wouldn't surprise me if this is still near the beginning of the Bitcoin bubble and we have a while to go. But please, for the love of god, do not invest money in Bitcoin that you can't afford to lose. Because when bubbles pop, they don't just drop a couple percent or even a couple times. They usually go to zero, and everyone who was burned avoids that asset class for at least the next decade if not for life.

> It sounds like you haven't been through a bubble before.

I had bitcoin in 2012 also. I've sold it when it hit 1000$ just before Mt Gox collapsing.

> and it wouldn't surprise me if this is still near the beginning of the Bitcoin bubble and we have a while to go


> But please, for the love of god, do not invest money in Bitcoin that you can't afford to lose.

I also agree here 100%, unfortunately some people bet a lot more, anyway, I can't stop someone from going into casino and betting all they have on red.

How is that relevant, the price spiking isn't because of people like you. It's because of people buying in now.

People are obviously not capable of understanding risk. Are you serious? You bring up casinos when they are perhaps the best example of how ill-equipped the majority of people are to understand risk and probability.

I think people buying in now know the risk too. I don't think the general, general population is buying yet. Anyone I know coming in during the last few months has been reasonably savvy. Taking a risk, but they're aware of it.

Two people asked me the other week, "Are we too late?" I said that I didn't think so, but to only risk what they could afford to lose. They bought in around $8k. It's now approaching $15k, two weeks later.

> How is that relevant, the price spiking isn't because of people like you. It's because of people buying in now.

I wrote in my last sentence that they take the highest risk.

> how ill-equipped the majority of people are to understand risk and probability.

If that's true then conclusion would be that democracy/any liberal system is the worst system of them all, because if majority of people do not understand risk and probability they shouldn't be allowed to even vote.

As I already wrote, all the data is there, just turn on the TV and you will hear "it's a bubble". No one is deceiving anyone in saying it's not a bubble in mainstream media.

Seems like a significant portion of the capital is coming from Asia, mainly South Korea, with just Bithumb BTC/KRW trades making almost 11% of today's volume.


I'm in Seoul as we speak, and it's an insane mania here.

It has absolutely nothing to do with North Korea. If Koreans want to keep money safe, they can, for example, buy US stocks and bonds. They can buy US Treasuries. Bitcoin they buy out of greed and fear of missing out. Korea is the land of the trend, of bangdwagonning.

I feel bad for all of the people who are going to be burned.

I saw an ad on YouTube, in Korean: VOICE: How easy is it to make money in Bitcoin? [Shot of a finger pressing a button. The price goes skyward. Finger presses again to sell, showing screen of juicy profit.] VOICE: That's how easy it is.

I literally hear random people in coffeeshops and the subway talking about their BTC schemes. I met someone at a coffeeshop and a group of four well-dressed guys at the next table were talking about their bitcoin scheme.

I went back about a week later. A different group at the very same table were chatting about their bitcoin thing. "We know it's not very original, but we're thinking of making a new bitcoin exchange... with a twist... so we're thinking about what the twist should be!"

Go to the unrelated programming meetup, it's half about bitcoin. A few guys are working together. Their project? Something bitcoin. They weren't sure what. But gotta be bitcoin. "I'm gonna make a new cryptocurrency business based on Bitcoin! We're gonna be big boys on the blockchain! Oh, what's Ethereum? I've never heard of it."

When I go online my browser windows are festooned with various bitcoin ads in Korean.

Although quite different, this has a very similar smell to the real estate boom in Los Angeles, when every waiter and wannabe actor and person between jobs was talking about buying their million dollar shack.

That's to say, it smells like doom.

"If Koreans want to keep money safe, they can, for example, buy US stocks and bonds. They can buy US Treasuries."

I wouldn't consider US securities to be a safe bet, especially considering risks from US's current political uncertainty. US might even cancel their debt, so US Treasuries might even be considered riskier than bitcoin.

I'm sorry, but you can't really be saying that you consider bitcoin to be a safer place to park your money than US Treasuries?

In any case, Koreans can access safe haven assets from around the globe; they don't need bitcoin for that.

In fact, I wouldn't be surprised if, after the rage of a shakeout, bitcoin were at some point banned in South Korea. Online gambling is banned (there are public service announcement ads in the subway against it, showing gamble-a-holics in handcuffs). They might just have to classify bitcoin as gambling. Once there is a large enough group of people angry at losing their money to bitcoin mania, it could happen.

I never said I consider bitcoin safer than US Treasuries. I just said I wouldn't consider US securities to be a safe bet and that even US Treasuries might be considered riskier than bitcoin.

Every asset has some degree of risk. And even something that might be considered somewhat risky might even reduce the risk of a portfolio through diversification if its risk doesn't correlate significatnly with the other assets.

Everything has some degree of risk. Truer words can't be spoken. And sure, diversification is the only one free lunch, they say. But could US Treasuries be riskier than Bitcoin, under any scenario? Even if an EMP attack wiped out North America, or Washington DC and New York were both nuked, I'm not so sure. But those are the kinds of scenarios that might make it possible. Something where the United States ceased to exist. In those cases, would Bitcoin survive? Good sci-fi material.

Sooo... how much savings South Korea has and how it compares to how much money was invested in bitcoin so far? I other words, what happens with the price in South Korea will put half of their savings in bitcoin?

Excuse the late reply. I don't have numbers for you, but they still can't be that big. Bitcoin is perhaps fanatically adopted by some, and they may bring their friends in, but it has to still be a very very small percentage of total investments. 50 percent of Korean personal investments going into bitcoin seems, thankfully, impossible.

Btw the gov't here has outlawed bitcoin derivatives including futures, and classifies bitcoin as a speculative asset, not a currency or means of exchange. I can easily imagine bitcoin being banned here, if there is a collapse and people get burned.

At the same time the gov't is supportive of new technologies and seeders interested in blockchains.

Yes, I've been reading about the South Korean frenzy for a day or two. This morning, a Bloomberg article[0] pointed to fear of war with North Korea, and fear of financial chaos around ongoing corruption scandals.

But there's little doubt that immanent trade in Bitcoin futures is the major driver. From a recent Coindesk article[1], I get that sellers of futures contracts are hedging in case the price falls. There's no requirement to own Bitcoin for selling futures contracts. But there is the expectation that they will hold Bitcoin at settlement.

So maybe some are buying now, and expect to win big in the futures crash.

0) https://www.bloomberg.com/news/articles/2017-12-06/bitcoin-f...

1) https://www.coindesk.com/bitcoin-futures-make-way-new-kind-w...

Probably from China going through Korea. And most volume in last weeks is coming from Korea.

They are buying bitcoin to buy other altcoins.

Alt-coins almost all dropping. BTC rising.

It's obvious to nearly everyone that this is the world's biggest pump-and-dump scam.

Sentiment on HN, Twitter and the financial press is nearly unanimously negative. Co-workers and family members are convinced this will end in tears for the foolish speculators.

But one thing bugs me about all this.

Historically, bubbles burst after long-time critics finally capitulate. Pyramids and Ponzis collapse when most people have bought in and there's nobody left to sell to.

Are there any examples of bubbles bursting when 98% of the population knew it was a bubble in advance?

People are also seeing their co-workers and families asking about how to "invest" in Bitcoins.

So the old story about Joe Kennedy and the shoe shine boy applies too? The saying " You know it's time to sell when shoeshine boys give you stock tips. This bull market is over."

Stocks are for the elite, Bitcoin is for the masses.

I'm pretty sure everyone knows that most bubbles are bubbles in advance. People don't invest because they think it won't crash, they invest because it is definitely going up and they hope they can cash out before it does.

If 98% of the population think it's in a bubble then it's probably not in a bubble

I will archive this comment, and ping you back if you're still on hackernews in 2020. We'll see the value of bitcoin then, and how far along adoption has gone in marketplaces such as Amazon. :)

Should someone tell him?

Could we stop turning HN into a Bitcoin ticker? It feels like every day we get a "Bitcoin reaches $X" post and it's getting old. It's certainly not newsworthy.

If there's something concrete that _causes_ Bitcoin to move majorly, I'd be happy to see that but if I just want to watch the price, I'll look at an actual Bitcoin ticker.

... Or maybe they should just pin this news to the top od HN because price of bitcoin is sort of developing story.

This is becoming a joke. Meanwhile, transactions times in both BTC and ETH are getting ridiculously slow.

As someone that has been in since 2013, I don't even recognize the current scene. The only reason the vast majority of people are getting into it is to get rich. It seems totally unsustainable, but the only incentives for people on the inside are to loudly convince others to join them.

Last day I saw a magazine on cryptocurrencies in a kiosk in Germany (in German language). As Warrent Buffett used to say, "When everybody and your taxi driver talks about your stocks... it's time to sell".

It's impossible to predict. Anyway, I'm investing with a buy & hold philosophy.

Crypto currencies are the first investment where everybody and your taxi driver gets to buy before the institutional investors.

I agreed with your first sentence, but then was confused by sentences 2 and 3. That's exactly the scene I recognize from 2011 until now.

This looks promising to improve transaction speeds https://www.youtube.com/watch?v=a73Gz3Tvx3k

Looks very promising! For those that don't want to click on the video (uploaded today), I've copied the description below:

"In this video Laolu (co-founder of Lightning Labs) demonstrates a multi-hop payment on Bitcoin's mainnet which travels across the 3 major Lightning implementations. In the demo Laolu (a.k.a roasbeef) sends a payment from our Lightning desktop app (https://github.com/lightninglabs/ligh...) to Starblocks, a coffee payment demo."

"This payment marks the first multi-hop, cross-implementation payment on Bitcoin's mainnet. All transaction performed in the video were performed completely off-chain, instantly, and with virtually zero fees. Lightning allows instant, low-fee payments on Bitcoin, enabling the system to scale further for the next wave of adoption. Additionally, Lightning unlocks a new class of use cases for Bitcoin enabled by the ability to instantly send low-fee payments on the system."

I just bought some and I will sell when it reaches 5x if it ever does.

If you're buying in order to speculate, why not sell gradually into the gains? Your strategy seems like it is taking what is already a high-risk, and artificially making the risk higher than needed...

Also, the time to buy is almost never after/during a large boom, heh.

because if you sell gradually, it doesn't move as fast...

since this is getting downvoted, I will give a simple example... if you have $2 and it goes up 100% (two-fold incease), than you have $4... but if you cash half your money, then you have only $1 invested, and you are stuck with $3 instead of $4 ... and lost 25%. Not sure if my math is 100% right, but if you are betting on value going up, you lost money.

The "if" parts of your comment need more thought that you've given them.

It depends on your goals, but maybe... we'll see if I was too late in the game to make a quick profit.

That's the only way to win long-term in gambling. Cash out winnings over your stake.

buy high, sell low!

I tried to do that on coinbase and it won't let me

I'm gonna do the same but sell when it gets to 10x. Have fun being half as rich as me!

Amateur! True bitcoin maestros never sell for less than a 100x profit :P

we are already at 100% profits... let's wait a bit longer

that's fine, I just like to set a goal and stick to it... enjoy the extra cash (maybe).

Transaction times are slow because there are so many of them. What you're saying is sort of equivalent to "look at how much traffic there is at that mall, it's going to fail".

The number of transactions is close to nothing compared to credit card transactions. The current blockchain networks have to improve a lot.

To understand what's happening, you have to observe how things have evolved. Bitcoin was advertised as digital cash. Tons of nerds envisioned a future of the whole world buying coffee with Bitcoin. As it became clear that the current network could never fulfill that vision, the whole community evolved its belief system to support the value of the currency, and they did so without any leader to coordinate their actions. They were just led by incentivized memes—the more convincing the justification for high valuations, the better the ideas spread. Now, people don't pitch Bitcoin's value as a digital cash. They tell people it's digital gold and the transaction fees don't matter.

The beliefs of the community will continue to evolve as needed to support the value of their claims on our society's productive capacity.

> "Bitcoin was advertised as digital cash. Tons of nerds envisioned a future of the whole world buying coffee with Bitcoin. As it became clear that the current network could never fulfill that vision..."

There is an interesting historical tidbit: Initially Satoshi didn't have a fixed block size limit. That limit was only added after a DDoS attack where absurdly large blocks flooded the network. But that was a temporary fix, and satoshi had said that limit could easily be changed, maybe using some algorithm that increased size based on demand or that gradually increases with time. He had said large blocks is not a concern because network bandwidth increases exponentially. Unfortunately, the early developers did not proactively address the scaling problem, such as by allowing for increasing block sizes, so we are stuck where we are at today. [1]

Point being, bitcoin could have been a micro-transaction-capable digital cash, and it (or another crypto-currency) still could fix this scaling problem. Not everyone in the community has "evolved their beliefs" about bitcoin (or cryptocurrency in general). I personally feel that bitcoin was and still is experimental, but has simply been a victim of its own success, but that the scaling problems are not insurmountable.


I'm excited about digital money. What could the effect be of a boom and crash? If bitcoin had some kind of algorithmic central bank mechanism, low transaction costs, and didn't spew CO2, I'd be in love with it. I'm half in love with Ethereum, although something there doesn't quite feel right yet, either.

Lately I've been exposed to the meme that Bitcoin isn't money, ok, "Bitcoin is Bitcoin" -- another way of saying, "it's different this time."

There are several projects on track to improve blockchain speeds by several orders of magnitude. So, in other words, it's a solved problem. See: https://en.wikipedia.org/wiki/Lightning_Network

Yet another hack resulting in the loss of tens of millions of dollars, transactions taking forever, retailers announcing that they no longer accept Bitcoin, massive questions surrounding one of the largest exchanges:

22% surge in a single day.

This is going to end well.

Meanwhile "An $814M Mystery Near the Heart of the Biggest Bitcoin Exchange" https://news.ycombinator.com/item?id=15851824

looks $ flowing out of alts and into bitcoin, which is somewhat surprising given the concerns over high transaction fees

I don't think anyone knows WTF is going on with it. I also sincerely hope people have only invested what they can afford to lose -- and that they've realized the gains that they'd be happy with.

Of course, it could just as likely be $20k tomorrow.

There are many motivations for buying bitcoin, speculation, get rich quick, freedom from bankers, a fair economic system and unit of exchange that can be transported geographically instantly and cheaply without censorship, to buy alt coins (to profit from high % gains in new tech.

It seems like a crazy surge because of the nature of adoption rates of new tech. It gets faster and faster, radio, tv, internet, google, facebook, bitcoin. The limited supply also throws off our normal convention of stock price valuations that usually have large amounts of shares - often to keep the prices low for trading - but infinite divisibility makes this different from stocks.

I bought because I wanted to help people have a fairer system, and because I believe equity based money to be more sound than debt based money. Many of the people I wanted to help have a hard time believing what is happening (even I do a little), but I'm glad it is. Human nature often conspires against us in these situations, the naive and greedy may come in and benefit from a small investment earlier than the risk averse considered decision maker. The system is intended to help both. When you can see past your fear, envy, disbelief, regret and instead trade it for hope, adventure and magic internet money you may see it as a new fairer way for humanity to bank and not an affront to reality.

Ha, I know a crypto nerd who was investing all his savings into bitcoin, several years ago. Today? He’s a rich man, but he still holds the vast majority of assets in Bitcoin and has not attempted to sell them all at once. So he’s Bitcoin rich right now. I wonder what his ultimate destiny will be.

He's trying to figure out when and how to dump. The when is right before the bubble bursts (look up Nina Brink for example in dotcom burst). The how is by spending the money on businesses who accept Bitcoin.

Problem is when a "Bitcoin run" (akin to bank run) starts you'll have slow, expensive transactions going down in worth compared to EUR or USD. Plus businesses can decide to stop accept BTC as currency like Steam did today.

And it will burst when Bitfinex bursts due to tether being an exposed fraud. Question is when, not if.

I'm not really sure what it means for someone to have millions of dollars of value in Bitcoin. In practice how much of that money might someone be able to convert to cash and over how long of a time period?

I'm also not really sure what the catalyst of a Bitcoin crash would be, wouldn't it require for the vast majority of people to decide Bitcoin is no longer worth buying ever? As long as the supply of greater fools never runs out, won't there be people around who buy into every dip and keep the price going higher?

I'm still not sure if that guy is lucky or screwed with his Bitcoin investment, but he seems confident it will work out.

> As long as the supply of greater fools never runs out, won't there be people around who buy into every dip and keep the price going higher?

Yeah, people thought the same during the tulip mania (something every Dutch kid gets taught at history class in high school [1]), dotcom bubble, MLM & ponzi schemes. "It can't possibly burst, the amount of fools who buy them are infinite." Of course it isn't infinite, and people are learning about Tether.

Plus, don't forget Bitcoin basically became illegal in China.

> I'm still not sure if that guy is lucky or screwed with his Bitcoin investment, but he seems confident it will work out.

As long as he can spend his Bitcoins, and as long as he does before it bursts, he's OK. Simple fact: if he spends it all now, he spend it with huge profit. I mean, if he can resell the products he buys with Bitcoin at a 10%-20% loss (which is very fair for a new product with receipt/warranty) he's still in on a net ~45-55% profit. Problem is the high transaction costs means people keep sit on their networth.

At some point though the exit strategy is destroyed when companies stop accepting Bitcoin as payment method. You can't exactly fortune tell when but when this happens en masse that's when the momentum of Bitcoin is RIP. Steam recently did, officially because as they put its "volatile" and because the transaction costs are too high (several tens of EUR/USD per transaction). Them saying its "volatile" is a way of expressing disagreement with the coin increasing in worth without being needlessly offensive. At the same time, they don't burn their bridge with Bitcoin altogether. My take is they'll restart with Bitcoin once the bubble bursted and stabilized.

And the reason it will burst is Tether. I'll patiently wait. I'm mid 30s. I got a whole life ahead. Recently bought a hardware wallet. Am I sad I didn't start with Bitcoins earlier? Sure, first of all because I like the concept in combination with a hardware wallet, and there was very little competition and virtually no drama about it (before Mt Gox). Second, I wish I did when it was 200 USD. And I even considered to start with BTC back then. I easily had a few thousand EUR to speculate with. The current stuff though, is irrational, and has the signs of bursting bubble all over it.

[1] https://en.wikipedia.org/wiki/Tulip_mania

Might be an indicator of the old FOMO maneuvers. Whether the underlying realities are solid (fast, cheap transactions) or not is less relevant if people were, say, profit taking on their alts and pouring it into BTC since they feel BTC is rallying more/consistently with the spotlight on it.

Interesting observation, in any case.

>Whether the underlying realities are solid (fast, cheap transactions)

but that's only the case if the coin isn't popular. more popularity = more transactions = more competition for block space = higher fees.

That's the dump part of "pump and dump".

What is too high and what is too low in Bitcoin world and how do people come up with those values?

If people were keeping track of Satoshis (0.00014 USD/Satoshi) would they also think it is expensive?

The only way to tell is look at the market capitalization (see https://coinmarketcap.com/)

To compare, if Bitcoin reaches $400.000 per bitcoin, the total value of all Bicoins will be the same as the total value of all gold.

For those who want to sell but not cash out in fiat (because on exchanges such paperwork can take over a week), what's the easiest stable thing to exchange your BTC for?

You can easily cash out on localbitcoins at least in Europe using SEPA.

Futures on Bitcoins will be introduced next week on CBOE and the week after on CME.

I wonder if we will still see this kind of crazy rallies as it will be easier to short it.

If one wants to short the CBOE/CME futures and also be hedged, he'd need to go long on spot price. That will only increase its price.

Given the futures will be cash settled there is going to be a disconnect. So it will be interesting to see if the crazy rallies do end.

The run up is a result of the futures. It legitimizes bitcoin.

No one in their right mind is going to short bitcoin unless they want to risk losing their shirts.

A lot of salt in this thread.

So let me take the opposite side and say congrats to everyone who's hodling bitcoin!

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