Bitcoin up 15+ percent in 1 day

by PaperclipTaken • 13 years ago

48 56 13 years ago

niggler4• 13 years ago

I hope people are selling something at these price levels. BTC may continue to run or may crash really hard soon, but at least make sure that if the crash comes you end up ahead.

zenmonk3• 13 years ago

See, this logic makes no sense to me, unless you bought way more bitcoin than you could afford. Every bitcoin I sell now (without topping back up, as I would normally do for my spending bitcoins) represents a potentially massive amount of future wealth. The downside is limited to the amount I put in to begin with.

If bitcoin crashes to nearly nothing, I will be sad that such a brilliant experiment has failed. I'll also be bummed that my money is gone, but I won't be destitute and it won't make my life worse off.

niggler4• 13 years ago

" Every bitcoin I sell now (without topping back up, as I would normally do for my spending bitcoins) represents a potentially massive amount of future wealth. The downside is limited to the amount I put in to begin with."

Lets say you purchased 10 BTC at 40 bucks. Losing 400 won't break the bank. Now it crossed 120. If you sold 4 BTC you'd still have 6 BTC and make 80 bucks in the process. The $80 isn't as important as the fact that you've already effectively reduced the cost basis of the 6 BTC to zero, in which case you literally could just sit there and wait. If the price did crash to zero, you would still be net ahead.

hamburglar• 13 years ago

It makes sense if you don't actually believe there is a sound reason for bitcoins to be worth $122 right now. If you think this crazy price curve actually makes sense, then, by all means, hang onto your bitcoins because they're just going to go up, up, up. One does have to wonder what exactly you think has fundamentally changed about bitcoins in the past two months to make their value skyrocket, but maybe you have some insight I don't (honestly -- I don't mean to snark. I'm not a believer, but if this is real, more power to you). On the other hand, if you notice anything distinctly bubble-like about the sudden hype and soaring price, it is pretty obvious that at the top of a bubble, things are overvalued, and that if you are holding onto something you know is overvalued, you should sell the hell out of it and buy it back when it is under- or right-valued.

127• 13 years ago

The utility of Bitcoin doesn't change even if its value drops close to zero, unless you can't buy anymore Bitcoin to facilitate your trade, in which case the price of Bitcoin will go up because of more demand. It can't fail while there is demand for virtual trade on the Internet.

monkeypizza• 13 years ago

The utility function for money for humans is not uniform.

Also, people hate to lose money. i.e. the difference between losing 1 dollar and breaking even is not large in fact, but is really large in mind. Even people who recognize this is irrational still suffer if feel they have lost money - so, removing this suffering is valuable to them.

If you only have 10 btc, selling one to break even lifetime will permanently mean you did not lose money. If btc go to a million each, an extra million will not make much difference, since utility of money at the top is much less than at the bottom.

Therefore I think it makes perfect sense for humans who bought btc cheaply to sell fractions of their total holdings to remove the possibility of losing money on btc overall.

aliston• 13 years ago

Does anyone know of a legit way to short bitcoins?

tlrobinson2• 13 years ago

I'll say it again...

People seem to love talking about shorting Bitcoin, and a crash wouldn't surprise me all, but given Bitcoin's meteoric rise recently you'd have to be insane to actually do it.

(https://news.ycombinator.com/item?id=5421675 11 days ago, when the price was about $70)

Permit2• 13 years ago

Even if there were a way, you do not want to short something that jumps 15% in a day even if you believe it's overvalued. In the long run you might be right, but when you get margin called it won't matter.

Just 15 days ago, it was trading at $50.00: https://news.ycombinator.com/item?id=5398042

yuvadam• 13 years ago

Since bitcoins are heavily (completely?) coupled to actually holding them, shorting (which is based on the concept of lending an assert) isn't really possible.

josephagoss3• 13 years ago

try bitfinex.com

Permit2• 13 years ago

Why are you hoping people sell something at this level? Why does it matter? If you're interested in protecting the masses from a ponzi-scheme, you're basically just saying "Those holding Bitcoins currently should get out, but other people should get in". For every seller there is a buyer.

Unless you have technical advice you'd be interested in sharing about where the price might head?

niggler4• 13 years ago

"Why are you hoping people sell something at this level?"

It's generic advice that applies to everything that's possibly in a bubble (like penny stock pumping). By sacrificing some of the potential upside, you allow yourself the ability to weather any potential drop (even if became worthless in the near future).

' "Those holding Bitcoins currently should get out, but other people should get in".'

I neither think that those holding BTC should entirely get out (hence "something" and not "everything") nor do I think others should get in. I'm not a timer and, especially given the fact that its $141 right now, I think it's a fool's game to pick the top and the bottom (so it makes sense to sell a little as the price runs)

qdog2• 13 years ago

Not sure how you can accept Bitcoins as a payment form, unless you tie it expressly to another currency. With this much fluctuation, the only other option would be an auction.

I think this makes it likely speculation is the only driving force for the value of a bitcoin at the moment, which doesn't bode well for something that wants to be a currency.

Edit: To be clear, what I mean is that normally we sell things for say, $2 and rarely adjust the price (a few times a year is unusual, usually it isn't even that quickly). You would need to constantly adjust your selling price in Bitcoins, making it very hard to use as an actual currency when the perceived value goes up this quickly.

Gasoline is one of the few things we buy that fluctuates pretty rapidly, and when it fluctuates people that own gas stations are often squeezed, sure they have a tank of gas they bought for say $3/gallon, but they need to schedule the next tank at $3.25/gallon, so all the profit from the current tank of gas is going to the next fill up. And when the price of gas drops, if they can't sell their $3.25/gallon gas quickly enough, they take a loss. For small stations operating on thin margins, this can wreck a month of profits.

PaperclipTaken• 13 years ago

There are several factors driving the bitcoin prices up, including people from European countries converting their money to bitcoin because it makes it harder to seize.

But since the beginning of the year bitcoin has doubled nearly 3 times, and this past month has seen additional acceleration. Bitcoin has been in the news a but I don't see any legitamate reason for the dramatic spikes of the past few weeks... except for speculaiton.

I posted this because I think that today's extraordinary spike is preceeding a crash of the market. At some point, all of the serious speculators will have put all their money into the coin, and they will be looking to cash out. A huge spike like this would seem like an optimal time to cash out.

And if there aren't enough people to buy the coins, the market will plummet.

Bitcoin has been succesful recently because the value has continued to go up. When the price takes a hit, people will lost confidence, and non-speculators will also start to sell. I don't know how hard the initial hit will be, but the last time that Bitcoin started losing value, it spent almost 3 months declining.

I believe that the same thing will happen again, and bitcoin will (after the initial hit) decline for several months before starting to make its deflationary recovery.

zenmonk3• 13 years ago

> At some point, all of the serious speculators will have put all their money into the coin, and they will be looking to cash out.

You are assuming that the price rise is due to short term speculators looking to make a quick buck. I think a lot more people are buying into the philosophy, politics, and revolutionary technology and won't be so quick to sell.

inoop• 13 years ago

> There are several factors driving the bitcoin prices up, including people from European countries converting their money to bitcoin because it makes it harder to seize.

I doubt many people are stupid enough to trust Bitcoin with their savings.

The thing with Bitcoin is that identities are easily made, and transactions are hard to track. Nothing is stopping you from creating a whole load of transactions between addresses you own, essentially creating a lot of traffic and faking interest in the currency. I'm sure there are lots of Bitcoin bots out there propping up prices, run by speculators who bought low.

zenmonk3• 13 years ago

I totally agree that the fluctuations are no good for a currency. People like to say that bitcoin is a currency, but it really could be a lot more than that. Even with wild volatility, it can still work great as an international funds transfer system (assuming the conversions to/from national currencies are smooth enough), and it can still take on Visa, Mastercard and paypal at the online payments game. It also acts as a hedge against bank account confiscation, as a speculative bet against inflationary monetary policy, and as a direct (although more risky) competitor to precious metals. Moderate success in any one of those categories would be huge for bitcoin. Acting as an everyday currency can come later.

Evbn6• 13 years ago

What stops a state from taxing your Mt God account? Or will you store $100k of BTC on your laptop?

nwzpaperman• 13 years ago

Everything is always valued in relation to something else, including bitcoin. USD/BTC is about $120.xx right now, right?

Dollars are valued against Euros, barrels of oil, rents and a six pack of beer. The same applies to everything else. When you talk about what it is worth it is always in terms of some quantity of something else.

What people will learn a few years from now is that almost every part of the human experience is a speculation; death and taxes excepted, of course!

b0rsuk• 13 years ago

I oppose Bitcoin for the same reason I oppose money not based on gold or other valuable physical resource. It lets one entity to produce money out of nowhere, at the drop of a hat.

There used to be a video in higher quality, but this will have to do. Hans Hermann Hoppe gives a concise, high-level explanation of money: http://www.youtube.com/watch?v=Gizetn5VuA0

josephagoss3• 13 years ago

There is a hard limit to the amount of Bitcoins however.

ashray• 13 years ago

I don't get this. If there are 21 million bitcoins but they're infinitely divisible - you can send 0.0000001 BTC to someone.. Then how is there a hard limit?

Countries have done this many times by dropping zeros when their currencies devalue, etc. The whole 'there are a fixed number of bitcoins' makes no sense if you can just divide the currency unit by 1 million and call the new currency micro bit coin.

Devilboy2• 13 years ago

Well then you'll be happy to hear that Bitcoin does NOT allow one entity to produce money out of nowhere.

gamblor9562• 13 years ago

Exactly. Bitcoin allows many entities to produce money out of nowhere...though this ethereal production will eventually stop at 21 million, if Bitcoin survives that long.

ghshephard• 13 years ago

Now, whenever I buy something in Bitcoins, I always end up getting a refund after the vendor converts into local currency - which I then need to sell to get USD again.

I expect that when it comes back down at 15% a day, the opposite will occur, and I will have to add a bit more.

It's annoying - I don't really care whether 1 Bitcoin = $USD 1, $USD 10, $USD 100, $1000, or $USD 10,000 - that's completely immaterial to me - I just wish it wouldn't move around.

It is interesting how more vendors who, for whatever reason are no longer able to accept paypal or credit cards, are transitioning over to BitCoin. It's certainly going mainstream more quickly than I would have thought.

This constant volatility is nothing but bad news though.

josteink• 13 years ago

That a whole currency can have fluctautions as big as this one in such a short time-span shows that it's still a very small currency, and that it doesn't take much manipulation, supply or demand to significantly impact it's value.

Not that there's anything wrong with that, but it's worth mentioning to balance recent articles quoting how the BitCoin economy is now very big(tm).

vijayboyapati• 13 years ago

It's up to $147. Was $140 just a few minutes ago. Any bets on whether it hits $200 today?

conanbatt2• 13 years ago

Im super surprised at this and i certainly dont understand it. True, Bitcoin now has a surge of popularity because several retailers with pull are using it and it got more news. Then it spiked the price, getting more attention. But the rise is so big that i dont understand what buyers are thinking.

Holders of BTC are making a lot of money selling (if they are selling), but why are people buying at this prices? BTC is not a need-purchase.

I wonder if after spiking price, the very BTC community started investing more money in what they already have. That could explain lack of sellers and price-spiking.

Cthulhu_• 13 years ago

> But the rise is so big that i dont understand what buyers are thinking.

"Hey, internet money / commodities on the rise, buy now, sell for profit, I'm in!" times tens or hundreds of thousands.

conanbatt2• 13 years ago

Way too speculative for new users. I think its the players themselves.

This might not be that known but Bitcoin has a stockmarcket with bonds and stock. For the volume of the coin, a significant part of the users of the coin are people trading and speculating with it. They are way more comfortable and likely to play with a rise like this than any other.

Someone with 1000 BTC made over 60k dollars in a couple of weeks.

adrianwaj• 13 years ago

"Bitcoin is good if you want to make a deposit of between $1,000 and $10,000. But the liquidity is just not there in the system for multimillion dollar transactions," Colas points out.

http://www.businessweek.com/articles/2013-03-20/jittery-span...

It's not a bubble if big money decides (or rather realizes) they can and will transfer and settle differences in bitcoin rather than fiat. (to me that's bitcoin's strongest point.. it's too cumbersome for day-to-day instant purchases) It might be a bubble now, but at some point either now or in the future, the (next) bubble won't pop.

Bitcoin up 15+ percent in 1 day

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