(01-07-2016 03:41 PM)JayJuanGee Wrote:  Probably, bitcoin's movement will more closely appear parallel to gold; however, one of the problems with gold is that there seems to have developed a considerable financialization and fakery of gold through paper instruments... accordingly , there could develop some differences between prices of real gold and paper gold.

It sure didn't last year. Every metal was down, with lead "winning" by only losing 5% of its value.

(01-11-2016 01:59 AM)BBinger Wrote:  

(01-07-2016 03:41 PM)JayJuanGee Wrote:  Probably, bitcoin's movement will more closely appear parallel to gold; however, one of the problems with gold is that there seems to have developed a considerable financialization and fakery of gold through paper instruments... accordingly , there could develop some differences between prices of real gold and paper gold.

It sure didn't last year. Every metal was down, with lead "winning" by only losing 5% of its value.

Yes... here's another chart, too regarding 2015 performance of bitcoin as compared with other currencies (including gold and silver against the dollar).

In essence, I agree with you, that ultimately bitcoin will probably blow a lot of the various precious metals out of the water in the coming years, like it did overall between 2012 and present... and even more so if we begin assessment from 2010.

http://www.valuewalk.com/2016/01/officia...ency-2015/


Nonetheless, bitcoin remains a real infant in the value storage and transmission space, and it seems that various time horizons are arbitrary in its assessment... so for 2015, bitcoin faired pretty well, yet if we were to average both 2014 and 2015, we still get downward btc performance - especially if the timeline starts November/December 2013.


However, those who like to begin their bitcoin analysis from November/December 2013 are failing/refusing to account for a proper bitcoin context. Any meaningful assessment of bitcoin will look at its present state of affairs in terms of bitcoin's longer history, and development.

Regarding the below linked article, it seems that even traditional institutions are becoming a bit more bullish about bitcoin, and even recognizing that stocks are not in the greatest, situation at this time... and that bitcoin may be a fairly decent hedge.


https://news.bitcoin.com/royal-bank-scot...y-bitcoin/


Regarding bitcoin's recent price performance, and its current floating in the $435 to $455 territories, personally, I have been giving pretty considerable emphasis in recent times to Bitstamp's weekly charts starting the week of 8/16/15.

https://bitcoinwisdom.com/markets/bitstamp/btcusd


So, in essence, we are in week 22 from that 8/16 starting point, and part of the way through, maybe towards the end of November, we should have been clear that bitcoin had fairly clearly transitioned into a bull market, and there have been 4 red candles, and 17 green candles.


The current weekly candle is floating, at the moment, in the red, but really Bitcoin's price could go either way, and we are still really early into this week's candle.

We also seem to have a pretty decent cushion (maybe nearly $100 in the green) before anyone could convincingly assert that bitcoin has transitioned into anything but a bull market.... accordingly, the odds seem to be fairly decent that BTC prices will be going up rather than down in the medium term (such as 1-2 months); however, the next couple of weeks could go either way, no?

Of course, I believe the longer term (1-2 years is going to be up because of the halving and various other decent BTC fundamentals, including investments, greater liquidation opportunities, non-hostile regulatory situation and good press, etc.)

(01-01-2016 09:40 PM)JayJuanGee Wrote:  

(01-01-2016 09:18 AM)SunW Wrote:  The S&P 500 and Dow ended red for the year and the Nasdaq was up a little, while I beat all of them for the eighth year (out of nine).

Two of my most surprising "beats" of the year were the US Dollar (up from 90 at the beginning of the year) and bitcoin, which I was able to get multiple times at lows this year (even less than $200!). I did not expect those positions to perform as well as they did, I even thought that toward the end of the year, bitcoin would be falling if there was an interest rate increase, which would give me some time to buy more. The interest rate increase told me a lot about who uses bitcoin though, and if we see four of them this year, that will strengthen my theory. With BLC, I've grown my bitcoins as well.

There may be some arbitrariness to using the calendar year as a measurement of performance, and sometimes performance may be a bit inaccurate as well, especially if the positions are still open and they are on paper as gains are losses, but have not been realized, yet.

Nonetheless, a lot of people make assessments based on the calendar year in part based on tax considerations.. and I suppose it could just be as good as any quasi-arbitrary time period for assessing the overall on paper performance package.

I have various index funds that are bundled into a kind of 401k, and the performance of my portfolio was as follows:

2012 - + 11.64%
2013 - + 21.27%
2014 - + 6.38%
2015 - - 0.93%



With BTC, there is overall market performance, and there is my personal on paper performance. I only got started in BTC for 1 month in 2013, so I was not involved at all in 2012, but I find the 2012 numbers fairly interesting as a contextual set up and a comparison to the on paper performance of my 401k investment.

I note that my personal performance in BTC is only a little bit better than the overall BTC market performance, but really I consider all of my time in BTC and my various investments, so far to be accumulation of BTC for a longer term, and as a hedge, as I had explained in some of my other posts.

Overall BTC performance
2012 - + 116.67%
2013 - + 5,669.23%
2014 - - 58.67%
2015 - +40.32 %


My BTC performance
2012 - not involved in BTC
2013 - - 2.78%
2014 - - 39.13%
2015 - + 52.15%

At the end of the year, my total BTC holdings are about 9.29 % in the red including various fees and BTC related expenses, and we will have to see how the rest of the year plays out At this point, I have quite a large sum in a trading fund to be able to continue to buy as prices go down and sell as prices go up, but my overall BTC portfolio does much better if the price goes up.

I am quite a bit more optimistic regarding my BTC holdings as compared with my 401k holdings, both long term and short term. Within my 401k holdings, I can trade around funds, and maybe it would be better to put the stock indexes in the government bonds category... but no matter what I do, it seems that the 401k portfolio is in a more precarious place as compared with the BTC portfolio.

I've been thinking a bit more about my 401k holdings as compared with my BTC holdings, and surely the risks within the categories are reallocating themselves to some degree.. and becoming more allocated towards BTC.

As I had been building up my BTC holdings, and prices of both BTC and overall stock market prices have been changing, my allocations within each category have been changing over the years too.


My assessment of my investment in 401k (stockmarket / fiat) compared with BTC holdings looks something like this.

2012 - 100% / 0%
2013 - 97.35% / 2.65%
2014 - 82.7% / 17.3%
2015 - 73.4% / 26.6%
2016 - 65.75% / 34.25% (projected)


Depending on how each asset class performs, I anticipate the asset categories to approach parity... but then a question will remain, whether to reallocate or to keep going with the flow, depending upon whether one asset class seems to be overvalued or not and if there is an ability to easily move one asset class without additional costs.

In recent weeks, and especially given some of the recent stock market performance, and future projections for the stock market, I have been a little bit torn regarding how to protect my stock market related investments (specifically the 401k).

Today, I decided to put in a reallocation request in my 401k funds towards the less risky assets. It will take about a day to process, and I have been also thinking that it may not be the best time to do it - especially since that particular portfolio of assets has already lost about 14% since May. Nonetheless, I get the sense that at the current time, the stock market scene (and maybe even the dollar's potential bubble status) looks fairly dismal, and there may be a time where these matters look more positive to jump back in, especially allocation towards stocks.


At the moment, based on my current allocations as referred to in my earlier post, I really don't want to go through various probable cumbersome steps to allocate any of my 401k funds towards BTC, since I feel that I already have a sufficiently aggressive allocation towards BTC - and even though the vision for BTC seems to be much brighter than the current outlook for my various 401k related funds.

I think that when we are looking at investments, we consider which aspects can be easily moved, and would it be prudent to take various moving measures.

Using bitstamp's prices, bitcoin is close to entering a bear market for this week, though it has $20-25 still to go. I wonder if some of this is related to people liquidating to offset other positions they're facing losses in.

Or this: http://www.coindesk.com/cryptsy-bankrupt...in-stolen/

Or this: http://www.coindesk.com/bitcoin-branded-...ious-exit/

Quote:"Why has Bitcoin failed? It has failed because the community has failed. What was meant to be a new, decentralised form of money that lacked ‘systemically important institutions’ and ‘too big to fail’ has become something even worse: a system completely controlled by just a handful of people."

I don't understand his statement. Who are these few? The Winklevii?

(01-15-2016 05:42 PM)SunW Wrote:  I don't understand his statement. Who are these few? The Winklevii?

That is most likely referring to Gavin (lead developer) and the rest of the bitcoin foundation or whoever else is calling the shots in regards to the development of bitcoin.

(01-15-2016 05:42 PM)SunW Wrote:  Using bitstamp's prices, bitcoin is close to entering a bear market for this week, though it has $20-25 still to go.

I believe when you wrote yesterday, bitcoin prices were in a downward trend around the current price of $380, and in the past 24 hours, we witnessed a correction down to $351 and then back up to the current price.

I think that your characterization is a bit misleading. We do not witness "bear markets for a week" The term "bear market" is describing a longer trend, which may take several months or even a year or more to go from one to another.... bull to bear or bear to bull.

In essence, I believe that I understand what you are saying to mean that the price is down for the week and the candle for the week could turn out to be red and overall down, even in a large way.

In recent weeks, I asserted that we had gone into a bull market after BTC prices went over $350 the second time, around late november.

A flash crash below $350 or even $320 would not return us to a bear market, unless such lower prices were sustained over a considerable period of time.

Surely, I don't know exactly what prices or how much time would be because we have to see how it all plays out, but it remains that we are in a bull market at the moment.... so prices are inclining up rather than down, even though we are currently experiencing some downwardly corrected prices.

Surely, also, it is possible that the market could be transitioning from bull back to bear, but we really cannot tell at this time because we are in the middle of something.. and we just have to see how it plays out... Some people have better foresight than others regarding these matters, but each of us is just going to need to assign our own probabilities regarding the future price direction... and 2016 seems to be poised and likely for a very decent year for bitcoin..

Sure, I could be wrong, but from today's so far floating price between $370 and $385, I think that the chances are much greater that we are going to experience a 10% upward sustained market than a 10% downward sustained market... and that is how I am investing.

(01-15-2016 05:42 PM)SunW Wrote:  I wonder if some of this is related to people liquidating to offset other positions they're facing losses in.

Or this: http://www.coindesk.com/cryptsy-bankrupt...in-stolen/

Or this: http://www.coindesk.com/bitcoin-branded-...ious-exit/

Quote:"Why has Bitcoin failed? It has failed because the community has failed. What was meant to be a new, decentralised form of money that lacked ‘systemically important institutions’ and ‘too big to fail’ has become something even worse: a system completely controlled by just a handful of people."

I don't understand his statement. Who are these few? The Winklevii?

As Savage mentioned, this kind of comment seems to be referring to persons within core development.

As you may realize there has been a nearly year long battle regarding scaling and big blocks and small blocks and varying competing proposals.

Towards the beginning of this scaling conversation, Mike Hearn aligned himself fairly strongly with Gavin Andresen, and proposed bitcoin XT and even were perceived by a large number of developers as attempting to strong arm (hard fork) bitcoin xt into the protocol. That caused a lot of resentment and internal squabbles, and no matter which side caused it, there has been a lot of heavy tactics in various directions in what seems to be uncompromising positions (which just likely means that feelings are going to get hurt).

Mike Hearn's recent exit seems to be over the top, and purposefully aimed at causing a negative impact in order to send a message regarding what seems to be his butt hurt resentment that small blockers are working out compromises that pretty much reject bitcoin xt. in light of his recent public actions, Hearn cannot really be appreciated as a benevolent character, even though he may have done some good work for bitcoin in the past, but he seems to be childish - because over a month ago, he had already taken a lucrative job for some bank that was going to attempt to build "blockchain" technologies... blah blah blah... so if he really is exiting bitcoin, I see no real good reason for him to exit with such butt hurt and apparent vindictiveness.


You know with bitcoin, you cannot really be sure, exactly what drives the prices up and down, but sometimes, pieces of news can be exaggerated and used to their extreme along with pumping and dumping in order to cause an exaggerated effect that goes beyond the import of whatever event is being exaggerated in the news... same is true with the timing of the crypsy news and how it was portrayed.. etc etc.
The crypsy situation had been known for several months, and the recent exaggerated attempts to compare it to Gox.. etc etc and to emphasize the loss of 13k btc, seems opportunistic and very exaggerated.

I don't know whether the current price correction has reached bottom at $351, and surely it is possible that prices could be driven into the upper $200s (because you know a lot of effects are exaggerated in bitcoinlandia)

(01-15-2016 07:13 PM)Savage Wrote:  

(01-15-2016 05:42 PM)SunW Wrote:  I don't understand his statement. Who are these few? The Winklevii?

That is most likely referring to Gavin (lead developer) and the rest of the bitcoin foundation or whoever else is calling the shots in regards to the development of bitcoin.

See my above post responding to this.

Yes, you are correct that Hearn was referring to disagreements within core development, but generally, Hearn was on the same side as Gavin, so he was referring his resentment regarding some of his dealing with small blockers and some of those developers and miners who have been rejecting XT and variations of XT and maybe some of the nastiness that has gone on around various small groups "getting their way" contrary to the logic of some of the big blockers, including Hearn and Gavin.

Regarding BTC's price performance of the past 24 hours or so, and really of the past 12 hours as there seems to have been some attempts at a rebound:


Really, before the crash, I was of the opinion that we were probably not going to witness BTC prices below $390.. and even prices reaching as low as $351 was a bit of a surprise to me, and how quickly it got there...


Certainly, as I type, we are not out of danger yet of potentially even lower prices in the coming days..... but we have been getting pretty decent volume over the past 12 hours or so as prices seem to be returning upwards...

Ideally, if we could get a fairly volume heavy trade rebound to bring us above $410-ish, I would feel a bit better in assessing $351 as having had been the bottom.

Interesting - http://coinmarketcap.com/? Dash now appears to be the second highest in USD value cryptocoin. JINN is number three. Both are ahead of Litecoin. Litecoin is really not that much different than bitcoin; dash at least offers actual anonymity. I've never heard of JINN and I read this about it https://letstalkbitcoin.com/forum/post/m...e-of-jinn.

(01-17-2016 07:32 AM)SunW Wrote:  Interesting - http://coinmarketcap.com/? Dash now appears to be the second highest in USD value cryptocoin. JINN is number three. Both are ahead of Litecoin. Litecoin is really not that much different than bitcoin; dash at least offers actual anonymity. I've never heard of JINN and I read this about it https://letstalkbitcoin.com/forum/post/m...e-of-jinn.

I don't understand to what you are referring, exactly. Even if I click on the coinmarketcap link that you provided Dash is listed as 5th with a 25million dollar market cap and Jinn is listed as 95 with a $186k market cap. Litecoin is still listed as number 3 with a $135million marketcap.

Yep, you can still from time to time witness some spurts in Alts, but seems that people have largely moved away from alts (compared with the alt passions of 2014..ish). Dash does seem to have some interesting features. I am not even going to bother to look at Jinn.., but that's just me... there are so many alts that many seem to be a waste of time or at least narrowly tailored in the event that they are not pump and dumps.

These days, the "alts" that seem to be attempting various undermining of bitcoin are various private blockchains and competing scaling solutions.... but in essence, bitcoin remains the main game in town.. without any real challengers and seeming ongoing resilience, in spite some of the recent downward price spikes.

Anyone here know anything about Xaurum? It's supposed to be a crypto backed in gold (and is currently priced at $140.46); wouldn't that mean that they have storage somewhere in order to assert that it's backed in gold?

(01-21-2016 01:21 PM)SunW Wrote:  Anyone here know anything about Xaurum? It's supposed to be a crypto backed in gold (and is currently priced at $140.46); wouldn't that mean that they have storage somewhere in order to assert that it's backed in gold?

You also know about the gold/silver thread.

https://www.rooshvforum.com/thread-3939-...pid1198013

Surely, that Xaurum looks like a pretty small market cap, so barely looks comparable to the bitcoin subject matter.
http://coinmarketcap.com/currencies/xaurum/

However, along those gold backing lines, there seem to be quite a few more companies that are getting into various aspects to either secure gold through bitcoin or by using some other alt, such as litecoin or ripple.... could be interesting, but also, you are correct to highlight a concern regarding potential proofs that supply is actual backed by the physical stuff.

On that gold precious metals topic, seems that I am hearing more and more (even though I do not have the names and/or links off the top of my head, because in part, it doesn't interest me too much because I believe that bitcoin is a better investment) about various ways to enter into pm investments through cryptos.

(01-16-2016 08:05 PM)JayJuanGee Wrote:  Regarding BTC's price performance of the past 24 hours or so, and really of the past 12 hours as there seems to have been some attempts at a rebound:


Really, before the crash, I was of the opinion that we were probably not going to witness BTC prices below $390.. and even prices reaching as low as $351 was a bit of a surprise to me, and how quickly it got there...


Certainly, as I type, we are not out of danger yet of potentially even lower prices in the coming days..... but we have been getting pretty decent volume over the past 12 hours or so as prices seem to be returning upwards...

Ideally, if we could get a fairly volume heavy trade rebound to bring us above $410-ish, I would feel a bit better in assessing $351 as having had been the bottom.

Following up to my post from about a week ago, in the past two days, it really seems that more or less what I wanted to occur with bitcoin prices did occur.

I mean, I really suggested a fairly high volume push over $410 to cause me to feel more comfortable that $351 was the bottom of the most recent dumping and price correction action.

Even though currently we are bouncing back down from $422-ish to lower $400s, I am still feeling pretty good about the bottom of $351 already being in.... .. but never say never in bitcoinlandia..... because all of these various price movements are about probabilities and momentum and whether one side or another can create such momentum, which can cause more momentum (and/or stickiness) in price movements.

I believe we are still generally in an upward price movement, and buying on dips is good and maybe this time around, it is possible to reach into the mid $380s, but I don't really expect much lower than that to be very likely...

Of course, i'm still buying and selling on both ends... or at least trying to when there are decent price swings

(01-21-2016 04:03 PM)JayJuanGee Wrote:  

(01-21-2016 01:21 PM)SunW Wrote:  Anyone here know anything about Xaurum? It's supposed to be a crypto backed in gold (and is currently priced at $140.46); wouldn't that mean that they have storage somewhere in order to assert that it's backed in gold?

You also know about the gold/silver thread.

https://www.rooshvforum.com/thread-3939-...pid1198013

Surely, that Xaurum looks like a pretty small market cap, so barely looks comparable to the bitcoin subject matter.
http://coinmarketcap.com/currencies/xaurum/

Yes, I post in that thread from time to time. I don't give two shits about market caps, as that's nothing short of the price multiplied by the supply and the latter two are more important. The question that I was asking relates to storage; it has nothing to do with anything else. Storing gold then setting up a crypto to match it is a massive challenge because it places a person on the map at a point (or in multiple points), and on some level restricts what privacy can be offered. Related, but Dash continues to rise in price, breaking $5 this morning. It's like someone big has moved into Dash in the last few weeks.

I may create a thread for alternative currencies that will include bitcoin too, to cover broader alternative financial topics.

(01-22-2016 08:03 AM)SunW Wrote:  

(01-21-2016 04:03 PM)JayJuanGee Wrote:  

(01-21-2016 01:21 PM)SunW Wrote:  Anyone here know anything about Xaurum? It's supposed to be a crypto backed in gold (and is currently priced at $140.46); wouldn't that mean that they have storage somewhere in order to assert that it's backed in gold?

You also know about the gold/silver thread.

https://www.rooshvforum.com/thread-3939-...pid1198013

Surely, that Xaurum looks like a pretty small market cap, so barely looks comparable to the bitcoin subject matter.
http://coinmarketcap.com/currencies/xaurum/

Yes, I post in that thread from time to time. I don't give two shits about market caps, as that's nothing short of the price multiplied by the supply and the latter two are more important. The question that I was asking relates to storage; it has nothing to do with anything else. Storing gold then setting up a crypto to match it is a massive challenge because it places a person on the map at a point (or in multiple points), and on some level restricts what privacy can be offered. Related, but Dash continues to rise in price, breaking $5 this morning. It's like someone big has moved into Dash in the last few weeks.

I may create a thread for alternative currencies that will include bitcoin too, to cover broader alternative financial topics.

I agree starting a new thread would be great, if your thinking in terms of various financial instruments, including bitcoin (if you do create such a thread, it would be great if you could link it here and probably also link it in the pms thread)...

Regarding bitcoin, there are so many interesting things going on in the space, and seems that we could have a multitude of subthreads within this space as well, if there were guys expressing interest. So, in that regard, I am surprised that more RVF guys are not considering ways in which to invest in bitcoin and to discuss their bitcoin investments.


Market cap and liquidation possibilities are both very important aspects of any asset, whether digital or physical; however, I understand that your earlier question seemed to be narrowing upon some other aspects of xaurum and logistics in securing gold, if that may be occurring...... the appeal of a variety of alts seem to make attempts at various kinds security in order to demonstrate their value; however, frequently, when push comes to shove, they are forms of vaporware in that they do not have the backing that they assert, and in other words end up being used in pump and dump manners (but that also relates to having small market caps)....

(01-21-2016 04:11 PM)JayJuanGee Wrote:  

(01-16-2016 08:05 PM)JayJuanGee Wrote:  Regarding BTC's price performance of the past 24 hours or so, and really of the past 12 hours as there seems to have been some attempts at a rebound:


Really, before the crash, I was of the opinion that we were probably not going to witness BTC prices below $390.. and even prices reaching as low as $351 was a bit of a surprise to me, and how quickly it got there...


Certainly, as I type, we are not out of danger yet of potentially even lower prices in the coming days..... but we have been getting pretty decent volume over the past 12 hours or so as prices seem to be returning upwards...

Ideally, if we could get a fairly volume heavy trade rebound to bring us above $410-ish, I would feel a bit better in assessing $351 as having had been the bottom.

Following up to my post from about a week ago, in the past two days, it really seems that more or less what I wanted to occur with bitcoin prices did occur.

I mean, I really suggested a fairly high volume push over $410 to cause me to feel more comfortable that $351 was the bottom of the most recent dumping and price correction action.

Even though currently we are bouncing back down from $422-ish to lower $400s, I am still feeling pretty good about the bottom of $351 already being in.... .. but never say never in bitcoinlandia..... because all of these various price movements are about probabilities and momentum and whether one side or another can create such momentum, which can cause more momentum (and/or stickiness) in price movements.

I believe we are still generally in an upward price movement, and buying on dips is good and maybe this time around, it is possible to reach into the mid $380s, but I don't really expect much lower than that to be very likely...

Of course, i'm still buying and selling on both ends... or at least trying to when there are decent price swings

It's possible that I could have been wrong with my assessment of $351 as the bottom in the most recent downward run (correction), because currently, we seem to be experiencing a pretty strong additional downward price movement and pressure for more downward movement...

In other words, I get surprised a lot in bitcoinlandia, even though I attempt to put my money where my mouth is, to the best of my ability (and even though I give quite a few details of my investment strategies, I may not say exactly what I am going to do before I do it)...

In any event, this return to the upper $300s came a bit sooner than I expected and with a bit more force than I had expected... yet it has been pretty decent for buying and selling opportunities.. which I have been doing while biting my nails.

How can anyone really know, really, (without being an exchange owner or a whale himself) whether some of the bear whales are running out of coins or if they have more in reserves ready willing and able to dump?

(01-22-2016 12:04 PM)JayJuanGee Wrote:  It's possible that I could have been wrong with my assessment of $351 as the bottom in the most recent downward run (correction), because currently, we seem to be experiencing a pretty strong additional downward price movement and pressure for more downward movement...

In other words, I get surprised a lot in bitcoinlandia, even though I attempt to put my money where my mouth is, to the best of my ability (and even though I give quite a few details of my investment strategies, I may not say exactly what I am going to do before I do it)...

I'm inclined to agree with your estimate of ~$350 as a new bottom. Maybe $300 if the mainstream media gets a hold of some particularly bad news, like the Hearn letter from a few days ago. But I wouldn't be surprised if bitcoin never goes that low again.

The Gartner Hype Cycle describes the visibility and adoption of a new technology over time:

Quote:1. Technology Trigger: A potential technology breakthrough kicks things off. Early proof-of-concept stories and media interest trigger significant publicity. Often no usable products exist and commercial viability is unproven.

2. Peak of Inflated Expectations: Early publicity produces a number of success stories—often accompanied by scores of failures. Some companies take action; most don't.

3. Trough of Disillusionment: Interest wanes as experiments and implementations fail to deliver. Producers of the technology shake out or fail. Investments continue only if the surviving providers improve their products to the satisfaction of early adopters.

4. Slope of Enlightenment: More instances of how the technology can benefit the enterprise start to crystallize and become more widely understood. Second- and third-generation products appear from technology providers. More enterprises fund pilots; conservative companies remain cautious.

5. Plateau of Productivity: Mainstream adoption starts to take off. Criteria for assessing provider viability are more clearly defined. The technology’s broad market applicability and relevance are clearly paying off.

Let's compare the Hype Cycle to bitcoin's progress thus far:

Hype Cycle:



Bitcoin price in USD, 2009-present:



2009: Bitcoin is invented (Technology Trigger)

2013: From what I understand, the giant spike in November wasn't authentic, organic growth, but occurred instead due to malicious bot purchases that took advantage of Mt. Gox's lax security measures in order to drive up the price. Nevertheless, it served the purpose of massively inflating expectations for a technology that, at the time, still wasn't ready for mainstream adoption. (Peak of Inflated Expectations)

2014-Oct 2015: Because bitcoin was never truly valued at $1100, the price quickly dropped, slowed only perhaps by an influx of new users lured in by the promise of quick, easy wealth. Once folks realized bitcoin wasn't going to solve all the world's problems overnight, the price dropped even further, and stayed that way for the better part of two years. (Trough of Disillusionment)

Oct 2015-present: Once the doom & gloom wore off and the technology proved its staying power (as can be seen by the recent proliferation of bitcoin startups and investments), things began to pick up again. I'm guessing we'll continue to see a gradual rise in price as bitcoin continues on its path towards mainstream adoption. (Slope of Enlightenment)

I doubt it will be a smooth transition out of the Trough, for a variety of reasons (general economic malaise, warring factions within the bitcoin community, pushback from central banks/governments looking to control the currency, etc.). However, neither do I think the Slope will be as small as it is pictured in the Cycle above. I think bitcoin is an exponential technology, and its growth will only compound on itself as more people buy-in to the idea and begin using the currency.

While I'm hoping for a few more downward swings in order to grab some cheap coins, I'm not going to sweat too much if I end up averaging ~$400/coin. With a long-term (> 5 years) mindset, it won't matter if I miss out on a twenty bucks difference, as bitcoin prices should be into four figures by then. I'd (cautiously) encourage others to continue investing, even as newcomers to the scene lament missing out on $200 bitcoin by mere months. In the long run, you'll still be glad you got in before the Slope started to really pick up steam.

Then again, I could easily be painting targets around my arrows. Only time will tell.

(01-22-2016 10:08 PM)Isaac Jordan Wrote:  ....
Hype Cycle:

[http://newmr.net/wp-content/uploads/2012/12/Hype-Cycle.png[/img]

Bitcoin price in USD, 2009-present:



2009: Bitcoin is invented (Technology Trigger)

2013: From what I understand, the giant spike in November wasn't authentic, organic growth, but occurred instead due to malicious bot purchases that took advantage of Mt. Gox's lax security measures in order to drive up the price. Nevertheless, it served the purpose of massively inflating expectations for a technology that, at the time, still wasn't ready for mainstream adoption. (Peak of Inflated Expectations)

2014-Oct 2015: Because bitcoin was never truly valued at $1100, the price quickly dropped, slowed only perhaps by an influx of new users lured in by the promise of quick, easy wealth. Once folks realized bitcoin wasn't going to solve all the world's problems overnight, the price dropped even further, and stayed that way for the better part of two years. (Trough of Disillusionment)

Oct 2015-present: Once the doom & gloom wore off and the technology proved its staying power (as can be seen by the recent proliferation of bitcoin startups and investments), things began to pick up again. I'm guessing we'll continue to see a gradual rise in price as bitcoin continues on its path towards mainstream adoption. (Slope of Enlightenment)

I doubt it will be a smooth transition out of the Trough, for a variety of reasons (general economic malaise, warring factions within the bitcoin community, pushback from central banks/governments looking to control the currency, etc.). However, neither do I think the Slope will be as small as it is pictured in the Cycle above. I think bitcoin is an exponential technology, and its growth will only compound on itself as more people buy-in to the idea and begin using the currency.

While I'm hoping for a few more downward swings in order to grab some cheap coins, I'm not going to sweat too much if I end up averaging ~$400/coin. With a long-term (> 5 years) mindset, it won't matter if I miss out on a twenty bucks difference, as bitcoin prices should be into four figures by then. I'd (cautiously) encourage others to continue investing, even as newcomers to the scene lament missing out on $200 bitcoin by mere months. In the long run, you'll still be glad you got in before the Slope started to really pick up steam.

Then again, I could easily be painting targets around my arrows. Only time will tell.

I believe that each of us who look into bitcoin develop theories regarding its history and/or price direction based on various information that help us to understand it better and which cause us to project our assessment of its future value and risks.

Of course, I don't disagree with your overall conclusion that bitcoin seems to be a great investment with considerable upside potential (and maybe even i am expecting higher upside potential than you, since you seem to be referring to $1,000 as an extremely high price - which it really does not seem to be), and really, I don't disagree overall with your historical outline; however, there are parts of your historical outline that I view to be glossing over a variety of underlying bitcoin dynamics, and thus my view is a bit different.

Yes, the extent to which the price rises in 2013 of nearly 100x was in part hype and/or pumping of bitcoin, and in retrospect, the infrastructure and base was not ready to support such price increases. I really don't buy some of the Gox bot explanations, but that may be another story.

In any event, in reality, BTC prices did not really drop back down to anywhere near pre-bubble levels... whether we start out with $2 to $6 prices in 2012 or $10 prices in early 2013, overall BTC prices have not dropped below $200 in any meaningful way since 2013... yes there were a few downward (and short lived) spikes below $200, but those were not sustained for any meaningful period beyond a few days in total.

Anyhow, part of my point is that the investment into BTC is currently much more solid than you seem to be crediting it with (especially in the past couple of years)... and the value of bitcoin pertains in part to its market cap, and liquidation and stability utility that comes with a larger market cap.... $4-6 billion and even $15 billion (which was about its 2013 peak value) is small potatoes in regards to the utility and paradigm shifting nature of bitcoin.... and really, the current numbers of computers and mining farms dedicated to bitcoin mining (and also by design security) would fairly easily support a BTC price beyond $10k.

Yes, we are getting a lot of infighting in recent times, and a lot of emphasis on the internal factions, which is causing downward price pressures, and could cause additional downward price pressures.

in the past couple of years, BTC prices have seemed to have been disproportionately controlled by exchanges, and not broader ways of establishing price. Whether this is the proper way for bitcoin or not, it remains true that you do not need a large number of coins to manipulate prices (relatively speaking). Surely, none of us small potatoes have control over prices, but any relatively wealthy person with less than $100 million could wield a lot of influence over bitcoin prices (at least for short term periods, and maybe even longer periods), if chosen to do so.. and if strategically employing such capital.

Accordingly, it is not out of the realm of possibilities that BTC prices could be driven back into the $200s and even with dips below $200; however, I am pretty confident that the broader and broader adoption of bitcoin in a large number of parts of the world, including bigger and bigger players investing into bitcoin with the purpose of expecting price appreciation is going to cause more and more difficulties for downward manipulators to be able to get ahold of coins and to be successful in their attempts at downward manipulation into the $200s or below.

In sum, both of us conclude that BTC price trend seems to continue in an upward direction, even during these apparently ongoing contentious times.

By the way, Isaac, have you continued to buy BTC on a regular basis in the past month or so.. and then also attempted to time dips to some extent?

I understand creating an accumulation theory and a buying plan and then attempting to stick with those can be pressure filled.. and challenging and there can be lots of pressures for reconsideration when prices seem to be so volatile... and the btc news is so prolific.. and even disparate with various macro-economic considerations, as well..

(01-23-2016 04:07 PM)JayJuanGee Wrote:  By the way, Isaac, have you continued to buy BTC on a regular basis in the past month or so.. and then also attempted to time dips to some extent?

I have. Started on the first of the year with Circle, figured I'd buy ~$50 a day and dollar cost average my way in. I didn't mind that they limited me to $300/week; from what I read online it takes about 4-6 weeks for their internal algorithm to bump up regular users to the $3k/week threshold. In the meantime, at least I can purchase and transfer coins for free.

But then BTC took that 10% dive last week after the Hearn letter, and having already hit my weekly Circle limit I started a Coinbase account and bought a few coins at $360. Worth it even with the 1% fee.

I've been alternating between the two lately, buying a little on Circle every day to try and encourage the algorithm to increase my limit, and then buying full coins off Coinbase whenever there's a dip below $375 (my current average purchase per coin). I'm looking into the somewhat arduous process of setting up my own "cold" wallet soon, and I'll be transferring my funds to it every couple of weeks to hedge against any hackers/issues within the exchanges.

I agree with you that bitcoin's upside is much, much larger than its downside (worst case scenario my coins are worth nothing, best case it doubles multiple times). I'd rather buy a few coins now and then feel bad if it drops down to $200 temporarily, rather than wait for the "right" price only to watch it go up, up, up.

I'm up to 10 BTC right now, and I'd like to triple that over the next few months. Just trying to get a feel for how volatile things are, and if there might be a few more solid dips to take advantage of before I'm fully invested.

(01-23-2016 05:05 PM)Isaac Jordan Wrote:  

(01-23-2016 04:07 PM)JayJuanGee Wrote:  By the way, Isaac, have you continued to buy BTC on a regular basis in the past month or so.. and then also attempted to time dips to some extent?

I have. Started on the first of the year with Circle, figured I'd buy ~$50 a day and dollar cost average my way in. I didn't mind that they limited me to $300/week; from what I read online it takes about 4-6 weeks for their internal algorithm to bump up regular users to the $3k/week threshold. In the meantime, at least I can purchase and transfer coins for free.

But then BTC took that 10% dive last week after the Hearn letter, and having already hit my weekly Circle limit I started a Coinbase account and bought a few coins at $360. Worth it even with the 1% fee.

I've been alternating between the two lately, buying a little on Circle every day to try and encourage the algorithm to increase my limit, and then buying full coins off Coinbase whenever there's a dip below $375 (my current average purchase per coin). I'm looking into the somewhat arduous process of setting up my own "cold" wallet soon, and I'll be transferring my funds to it every couple of weeks to hedge against any hackers/issues within the exchanges.

I agree with you that bitcoin's upside is much, much larger than its downside (worst case scenario my coins are worth nothing, best case it doubles multiple times). I'd rather buy a few coins now and then feel bad if it drops down to $200 temporarily, rather than wait for the "right" price only to watch it go up, up, up.

I'm up to 10 BTC right now, and I'd like to triple that over the next few months. Just trying to get a feel for how volatile things are, and if there might be a few more solid dips to take advantage of before I'm fully invested.

Even though you and I phrase things in a bit different ways, your thinking seems very similar to mine as to when I was beginning to accumulate BTC.. .and of course, when I started, the price dynamics were different; however, like you, I still had a goal to accumulate a certain quantity of coins....


In that regard, like you said, you do not want to pay more for your coins than necessary, but you want to have stake in the BTC game, in case there's an upward bump (or pump) that does not return the prices back down.

Currently, Circle does seem to be the better value, as compared with Coinbase, but Coinbase's buy limits are higher. I do currently have $3k per week on Circle, and it is best to link your debit card directly to Circle to get faster processing times (and that may also increase your limits).

I also created an account on Uphold, which allows you to get coins at about same price as the BitStamp price (Even though Circle does not have fees, Circle is about 1% or more above stamp, depending on bitcoin price fluctuation activities.. but still a bit cheaper than Coinbase on most occasions.. and coinbase has the obvious fee while circle just has a higher price that works for either buying or selling).

In the past few months, Uphold just began to allow free transfers of dollars from US bank accounts, and in the past couple of months I have been sending dollars to them to get coins cheaper.. you can send the dollars and have those dollars available on the Uphold account to buy (or convert) on price dips.

I also convert various chosen quantities of BTC at various times on Uphold for free, which is really the same concept as trading.

My thinking regarding trading (or selling) mostly changed in mid 2015 once BTC prices started returning upwards; however, probably, I could have begun to trade a bit earlier than that ... but really, I felt a considerable disincentive to sell any coins while BTC price were mostly going down through most of 2014 and half of 2015 and during that time, I also felt that I was still accumulating coins... even though I ran out of money at various times in early 2015 to keep accumulating.

I may be repeating myself a little bit; however, I got both my mom and my girlfriend employing some of my trading tactics, using Uphold. Neither one really listens to me and each of them can be a bit stubborn from time to time, but in essence, let's say hypothetically that you have accumulated 20 bitcoins.....

If you have accumulated 20 BTC, then each time BTC prices go up by $1, you have $20 of profit on paper. I personally set my trade authorizations in either $5 or $10 price increments, depending on the speed of the BTC price changes and whether I believe that the price is going to change directions.

Frequently, there can be more than a $20 gap in my next buy or sell price.... so in that regard, if you were to have 20 BTC and bitcoin prices go up $10, then you have $200 profits, and maybe you could feel comfortable selling up to 30% of those profits ($67) in order to prepare to buy back at a lower price.

More or less, I am doing something like this to trade with up to 30% of the profits with higher quantities of bitcoin being allocated for sale as the price goes higher...and my comfort level of how much I am willing to sell goes up as the price goes up.. but no matter what it stays within boundaries.

With my current trading method, I continue to accumulate more coins and to bring down my average price per BTC... while really only selling a small percentage (maybe less than 1% or cumulatively less than 10%) of my coins at any one time.

Hopefully, that information is not too repetitive.

(01-23-2016 07:45 PM)JayJuanGee Wrote:  Even though you and I phrase things in a bit different ways, your thinking seems very similar to mine as to when I was beginning to accumulate BTC.

It does. Please keep posting your updates, as having a like-minded investor sharing his thoughts on something as revolutionary as bitcoin has been incredibly helpful.

The only major difference I see in our strategies is that I'm not so interested in active trading as I am simply buying and holding for the long term. I'm doing so mostly for tax purposes, as from what I understand (at least here in the U.S.), any short-term profits are taxed on top of regular income, whereas anything sold after holding for a year only gets hit with a capital gains tax.

I also imagine it would get rather tedious keeping track of each and every trade for tax reporting purposes. But again, I'm rather new to this so I remain flexible. I may set aside a thousand dollars or so worth of "gambling funds" using the strategy you described, of essentially only "betting" with your winnings, and keeping your principle protected.