Bitcoin discussion and news

[camouflage]

The market is so small that it's fairly easy for large scale speculators to manipulate it. Pump and dump is when they drive up the price with lots of small buys, then dump a big market sell order which drives the price down, causes panic and they then rebuy more btc for the same money.

Despite all the "free market" talk, other stock markets and currency exchanges have all kinds of rules, failsafes, market makers in place to control this.

bitcoin at this point is complex enough that we can't assume speculators are all playing the same game, and neither can the speculators, or the crowd, or the insider-knowers. The outcome of all this muddle is what we're calling the bitcoin price. There's still a strong element of staring at the shiny new contraption trying to figure out where to attach the harness. As someone said during the last surge and crash an surge... "bitcoin does what it wants".

 

[Idaho]

The honey badger of currencies

 

[camouflage]

By the way, when I said insider-knowers I meant stuff like this: WINKLEVOSS BITCOIN TRUST (COIN) IPO, bitcoin itself of course being an open-source project.

 

[Idaho]

Looks like the yuan is rising fast today against the dollar and euro. Perhaps this has created momentum out of btc.

 

[Ranbay]

Bitcoin to British Pound Rate — Bitcoin Live Converter — Preev

Down Down De Down.

 

[Idaho]

It seems that the Xmas rush has cooled and we are back to the position early December.

 

[UnderOpenSky]

It seems that the Xmas rush has cooled and we are back to the position early December.

Thats probably because everyone was buying drugs for the festive season.

 

[Idaho]

Bitcoin = your currency on drugs

 

[ffsear]

Santa Rally!

 

[Wolveryeti]

Thats probably because everyone was buying drugs for the festive season.

And many market makers were on holiday.

 

[Idaho]

It's not a holiday in China. The usd$-btc exchange is insignificant. We have a representative bias because we understand familiar currencies and news sites in English. Bitcointalk.org is so western-centric to the point of being in lala land. Bitcoin is 95% Chinese. China is all that matters and we are largely blind to what's going on there.

 

[WWWeed]

I've read many articles about bitcoins but I still don't understand who uses them, what for, or why. Mainly why. Why not PayPal?

I use bitcoin in places I don't feel happy using my card although I'm seeing more and more legitimate places accept bitcoin now (scan.co.uk for example).

While I don't use bitcoin for drug purchases I do use for some of my more dogie transactions. One example of a place I have used it is rapidgator.net where I buy premium accounts for downloading *ahem* evaluation software, music, movies, etc. Another was for leakedsource.com which is just a dodgyer version of haveibeenpwned.com except you can pay a few quid for a subscription and find out the password that was leaked (and not use it again).

I have to be honest in that I was sceptical of bitcoin for a long time and wouldn't touch it with a barge pole, but so long as your not a complete idiot bitcoin is way safer and more anonymous that any other form of payment out there. As others have said I wouldn't recommend using bitcoin as an investment anymore than investing in another currency like euros/rupees/yen/whatever. I do however recommend picking some bitcoin up when it is cheap just like it's worth getting euros when the exchange rate is good for an upcoming holiday (assuming you have the intention of buying stuff).

But my advice is just treat it like cash and only buy/use when you need and you should be fine. You wont make money but you wont lose money either. If we knew the answers to this kind of stuff we probably wouldn't be sitting here typing this but lying on a beach somewhere and living off the interest of all the millions we made.

 

[not-bono-ever]

PBoC are going to get extremely heavy on bitcoins spotty ass this year.

 

[Idaho]

PBoC are going to get extremely heavy on bitcoins spotty ass this year.

The messages from the Chinese government seem to be that they don't mind virtual currencies, but that they want them to develop steadily. The rumours are that state officials got the heads of the exchanges into a room and told them to stabilise the value.

There is definitely price manipulation by exchanges and miners. But how much of that can be controlled is unclear. What seems likely now is that the Chinese government will throw water onto bitcoin when it gets too hot. Which is probably no bad thing.

 

[not-bono-ever]

This is more about asserting control over worries about bc facilitating capital leakage that could undermine the intensely controlled yuan I am led to believe

 

[camouflage]

The messages from the Chinese government seem to be that they don't mind virtual currencies, but that they want them to develop steadily. The rumours are that state officials got the heads of the exchanges into a room and told them to stabilise the value.

There is definitely price manipulation by exchanges and miners. But how much of that can be controlled is unclear. What seems likely now is that the Chinese government will throw water onto bitcoin when it gets too hot. Which is probably no bad thing.

Ha.... circle complete. Governments can't print more bitcoin as they can with fiat (not that there's anything wrong with that in itself) but they can use open market operations to influence it's price. Two governments attempting different objectives would be popcorn worthy.

 

[not-bono-ever]

The Chinese are fairly bubble tolerant as they have demonstrated over the years - this looming intervention is based on factors other than controlling bc nominal

 

[mauvais]

Sometimes you have to wonder whether the yuan is a virtual currency in the first place.

 

[not-bono-ever]

That is indeed a moot point

 

[Idaho]

All currencies are virtual. It's just that there is only one virtual currency where there is oversight for supply.

As for bitcoin being used for capital outflow - I'm not convinced. It seems more likely used as a yuan hedge/speculation tool. You can get money out of China for less than 1% using conventional methods, and btc exchange costs back into normal currency is way more than that. Also the volume on USD, GBP and euro exchanges doesn't reflect this parallel cash out.

Bitquant Founder: Bitcoin ‘Useless’ for Dodging China Capital Controls

 

[camouflage]

All currencies are virtual. It's just that there is only one virtual currency where there is oversight for supply.

As for bitcoin being used for capital outflow - I'm not convinced. It seems more likely used as a yuan hedge/speculation tool. You can get money out of China for less than 1% using conventional methods, and btc exchange costs back into normal currency is way more than that. Also the volume on USD, GBP and euro exchanges doesn't reflect this parallel cash out.

Bitquant Founder: Bitcoin ‘Useless’ for Dodging China Capital Controls

Perhaps "outflow" into bitcoin itself and back, rather than using bitcoin as a bridge to Dollarstan.

 

[Ranbay]

Bitcoin to British Pound Rate — Bitcoin Live Converter — Preev down down de down

 

[Idaho]

It's a good thing that the Chinese are making the exchanges play honestly. Currently they are pretty corrupt and opaque in their dealings. It will squeeze the price in the short term. But hopefully it will reduce the amount of pump and dump and volume faking.

 

[a_chap]

Bitcoin to British Pound Rate — Bitcoin Live Converter — Preev down down de down

Very surprised how volatile Bitcoins are (according to the Preev site)

Never having bought anything with Bitcoins before; are the prices (for things paid in Bitcoins) equally as volatile? i.e. waiting for Bitcoins to drop in price simply means that the goods you buy cost more Bitcoins?

 

[BigTom]

Very surprised how volatile Bitcoins are (according to the Preev site)

Never having bought anything with Bitcoins before; are the prices (for things paid in Bitcoins) equally as volatile? i.e. waiting for Bitcoins to drop in price simply means that the goods you buy cost more Bitcoins?

in my very limited experience, stuff is priced in $, bitcoins are used for the transaction but don't (exactly) affect the price of what you are buying, it only matters if you are holding bitcoins. Having said that I don't know how the sites do their conversions, how often they are updated etc so it could make a difference but I don't think much of one. Probably makes a difference to vendors on dark markets who have bitcoins held in escrow so could sell at one price then 2-3 days later get the coins and now it's a different price to convert them back.

 

[Idaho]

Very surprised how volatile Bitcoins are (according to the Preev site)

Never having bought anything with Bitcoins before; are the prices (for things paid in Bitcoins) equally as volatile? i.e. waiting for Bitcoins to drop in price simply means that the goods you buy cost more Bitcoins?

On dark markets the $ price stays constant and the conversion rate shifts. There are a few legit services where you can pay in btc, and that service converts and pays the vendor in normal currency. Again, there is a real time conversion.

 

[a_chap]

On dark market...

Obviously I would never admit to using the "dark market". Then again, where else does one buy weapons-grade plutonium these days? Not like the old days where it was a tenner a hundredweight in the local fruit'n'veg market. You try telling kids that today and they just won't believe you. And another thing, that Nigel Farridge, well...

 

[Idaho]

 

[Wolveryeti]

Interesting article about how quantum computing will screw bitcoins if it ever arrives:

Quantum Computers Will Destroy Bitcoin, Scientists Warn - CryptoCoinsNews

 

[Idaho]

Quantum computing will screw *all* computer security - banks, government, military, personal. It's just that bitcoin users are the only ones taking about it.