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Bitcoin Businesses The Almighty Buck

Bitcoin Plummets Below $3,000 on Rising China Worries (ft.com) 221

Posted by msmash from the changing-market dept.
Bitcoin dropped below $3,000 on Friday as the cryptocurrency extended a brutal eight-day sell-off that has reduced its value against the dollar by a third. Financial Times reports: The currency traded as low as $2,972, marking a 36 per cent fall from bitcoin's close on September 7, and a collapse of 40 per cent from the highs struck earlier this month. The latest bout of selling came after BTCChina, one of the country's biggest bitcoin exchanges, said it would halt trading at the end of the month. Focus has now shifted to the communist country's other two big exchanges: OKCoin and Huobi. Alternative source.
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Bitcoin Plummets Below $3,000 on Rising China Worries More

Bitcoin Plummets Below $3,000 on Rising China Worries

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  • Also... (Score:5, Informative)

    by Luthair ( 847766 ) on Friday September 15, 2017 @09:08AM (#55202323)
    JP Morgan's CEO referred to bitcoin as a fraud, and made reference to tulips (the first recorded bubble).

    • Re:Also... (Score:4, Insightful)

      by DontBeAMoran ( 4843879 ) on Friday September 15, 2017 @09:10AM (#55202341)

      "JP Morgan Chase & Co. is a U.S. multinational banking and financial services holding company headquartered in New York City." - Wikipedia

      Yeah, let's trust the guy trying to push a competing product. Let's also forget the bank bailouts where they squandered billions and were saved by the government anyway (i.e. with your taxes).

      • Re:Also... (Score:5, Insightful)

        by Luthair ( 847766 ) on Friday September 15, 2017 @09:16AM (#55202387)
        Exactly what do you think is competing here? If the banking industry thought these were viable, they'd be trading them and they'd be operating exchanges.

        • Yep. They're not viable for large-scale use, and probably never will be. Sure seems like a lot of stories here lately though, breathlessly trying to make it sound like they're a big deal.

          • Re: (Score:2)

            by Luthair ( 847766 )
            I noticed the same, an inordinate number of puff pieces are submitted by BTC supporters to spread the propaganda. I'd actually intended to submit the JP Morgan article earlier this week to counter it but hadn't made the time yet.
        • hell for that matter, they'd be MINING on all those thousands of PC's that sit idle during non business hours, or any otherwise idle servers.
          • Those "Idle PCs" will no longer be idle mining cryptocurrency. They'll consume far more power doing CPU mining, which is very inefficient compared to GPUs or ASICs. The electric company bill will show them that electricity in the US is pretty expensive...

        • Re: (Score:1)

          by ag0ny ( 59629 )

          Exactly what do you think is competing here?

          They've been applying for a patent on an electronic cash system since 1999 [ft.com]. They updated the patent in 2009-2011 to something that resembles very, very much, Bitcoin.

          These bankers do own Bitcoin. Lots of it. In the last few hours we've seen massive buy orders that have made the price start to rebound [coinmarketcap.com].

          While this can't be proven, these signs suggest price manipulation by JP Morgan in order to buy more cryptocurrency at a much cheaper price.

        • Re: (Score:2)

          by Q-Hack! ( 37846 ) *

          It isn't so much as competing as it is fear of loosing control. JP Morgan Chase & Co. is part of the centralized banking system. They have a lot to lose if they can no longer influence the worlds monetary system.

        • Yeah, and if Apple were interested in a particular feature, they certainly wouldn't trash it and then claim they invented it a few years later...

          Public statements from for-profit companies are not always trustworthy.

      • No, if you read his comments they were actually one of the few I've heard from him that were smart and I agree with. His comments were effectively, if he found anyone in the company trading Bitcoin, he'd fire them since they are stupid.

        He accurately made a distinction between blockchain tech (which has high potential), and bitcoin, which is truly useless for any kind of large scale economic activity. It's a playground of the financial retards right now; the vast majority buying bitcoin right now have ze

    • The same JP Morgan that got sued along with Goldman Sachs for manipulating the price of aluminum?

      http://www.businessinsider.com/jpm-goldman-face-suits-over-warehouses-2013-8 [businessinsider.com]

      • Re: (Score:1)

        by Luthair ( 847766 )
        Bankers are indeed sleazy, but what does that say about the BTC market when even they think its sleazy?

        • Bankers are indeed sleazy, but what does that say about the BTC market when even they think its sleazy?

          It means that the bankers haven't figured out how to get a piece of the BTC action. Once they get their cut, BTC will become legit in their eyes.

          • Re: (Score:2)

            by Luthair ( 847766 )
            Bankers could pretty easily operate an exchange if they wanted - they already have that infrastructure. They could also trade, but it might be illegal for them at the moment.

            • JP Morgan is an investment bank, not a commercial/retail bank. They don't take deposits from individuals and don't make car loans. I don't recall (if I ever knew) what, if any, constraints there are on their activities, but I wouldn't be surprised that they can do pretty much whatever they damn well please as long as they don't mislead their investors.

    • JP Morgan's CEO referred to bitcoin as a fraud, and made reference to tulips (the first recorded bubble).

      Repeating a comment I made on another thread, I think the tulip reference is inaccurate. The tulips never had any real fall-back value besides as ornamental plants. Bitcoin has a lot of value on the dark-web as a non-governmental currency easily traded online..

      So, yes, until another alternative to bitcoin comes along (perhaps one with more security and anonymity) bitcoin will continue to be used and traded. It won't completely crash.

      Citizen speculators may add to the value and cause it to boom and bust b

  • Bitcoin's value is still up (Score:5, Informative)

    by DontBeAMoran ( 4843879 ) on Friday September 15, 2017 @09:08AM (#55202325)

    Not only is Coindesk showing a rebound above USD$3400 [coindesk.com] but let's not forget that Bitcoin's value was only around USD$1000 at the beginning of january 2017. So it's still up 200% right now. That USD$5000 value was a bubble and it had to burst.

    • Lets also remember that a few years ago Bitcoin spiked to $1,1000 and then dropped to $250 and spent a couple years around there. Yes, people who bought around $1,000 are up in the long term, but more patient people who were cautious due to the spike and bought a year later at $250 are up 4x more than those who bought on the spike.

      The current spike to $5,000 looks a lot like the 2014 spike to $1,100. I am *not* saying we will see a similar $75% drop, merely that waiting to buy might be prudent and even a

      • Re: (Score:1)

        by Anonymous Coward
        Do you not understand that reasonable currencies don't behave this way? These are death throes.

        • Do you not understand that reasonable currencies don't behave this way? These are death throes.

          Bitcoin is not a currency, it is an asset. An easily transferable asset since it is a digital asset. An asset with no gatekeepers to impede that asset transfer.

          Bitcoin is a competitor to PayPal and other such payment vehicles, not to currencies like the US Dollar or the Euro. Not anytime soon despite the enthusiast's fondest wishes. However it is also a speculative trading vehicle, and also a highly speculative investment vehicle. Trading with a timeframe of some small number of years is one thing, inves

        • I don't have any skin in the game, but technical traders in equities would tell you that you are looking for the "head and shoulders" graph-- a drop with lower peaks after a big run up-- to foreshadow gloom. If in a few weeks BTC climbs back up to 4,000 and drops to 2,000 that is bad. If it climbs to 6,000 and drops to 4,000-- not so much.

          Bitcoin may last... or it may fail. Regulatory pressure in the next few years is likely to be a burden for it.

          • Re: (Score:2)

            by torkus ( 1133985 )

            I love the investment advice here on /. almost as much as the corny and poorly analyzed predictions in various blockchain news outlets.

      • merely that waiting to buy might be prudent and even at $3,400 we might still be at an overly enthusiastic level.

        Then again, maybe not. Nobody knows.

        • Re: (Score:2)

          by torkus ( 1133985 )

          People thought $1000 was ridiculous, shortly after they thought that $300 was insane which wasn't that long after $1 seemed farfetched.

          $5000 is impossible much less $20,000 or whatever is next...but they'll either happen or BTC will be forked to something that scales to suit the pricing.

    • Re: (Score:2)

      by JeffSh ( 71237 )

      It was only kind of a bubble.

      Bitcoin will go through many boom bust cycles on its way to being a globally relevant store of value. As early adopters realize they have assets that amount to "life changing money", they will sell a portion of their holdings to exchange it for other assets, houses, business investments, cars, education for their kids... whatever.

      Each one of these will trigger a minor panic and send the currency tumbling, before it reaches a low point where it will grow again to the next point w

      • Re: (Score:2)

        by torkus ( 1133985 )

        You do realize that every few minutes somewhere between 10,000 and 30,000 BTC are exchanged right? What's life-changing money? $500k? That's less than 200 BTC and not something which would significantly (or even noticeably TBH) alter the market.

    • Re:Bitcoin's value is still up (Score:4, Insightful)

      by DNS-and-BIND ( 461968 ) on Friday September 15, 2017 @10:18AM (#55202727) Homepage
      Yes, because what I want from a currency is wild swings and the ability to speculate instead of hold value long-term. Honestly that sounds like a commodity, not a currency.

    • For things like gold and tulips which lack significant underlying intrinsic value the price is set by a speculative market. ( yes I'm ignoring golds use in the semiconductor industry for exposition).

      Bit coin differs in two fundamental ways that ideally should link its price to a fixed value but empirically do not. I am struggling to figure out why the theory fails.

      To be specific , first there is a cost to mine bit coin and this cost rises as more mining capacity is working because bitcoin adapts its diffi

      • Adding a clarification to the parent post.

        An easy but wrong retort to the above logic is for someone to say it's only worth what someone is willing to pay.

        That's true of everything except bitcoin. Why? Because you can't actually offer less than it costs to mine because there's no way for the offerer to consummate the transaction unless a miner confirms it. A miner probably won't mine if the price of bit coin falls below the mining costs.

        A second wrong retort is to say that the miners reward isn't just the

        • Perhaps this is a possible answer to this conundrum. If I owned a bazillion bitcoin and I panic when the price drops below 1/12 the mining cost because now miners won't mine so I have a non liquid item. I can't even give it away let alone sell it cheap without the cooperation of a miner. And they won't mine when the selling price is too low.

          So what I do is I offer to pay the full cost needed to make a mining event profitable. It's a hefty fee but with a bazzillion bitcoins worth nothing if I don't pay i

          • Re: (Score:2)

            by pakar ( 813627 )

            And what happens if you get less miners? Well the difficultly drops so it requires less electricity to mine there by making it profitable again to mine..

            Fees by themselves are there to allow miners to make a bit extra.. The miners will pick the transactions with the highest fees first and include in the blocks, so if there are loads of unconfirmed transactions people will choose to pay a higher fee to have their transactions complete faster. But even then, when we had the issue with loads of unconfirmed tra

            • No it does not take less electricity to mine if there are fewer miners. It takes EXACTLY the same amount of electricity. the ratio of the mining cost to the rewards would be the same evenif there was one miner.

              Fees are a different ball of wax and I admitted in a follow up below that these could contribute to price fluctuation. But remeber there were price fluctuations long before fees came into bitcoin. And at the moment fees are more about prioritization than coin valuation.

              • Re: (Score:2)

                by pakar ( 813627 )

                No it does not take less electricity to mine if there are fewer miners. It takes EXACTLY the same amount of electricity. the ratio of the mining cost to the rewards would be the same evenif there was one miner.

                Eh what?
                1 miner doing mining with a 500W (1Mh/s) machine. Network adjust difficultly to allow for 1 block mined every 10 minutes.. total mining power is 500W and will result in 1 block every 10 minutes... Ie 6 blocks per hour for 500W..
                100 miners doing mining with 500W (1Mh/s) machines.. Network adjust difficultly to allow for 1 block every 10 minutes.. Total mining power is 50KW and will result in 1 block every 10 minutes..

                It does take a bit of time for the network to adjust difficulty, but it slowly (adju

      • Re: (Score:1)

        by G ( 2545 )

        Speculation. Money pouring into market cap in the hopes of making more money. If there were no exchanges to facilitate speculation you may very well be right. But once people start trading it the value based on production cost is out the window.

        • Okay but if the price is higher than the production cost then more miners will turn on their rigs, the rate of mining will rise, and then the bitcoin algorithm will respond by increasing the difficulty.

          thus the cost of mining always rises to match the current speculative price. Or should eventually.

      • Miners not prioritize transactions without a fee attached. The days when bitcoin transfers are free are years behind us.

        There is another problem regarding bitcoin mining: the majority is in China where it is clear as mud if they are actually businesses that could survive under normal economic conditions. Even if someone gave me the most up to date asics in a new server, I could not pay even a quarter of my electrical bill running the thing. What are the costs that Chinese miners are paying? Or are they

  • "percent" (Score:2, Informative)

    by Dan East ( 318230 )

    "percent" and "per cent" aren't the same thing, and this is especially grievous when talking about money. I assume Bitcoin didn't fall 36 bitcoins per US cent, but fell 36 percent.

    • Re: (Score:1)

      by Anonymous Coward

      FT is a British publication and "per cent" is often the preferred option in British English and is closer in meaning than the US favoured "percent". Your assumed possible alternative meaning makes no sense grammatically anyway. If you are going to be a pedant, it helps to be know what you are writing about.

    • Re:"percent" (Score:5, Informative)

      by mysidia ( 191772 ) on Friday September 15, 2017 @09:30AM (#55202473)

      "percent" and "per cent" aren't the same thing, and this is especially grievous when talking about money.

      False. "Percent" literally means per 100 ( a fraction), and "Per cent" literally means per 100 ( a fraction). It is your "Per US cent" which is completely different, because now you are suddenly comparing it to units of a different currency.

    • Re: (Score:2)

      by ceoyoyo ( 59147 )

      Cent means 100 in latin. "Cent" in English properly refers to a unitless fraction, 1/100. You seem to assume that the word refers to 1/100th of a US dollar, which is kind of odd.

  • Silver continues to bounce between $17 and $18 per ounce. No reason to move my cash pile.

  • Plunges... (Score:3)

    by PortHaven ( 242123 ) on Friday September 15, 2017 @09:23AM (#55202427) Homepage

    Wait a minute????

    Wait a darn minute...

    I just bought like a $100 of bitcoin a couple months back. It was $1,500 a coin. How does something get labeled "plunging" when it's doubled in a mere few months.

    I would say, BitCoin as "dipped" back down under $3,000 showing some likely minor correction in the BitCoin market.

  • news at 11 I guess....
  • So far as I can tell Bitcoin's value is mostly tired to illegal things (drugs, ransomware, money laundering, tax evasion, etc). I base this on the fact that there's very little else I can but with it. It was only a matter of time before it got too big for its own good. And I'm not sure I'll miss it. Fiat currencies are a lot more stable since they'll stable so long as the country and it's government are...

    • Re:Eventually governments are going to crack down (Score:4, Interesting)

      by thechemic ( 1329333 ) on Friday September 15, 2017 @12:00PM (#55203515)

      You can get a shift card, a bitpay card, and dozens of other debit style cards tied to your bitcoin. I mine bitcoin at home, and then I spend it EVERYWHERE AND ANYWHERE THAT VISA/MASTERCARD ARE ACCEPTED. I just bought lunch with bitcoin today. A couple days ago I bought a headset from best buy using bitcoin. I also paid my $1300 electric bill with bitcoin. I pay my car insurance with bitcoin.

      Because mining produces FAR MORE money that the electricity costs, everything I bought with bitcoin was essentially free. If you truly believe that bitcoin is only for illegal things, you've got your head in the sand or otherwise somewhere where the sun don't shine.

    • I for one am happy to utilize BTC as a legitimate proxy investment into black market activity. Black markets are pretty good investments when diversified and legitimized.

  • for commerce seems to be a variation of Embrace, Extend, and Extinguish.

  • Ob (Score:4, Funny)

    by Hognoxious ( 631665 ) on Friday September 15, 2017 @10:14AM (#55202705) Homepage Journal

    1) Become member of Chinese equivalent of Politburo.
    2) Short bitcoin
    3) ????
    4) Profit!!!!!

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