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The Almighty Buck Bitcoin

Bitcoin Jumps Another 10% in 24 Hours, Sets New Record at $19,000 (arstechnica.com) 224

Posted by EditorDavid from the magic-internet-money dept.
An anonymous reader quotes Ars Technica: Bitcoin's price set a new record on Saturday as the virtual currency rose above $19,000 for the first time on the Bitstamp exchange. The gains came just hours after the currency crossed the $18,000 mark. Bitcoin's value has doubled over the last three weeks, and it's up more than 20-fold over the last year.

Bitcoin's value keeps rising despite a growing chorus of experts who say the currency value is an unsustainable bubble. One CNBC survey this week found that 80 percent of Wall Street economists and market strategists saw bitcoin's rise as a bubble, compared to just two percent who said the currency's value was justified. Another survey reported by The Wall Street Journal this week found that 51 out of 53 economists surveyed thought bitcoin's price was an unsustainable bubble.
Less than a month ago, Bitcoin was selling for $8,000.
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Bitcoin Jumps Another 10% in 24 Hours, Sets New Record at $19,000 More

Bitcoin Jumps Another 10% in 24 Hours, Sets New Record at $19,000

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  • I have an idea. (Score:4, Insightful)

    by AlanObject ( 3603453 ) on Saturday December 16, 2017 @11:20PM (#55753665)

    Let's play Who's The Greater Fool?

    • Re: (Score:3, Funny)

      by Pseudonym ( 62607 )

      Well I invested all my money in tulips. Who's laughing mow?

    • Re: (Score:3, Informative)

      by Rei ( 128717 )

      This whole situation reminds me of the old Onion article, AOL Acquires Time-Warner In Largest-Ever Expenditure Of Pretend Internet Money [theonion.com]. The AOL-Time Warner merger was the peak in the Dot Com boom insanity, en route to it transitioning to a bust. Now: Bitcoin Plunge Reveals Possible Vulnerabilities In Crazy Imaginary Internet Money [theonion.com]

      The amount of money people are dumping into coins is just absurd. I was just checking, and Dogecoin now has a market cap of $754 - more than the combined GDPs of Tualu, Kiriba

    • Let's play Who's The Greater Fool?

      I don't have time for silly games, I'm gonna buy me some of them thar bitcoins before they go up even more!

    • Re: (Score:2)

      by Rei ( 128717 )

      It's very much in "Greater Fool" mode. I was just messaged the other day by my sister, who is my standard bearer for the technologically illiterate (can't even remember how many times I've had to remove viruses from her system because she installed some program or opened some email attachment or another... probably is infected with spyware as we speak). Your standard instagram / pinterest / farmville / etc user. She and her husband had already bought a small amount of bitcoin and were thinking about buyin

      • Buy her a MalwareBytes subscription and save your time and hassle. My brother complained when my dad kept installing toolbars when he used his PC. Yet the only toolbar he has on his own laptop was Yahoo. I figured that was OK since he uses Yahoo mail. Malware Bytes ftw.

        • Re: (Score:2)

          by Rei ( 128717 )

          I did the last time I was at her house. But she surely has a new computer by now.

      • Re: (Score:2)

        by Blymie ( 231220 )

        Thing is -- look at the whole subprime mortgage thing. People, businesses, unions, other banks, and even countries invested in securities they had zero idea about. If you're thinking bitcoin is a bad investment because the normals are getting involved?

        Likely not.

        If so, then there is quite the potential for it to take off like crazy. The real problem is -- getting out before the bubble pops... just like with every other scheme over the last .. well, since we've had markets.

  • Bitcoin Mania (Score:5, Informative)

    by Bruce Perens ( 3872 ) <bruce@perens.com> on Saturday December 16, 2017 @11:35PM (#55753707) Homepage Journal
    Bitcoin mania: people confuse creation of money with creation of value. Value is food, materials, information, useful work. Dollars/bitcoins are unreliable media for exchange of value, not the value itself. Creation of $300B in bitcoin won't help the world to feed one more mouth.

    • Re:Bitcoin Mania (Score:5, Insightful)

      by hey! ( 33014 ) on Saturday December 16, 2017 @11:53PM (#55753771) Homepage Journal

      I wouldn't say that the creation of a currency is useless, if it fill some sort of need it will probably will metaphorically feed mouths. The problem with Bitcoin is that it sucks as money. Sure if you're trading in BitCoin as an *asset* and your timing works out you'll make a killing, but the volatility of Bitcoin makes it unattractive to set a price for goods denominated in Bitcoin. If the price swings high nobody will buy. If it swings low then you could be selling at a loss.

      • Re: Bitcoin Mania (Score:1)

        by Anonymous Coward

        Every currency is volatile when it is thinly held. Give it time it will become boring like the rest.

      • The volatility is a temporary thing. After the first gold nugget was ever found in a river, how long before it had a price that was stable enough to use it as global currency ? I'm guessing it took more than 10 years.

        • Gold's stability was created through the near universal acceptance as a currency which lead to large trading volumes against more stable items with known value like food, wood, etc. Fiat currencies achieved the same thing via a decree from the government.

          The GP described a chicken and egg problem. Why would you sell goods and services against an unstable currency? How do you stabilise a currency if you can't trade it against goods and services. The best you can do is trade it in high volume against a fixed

          • Just wait, and it will stabilize itself. The volatility is caused by a new asset starting out at zero, and trying to discover its real price. People are excited now, but in a few years time, it will become boring, and volatility goes down as price settles somewhere.

            The GP described a chicken and egg problem

            That problem was solved too. We now have chickens and eggs.

            • Just wait, and it will stabilize itself.

              Based on what? I just gave you the criteria required for a stable currency system. Something needs to change, it's not just a simple case of waiting.

              • Based on what?

                Like I said. It will become boring. Volatility depends on people changing their minds. There's a finite supply of people, and they can only change their minds so many times before they settle on something.

                • Like I said. It will become boring.

                  Like I said: Based on what? The bitcoin volatility attracts speculation which retains volatility. Boring? We've only just started trading bitcoin futures this week. That speculation in all things promotes instability and speculation never gets boring. Heck we're still pretty good at screwing up the price of oil, petrol, and even gold itself through this means.

                  Heck it may be worse than that. Much of the rest of the things on the world are traded at high frequency. That in itself provides a negative feedback

              • Re: (Score:2)

                by ceoyoyo ( 59147 )

                Sure it is. Just wait long enough and Bitcoin will find it's natural value. Just like pogs. And beanie babies. And baseball cards.

      • but the volatility of Bitcoin makes it unattractive to set a price for goods denominated in Bitcoin.

        And this is precisely the chicken and egg problem that will be difficult to solve. Central banks can resolve this by decree but with an alternate currency stability comes through trading volumes against other more stable things. As long as that is just small one way trading against another currency in small volumes it will remain highly volatile.

        It won't be stable until there's wide spread trade in goods and services in the currency.
        There won't be wide spread trade in goods and services until the currency i

    • So what is your view on the difference between the non-value of BTC and the non-value of "real" paper money (which doesn't feed people either, but is equally a convenience).

      I mean, is this a non-subtle way to tell everyone they should buy only gold? Or do you mean to say people should trade only using potatoes.

      • I don't think much of dollars either. Especially at the moment.

        Any investment counselor can tell you how to diversify.

        I am welcome in a number of countries and have a way to make a living there if necessary. That's about the best you can do.

        • Sure, I am the same way - I can make a living it lots of countries also. But "making a living" implies you will be paid something, either USD or EUR or BITC. Because of volatility I'm not sure I'd want to be paid in BITC at the moment but long term I don't see a fundamental reason why I'd prefer other currency over BITC, and because of potential long-term volatility with countries I can actually see a case where I'd prefer to be paid in BITC. Any currency only has value if people all agree it does, look

      • The US Dollar or any currency equivalent backed by a large and productive workforce provides economic value by lowering transaction costs and increasing liquidity.

        • BitCoin is backed by a large productive workforce also. In face I would argue that BitCoin is MORESO backed in that way, because all people keeping it going are productive and intelligent members of society - in the U.S. you have millions on welfare for example, that are not productive members of society in that they do not produce, just consume. Bitcoin has zero such overhead.

          • Thatâ(TM)s not what productive workforce means in this case. It means they actually use the currency as an exchange medium. The more in population and volume of transactions, the bigger the productive workforce that creates the bedrock of confidence & trust that others rely upon.

            You canâ(TM)t really count someoneâ(TM)s daily life that runs in their local currency and only stores value in Bitcoin against Bitcoin. Thou the few storage and retrieval transactions do count toward it.

            By its ver

      • My banknote is now made of plastic, but it still has printed on it "I promise to pay the bearer on demand the sum of...", signed on behalf of one of the oldest banks in the world. Sure, they depreciate it on purpose, but -

    • Bitcoin probably keeps several amortised power generation plants in business.

    • Creation of $300B in bitcoin won't help the world to feed one more mouth.

      Neither will the creation of one more video game or the invention of some new beauty product. People invest money in lots of useless things, why should Bitcoin be any different?

    • Value is food, materials, information, useful work. Dollars/bitcoins are unreliable media for exchange of value, not the value itself. Creation of $300B in bitcoin won't help the world to feed one more mouth.

      I agree with you 100%. And yet.......

      Somehow I wish I had bothered to mine a few coins back in 2010.

    • It might do a very good job wrestling control over the financial system from unreliable governments, though. If I were living in Venezuela, for example, I'd much prefer to own bitcoin, rather than the local currency. And if it grows big enough it will be a threat to every other currency on the planet.

    • It might feed mine.

    • people confuse creation of money with creation of value.. Value is food, materials, information, useful work.

      The purpose of money is to facilitate trade. Say you raise chickens, and you go to the market with eggs to sell. You want to buy some milk, so you visit the dairy farmer. He has milk, but he doesn't want eggs. He wants carrots. So you visit the vegetable farmer. Yes he has carrots, but he doesn't want eggs either. He wants apples. So you visit the orchard farmer who sells apples. He doesn

    • Re: (Score:2)

      by Kaenneth ( 82978 )

      Liquid currency has a value; Bitcoins are cheaper to produce than the same value in US Pennys.

      • Liquid currency has a value; Bitcoins are cheaper to produce than the same value in US Pennys.

        Actually, a hundred dollar bill is vastly less expensive to print than it is to mine a bitcoin. Even a dollar bill is.

  • Tulip price index 1636-37 (Score:1)

    by Anonymous Coward

    This is good for tulips. [wikimedia.org]

  • ...for this bubble to burst. I wanna see the look on those investors' faces when they watch the price of their Bitcoin fall.

  • As much as Facebook is for forums and Google is for card catalogs, crypto-currency is to online money.

    I think what most of us skeptics are overlooking is that as people move online, they are moving farther and farther from what we would call the "real world." There is absolutely a place for crytp-currencies. I always think -- but what if it all goes away due to a power outage. The problem with that thinking is that most of the planet doesn't think that way, virtual belongings are here to stay. Kitti

  • Supply and demand explains the value. There's been a huge influx of new buyers and not enough coin being mined and sold to meet the demand.

  • Only one question left: (Score:4, Insightful)

    by Gravis Zero ( 934156 ) on Sunday December 17, 2017 @01:02AM (#55753937)

    Who will be the ones left holding the bag?

  • Growing in value by 20% per week is totally sustainable. In 52 weeks, each Bitcoin will be worth $260-million and the market cap will be $3-quadrillion.

  • New asset class (Score:1)

    by Anonymous Coward
    It looks like cryptocurrencies is becoming a new asset class that is inherently virtual and global. It bear similarities to already established asset classes.
    Most cryptocurrencies are directly usable for payments, like a currency. There is also a network effect.
    They work as a easy accessible store of value, like gold and silver, but easier to access for most people and can be traded in smaller volumes.
    They are exchange tradable, like stocks. Everybode with a smartphone can participate.


    Today's crypto
  • Bitcoin mining is estimated toconsume around 34 TWh of power [digiconomist.net]. Sort this list by TWh consumption [wikipedia.org] and you'll find that BTC mining consumes more power than 75% of all the nations on the face of the Earth. More power than places like Denmark, Ireland, Serbia, Myanmar. It's not sustainable - and I'm surprised so many strong climate-change proponents are accepting of this clear waste of energy (note that most of those countries are poor, and get a majority of their power from coal and other fossil fuels).

  • Say it all with me "Bubble"...

    Seriously, Bitcoin is nothing but a string of unique numbers at it's core. There is no tangible value, not even a government fiat supporting it. The only thing propping up the value is it's meteoric increase in value. If any of the major holders of Bitcoin decide to divest, the value will go down and all the speculators that are leveraged to the hilt will try to sell and the value will drop to nothing overnight. If it were a stock, I would short the hell out of it.

  • 1/1/2019:
    Bitcoin just passed $1m per coin and governments worldwide have banned its use under penalty of death as it's too disruptive to existing economic norms. many "bit billionaires" are afraid of cashing in due to publicity and government scrutiny. Think this is unlikely, look at https://www.coindesk.com/price... [coindesk.com] (1 year) and do a linear regression of the trajectory. Makes tulips look like sawdust,

  • Oh boy a 10x return since like a year ago. Wooow. Great, you missed that train. If you think t hey'll hit $100,000, they won't. That's basically impossible. If you want a return better than some 10% shift buy Sia, BCC, or LTC.

  • I live in Houston, which was devastated by Hurricane Harvey this year. As the storm approached, we could all see (on radar) the progress of the storm, getting closer and closer. We knew it was going to cause a lot of damage, we just didn't know exactly when, or how much, or exactly where.

    Bitcoin is going to be a disaster just as surely as Hurricane Harvey. It's going to hurt a lot of people, leave others unscathed, and help a few. But a collapse is certainly coming.

    The best thing we can do for our friends i

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