The State of Cryptocurrency

[R-T-B]

Everything is linked to dollar value.

In this case more dollar profit, but yes.

 

[Papahyooie]

All cryptocurrencies are only worth what people are willing to pay. That's dwindling too.

Everything is linked to dollar value. People bought hardware with dollars to mine to sell cryptocurrencies to investors which paid in dollars. The market is shrinking because the investors are leaving. It's getting harder and harder to find a buyer for cryptocurrencies as trading volumes fall. Holders are paying to sustain cryptocurrencies out of pocket because selling now barely breaks even. Some stop entirely which decreases difficulty but those that remain are still fighting over scraps. Without new investments to buy all of the cryptocurrencies holders have the "lull" is self propagating.

You're missing the point. No matter the dollar value of a bitcoin, the cycle that RTB was referring to exists. Yes, the overall dollar value of a bitcoin may move, which will affect overall profitability. But as mining becomes less profitable, miners exit, decreasing difficulty, increasing rewards per miner. The math isn't hard, dude. If you get more bitcoin per transaction, you make more dollars per transaction. This insulates the miner in the mid-term against rising and falling prices.

Short term and long term are obviously more predicated on the dollar pair.

To illustrate: Yes, 7k is my magic number for me to consider myself profitable *at the current difficulty.* If difficulty of some key coins drop, I'll be profitable even under 7k and could start mining now, because I'd make more coins per transaction, which would make up for the drop in price.

 

[FordGT90Concept]

Bitcoin didn't spike to over $10k because of miners, it spiked because of outside investment (mostly retirees looking for high yield place to put their money). Without another infusion of money, profitability is going to move in lockstep with difficulty to the floor.

 

[Papahyooie]

Your level of myopia in a discussion astounds me Ford.

 

[FordGT90Concept]

Cryptocurrency exchange theft surges in first half of 2018: report

Thefts in 2018 have already exceeded three times of what was stolen for all of 2017. There's also been a three fold boom in using cryptocurrencies to launder money.

 

[LFaWolf]

Bitcoin didn't spike to over $10k because of miners, it spiked because of outside investment (mostly retirees looking for high yield place to put their money). Without another infusion of money, profitability is going to move in lockstep with difficulty to the floor.

I am curious, how do you know this, specifically retirees looking for high yield place to put their money? Bitcoin is very risky and as far as I can tell not an usual investment for risk averse retirees.

 

[R-T-B]

Your level of myopia in a discussion astounds me Ford.

Honestly, it amazes me anyone still even tries with him.

 

[R0H1T]

I am curious, how do you know this, specifically retirees looking for high yield place to put their money? Bitcoin is very risky and as far as I can tell not an usual investment for risk averse retirees.

He might be talking about individual investors. Even in my part of the world computer illiterate people were talking about mining & investing into BTC or ETH. Imagine the hype in first world countries.

 

[FordGT90Concept]

I am curious, how do you know this, specifically retirees looking for high yield place to put their money? Bitcoin is very risky and as far as I can tell not an usual investment for risk averse retirees.

There were news articles and stories back in early 2017/early 2018 of people acting like brokerages convincing people to invest in cryptocurrency often without informing them of the risks. Large chunks of retirement funds have been lost.

 

[silkstone]

There were news articles and stories back in early 2017/early 2018 of people acting like brokerages convincing people to invest in cryptocurrency often without informing them of the risks. Large chunks of retirement funds have been lost.

I thought that was Iceland?

 

[FordGT90Concept]

Maybe? It's likely to be happening everywhere when you consider $9 Million Lost Each Day In Cryptocurrency Scams. Not the specific case I was looking for before but here's a Ponzi scheme setup that used the cryptocurrency buzzword to defraud people: Scams Cost Investors Millions In Lost Retirement Funds.

He might be talking about individual investors. Even in my part of the world computer illiterate people were talking about mining & investing into BTC or ETH. Imagine the hype in first world countries.

Yes, the computer illiterate fundamentally powered the 2017 boom just like they did when the buzzwords were "American Online" and "Hotmail" in the 1990s. That's why I don't expect BTC to get anywhere close to $20K for a very, very long time (if ever). The computer illiterate know "cryptocurrency" is trouble just like "time share" and "your computer is infected." "Fool me once..."

 

[LFaWolf]

From the articles these are outright scams, where the money was taken to buy luxury cars and yachts, not bitcoin, so they do not contribute to the rise of the price of bitcoin, nor were they affected by the drop in bitcoin price. I still don’t see the connection.

 

[FordGT90Concept]

As I said, there were a plethora of articles and reports at the turn of the year (before this thread was made) but they're drowned out by more recent articles.

 

[R-T-B]

There were news articles and stories back in early 2017/early 2018 of people acting like brokerages convincing people to invest in cryptocurrency often without informing them of the risks. Large chunks of retirement funds have been lost.

This happens with securities? People can be wrong?

The articles did indeed not inform them of the risks, but they had their own motivations not to do so. Namely they were invested in the market and had no reason to do so legally. Which is why a legal framework is important, but must not be suffocating either.

I'd actually argue it's more important to regulate crypto related sales and ads than crypto itself.

 

[Papahyooie]

Or maybe, take responsibility for your damn self, and don't rely on mommy and daddy government to save you when you make stupid decisions.

 

[R-T-B]

Or maybe, take responsibility for your damn self, and don't rely on mommy and daddy government to save you when you make stupid decisions.

That is one perspective too, yes.

 

[LFaWolf]

As I said, there were a plethora of articles and reports at the turn of the year (before this thread was made) but they're drowned out by more recent articles.

I did a quick Google search and found no evidence at all. I am not looking for a single case or some crazy investors. We are talking about a systematic way of investment which is the only way that could be pumping the price of bitcoin. I think it is what you feel happened, not that it actually happened.

Anyway, I am not sure but I feel you have an axe to grind against bitcoin or other coins. It is like you can't wait for their demise. From what I can see, the spread and reach are now too far and too wide for them just to die. They will be around for a while. People that invest or buy coins without understanding have no one else to blame but themselves. Coins scams are no different from other scams such as real estate. Caveat emptor I say.

I think block chain is an interesting technology. However, I am not a miner, since I learned a lot of the coins were used for shadowy transactions. I don't care if the coins survive or thrive. Sometimes I am just curious about the profitability of coin mining.

 

[R-T-B]

Anyway, I am not sure but I feel you have an axe to grind against bitcoin or other coins.

I mean I'm sorry, but the reason I dropped from this debate is how blatantly transparent that is with Ford.

 

[FordGT90Concept]

I did a quick Google search and found no evidence at all. I am not looking for a single case or some crazy investors. We are talking about a systematic way of investment which is the only way that could be pumping the price of bitcoin. I think it is what you feel happened, not that it actually happened.

Anyway, I am not sure but I feel you have an axe to grind against bitcoin or other coins. It is like you can't wait for their demise. From what I can see, the spread and reach are now too far and too wide for them just to die. They will be around for a while. People that invest or buy coins without understanding have no one else to blame but themselves. Coins scams are no different from other scams such as real estate. Caveat emptor I say.

I think block chain is an interesting technology. However, I am not a miner, since I learned a lot of the coins were used for shadowy transactions. I don't care if the coins survive or thrive. Sometimes I am just curious about the profitability of coin mining.

You're missing the point. I'll provide a specific example: Man Who Lost $22,000 In Cryptocurrency Scam: ‘I Gave Him The Password’. This guy pumped $22,000 into cryptocurrencies on the rise to $20k. The money was stolen because he's computer illiterate but he was one of thousands, if not millions, investing (not mining) to cause the surge. People like him aren't likely to touch crypto again.

 

[LFaWolf]

You're missing the point. I'll provide a specific example: Man Who Lost $22,000 In Cryptocurrency Scam: ‘I Gave Him The Password’. This guy pumped $22,000 into cryptocurrencies on the rise to $20k. The money was stolen because he's computer illiterate but he was one of thousands, if not millions, investing (not mining) to cause the surge. People like him aren't likely to touch crypto again.

No, I am right on point. I said before - 1) not looking for a single case, 2) the person you quoted was scammed giving remote access to someone who stole the money, not using the money to pump into cryptocurrency and lose money from the fall of cryptocurrency. The $22k has NOTHING to do with the rise or fall of cryptocurrency market.

 

[hat]

No, I am right on point. I said before - 1) not looking for a single case, 2) the person you quoted was scammed giving remote access to someone who stole the money, not using the money to pump into cryptocurrency and lose money from the fall of cryptocurrency. The $22k has NOTHING to do with the rise or fall of cryptocurrency market.

I'm with you on that one. One guy getting scammed is neither going to affect the price of any cryptocurrency, nor does it show one way or the other whether cryptocurrency is a viable thing or not. If I gave you my online banking password, I'm sure you'd be able to clean that out all the same...

The only questions that article does raise is what number he called and where he got it from... it shows that there's places you can put cryptocurrency that aren't as trustworthy as an established bank, and it shows that people will invest in things they know little about. Most people who are really into crypto use a hardware wallet of some type, or software wallet (computer program?), which they have control over, not some institution.

 

[silkstone]

You're missing the point. I'll provide a specific example: Man Who Lost $22,000 In Cryptocurrency Scam: ‘I Gave Him The Password’. This guy pumped $22,000 into cryptocurrencies on the rise to $20k. The money was stolen because he's computer illiterate but he was one of thousands, if not millions, investing (not mining) to cause the surge. People like him aren't likely to touch crypto again.

I think you are overestimating the pervasiveness of crypto investing in the world, Ford. It is a very small market, with very few players. You might feel like it is 'everywhere' and lots of people have invested in it because the media attention around it is not in line with the amount of money involved.
For a comparison, the market cap of Apple is around 900 B USD, in comparison, the market cap of crypto is ~300 B. A single NASDAQ company's market cap greatly exceeds the market cap of any single coin.

 

[FordGT90Concept]

People like him are the reason why the market expanded: low knowledge investors buying cryptocurrencies that miners cashed out on. The fact he was scammed was what caused it to be reported on. The point was he invested money which pumped up the price of cryptocurrencies (granted, a tiny bit, but he wasn't the only one buying into cryptocurrencies in November/December). Sprinkle manipulation on top and you have a bubble about to burst.

For a comparison, the market cap of Apple is around 900 B USD, in comparison, the market cap of crypto is ~300 B. A single NASDAQ company's market cap greatly exceeds the market cap of any single coin.

BTC had a market cap of over 900 billion before the bubble burst. Virtually every 401K out there has a stake in Apple.

 

[hat]

I always figured it was just plain manipulation done by the big players. It's always going up and down...

 

[silkstone]

People like him are the reason why the market expanded: low knowledge investors buying cryptocurrencies that miners cashed out on. The fact he was scammed was what caused it to be reported on. The point was he invested money which pumped up the price of cryptocurrencies (granted, a tiny bit, but he wasn't the only one buying into cryptocurrencies in November/December). Sprinkle manipulation on top and you have a bubble about to burst.


BTC had a market cap of over 900 billion before the bubble burst. Virtually every 401K out there has a stake in Apple.

It was still lower than the Market cap of a single company. The market cap of all global equities is somewhere in the range of 70 Trillion dollars. The crypto market makes up for 0.005% of global equities and is quite insignificant in the grand scheme of things. The money involved isn't even close to the amount of money in the dotcom bubble where 5 trillion was wiped out almost overnight.