Bitcoin hits $100



lukep said:
Alright, one last response for the night. (Yes, it's too fucking hot here and I'm sleeping in the daytime lol.)

Is value being created from nothing?

Market Cap's definition, if boiled down to one word, is: value.

I submit that the value of this currency, which is, after all, fiat and comprises no assets, is measured by what people have paid for it, nothing more.

With me so far?

If we were to run with your definition of Market Cap being nothing more than the recent small percent changes times quantity (which i'm guessing you learned from valuing stocks), then I have to ask: What then created the VALUE of that market cap?

Your idea of it means it has no value... It's just one ledger entry times another, yet that's not the definition of market cap. Value is.

So do you claim that something valued at $1.4 billion has no value?



Utterly devastated... Wait... Who were you again?
Click to expand...

Now, a "market cap" is NOT enough on its own.

  • Tulips were worth huge sums at one point in time. That collapsed when everyone started planting and harvesting tulips.
  • A lot of collectors items (like Vinyls and Comic books) lost their value when ebay arrived on the scene. Good friend of mine saw his collection of Techno vinyls go from several 10s of K to a few hundred dollars in value.
  • Beanie babies..

Well, looking at bitcoins, the "value" is also secured by other factors:

The most important one is the computation behind every bitcoin. Simply having to run a GPU/CPU for a lot of time means there is an investment of time and money into making every bitcoin.

This helps with the security AND protects the currency as you can't just mint 20K new bitcoins in a second.
While computers are getting faster, the computations become more complex, thus keeping the price to generate quite stable.
(More on that later)

So we have
  • necessary computation
  • investment
  • computing power
  • the ability to be used as currency (people accepting it)

So .. how would bitcoins loose their value (aside from the market movements)

  • Computation gets ridiculously easy.
    A hardware or software paradigm shift makes the computations laughable and bitcoins are mined by the second.
    Not likely. Not THAT unlikely.
  • Investment costs go down
    Free / cheaper energy.
    Not likely. But if you power your mining operation on solar or wind...
  • Not accepted
    This used to be a bigger danger. Bitcoins seem to be going mainstream, whihc will make them worth more.
    Not likely.
  • Hackers
    This IS happening... it has not destroyed bitcoin yet.. but it might.

On the other hand, getting bitcoins accepted in more places and ultimately being able to have my ATM spit out money for me or pay with my card using bitcoins... This would serve to make them even more valuable.

::emp::
 
MSTeacher said:
Dude you must be smoking too much of that Thai stick. I don't know what you consider stability but btc seems to be about the least stable thing in the world at the moment. Even its strongest proponents should be able to recognize that.

Also please sell me some btc in exchange for my old Magic card collection and I'll immediately sell them back to you for Second Life lichen. If we do this a few million times over the next few days we might be able to pull the world out of the current economic depression by next Monday.
Click to expand...

If you seriously have a mtg collection pm me what you got.
 
lukep said:
Alright, one last response for the night. (Yes, it's too fucking hot here and I'm sleeping in the daytime lol.)

Is value being created from nothing?

Market Cap's definition, if boiled down to one word, is: value.

I submit that the value of this currency, which is, after all, fiat and comprises no assets, is measured by what people have paid for it, nothing more.

With me so far?

If we were to run with your definition of Market Cap being nothing more than the recent small percent changes times quantity (which i'm guessing you learned from valuing stocks), then I have to ask: What then created the VALUE of that market cap?

Your idea of it means it has no value... It's just one ledger entry times another, yet that's not the definition of market cap. Value is.

So do you claim that something valued at $1.4 billion has no value?



Utterly devastated... Wait... Who were you again?
Click to expand...

Dude, you're arguing a different thing.

You said that $1.4 billion USD in exact currency, was moved into BTC.

That is not true.

Take this example:

I buy 10 BTC for $10. You then buy 10 BTC for $10.

Nothing happens for 6 months.

I now sell 1 BTC to mattseh for $1,000,000.

The market capitalisation of BTC is now $1,000,000 (most recent value) x 20 (total bitcoins that exist) = $20 million, based on the trading done on that particular day. Market cap is calculated by using the most recent trades.

The amount of USD put into BTC, was actually $1,000,020.

So technically yes, the entire BTC is valued at ~$1.4bn, given what people are currently willing to pay for BTC.

The amount of $ that has been put into BTC is however vastly less than $1.4bn, due to all the cheap BTC bought early on. How much $ has been put into BTC is impossible to know, without tracking every single exchange done by anyone anywhere from $ to BTC, but it's pretty much mathematically impossible that it's $1.4bn or more.

If every BTC was sold today on the market, you would not get $1.4bn for them. It's the most basic of economics (the school of economics you believe in is entirely irrelevant to this), and I don't really understand how you don't get this.
 
making money from bitcoins makes me feel like im making money from runescape gold or something
 
lukep said:
No, but cumulatively, $1.4B had to be paid to get the price up to $135 in this case. The market cap reflects the VALUE.
Click to expand...

This is wrong.

For example imagine Bitcoin is at $1 each. And 99% of people agree not to sell any.

The price could easily shoot up to $140 per bitcoin on just $100,000 worth of buying.

Market cap reflects nothing more than the last price multiplied by total outstanding.
 
stockfire said:
This is wrong.

For example imagine Bitcoin is at $1 each. And 99% of people agree not to sell any.

The price could easily shoot up to $140 per bitcoin on just $100,000 worth of buying.

Market cap reflects nothing more than the last price multiplied by total outstanding.
Click to expand...

That is completely wrong.
 
crackp0t said:
That is completely wrong.
Click to expand...

It's correct.

NYSE, New York Stock Exchange > Listings > Listings Directory

A stock's market-capitalization (CAP) figure is calculated by multiplying the number of shares outstanding (SHO) for that issue by its last trade price. Because the SHO figure represents the number of shares outstanding for a single issue - meaning multiple classes of a company's stock are not combined - the nyse.com CAP value also represents a single issue, and does not always reflect a company's total market capitalization.
Click to expand...
 
Does anyone know if Vircurex got hacked or not?

It'd be really painful if it got hacked!
 
Looks like mtcock stole my money. This is a joke. mMgox has no way to contact them except for some lame support ticket which they don't answer
10k down the drain .wires cant be reversed
At least I can use the loss as a good excuse for my back taxes,..I owe a lot so either i pay mtgox or the IRS.
bitcoins are impossible ot buy
maybe i can skim some $ putting up fake bitcoin ads on crigslist for $20 below quotes prices
 
cpauser said:
Looks like mtcock stole my money. This is a joke. mMgox has no way to contact them except for some lame support ticket which they don't answer
10k down the drain .wires cant be reversed
At least I can use the loss as a good excuse for my back taxes,..I owe a lot so either i pay mtgox or the IRS.
bitcoins are impossible ot buy
maybe i can skim some $ putting up fake bitcoin ads on crigslist for $20 below quotes prices
Click to expand...

How long ago did you send them money? The lack of a physical location does not inspire confidence.
 
cpauser said:
Looks like mtcock stole my money. This is a joke. mMgox has no way to contact them except for some lame support ticket which they don't answer
10k down the drain .wires cant be reversed
At least I can use the loss as a good excuse for my back taxes,..I owe a lot so either i pay mtgox or the IRS.
bitcoins are impossible ot buy
maybe i can skim some $ putting up fake bitcoin ads on crigslist for $20 below quotes prices
Click to expand...

images
 
Two nights ago I wanted to order 50 bitcoins. I signup on coinbase, and realize that they have 10 bitcoin limit per order on new accounts..

I end up placing an order for those 10, enter my ACH info and now have to wait until Tuesday night before I receive those coins. In addition, I will be forced to buy the coins at that current market price on that night. So if bitcoins starts crashing and falls 1/2 by next Tuesday, I would end up with 20 coins..but it might not be the best time to get in if it is crashing. Guess what I am trying to say is that I am at the complete mercy of the exchange site from this point on as to what my $1,300 is valued at.
 
mGrunin said:
Two nights ago I wanted to order 50 bitcoins. I signup on coinbase, and realize that they have 10 bitcoin limit per order on new accounts..

I end up placing an order for those 10, enter my ACH info and now have to wait until Tuesday night before I receive those coins. In addition, I will be forced to buy the coins at that current market price on that night. So if bitcoins starts crashing and falls 1/2 by next Tuesday, I would end up with 20 coins..but it might not be the best time to get in if it is crashing. Guess what I am trying to say is that I am at the complete mercy of the exchange site from this point on as to what my $1,300 is valued at.
Click to expand...
Get yourself on Mtgox, they're the largest and have been round the longest, and have no limits. Also, you have a USD balance and a BTC balance, so you can pay x into mtgox, but you only change it into BTC when you want to. Mtgox -> Mtgox transactions are instant.
 
mGrunin said:
Two nights ago I wanted to order 50 bitcoins. I signup on coinbase, and realize that they have 10 bitcoin limit per order on new accounts..

I end up placing an order for those 10, enter my ACH info and now have to wait until Tuesday night before I receive those coins. In addition, I will be forced to buy the coins at that current market price on that night. So if bitcoins starts crashing and falls 1/2 by next Tuesday, I would end up with 20 coins..but it might not be the best time to get in if it is crashing. Guess what I am trying to say is that I am at the complete mercy of the exchange site from this point on as to what my $1,300 is valued at.
Click to expand...

You can use other exchanges.

Coinbase is really fucked lately since the huge influx of new users.

Bitfloor
mtgox
https://localbitcoins.com - see if someone local is near you and go meet them IRL and buy them with cash money.
 
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