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Bitcoin Is Tanking, right now!!

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zg7666 Posted: Wed, Apr 10 2013 2:18 PM

http://www.businessinsider.com/bitcoin-plunges-2013-4

 

108$ now

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Bogart replied on Wed, Apr 10 2013 3:35 PM

I guess it was a bubble.  Maybe the people in Cyprus are not going to lose that much of their money after all.

 

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zg7666 replied on Wed, Apr 10 2013 6:37 PM

 

Has stabilized at ~150 , for now at least. 
 
A correction is natural, healthy and expected. 
Some suspect DDoS'd hack on Mt.Gox but as far as I know it is not confirmed. 

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baxter replied on Wed, Apr 10 2013 7:27 PM

How are LiteCoins doing?

The price was really going up, recently at least.

 

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A DDoS attack could cause a huge price swing? That's terrible! At least with gold, the state would have to get involved to debased it like crazy.

 

To paraphrase Marc Faber: We're all doomed, but that doesn't mean that we can't make money in the process.
Rabbi Lapin: "Let's make bricks!"
Stephan Kinsella: "Say you and I both want to make a German chocolate cake."

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baxter replied on Wed, Apr 10 2013 7:39 PM

It looks like a good deal to dump BitCoins and buy up LiteCoins instead. They are only like $3 now.

It sounds like all the miners are switching to LiteCoin too. Apparently, LiteCoins have faster confirmation times and a more difficult algorithm.

As I said before, BitCoins aren't really scarce. People can create as much cryptocurrency as they want.

Storing your wealth in cryptocurrency might mean having proficiency at jumping onto the next bandwagon before the old one crashes.

 

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Anenome replied on Wed, Apr 10 2013 8:25 PM

Price now $174. Higher than it was a couple days ago and people are declaring doom and gloom = LOL.

baxter:
It looks like a good deal to dump BitCoins and buy up LiteCoins instead. They are only like $3 now.

Mmm, no. Bitcoin has already won the adoption war.

baxter:
It sounds like all the miners are switching to LiteCoin too. Apparently, LiteCoins have faster confirmation times and a more difficult algorithm.

Miners are switching because of ASICs being far more efficient for bitcoin.

baxter:
As I said before, BitCoins aren't really scarce. People can create as much cryptocurrency as they want.

A distortion at best. Network effect and path dependence are likely to keep bitcoin well ahead of the others. Litecoin's success I expect to vanish as bitcoin takes off further. It's a crypto hot-potato.

baxter:
Storing your wealth in cryptocurrency might mean having proficiency at jumping onto the next bandwagon before the old one crashes.

Nah. Litecoin could just as easily crash, and I expect it will, as people band around the clear market leader. If litecoin survives long-term it will be an interesting turn since I don't see how it can at this point when it offers no advantage over bitcoin.

Any real competitor would have to have significant technological advantage, litecoin just doesn't.

 
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Anenome replied on Wed, Apr 10 2013 8:31 PM

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baxter replied on Thu, Apr 11 2013 4:00 AM

>If litecoin survives long-term it will be an interesting turn since I don't see how it can at this point when it offers no advantage over bitcoin

It seems like LiteCoin is fairly stable at 0.02 BTC = 1 LTC:

https://btc-e.com/exchange/ltc_btc

TerraCoin and PPCoin look interesting, too.

 

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baxter replied on Thu, Apr 11 2013 8:10 AM

Now this guy's creation (Ripple) sounds like a substantial improvement over BitCoin:

http://www.businessweek.com/articles/2013-04-11/introducing-ripple-a-bitcoin-copycat

"One reason the value of Bitcoins fell by $100 yesterday, according to reports, is that its largest marketplace, Mt.Gox, was under a denial-of-service attack and couldn’t satisfy orders fast enough. Ripple, he points out, doesn’t require such centralized servers; it is completely decentralized."

It sounds much more decentralized than BitCoin (more robust against hacker attacks or government shut down) and won't waste energy or harm the environment due to mining. I think this guy was one of the founders of Mt. Gox and possibly BitCoin itself.

Also BitCoin is described as an "expiermental currency", not so with Ripple. It is being launched with the help of VC money.

 

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zg7666 replied on Thu, Apr 11 2013 10:02 AM

 

Mt.Gox - "First of all we would like to reassure you but no we were not last night victim of a DDoS but instead victim of our own success!
 
Indeed the rather astonishing amount of new account opened in the last few days added to the existing one plus the number of trade made a huge impact on the overall system that started to lag. As expected in such situation people started to panic, started to sell Bitcoin in mass (Panic Sale) resulting in an increase of trade that ultimately froze the trade engine!..."

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baxter replied on Thu, Apr 11 2013 10:10 AM

>an increase of trade that ultimately froze the trade engine!

Exactly what you don't want: a medium of exchange that freezes up and can't be exchanged!

BitCoin is too centralized and vulnerable to DDOS (and government attack!). It can't even hold up to normal use.

 

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Blargg replied on Thu, Apr 11 2013 11:12 AM

In many cases it can take a long time for Bitcoin transactions to clear because coins have to be “mined,” a computationally intensive process that involves sifting through large amounts of data to find numerical patterns that confirm the transaction is legitimate. OpenCoin maintains a single global ledger; transactions are confirmed as the network’s servers automatically check the ledger.

Huh? Author didn't even look up what mining is. And yay, a single global ledger, I'd love to have the world's money tied up in that.

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Anenome replied on Thu, Apr 11 2013 1:31 PM

Mining confirms transactions, so in a way he's right. This happens on average once every 10 minutes. But to double-spend is still really hard, as the earliest broadcast transaction gets added to a mined block.

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baxter replied on Thu, Apr 11 2013 1:43 PM

>And yay, a single global ledger, I'd love to have the world's money tied up in that

It sounds similar to the BitCoin block chain.

FYI:

https://ripple.com/wiki/FAQ
"Ripple is a distributed database secured by cryptography. The database is used to store the ledger"

i.e. the ledger is distributed.

 

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Anenome replied on Fri, Apr 12 2013 7:52 PM

Bitcoin gains 134% in 12 hours, $54.25 ---> $127

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gotlucky replied on Fri, Apr 12 2013 8:25 PM

Wasn't it $150 a few days ago? So it tanked to $54 and now that it's back to $127?

Someone should contact Six Flags about opening a bitcoin rollercoaster. Better hope you don't get ripped off by being paid in litecoins...

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Anenome replied on Fri, Apr 12 2013 9:52 PM

It was $266 at the highest a day or so ago :)

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Blargg replied on Fri, Apr 12 2013 10:41 PM

Are Bitcoin's wide swings something desired for someone holding Bitcoins or wanting to use them as money or a store of value? I'm unsure as to whether the posts here about it going down and then up are congratulatory or derogatory.

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Someone I was talking to tonight at a bar literally made the criticism that Bitcoin is unviable because it's not traceable--you can buy child porn with it too easily without repercussion...

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zg7666 replied on Mon, Apr 15 2013 7:13 PM

From a friend: "...did you guys know the ASIC servers are coming online in the next 2 months?  The network difficulty is about to go right through the roof.  There's going to be really dramatic unloading and shuffling until the network stabilizes around the new production paradigm

I should add that GPUs have additional costs which ASIC servers do not.  Namely, you can hook more than 2 ASIC servers to a single computer.  Most PCs max out at 3 or 4 GPUs.  With a series of USB hubs, it would be possible to hook an unlimited number of ASIC servers into a single computer.  As such, you save a ton of money on support (non-revenue generating) hardware.  Really, who wants a dozen motherboards anyway?

...There's more costs associated with hardware than the GPU.  Namely, a PC can only hold three or four of those bad boys.  Believe me when I tell you, the cost of extra mother boards, memory, power supplies, ram, and monitor switches adds-up quickly.  Not to mention the heat.  15 GPUs can raise a sealed 20x20 room's ambient temperature by 75 degrees in less than 5 minutes.  It takes some serious engineering to expel that much heat from an enclosed space.  I thought a plastic fan might work in the window...then the fan melted.  A cluster of GPUs needs an actual exhaust system, and the space to hold all the equipment.  When you cost average non-revenue equipment into the cost of GPU mining, the cost per MH becomes rather prohibitive...  Well, it was prohibitive when BTC were trading at less than $10. However, the difficulty was under 1,000,000.  With the difficulty over 7,000,000 (it's gonna break 8 million at the next difficulty check), it's impossible to make a profit with any number of GPUs.  The power costs alone will eat the miners alive.

This bubble is the last chance for GPU miners to recover their sunk costs and turn a profit.

I pay $.11 per kWh.  With 24 GPUs @ 750,000 difficulty I could make 2-3 BTC per day through pooled mining.  The power costs were $750 per month.  I could break-even while BTC stayed above $10.  I never recovered all my sunk costs.

Assuming power costs are comparable everywhere, a 24 GPU system (which is a big cluster computer) @ 7,500,000 (or 10x difficulty) should be able to produce .2-.3 BTC per day.  I'd say that's, at most, 14 BTC a month.  The price needs to stay above $50 to break even.  I guess fifty is the new zero while there's still GPU mining.

I assume all miners, prior to the current bubble, have been running at a loss for a very long time.

The major source of cost is power.  The ASIC systems use 5 to 10 times less power than GPU systems.  To me, that means the ASIC miners can sell their coins for less than GPU miners' coins.  I would assume the ASICs will drive the price of BTC back down to $20 or so.

The ASIC boxes are quiet, cool, and consume almost no power.  Not to mention the fact that you can hook dozens of them into a network of USB hubs.  One computer, dozens of miners.  To me, that equals very low barriers to entry.  Lots of competition in a zero-sum game.  Thanks anyway."

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I love the arrogance and brazen shamelessness of the bitcoin crowd here.

After telling everyone to buy buy buy at $266 a bitcoin, you'd think they'd slink onto some hole in the ground when it has lost 2/3 of it's value [so far].

Stockbrokers get sued for that kind of thing, especially if it turns out they have a stake in pumping and dumping a stock.

Well, don't say I didn't warn you, everyone. Don't come crying to me now, naive innocents who lost their shirts.

Maybe next time you will pay more attention to Smiling Dave, put more effort into actually understanding what he is saying.

Kudos, however, to Malachi, who was shamed into changing his juvenile signature.

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Malachi replied on Wed, Apr 17 2013 3:35 PM

I'm sorry I added to your butthurt with my signature. now that its changed, perhaps you could pay more attention to your own posts and realize that you even admit that bitcoin is money.

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Talking about mining.....

People with large botnets under their control can just click a button and have thousands of computers mining coins for them.....

 

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To me, it seems like Bitcon is merely speculation. There's no real value there, no production, no wealth created, etc. I could be wrong, but those are just my superficial thoughts.

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Malachi replied on Wed, Apr 17 2013 9:29 PM

you dont think theres value in sending and receiving data?

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Malachi:

you dont think theres value in sending and receiving data?

 

What can I do with the data? I asked SmilingDave if one can use Bitcoin to make purchases.

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Malachi replied on Wed, Apr 17 2013 10:49 PM

what are you doing with the data right now?

dont ask dave anything about bitcoins, he cant see straight. yes you can buy stuff with them.

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Blargg replied on Thu, Apr 18 2013 3:52 PM

There's a thread about a Bitcoin competitor on Reddit and it's funny to see Bitcoin fans attacking the competitor for things that also apply to Bitcoin. This one was especially ironic:

There's a passing curiousity because it uses XRP coins but XRP isn't going to hold value.. giving them away it seems is a gimmicky marketing for a traditional Western Union type service.

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jmorris84 replied on Thu, Apr 18 2013 4:41 PM

Malachi,

Dave has been one of the few people who have been able to explain Bitcoins in a simple manor. It's really hard to find anyone who has an opposing opinion of them to do the same for their defense. I mean, there is someone here who wants others to read a 90+ page thesis on them. You've got to be kidding me!

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baxter:

Now this guy's creation (Ripple) sounds like a substantial improvement over BitCoin:

http://www.businessweek.com/articles/2013-04-11/introducing-ripple-a-bitcoin-copycat

"One reason the value of Bitcoins fell by $100 yesterday, according to reports, is that its largest marketplace, Mt.Gox, was under a denial-of-service attack and couldn’t satisfy orders fast enough. Ripple, he points out, doesn’t require such centralized servers; it is completely decentralized."

It sounds much more decentralized than BitCoin (more robust against hacker attacks or government shut down) and won't waste energy or harm the environment due to mining. I think this guy was one of the founders of Mt. Gox and possibly BitCoin itself.

Also BitCoin is described as an "expiermental currency", not so with Ripple. It is being launched with the help of VC money.

Adam Kokesh comments on Ripple:

The top comment:

ripple is:

1. Centralized.

2. Premined (supply is created by creators)

3. Supply is then distributed by the creators how they see fit

4. Ripple is a trust based system (human trust network)

5. No cap on the total amount of XPRs in the system.

6. Might as well use the Federal Reserve System as it is.

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Malachi replied on Thu, Apr 18 2013 4:54 PM

Dave has been one of the few people who have been able to explain Bitcoins in a simple manor.

well do you prefer an easy to understand piece of misinformation, or a truth that requires thought?

It's really hard to find anyone who has an opposing opinion of them to do the same for their defense.

I wasnt aware they needed defending.

I mean, there is someone here who wants others to read a 90+ page thesis on them. You've got to be kidding me!

what is your question?

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The Bitcoin Money Myth

 

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jmorris84 replied on Thu, Apr 18 2013 7:47 PM

"Well do you prefer an easy to understand piece of misinformation, or a truth that requires thought?"

It's not having to think about something that bothers me, it's the tongue twister that people come up with when trying to defend Bitcoin against someone who has shown it for what it clearly is. Like I've said before, it doesn't take a 90 page thesis to explain why things like gold and silver or even fiat have been used as money. If you need 90 pages to explain such a thing for Bitcoin then maybe it's whoever wrote such a thing to start wondering to themselves if they actually understand it or not.

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Malachi replied on Thu, Apr 18 2013 7:58 PM

you found Dave's arguments to be so convincing that further investigation isnt required. cool. good for you. why are you posting in this thread?

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jmorris84:
Like I've said before, it doesn't take a 90 page thesis to explain why things like gold and silver or even fiat have been used as money.

Why do people use bitcoin as a medium of exchange?  Because it lowers their transaction costs.  What else do you need explaining?

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Anenome replied on Fri, Apr 19 2013 2:58 AM

Graham Wright:

jmorris84:
Like I've said before, it doesn't take a 90 page thesis to explain why things like gold and silver or even fiat have been used as money.

Why do people use bitcoin as a medium of exchange?  Because it lowers their transaction costs.  What else do you need explaining?

I agree with Peter Surda, this is the killer feature that will drive adoption perhaps even unto the point of making it the worldwide unit of account.

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jmorris84 replied on Fri, Apr 19 2013 9:38 AM

Malachi:
you found Dave's arguments to be so convincing that further investigation isnt required. cool. good for you. why are you posting in this thread?

Malachi, what gives you the impression that I don't believe further investigation is required? I said Dave has given the best explanation in here; that doesn't mean that I don't continue to read what he and others write about the subject. I'll tell you I'm definitely not reading a 90 page thesis on the subject right now though.

Oh, I'm posting in this thread because this is a message board and that is what you do on message boards; discuss things.

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jmorris84 replied on Fri, Apr 19 2013 9:41 AM

Graham Wright:
Why do people use bitcoin as a medium of exchange? Because it lowers their transaction costs. What else do you need explaining?

Is it really being used as a medium of exchange though? From what I gather, more people are holding on to bitcoins rather then passing them around as a medium of exchange but maybe your definition of medium of exchange is different from what I understand it to be. Would you mind defining it for us?

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