Bitcoincharts Mt. Gox - USD Summary

Bitcoin price vs volume graph for 2011-2016 suggests: (1) MtGox/Willy made price overshoot in late 2013; (2) Blockstream is making price undershoot since late 2014. This is easy to test, by sticking with Satoshi's plan. Anyone who opposes this test is anti-science, anti-markets - and anti-investors!

https://imgur.com/jLnrOuK
If you look at this graph, you will notice:
If you look really close, you'll also be tempted to formulate a rough estimate that:
So, if the correlation in this graph had continued (ie, if Blockstream / Core hadn't started attempting to artificially suppress the blocksize, since their launch in November 2014), then 1 BTC would equal over 2,000 USD now.
You can shout "correlation isn't causation!!!" all you want.
All I am saying is: let's test it out.
Let's allow the actual blocksize to continue to increase like it has been doing for the past few years - un-impeded by any artficial blocksize limit.
Let's follow Satoshi's plan (where the price increased with the volume) and not Core / Blockstream's plan (where the volume is rising and hitting an artificial limit, and the price has been stagnating).
We can easily test hypothesis (2) in the title of the OP (the claim that "Core / Blockstream is suppressing the price by suppressing the blocksize"), by simply increasing (or removing) the temporary artificial blocksize limit, thus allowing the natural blocksize to continue to grow unrestrained - and observing whether price and volume continue to grow together.
This is what Satoshi wanted. Since he was right about everything else, we should do what he wants now.
Those who would deny us the chance to continue this experiment (Core / Blockchain) are anti-science, anti-markets - and anti-investors.
Info on MtGox/Willy here:
https://duckduckgo.com/?q=mtgox+willy
Info on Satoshi's plan to increase / remove the temporary 1 MB "max blocksize" anti-spam kludge here:
"The existing Visa credit card network processes about 15 million Internet purchases per day worldwide. Bitcoin can already scale much larger than that with existing hardware for a fraction of the cost. It never really hits a scale ceiling." - Satoshi Nakomoto
https://np.reddit.com/btc/comments/49fzak/the_existing_visa_credit_card_network_processes/
“the eventual solution will be to not care how big it (the bitcoin blockchain) gets.” - Satoshi Nakamoto
https://forum.bitcoin.com/bitcoin-discussion/the-eventual-solution-will-be-to-not-care-how-big-it-the-bitcoin-blockchain-gets-t6196.html
https://np.reddit.com/btc/comments/49ju32/the_eventual_solution_will_be_to_not_care_how_big/
A scientist or economist who sees Satoshi's experiment running for these 7 years, with price and volume gradually increasing in remarkably tight correlation, would say: "This looks interesting and successful. Let's keep it running longer, unchanged, as-is."
https://np.reddit.com/btc/comments/49kazc/a_scientist_or_economist_who_sees_satoshis/
submitted by ydtm to btc [link] [comments]

Bitcoinium Android app (previously known as VirtEx Bitcoin). Monitor BTC Price on MtGox and VirtEx. Includes: Widget, Price Alarm (via Notifications), Price Graph, Orderbook, Deepbit Mining stats. *Now Open Source* (free ad-supported version in comments)

Bitcoinium Android app (previously known as VirtEx Bitcoin). Monitor BTC Price on MtGox and VirtEx. Includes: Widget, Price Alarm (via Notifications), Price Graph, Orderbook, Deepbit Mining stats. *Now Open Source* (free ad-supported version in comments) submitted by veken0m to Bitcoin [link] [comments]

A graph says a thousand words - Closing price of bitcoin over a year - 16/04/13 (mtgox).

submitted by sirboozebum to EnoughLibertarianSpam [link] [comments]

$1B Bitcoins On The Move: Owner Transfers ~$100M to Bitfinex And Binance In 10 Days

$1B Bitcoins On The Move: Owner Transfers ~$100M to Bitfinex And Binance In 10 Days
This is the third post of a series of articles dedicated to investigate $1B worth of bitcoins (111,114 BTC/BCH/... BXX) that were dormant since 2014 and started moving actively. The BTC coins were originally located at this address (1933phfhK3ZgFQNLGSDXvqCn32k2buXY8a).
The origin of the bitcoins is discussed here.
A deep-dive into the wallet activity was discussed here.
Today, I will focus on the transfer to major exchanges wallets that could indicate that the owner is selling his coins or exchanging it with alts or mixing it to cover his back.
I built a graph in order to deep dive into the transactions originated from the 111,114-BTC wallet and to follow it. This is the resulting graph were red indicates transactions <1 day, yellow <1 month, blue <1 year, green else.
https://preview.redd.it/nk3iov045vj11.png?width=1677&format=png&auto=webp&s=176d5b5bda930abf870dbea7edd1ba5b654158be

I found that at least 15,593 BTC originated from the 111,114-BTC wallet have been moved to Bitfinex and Binance wallets. This represents 14% of the original funds and more than $110M.

Bitfinex wallet

https://preview.redd.it/m8fryy8s5vj11.png?width=2038&format=png&auto=webp&s=117806763f7fc79909ee0358755e43c6de652749

11,114 BTC have been transferred to Bitfinex wallet 1Kr6QSydW9bFQG1mXiPNNu6WpJGmUa9i1g and the majority of these coins have been transferred in the last 7 days (August 24th - September 2nd).
Here is the list of the transactions:
https://preview.redd.it/8e9l0lqf0vj11.png?width=471&format=png&auto=webp&s=c63fa6ce9479efd4f27ce8f8cd456de19712fc9e

Binance wallet

https://preview.redd.it/i1v5lv3j9vj11.png?width=2025&format=png&auto=webp&s=bc6c893b684d2c97206565219ff4d5ce8eb721a2

4,421 BTC have been transferred to Binance wallet 1NDyJtNTjmwk5xPNhjgAMu4HDHigtobu1s and the majority of these coins have been transferred in the last 10 days (August 21st - September 2nd).
Here is the list of the transactions:
https://preview.redd.it/2cs6ufabavj11.png?width=453&format=png&auto=webp&s=5cdcb45cbe44f3f61251317036c6738aa0f3a9cd
Bitmex wallet(s)

I tracked Bitmex as well but "only" found 210 BTC transferred in with the following 6 major transactions:
https://preview.redd.it/2oondki1ovj11.png?width=432&format=png&auto=webp&s=9ae358b80e747b62d6940ef9022df2734ed001f0

Also, I have found 350 BTC transferred from Bitmex wallets though, maybe after being "washed out":
https://preview.redd.it/sx2g36jnovj11.png?width=546&format=png&auto=webp&s=26f0ac6c64e6aa9aedb7f76c90fb8ebea1beefcc

Update 1
If anyone finds if the owner of this address is an exchange : 3PtJRj5xKUKJ21TshP5u2G6dQMPNz2yUSc, I would be interested, thanks.

Update 2
Here is a full resolution version of the graph requested by u/rush717:
https://preview.redd.it/xwvn0l9yxxj11.png?width=2705&format=png&auto=webp&s=cc01b3bfc8aed64af4323a485e35ce459f498327


Update 3
MtGox vs SilkRoad origin and September 6th BTC price impact is now discussed here: https://www.reddit.com/btc/comments/9dvaj1b_bitcoins_on_the_move_mtgox_vs_silkroad_origin/

--
Surprisingly BTC price was pumping since those funds were starting to be transferred to Bitfinex and Binance wallets (see Binance transactions' list, August 11th)
How do you think this will impact the market?
Do you want me to continue this investigation? If yes let me know what you would want me to focus on.
submitted by sick_silk to Bitcoin [link] [comments]

Investigating the $1B Bitcoins on the move from a SilkRoad related wallet

Investigating the $1B Bitcoins on the move from a SilkRoad related wallet
2 days ago, I reported that a SilkRoad related wallet containing about $1B worth of Bitcoins (111,114 $BTC and the same amount of $BCH and of other Bitcoin forks) was on the move after 4 years and 5 months of inactivity : https://www.reddit.com/Bitcoin/comments/9bfnff/near_1b_are_currently_on_the_move_from_a_silkroad/

Today, I will dig a little bit more into this wallet activity.

Below you will find a graph representation of the transactions sent over time from the original 111,114-BTC wallet to the most recent wallets which have received some of the coins. Each branch represent a sequence of transactions sent through several wallets.

Red nodes indicate the most recent transactions (< 1 month), blue nodes indicate quite recent ones (<1 year) and green nodes are the older ones ( > 1 year).

https://preview.redd.it/jjhfpb4udhj11.png?width=2233&format=png&auto=webp&s=7a369b73dfbe4601e05608f1aae36aff24a4d52e

  • Picture 2: original coins are currently transferred on Binance wallet, in fact it is a major end-point/aggregate of transactions originated from the 111,114-BTC wallet (1NDyJtNTjmwk5xPNhjgAMu4HDHigtobu1s).
https://preview.redd.it/7novcf2wdhj11.png?width=2222&format=png&auto=webp&s=d0c429674a70bf2baf32c4ecc9c4475a1d43ad7e

https://preview.redd.it/9ungmsexdhj11.png?width=1620&format=png&auto=webp&s=079fcf54605e88debe0cac297e492785b7cc73ed

  • Picture 4: funds are currently actively mixed, you can see a chain of red nodes with no other purpose than transferring n time the coins and splitting/mixing it a bit (3Ah15skNb8R1teRWs6h2Q2vRywkLJWUhhb).​
https://preview.redd.it/9lzr31n0ehj11.png?width=2227&format=png&auto=webp&s=ade9fcf046e86a595e47f8c196df3abcb28866d3

So it's now obvious that the wallet's owner :
  1. is very actively splitting his original 111,114 BTC this past month (a lot of transactions are very recent, see the amount of red nodes on the graph);
  2. some of this funds are currently being sold on Binance (picture 2 and 3);
  3. is very actively in the process of mixing, hiding and making difficult to track his coins (picture 4).
Is the owner going to sell all his coins? How do you think this can impact the market?

Update 1
Following the request of u/btc-reddit, below you will find the graph that marks with red dots the wallets which have been active in the past 24h. At least 88 BTC have been transferred in the last 24h to Binance wallet: 18afibtW5NLMqMwCZD6yt1qhkmEbrfa3QF , 1M2stLGnZGi9XhB2sqTwFfcSfxZhzYKHs6 , 15jFKpCBfHN599TopLPQYdv2aNCRZSUw2r , 1F1EWmLJtYUA1yvDGRBQ6Z6Zjp33ci9EZX , 1M2stLGnZGi9XhB2sqTwFfcSfxZhzYKHs6 ...
https://preview.redd.it/v4yql8ftvhj11.png?width=1630&format=png&auto=webp&s=73d3b35f04854dc66accc3485680404d3e76cbc3

​Furthermore, more than 2,980 BTC have been transferred to Binance wallet in August 2018, certainly to be sold or exchanged with other currencies, which represents 3% of the original wallet.
That's more than $20M worth of bitcoin at current price, it definitely can have impacted the overall price this month.
Most of it was sold after August 12th, which corresponds to the start of an increase in Bitcoin price interestingly:
https://preview.redd.it/lg3ckep3zjj11.png?width=456&format=png&auto=webp&s=e7ba5ec10628ca7b6872beae249ee047f1cee408

Update 2
​This address is also heavily involved in this graph: 1NyfNYAXZ76VNdvxUUVxdbhWFQGa7QDjTn. It saw 73,673 BTC go through it (only 350 BTC originated from the wallet we are studying here though), in a little bit more than a year.
https://preview.redd.it/sbkx1etviij11.png?width=2041&format=png&auto=webp&s=05d81143196dce1c33dd2d6ea6695900ddd8d0d9

Update 3
This address 3D83uPnvodCLpwedooiRrLjdQ9pcFVZF32 is part of the graph and is multiplexing a lot of coins, about 175 BTC in small chunks < 1 BTC.​

Update 4
This is a more refined and complete version of the graph (the yellow nodes indicate transactions activity < 1 month). I let you find where is Binance wallet located ;-)
Obvious, isn't it!
https://preview.redd.it/y9e8tdlodkj11.png?width=2277&format=png&auto=webp&s=386fc91353b6c67d9ce8d6970c6c4bc1b7416a1a

Update 5
$110M worth of Bitcoins ​transferred Bitfinex and Binance: https://www.reddit.com/Bitcoin/comments/9ceb5v/1b_bitcoins_on_the_move_owner_transfers_100m_to/

Update 6
$1B bitcoins on the move: MtGox vs SilkRoad origin and BTC crash discussed
MtGox vs SilkRoad origin and September 6th BTC price impact is now discussed here: https://www.reddit.com/btc/comments/9dvaj1b_bitcoins_on_the_move_mtgox_vs_silkroad_origin/
submitted by sick_silk to Bitcoin [link] [comments]

A Guide To Buying and Selling Premium Bitcoin

Introduction
All Bitcoin are created equal, but they rarely remain that way.
With the traceability and open nature of Bitcoin's Blockchain, individual Bitcoin and satoshis can be traced back to cypherpunk giants like Hal Finney, or even Satoshi Nakamoto himself. Furthermore, newly minted, or old-minted-but-never-moved Bitcoin trade at a significant premium, compared to the Bitcoin spot price (it's been reported that there have been premiums of 15-20% for coinbase Bitcoin).
These coins are novelties. Collectables. Because they can be tracked, identified and are cryptographically verifiable.
So with that dynamic in place, there is an opportunity for a Premium Bitcoin market to form. This subreddit will attempt to form the infancy of that market for retail customers, and perhaps whales.
Instructions for Buyers on making a Post
If you wish to buy a specific kind of coin you can make a post is this subreddit starting with
  1. "[WTB]"
  2. followed by the kind of Bitcoin you wish to buy,
  3. followed by specific requirements, like the number of transactions away from the source/event/coinbase/person/exchange
  4. followed by the premium above spot price as a percentage in which you are willing to buy the novelty, collectable or even tainted Bitcoins.
  5. followed by your preferred payment method
Examples:
[WTB] 1 Satoshi Nakamoto Bitcoin, 1 transaction away from coinbase: 100% above spot - USDC
[WTB] 2 Bitcoin Coinbase from 2013, less then 2 transactions away from origin: 21% above spot - Bitcoin
[WTB] 0.5 Silk Road Bitcoin, any length of transactions away from origin: -10% below spot - Monero
Instructions for Sellers on making a Post
If you believe you have collectable, unique or novelty Bitcoin for sale, you can make a post in this subreddit starting with
  1. [WTS]
  2. followed by the kind of Bitcoin you wish to sell,
  3. followed by any specifics of those Bitcoin, like the number of transactions away from the event/source/coinbase/person/exchange
  4. followed by the asking premium above spot price as a percentage you wish to charge for the novelty, collectable or even tainted Bitcoins.
  5. followed by what kind of payment you accept
Examples:
[WTS] 1 Satoshi Nakamoto Bitcoin, 2 transactions away from coinbase, 121% above spot - Accepting Bitcoin, ETH, USDC
[WTS] 25 Bitcoin coinbase, from 2014 has not be moved, asking for 25% above spot - Accepting USDT
[WTS] 1 Hacked Bitfinex Bitcoin, 21 transactions away from source, -20% below spot - Accepting Monero
Instructions for Escrow Agents on making a Post
If you want to offer your escrow services to facilitate the buying and selling of Premium Bitcoin between two parties then you can make a post in this subreddit starting with
  1. [EA]
  2. a short description of yourself
  3. the percentage or flat rate you will charge for your services
  4. any extra features available
  5. payment methods accepted
Examples:
[EA] Experienced and Reviewed Escrow Agent here to help, flat rate of 0.01BTC - all payment methods accepted
[EA] Bitrated verfied Escrow Agent, 0.5% commission - physical opendime optional for 150$ more - Bitcoin and USDC accepted upfront
Best Practices for Buyers, Sellers and Escrow Agents
once you submit a post, a seller may try to contact you by private message, chat, or by replying to your post. Most will claim that they have what you are looking for. But you will need to verify on your own that the person you are communicating with does have the type of coins you are looking for. You can verify this by having the seller who contacts you sign a message from the address that holds the coins that satisfy your buying requirements.
It's recommended that the verification message format be something like "I am ."
Further instructions on signing messages can be found here:
http://support.vaultoro.com/knowledgebase/articles/536758-how-do-i-sign-a-message-with-my-bitcoin-wallet
https://www.youtube.com/watch?v=B4GZ4qDEanA
https://www.youtube.com/watch?v=S88ciN9DsRk
Once the buyer has verified the coins are possessed by the seller with a signed message from the seller, the transaction can begin. Other useful tools for looking up the transaction trail of the coins being sold can be found here:
blockpath.com
blockchain3d.info
symphony.iohk.io
walletexplorer.com
a list of MTGox cold wallet coins
a list of historic bitcoin transactions
It's recommended that a trusted third party escrow agent be used to ensure that neither party scams another. It's important that the seller, buyer and escrow agent all know the details of the transaction that is to occur, including the evidence to support the Bitcoins novelty. It's important that the buyer conduct his due diligence in verifying the evidence of the coins authenticity and related history. If possible, the escrow agent should do the same.
To find a escrow agent, a buyeseller can search this subreddit for EA posts, use www.bitrated.com to search for a trusted escrow, or use a different escrow agent service that they both agree to using.
Once all parties are clear on the details of the transactions, including the EA's fee, the transaction can proceed. If the transaction is successful, please let us know in the original subreddit posting.
submitted by Fiach_Dubh to BitcoinPremium [link] [comments]

We are here..

We are here.. submitted by Amacfa to Bitcoin [link] [comments]

Longterm Non-Linear Regression Analysis of Bitcoin Exchange Rate based on price data for over 7 years

I would like to share this plot (old plot) that I made. I calculated a non-linear regression based on daily weighted arithmetic mean of BTC exchange rates, the plot shows the development over 20 year. As usual, this is not a "set in stone" result, it merely reflects the dynamics of the market over the last seven years. Future singular events, such as the mtgox crash in the past, could significantly alter the prediction.
The basic result from this graph is that we are currently in a bubble (also known as speculative mania), a possible crash could wipeout as much as 70% of the current value. The questions are when exactly will the bubble burst and if a crash can be avoided altogether. (Of course, nobody can really answer these questions.) But in order to avoid such a devastating crash the dynamics of the market has to change fundamentally in the near future.
Personally, I am expecting either a correction downwards (which could be quite massive) or a sideways movement until the exchange rate meets with the regression curve. I do not expect that we can keep growing at the current rate for much longer. The market is driven by psychology, many new people are coming in with expectations of great and fast profits, which is the typical fuel of a bubble. Such support of the price is fragile and unpredictable. On the other hand, Bitcoin is taken increasingly seriously by the classical financial industry, which could lead to unexpected longterm support for such high exchange rates which we are seeing right now.
Further, development of new technologies, such as the Lightning Network, could lead to a fundamental change of how Bitcoin is utilized, from the nowadays common use as a storage value as opposite to a true currency. (Of course, there is also always the looming risk of a flaw in the software, which could lead to a total lost of value. But we can only hope that the revision and testing process of the next bitcoin iteration will be held to high standard.) We can expect that such a fundamental change will have an effect of the market dynamics.
Edit: On the positive side, I should have pointed out that according to the non-linear model I used, the growth rate of the bitcoin price is polynomial, proportional to
~ t5.7
where t is the number of days since Bitcoins creation. This result alone is pretty incredible, it means that for the past seven years we had a growth rate to the power of 5.7. It is not exponential growth, but still quite amazing. I am not aware of any other assets with such growth rates for such a long period of time.
Edit: uploaded updated hi-res version
Edit: formating
submitted by marf9 to BitcoinMarkets [link] [comments]

$1B bitcoins on the move: MtGox vs SilkRoad origin and BTC crash discussed

$1B bitcoins on the move: MtGox vs SilkRoad origin and BTC crash discussed
This is the 4th post of a series of articles dedicated to investigate $1B worth of bitcoins (111,114 BTC/BCH/... BXX) that were dormant since 2014 and started moving actively. The BTC coins were originally located at this address (1933phfhK3ZgFQNLGSDXvqCn32k2buXY8a).
  • The facts that part of this funds (>13%) have been transferred in the past month to Bitfinex, Binance and Bitmex exchanges is discussed here.
  • The origin of the bitcoins was originally discussed here.
  • A deep-dive into the wallet activity was discussed here.

Today I am writing a short update to discuss the origin of the funds and some events that could be related both to this wallet and yesterday's price crash.

Wallet's origin

This question has been discussed a lot by the crypto community in the past year.
Here is a summary of the most probable hypothesis for the wallet's origin:
  1. a SilkRoad user or DPRs wallet per this post: https://bitcointalk.org/index.php?topic=310600.0
  2. a MtGox cold wallet that has been seized or is still owned by MtGox: in fact the wallet funds moved in March 2014 right after MtGox filed for bankruptcy one month earlier in February 2014; these movements dates are really similar to the 200,000 lost coins "found" by Karpeles which moved March 7th, 2014 (1dda0f8827518ce4d1d824bf7600f75ec7e199774a090a947c58a65ab63552e3), just 2 days before the movements on the wallet we are talking about here.
  3. a whale wallet since the major part of the 111,111 coins are coming from a very old deposit of 37,421 coins processed on June 21st, 2011 making this an early adopter's wallet (70d46f768b73e50440e41977eb13ab25826137a8d34486958c7d55c5931c6081)

Wizsec, a prominent Bitcoin security expert, seems to be pretty sure that the wallet belongs to a MtGox hodler and early investor, who is not a DPR or a SilkRoad user, per his Twitter post: https://twitter.com/wizsecurity/status/1037030003068653569
Finally, Wizsec and I agree that this wallet is not CSW`'s wallet despite it is mentioned in several court documents. Wizsec spent a lot of time debunking CSW's ownership claims earlier this year: https://twitter.com/wizsecurity/status/968337084837781504

What do you think about this wallet origin?
`
BTC price crash

Also, I wanted to report some events that could be related to this 1933f wallet activity:
  • $100M USDT were transferred (reported by u/whalecheetah) while the 1933f wallet owner was in the process of transferring approximately the same amount to several exchanges;
  • a 10,000 BTC buy order was filed last night on Bitmex with 8,030 BTC transferred from a Bitfinex user wallet while the 1933f wallet owner transferred approximately the same amount of BTC to Bitfinex since August, 24th. Was this deal prepared or was the buyer a bitcoin angel?

In the light of this yesterday's price crash, do you think the $100M transferred to the exchanges caused it?


graph of transactions originated from 1933f wallet
submitted by sick_silk to Bitcoin [link] [comments]

Why the price of DOGE is falling and will continue to. SUCH MAFFS. SO LOGIC. WOW.

TLDR; Dogecoin is one of the most profitable coins to mine, so people are mining and dumping for profit. Will probably still drop by ~10-25%. Woof. http://i.imgur.com/NRVOtRI.jpg
A lot of people are posting about the price of Dogecoin and are concerned with its price. There is speculation that is misleading and not backed up by much theory. It’s not just as simple as supply and demand, panic selling or the line of best fit on a graph. Let’s look at the maths and see why the coin is dropping so rapidly and why now.
MAFFS
The difficulty of mining a block of DOGE currently ranged from 300-400 [1], the higher this goes the less coin you will mine. To make things simple let’s run an example: Assume you have 1000kHash of digging power; with that you could mine at the current difficulty level approx. 30,000 DOGE a day [2]! The value of Dogecoin is tightly tied to Bitcoin, we first convert it to BTC and sell that. The price for a single DOGE is roughly 0.00000040 BTC [3] and a BTC is worth around $850 [4]. In our 24 hours of work we earn $10.20 (0.00000040 * 30000 * 850). Wow. Such pawfit.
Now compare this to the ‘standard’ of scrypt mining, Litecoin. For the same time and strength of your digging you would yield around $8.50. If you were only interested in profit you would mine DOGE and sell it because it made you the most profit for your hashrate. A lot of people are doing this, including multicoin pools, they mine the most profitable coin and convert it to BTC. It’s simply efficient. This means that there is a huge dump of coin on the market and the price will fall.
SPECULATION
When will the coin stop dropping in price? When it is no longer the most profitable coin, so probably around 0.00000030 to 0.00000035 BTC. At this price the profitability is too low to reward these types of miners. Alternatively, if the difficulty was to increase then the amount of coins earned (EDIT: coins per person, overall supply per time is constant! More miners = lower split per miner) would be reduced and the profit margins would also decrease, I’d estimate the difficulty would need to be around 450 to 500 to balance out. The difficulty increases if more people mine the coin, and at this point that will be depending on popularity.
Sure a few people are panic selling but comparatively this is a drop in the ocean and even so it will just help the coin reach its stable price a little faster. Anybody who wants to see the coin succeed is already doing what they need to, they are not concerned with the price, remember to have fun!
Another point to note is that over the last few days the price of BTC has risen, and so even if the price of DOGE was stable the exchange ratio for DOGE->BTC would still show a fall – this is slightly misleading and the fall in price is not as hard as it seems!
So what can you do? Wait. The price will level out and over time the difficulty should increase with popularity and in around 1-2 months the reward will halve, I'd expect a big peak in price around that time. The coin is young and popular; it needs to learn the Earth before it can go to the Moon.
Sources: [1]http://www.cryptocoincharts.info/v2/coins/show/doge [2] http://www.coinwarz.com/calculators/dogecoin-mining-calculator [3]https://www.cryptsy.com/markets/view/132 [4]http://bitcoinity.org/markets/mtgox/USD 
submitted by Piedo_Bear to dogecoin [link] [comments]

The New Crypto Order & Escaping Financial Repression

The Vigilante’s View
It is our first issue in months that bitcoin hasn’t hit an all-time high! And it’s the last issue of the year. And what a year for cryptos it was.
To put it in perspective, bitcoin could fall 90% from current levels and it will still have outperformed stocks, bonds and real estate in 2017.
Bitcoin started 2017 at $960.79.
At the time of this writing it is near $13,000 for a gain of 1,250% in 2017.
And, bitcoin was actually one of the worst performing cryptocurrencies in our TDV portfolio in 2017!
Ethereum (ETH) started 2017 at $8. It has since hit over $800 for a nice 10,000% gain in 2017.
That’s pretty good, but not as good as Dash which started the year at $11.19 and recently hit $1,600 for a nearly 15,000% gain.
I hope many of you have participated in these amazing gains! If not, or you are new, don’t worry there will be plenty more opportunities in the years ahead.
It won’t all be just home runs though… in fact, some of the cryptos that have performed so well to date may go down dramatically or collapse completely in the coming years.
I’ll point out further below why Lightning Network is not the answer to Bitcoin Core’s slow speeds and high costs. And, I’ll look ahead to 2018 and how we could already be looking beyond blockchains.
Yes, things are moving so fast that blockchain just became known to your average person this year… and could be nearly extinct by next year.
That’s why it is important to stick with us here at TDV to navigate these choppy free market waters!
New Years Reflection On The Evolution Of Consensus Protocols
Sooner or later crypto will humble you by its greatness. Its vastness is accompanied by a madness that is breathtaking, because you quickly realize that there is no stopping crypto from taking over the world. The moment you think you have everything figured out, is the moment the market will surprise you.
We are for the first time living and witnessing the birth of the first worldwide free market. Throughout this rampage of innovation, we all are implicitly aiming for the best means of harnessing consensus. As we leave this bountiful 2017 and aim at 2018, it is important for us to meditate and appreciate the progress we have made in transforming the world through the decentralization of consensus. It is also important to reflect on the changes in consensus building we have partaken in and those yet to come.
Consensus is the agreement that states “this is what has occurred, and this is what hasn’t happened.”
Throughout the vastness of history, we humans have only really had access to centralized means for consensus building. In the centralized world, consensus has been determined by banks, states, and all kinds of central planners. As our readers know, any centralized party can misuse their power, and their consensus ruling can become unfair. In spite of this, many individuals still praise the effectiveness of consensus building of centralized systems.
People from antiquity have had no other option but to trust these central planners. These systems of control have created still-water markets where only a few are allowed to compete. This lack of competition resulted in what we now can objectively view as slow innovation. For many, centralized consensus building is preferred under the pretense of security and comfort. Unfortunately, these same individuals are in for a whole lot of discomfort now that the world is innovating on top of the first decentralized consensus building technology, the blockchain.
Everything that has occurred since the inception of bitcoin has shocked central planners because for the first time in history they are lost; they no longer hold power. We now vote with our money. We choose what we find best as different technologies compete for our money.
What we are witnessing when we see the volatility in crypto is nothing more than natural human motion through price. The innovation and volatility of the crypto market may seem unorthodox to some, because it is. For the first time in history we are in a true free market. The true free market connects you to everybody and for this reason alone the market shouldn’t surprise us for feeling “crazy.” Volatility is a sign of your connection to a market that is alive. Radical innovation is a sign of a market that is in its infancy still discovering itself.
In juxtaposing centralized consensus building with decentralized consensus building, I cannot keep myself from remembering some wise biblical words; “ And no one pours new wine into old wineskins. Otherwise, the new wine will burst the skins; the wine will run out and the wineskins will be ruined.” – Luke 5:37
The centralized legacy financial system is akin to old wineskins bursting to shreds by the new wine of crypto. Decentralized consensus building has no need for central planners. For example, think about how ludicrous it would be for someone to ask government for regulation after not liking something about crypto. Sorry, there is no central planner to protect you; even the mathematical protocols built for us to trust are now competing against one another for our money.
These new mathematical protocols will keep competing against one another as they provide us with new options in decentralizing consensus. As we look unto 2018, it is important that we as investors begin to critically engage and analyze “blockchain-free cryptocurrencies.”
HASHGRAPHS, TANGLES AND DAGS
Blockchain-free cryptocurrencies are technologies composed of distributed databases that use different tools to achieve the same objectives as blockchains.
The top contenders in the realm of blockchain-free cryptos are DAGs (Directed Acyclic Graphs) such as Swirlds’ Hashgraph, ByteBall’s DAG, and IOTA’s Tangle. These blockchain-free cryptos are also categorized as belonging to the 3 rd generation of cryptocurrencies. These technologies promise to be faster, cheaper, and more efficient than blockchain cryptocurrencies.
Blockchains were the first means of creating decentralized consensus throughout the world. In the blockchain, the majority of 51% determine the consensus. The limits of blockchains stem from their inherent nature, whereupon every single node/participant needs to know all of the information that has occurred throughout the whole blockchain economy of a given coin.
This opens up blockchains to issues akin to the ones we have been exposed to in regards to Bitcoin’s scaling. It is important to make a clear distinction in the language used between blockchains and blockchain-freecryptocurrencies. When we speak about blockchains it is more proper to speak about its transactionconsensus as “decentralized”, whereas with blockchain-free cryptocurrencies it is best if we refer to transaction consensus as “distributed.”
Swirlds’ Hashgraph incorporates a radical and different approach to distributing consensus. Swirlds claims that their new approach will solve scaling and security issues found on blockchains. They use a protocol called “Gossip about Gossip.” Gossip refers to how computers communicate with one another in sending information.
In comparison to the Blockchain, imagine that instead of all of the nodes receiving all of the transactions categorized in the past ten minutes, that only a few nodes shared their transaction history with other nodes near them. The Hashgraph team explains this as “calling any random node and telling that node everything you know that it does not know.” That is, in Hashgraph we would be gossiping about the information we are gossiping; i.e., sending to others throughout the network for consensus.
Using this gossiped information builds the Hashgraph. Consensus is created by means of depending on the gossips/rumors that come to you and you pass along to other nodes. Hashgraph also has periodic rounds which review the circulating gossips/rumors.
Hashgraph is capable of 250,000+ Transactions Per Second (TPS), compared to Bitcoin currently only allowing for 7 TPS. It is also 50,000 times faster than Bitcoin. There is no mention of a coin on their white paper. At this moment there is no Hashgraph ICO, beware of scams claiming that there is. There is however a growing interest in the project along with a surge of app development.
IOTAs DAG is known as the Tangle. Contrary to Hashgraph, IOTA does have its own coin known as MIOTA, currently trading around the $3 mark. There are only 2,779,530,283 MIOTA in existence. The Tangle was also created to help alleviate the pains experienced with Blockchain scaling. IOTAs Tangle creates consensus on a regional level; basically neighbors looking at what other neighbors are doing.
As the tangle of neighbors grows with more participants the security of the system increases, along with the speed of confirmation times. IOTA has currently been criticized for its still lengthy confirmation times and its current levels of centralization via their Coordinators. This centralization is due to the fact that at this moment in time the main team works as watchtower to oversee how Tangle network grows so that it does not suffer from attacks.
Consensus is reached within IOTA by means of having each node confirm two transactions before that same node is able to send a given transaction. This leads to the mantra of “the more people use IOTA, the more transactions get referenced and confirmed.” This creates an environment where transactional scaling has no limits. IOTA has no transaction fees and upon reaching high adoption the transactions ought to be very fast.
Another promising aspect about IOTA is that it has an integrated quantum-resistant algorithm, the Winternitz One-Time Signature Scheme, that would protect IOTA against an attack of future quantum computers. This without a doubt provides IOTA with much better protection against an adversary with a quantum computer when compared to Bitcoin.
ByteBall is IOTA’s most direct competitor. They both possess the same transaction speed of 100+ TPS, they both have their own respective cryptocurrencies, and they both have transparent transactions. ByteBall’s token is the ByteBall Bytes (GBYTE), with a supply of 1,000,000; currently trading at around $700. ByteBall aims to service the market with tamper proof storage for all types of data. ByteBall’s DAG also provides an escrow like system called “conditional payments;” which allows for conditional clauses before settling transactions.
Like IOTA, ByteBall is also designed to scale its transaction size to meet the needs of a global demand. ByteBall provides access to integrated bots for transactions which includes the capacity for prediction markets, P2P betting, P2P payments in chat, and P2P insurance. ByteBall’s initial coin distribution is still being awarded to BTC and Bytes holders according to the proportional amounts of BTC or Bytes that are held per wallet. IOTA, ByteBall and Hashgraph are technologies that provide us with more than enough reasons to be hopeful for 2018. In terms of the crypto market, you don’t learn it once. You have to relearn it every day because its development is so infant. If you are new to crypto and feel lost at all know that you are not alone. These technologies are constantly evolving with new competitive options in the market.
As the technologies grow the ease for adoption is set to grow alongside innovation. We are all new to this world and we are all as much in shock of its ingenuity as the next newbie. Crypto is mesmerizing not just for its volatility which is a clear indication of how connected we are now to one another, but also because of the social revolution that it represents. We are experiencing the multidirectional growth of humanity via the free market.
Meanwhile Bitcoin Is Turning Into Shitcoin
It is with a great degree of sadness that I see bitcoin is on the cusp of destroying itself. Bitcoin Core, anyway. Bitcoin Cash may be the winner from all of this once all is said and done.
Whether by design or by accident, bitcoin has become slow and expensive.
Many people point out that IF the market were to upgrade to Segwit that all would be fine. I’ll explain further below why many market participants have no incentive to upgrade to Segwit… meaning that the implementation of Segwit has been a massively risky guess that so far has not worked.
Others say that the Lightning Network (LN) will save bitcoin. I’ll point out below why that will not happen.
Lightning Networks And The Future Of Bitcoin Core
If you’ve been following bitcoin for any length of time, you’re probably aware of the significant dispute over how to scale the network. The basic problem is that although bitcoin could be used at one time to buy, say, a cup of coffee, the number of transactions being recorded on the network bid up the price per transaction so much that actually sending BTC cost more than the cup of coffee itself. Indeed, analysis showed that there were many Bitcoin addresses that had such small BTC holdings that the address itself couldn’t be used to transfer it to a different address. These are referred to as “unspendable addresses.”
In the ensuing debate, the “big blockers” wanted to increase the size of each block in the chain in order to allow for greater transaction capacity. The “small blockers” wanted to reduce the size of each transaction using a technique called Segregated Witness (SegWit) and keep the blocks in the chain limited to 1MB.
SegWit reduces the amount of data in each transaction by around 40-50%, resulting in an increased capacity from 7 transactions per second to perhaps 15.
The software engineers who currently control the Bitcoin Core code repository have stated that what Bitcoin needs is “off-chain transactions.” To do this, they have created something called Lightning Networks (LN), based on an software invention called the “two-way peg.” Put simply, the two-way peg involves creating an escrow address in Bitcoin where each party puts some bitcoin into the account, and then outside the blockchain, they exchange hypothetical Bitcoin transactions that either of them can publish on Bitcoin’s blockchain in order to pull their current agreed-upon balance out of the escrow address.
Most layman explanations of how this works describe the protocol as each party putting in an equal amount of Bitcoin into the escrow. If you and I want to start transacting off-chain, so we can have a fast, cheap payment system, we each put some Bitcoin in a multi-party address. I put in 1 BTC and you put in 1 BTC, and then we can exchange what are essentially cryptographic contracts that either of us can reveal on the bitcoin blockchain in order to exit our agreement and get our bitcoin funds.
Fortunately, it turns out that the video’s examples don’t tell the whole story. It’s possible for the escrow account to be asymmetric. See:. That is, one party can put in 1 BTC, while the other party puts in, say, 0.0001 BTC. (Core developer and forthcoming Anarchapulco speaker Jimmy Song tells us that there are game theoretic reasons why you don’t want the counterparty to have ZERO stake.)
Great! It makes sense for Starbucks to participate with their customers in Lightning Networks because when their customers open an LN channel (basically a gift card) with them for $100, they only have to put in $1 worth of Bitcoin. Each time the customer transacts on the Lightning Network, Starbucks gets an updated hypothetical transaction that they can use to cash out that gift card and collect their bitcoin.
The elephant in the room is: transaction fees. In order to establish the escrow address and thereby open the LN channel, each party has to send some amount of bitcoin to the address. And in order to cash out and get the bitcoin settlement, one party also has to initiate a transaction on the bitcoin blockchain. And to even add funds to the channel, one party has to pay a transaction fee.
Right now fees on the bitcoin blockchain vary widely and are extremely volatile. For a 1-hour confirmation transaction, the recommended fee from one wallet might be $12 US, while on another it’s $21 US. For a priority transaction of 10-20 minutes, it can range from $22-30 US. Transactions fees are based on the number of bytes in the transaction, so if both parties support SegWit (remember that?) then the fee comes down by 40-50%. So it’s between $6 and $10 US for a one hour transaction and between $11-15 for a 15 minute transaction. (SegWit transactions are prioritized by the network to some degree, so actual times may be faster)
But no matter what, both the customer and the merchant have to spend $6 each to establish that they will have a relationship and either of them has to spend $6 in order to settle out and get their bitcoin. Further, if the customer wants to “top off” their virtual gift card, that transaction costs another $6. And because it adds an address to the merchant’s eventual settlement, their cost to get their Bitcoin goes up every time that happens, so now it might cost them $9 to get their bitcoin.
Since these LN channels are essentially digital gift cards, I looked up what the cost is to retailers to sell acustomer a gift card. The merchant processor Square offers such gift cards on their retailer site. Their best price is $0.90 per card.
So the best case is that Lightning Networks are 600% more expensive than physical gift cards to distribute, since the merchant has to put a transaction into the escrow address. Further, the customer is effectively buying the gift card for an additional $6, instead of just putting up the dollar amount that goes on the card.
But it gets worse. If you get a gift card from Square, they process the payments on the card and periodically deposit cash into your bank account for a percentage fee. If you use the Lightning Network, you can only access your Bitcoin by cancelling the agreement with the customer. In other words, you have to invalidate their current gift card and force them to spend $6 on a new one! And it costs you $6 to collect your funds and another $6 to sell the new gift card!
I’m sure many of you have worked in retail. And you can understand how this would be financially infeasible. The cost of acquiring a new customer, and the amount of value that customer would have to stake just to do business with that one merchant, would be enormous to make any financial sense.
From time immemorial, when transaction costs rise, we see the creation of middlemen.
Merchants who can’t afford to establish direct channels with their customers will have to turn to middlemen, who will open LN channels for them. Instead of directly backing and cashing out their digital gift cards, they will establish relationships with entities that consolidate transactions, much like Square or Visa would do today.
Starbucks corporate or individual locations might spend a few USD on opening a payment channel with the middleman, and then once a month spend 6 USD to cash out their revenues in order to cover accounts payable.
In the meantime, the middleman also has to offer the ability to open LN channels for consumers. This still happens at a fixed initial cost, much like the annual fee for a credit card in the US. They would continue to require minimum balances, and would offer access to a network of merchants, exactly like Visa and MasterCard today.
This process requires a tremendous amount of capital because although the middleman does not have to stake Bitcoin in the consumer’s escrow account, he does have to stake it in the merchant’s account. In other words, if the Lightning Network middleman wants to do business with Starbucks to the tune of $100,000/month, he needs $100,000 of bitcoin to lock into an escrow address. And that has to happen for every merchant.
Because every month (or so) the merchants have to cash out of their bitcoin to fiat in order to pay for their cost of goods and make payroll. Even if their vendors and employees are paid in bitcoin and they have LN channels open with them, someone somewhere will want to convert to fiat, and trigger a closing channel creating a cascading settlement effect that eventually arrives at the middleman. Oh, and it triggers lots of bitcoin transactions that cost lots of fees.
Did I mention that each step in the channel is expecting a percentage of the value of the channel when it’s settled? This will come up again later.
Again, if you’ve worked in the retail business, you should be able to see how infeasible this would be. You have to buy inventory and you have to sell it to customers and every part that makes the transaction more expensive is eating away at your margins.
Further, if you’re the middleman and Starbucks closes out a channel with a $100,000 stake where they take $95,000 of the bitcoin, how do you re-open the channel? You need another $95,000 in capital. You have revenue, of course, from the consumer side of your business. Maybe you have 950 consumers that just finished off their $100 digital gift cards. So now you can cash them out to bitcoin for just $5700 in transaction fees, and lose 5.7% on the deal.
In order to make money in that kind of scenario, you have to charge LN transaction fees. And because your loss is 5.7%, you need to charge in the range of 9% to settle Lightning Network transactions. Also, you just closed out 950 customers who now have to spend $5700 to become your customer again while you have to spend $5700 to re-acquire them as customers. So maybe you need to charge more like 12%.
If you approached Starbucks and said “you can accept Bitcoin for your customers and we just need 12% of the transaction,” what are the odds that they would say yes? Even Visa only has the balls to suggest 3%, and they have thousands and thousands of times as many consumers as bitcoin.
The entire mission of bitcoin was to be faster, cheaper and better than banks, while eliminating centralized control of the currency. If the currency part of Bitcoin is driven by “off-chain transactions” while bitcoin itself remains expensive and slow, then these off-chain transactions will become the territory of centralized parties who have access to enormous amounts of capital and can charge customers exorbitant rates. We know them today as banks.
Even for banks, we have to consider what it means to tie up $100,000/month for a merchant account. That only makes sense if the exchange rate of bitcoin grows faster than the cost of retaining Bitcoin inventory. It costs nothing to store Bitcoin, but it costs a lot to acquire it. At the very least the $6 per transaction to buy it, plus the shift in its value against fiat that’s based on interest rates. As a result, it only makes sense to become a Lightning Network middleman if your store of value (bitcoin) appreciates at greater than the cost of acquiring it (interest rate of fiat.) And while interest rates are very low, that’s not a high bar to set. But to beat it, Bitcoin’s exchange rate to fiat has to outpace the best rate available to the middleman by a factor exceeding the opportunity cost of other uses of that capital.
Whatever that rate is, for bitcoin, the only reason the exchange rate changes is new entry of capital into the “price” of bitcoin. For that to work, bitcoin’s “price” must continue to rise faster than the cost of capital for holding it. So far this has happened, but it’s a market gamble for it to continue.
Since it happens because of new capital entering into the bitcoin network and thus increasing the market cap, this results in Bitcoin Core becoming the very thing that its detractors accuse it of: a Ponzi scheme. The cost of transacting in Bitcoin becomes derived from the cost of holding bitcoin and becomes derived from the cost of entering bitcoin.
Every middleman has to place a bet on the direction of bitcoin in a given period. And in theory, if they think the trend is against Bitcoin, then they’ll cash out and shut down all the payment channels that they transact. If they bought bitcoin at $15,000, and they see it dropping to $13,000 — they’ll probably cash out their merchant channels and limit their risk of a further drop. The consumer side doesn’t matter so much because their exposure is only 1%, but the merchant side is where they had to stake everything.
If you’re wondering why this information is not widely known, it’s because most bitcoin proponents don’t transact in bitcoin on a regular basis. They may be HODLing, but they aren’t doing business in bitcoin.
Through Anarchapulco, TDV does frequent and substantial business in bitcoin, and we’ve paid fees over $150 in order to consolidate ticket sale transactions into single addresses that can be redeemed for fiat to purchase stage equipment for the conference.
For Bitcoin to be successful at a merchant level via Lightning Networks, we will have to see blockchain transactions become dramatically cheaper. If they return to the sub-$1 range, we might have a chance with centralized middlemen, but only with a massive stabilization of volatility. If they return to $0.10, we might have a chance with direct channels.
Otherwise, Lightning Networks can’t save bitcoin as a means of everyday transaction. And since that takes away its utility, it might very well take away the basis of its value and bitcoin could find itself truly being a tulip bubble.
One final note: there are a some parties for whom all these transactions are dramatically cheaper. That is the cryptocurrency exchanges. Because they are the entry and exit points for bitcoin-to-fiat, they can eliminate a layer of transaction costs and thus offer much more competitive rates — as long as you keep your bitcoin in their vaults instead of securing it yourselves.
Sending it out of their control lessens their competitive advantage against other means of storage. It comes as no surprise, then, that they are the least advanced in implementing the SegWit technology that would improve transaction costs and speed. If you buy bitcoin on Poloniex, it works better for them if it’s expensive for you to move that coin to your Trezor.
In fact, an exchange offering Lightning Network channels to merchants could potentially do the following…
1) Stake bitcoins in channels with merchants. These coins may or may not be funds that are held by their customers. There is no way to know.
2) Offer customers “debit card” accounts for those merchants that are backed by the Lightning network
3) Establish middle addresses for the customer accounts and the merchant addresses on the Lightning Network.
4) Choose to ignore double-spends between the customer accounts and the merchant addresses, because they don’t actually have to stake the customer side. They can just pretend to since they control the customer’s keys.
5) Inflate their bitcoin holdings up to the stake from the merchants, since the customers will almost never cash out in practice.
In other words, Lightning Networks allow exchanges a clear path to repeating Mtgox; lie to the consumer about their balance while keeping things clean with the merchant. In other words, establish a fractional reserve approach to bitcoin.
So, to summarize, Bitcoin Core decided increasing the blocksize from 1mb to 2-8mb was “too risky” and decided to create Segwit instead which the market has not adopted. When asked when bitcoin will be faster and less expensive to transfer most Bitcoin Core adherents say the Lightning Network will fix the problems.
But, as I’ve just shown, the LN makes no sense for merchants to use and will likely result in banks taking over LN nodes and making BTC similar to Visa and Mastercard but more expensive. And, will likely result in exchanges becoming like banks of today and having fractional reserve systems which makes bitcoin not much better than the banking system of today.
Or, people can switch to Bitcoin Cash, which just increased the blocksize and has much faster transaction times at a fraction of the cost.
I’ve begun to sell some of my bitcoin holdings because of what is going on. I’ve increased my Bitcoin Cash holdings and also increased my holdings of Dash, Monero, Litecoin and our latest recommendation, Zcash.
Other News & Crypto Tidbits
When bitcoin surpassed $17,600 in December it surpassed the total value of the IMF’s Special Drawing Rights (SDR) currency.
Meanwhile, Alexei Kireyev of the IMF put out his working paper, “ The Macroeconomics of De-Cashing ,” where he advises abolishing cash without having the public aware of the process.
Countries such as Russia are considering creating a cryptocurrency backed by oil to get around the US dollar and the US dollar banking system. Venezuela is as well although we highly doubt it will be structured properly or function well given the communist government’s track record of destroying two fiat currencies in the last decade.
To say that the US dollar is being attacked on every level is not an understatement. Cryptocurrencies threaten the entire monetary and financial system while oil producing countries look to move away from the US dollar to their own oil backed cryptocurrency.
And all this as bitcoin surpassed the value of the IMF’s SDR in December and in 2017 the US dollar had its largest drop versus other currencies since 2003.
And cryptocurrency exchanges have begun to surpass even the NASDAQ and NYSE in terms of revenue. Bittrex, as one example, had $3 billion in volume on just one day in December. At a 0.5% fee per trade that equaled $15m in revenue in just one day. If that were to continue for 365 days it would mean $5.4 billion in annual revenue which is more than the NASDAQ or NYSE made this year.
Conclusion
I never would have guessed how high the cryptocurrencies went this year. My price target for bitcoin in 2017 was $3,500! That was made in late 2016 when bitcoin was near $700 and many people said I was crazy.
Things are speeding up much faster than even I could have imagined. And it is much more than just making money. These technologies, like cryptocurrencies, blockchains and beyond connect us in a more profound way than Facebook would ever be able to. We are now beginning to be connected in ways we never even thought of; and to some degree still do not understand. These connections within this completely free market are deep and meaningful.
This is sincerely beautiful because we are constantly presented with an ever growing buffet of competing protocols selling us their best efforts in providing harmony within the world. What all of these decentralized and distributed consensus building technologies have in common is that they connect us to the world and to each other. Where we are going we don’t need foolish and trite Facebook’s emojis.
As we close a successful 2017 we look with optimism towards a much more prosperous 2018. The Powers That Shouldn’t Be (TPTSB) can’t stop us. As we move forward note how much crypto will teach you about ourselves and the world. In a radical free market making our own bets will continue to be a process of self discovery. Crypto will show us the contours of our fears, the contours of our greed, and will constantly challenge us to do our best with the knowledge we have.
Remember, randomness and innovation are proper to the happenstance nature of a true digital free market.
Happy New Year fellow freedom lovers!
And, as always, thank you for subscribing!
Jeff Berwick
submitted by 2012ronpaul2012 to conspiracy [link] [comments]

Lets talk about bitcoin and decentralization and some disturbing trends.

Bitcoin was built to be decentralized. It is not meant to be controlled by any one person or any one group. In 2014 this is still the case. However the trend of centralizing is real and very scary for the future of bitcoin: less and less people control the various aspects of bitcoin as time passes.
--------------------------Mining Bitcoin--------------------------
How Centralized?
According to: https://blockchain.info/pools 4 people control over half of all mining.
How Dangerous?
Extremely. Beyond the fear of 51% attacks, having less pools is just inherently less secure. making single points of failure. Making government control and regulation easier, and giving individual pools more potential power over things like code decisions, what transactions get mined and potentially what level of fees are required.
--------------------------Talking About Bitcoin--------------------------
How Centralized?
/bitcoin, bitcoin talk and the bitcoin wiki are all moderated by largely the same people.
How Dangerous?
Meh. It's extremely centralized currently, but seems like the easiest and fastest to fix if it ever became a problem. It feels somewhat uncomfortable though with things like this: http://www.reddit.com/Bitcoin/comments/23jlet/censorship_in_rbitcoin_happening_right_now_all/
--------------------------Developing Bitcoin--------------------------
How Centralized?
Using "number of commits to the reference client" as a metric here is a graph of commits by developer: http://imgur.com/2hSxTdg Despite being well over 100 contributors 4 people have made almost 75% of the changes to bitcoin's core code. (excel just cuts off most of the names and most of the slices are too small to see).
How Dangerous?
Somewhat. It's an open source project, if a rouge developer put in evil code it'd be hopefully caught and removed. So there isn't much danger of outright maliciousness. But at the same time, that is a very small number of people calling the shots. And with so much money on the line it seems like a dangerous situation.
--------------------------Transmitting Bitcoin--------------------------
How Centralized?
https://getaddr.bitnodes.io/dashboard/chart/?days=60 With the creation of light wallets the number of full nodes is constantly decreasing. In the last two months we have gone from 9000+ to less than 8000. With only 2000 being the current version (9.1) and a majority being older versions and not the current protocol.
How Dangerous? No one knows how many nodes is the right amount to be safe. It seems like if there was a major issue it'd be simple for people to set up new nodes. But at the same time it is distressing the number is so small and that it is shirking over time.
--------------------------Owning Bitcoin--------------------------
How Centralized?
according to: http://bitcoinrichlist.com/charts/bitcoin-distribution-by-address?atblock=295000 only 99 addresses hold more than 10,000 bitcoins. and slightly over 10,000 addresses hold 93% of all bitcoins are held by ~200,000 addresses
How Dangerous? Medium. There is hippie gini index equality nonsense, but really 1 address doesn't equal 1 person due to exchanges and web wallets. However mtgox has shown how dangerous it is for multiple people to hold many people's money in one wallet. Very few people control the vast majority of bitcoins even if many of the large addresses are owed to several people.
--------------------------Buying Bitcoin--------------------------
How Centralized?
http://bitcoincharts.com/charts/volumepie/ This actually could be worse. For a long time mtgox dominated this chart. It actually looks better now than it did in the past. It's not a ton of companies but there is at least some completion among them now.
How Dangerous? Less than it was. If one exchange gets too much of the market it has broad powers to manipulate the price and like mtgox potentially becomes a massive threat of one person stealing all the coins.
--------------------------Conclusion--------------------------
Shit's fucked up yo. It's not so far gone it can't be fixed, but too few people control the important aspects of bitcoin. I didn't even go into the incestuous crossovers. (Developers that are mining pool operators, forum mods that control 10,000+ coins, etc, but that is beyond the scope of this for me to research fully).
Discuss!
submitted by Consoidotion to Bitcoin [link] [comments]

Core/Blockstream is *not* Bitcoin. In many ways, Core/Blockstream is actually similar to MtGox. Trusted & centralized... until they were totally exposed as incompetent & corrupt - and Bitcoin routed around the damage which they had caused.

Core/Blockstream can't/won't grow any more.
Bitcoin is growing - and the only way it can continue to grow is for Core/Blockstream to get out of the way.
Core/Blockstream doesn't have any solutions for the graphs below - but that's their problem, not Bitcoin's:
https://blockchain.info/charts/n-transactions?showDataPoints=false×pan=all&show_header=true&daysAverageString=7&scale=0&address=
https://tradeblock.com/bitcoin/historical/1w-f-txval_per_tot-01071-blksize_per_avg-01071
Just click on these historical blocksize graphs - all trending dangerously close to the 1 MB (1000KB) artificial limit. And then ask yourself: Would you hire a CTO / team whose Capacity Planning Roadmap from December 2015 officially stated: "The current capacity situation is no emergency" ?
https://np.reddit.com/btc/comments/3ynswc/just_click_on_these_historical_blocksize_graphs/
Core/Blockstream has no solutions to these problems - because they don't want to solve them:
Lesser known reasons why Core developers want to keep block size small, in their own words
https://np.reddit.com/btc/comments/473i0h/lesser_known_reasons_why_core_developers_want_to/
https://medium.com/@elliotolds/lesser-known-reasons-to-keep-blocks-small-in-the-words-of-bitcoin-core-developers-44861968185e
But Bitcoin does have solutions right now. For example, one solution is already installed and running on over a thousand nodes:
Be patient about Classic. It's already a "success" - in the sense that it has been tested, released, and deployed, with 1/6 nodes already accepting 2MB+ blocks. Now it can quietly wait in the wings, ready to be called into action on a moment's notice. And it probably will be - in 2016 (or 2017).
https://np.reddit.com/btc/comments/44y8ut/be_patient_about_classic_its_already_a_success_in/?ref=search_posts
So, remember to be precise in your phrasing and your thinking:
"Bitcoin" isn't dying.
"Core/Blockstream" is dying.
That's all that's happening here.
Yes it could get ugly for a while.
The death of Core/Blockstream could get as ugly as the death of MtGox.
In both cases, people trusted a centralized institution which thought that it could control Bitcoin forever.
And then that centralized institution was revealed to everybody as incompetent and corrupt and rotten to the core.
People who had placed their trust in that centralized institution got hurt bad - but the people who hadn't trusted that institution, came out fine.
If you're part of the crowd that's been complaining about Core/Blockstream for these many months - that's the same as being part of the crowd that was complaining about about MtGox for many months.
Consider yourself one of the informed. Just like the people who didn't trust MtGox, the people who don't trust Core/Blockstream will emerge unscathed after this crisis is past.
But people who trust Core/Blockstream are gonna get hurt:
The Nine Miners of China: "Core is a red herring. Miners have alternative code they can run today that will solve the problem. Choosing not to run it is their fault, and could leave them with warehouses full of expensive heating units and income paid in worthless coins." – tsontar
https://np.reddit.com/btc/comments/3xhejm/the_nine_miners_of_china_core_is_a_red_herring/
As long as people continue to trust Core/Blockstream, the network will start to get clogged, and the price could crash - or just stay flat, as Bitcoin's expected price rise due to the halving, collapsing fiat financial markets, NIRP (negative interest rate policy from governments and banks) etc. gets cancelled out by Core/Blockstream's stalling and incompetence.
3 months performance of Dow Jones, NASDAQ, S&P500, FTSE 100 (UK), DAX (Germany), Nikkei (Japan), Shangai Composite (China), Gold, and Bitcoin (cross-post from /BitcoinMarkets - original post by brg444)
https://np.reddit.com/btc/comments/45u8cf/3_months_performance_of_dow_jones_nasdaq_sp500/
Once Core/Blockstream's failure/refusal to scale causes enough damage to make the majority of people understand that Core/Blockstream is not Bitcoin - then people will wake up and reject Core/Blockstream's failure/refusal to scale.
And remember, scaling for the next few years is easy: just change a 1 to a 2 in the code. Or set it to some average or median based on the previous blocks.
BitPay's Adaptive Block Size Limit is my favorite proposal. It's easy to explain, makes it easy for the miners to see that they have ultimate control over the size (as they always have), and takes control away from the developers. – Gavin Andresen
https://np.reddit.com/btc/comments/40kmny/bitpays_adaptive_block_size_limit_is_my_favorite/
There are plenty of simple scaling solutions solutions like this available (Classic, BitPay's Adaptive Block Size Limit).
Core/Blockstream thinks it can dominate Bitcoin by throwing around money and lies while they ignore users' needs - and certain people appear to be gullible enough to actually trust them (e.g. Chinese miners signing meaningless loyalty statements at 3 AM at some roundtable in Hong Kong).
But Satoshi carefully designed the incentives of Bitcoin so that it will always route around that kind of centralization and corruption.
As an investor, you're the one in control. The miners only provide a commodity (timestamping of transactions), and the devs only provide code (which is open-source, so it can easily be modified to suit our needs).
Forkology 301: The Three Tiers of Investor Control over Bitcoin
https://np.reddit.com/btc/comments/3t4kbk/forkology_301_the_three_tiers_of_investor_control/
https://duckduckgo.com/?q=site%3Abitco.in%2Fforum+spinoff
You still have X bitcoins on the Blockchain and there isn't a damn thing Core/Blockstream or the Chinese miners can do to change that.
submitted by ydtm to btc [link] [comments]

You people are seriously not thinking clearly.

This situation is not the end of the world. It is not some massive shift in the world of Bitcoin. It is not MtGox's fault. It is not the high frequency traders fault. It is not even the speculators fault. Merchant acceptance will not save us from these things.
We are dealing with a massive new technology that has the potential to change everything. It will change how money is transferred between countries. It could become the international standard among currency evaluation. It will change how the drug/black market operates. It will change how Governments regulate borders. This is not a speculative stock. This is not a currency useful for day-to-day trading. You cannot be a "bitcoin millionaire" without knowing that if the network got cracked, you'd be worth $0 in minutes.
We have a long, long way to go yet. In order for the above things to happen(and they WILL happen, even if bitcoin gets cracked or made illegal- something else will replace Bitcoin), the market size of Bitcoin needs to increase.
  1. $50k - Early adopters will push it up($0.01->$0.20).
  2. $1 million - People will start using it for small transactions(silk road).
  3. $50 million - Small time illegal activity will flow through it, and people will start to use it to transfer money across borders(See; Argentina post recently).
  4. $1 billion - Mid-level illegal transactions and mid-sized legal transactions will flow through it. Angel and VC Investors(200k - 5 million) will move in in increasing size will both invest and create startups(happening now; this is the step we are on. We will never go back to step 3 unless the Bitcoin network itself is cracked).
  5. $25 billion - Higher level illegal transactions(mob bosses) and larger investors(multi-million sized) start to move in. Governments start to get involved, try to regulate what they can, and create rules for the system. High net worth individuals use it for international currency transfers.
  6. $400 billion - After that, large businesses & investors move in. Becomes the de-facto standard for illegal activity. Government regulation cracks down and becomes more rigid. Some(A few) Bitcoin businesses are shut down by the Government without warning, prompting fear and anger. Small companies regularly use it for international currency transfers.
  7. $1 trillion - After that, International currency movements start to flow through it. Very large investors move in, it is talked about as if it were standardized and common. Businesses learn to follow Government rules and procedures become standardized. Large businesses use it to transfer currencies internationally.
  8. $5-20 trillion - Becomes the de-facto standard of international trade and currency evaluation, replacing the dollar as the global standard. Prices stabilize and shift only a fraction of a percent a day. Can now be used as a real currency for the first time since inception.
Do I know for sure this will happen? Of course not. But the first 4 steps were pretty clear in hindsight. And it makes sense- Why would ANYONE use the dollar for international money transfer post-Bitcoin? It depreciates, it is expensive to move, it is heavily regulated and tracked, it is subject to seizure. It is subject to the whims and mistakes of one government, who are all subject to the whims of their short-sighted voters.
So now how the fuck do you go from a $500 million currency to a $5 trillion currency? It isn't going to be a linear graph- that doesn't make any sense. It isn't going to be a smooth rise- Why would it? If everyone can see a nice, smooth, pretty graph going up, everyone is going to buy into that nice, smooth, pretty graph. It isn't going to be unidirectional- If the price always went up, everyone would buy into the up, and it would overshoot any and every step. It isn't going to happen quickly- Many of these steps take time to build confidence and make mistakes to learn from.
No, it is going to be a very painful up and down process. Because the technology has so much potential, it is going to experience explosive growth. Because it experiences explosive growth, it is going to have dramatic, painful, scary collapses. Then there will be fear. Then it will stabilize, and then it will start growing again. A few months later, it will explode again as it approaches the next big transition.
It takes time for Bitcoin companies to get their systems in order. It takes time for them to earn our trust and for us to weed out the scams and unreliable ones. It takes time for VC and Angel investors to evaluate and plan Bitcoin ventures. It takes time for Bitcoin to adapt to its own growth.
For those who think merchant adoption and currency status are the step we should be on, you are gravely mistaken. The only use that merchant adoption has right now is 1. Getting more people into it/increasing transactions, and 2. making a legal case for why Bitcoin shouldn't be illegal(which would slow us down by 10-25 years).
This is not the last big rise. This is not the last big crash. We aren't even at the bottom of this one. Until the network either gets cracked or replaced, this is going to keep moving forward. There is no going back; We've improved the Gold coin, the Dollar, and the wire transfer all at once. Hang on to your seat, and stop panicking over just another crash.
tl;dr: This is not the last big rise. This is not the last big crash. Stop panicking and focus on the long view.
submitted by JustSomeBadAdvice to Bitcoin [link] [comments]

Estimating DPR's income after expenses & exchange rate

The FBI indictment states that SDPR earned ฿614,305 in commissions. It's been suggested that the expense of running SR, and the large changes in the exchange rate, may substantially reduce how many bitcoins DPR actually could have saved up, possibly to as low as ฿"150-200k". (The logic here is that if SR earns commissions of ฿100 in 2011 but needs to pay $100 of hosting bills, it needs to sell all ฿100 but in 2013, it would need to sell only ฿1.)
DPR surely spent some of the commissions on running SR & himself, but running a website isn't that expensive, and how badly the exchange rate bites will depend on details like how it fluctuated over time, how sales grew over time, and how big the expenses really are. The reduction could be tiny, or it could be huge. It's hard to tell based just on a gut estimate.
So: below, I take estimates of SR growth from Christin 2013's crawl and the FBI indictment, infer linear growth of SR sales, estimate daily expenses, and combine it with historical Bitcoin exchange rates to show that DPR probably has most of his bitcoins and 200k or lower is right out.

Model

My strategy is to model Silk Road's growth as linear in dollar amounts, but with different amounts of bitcoins each day depending on the exchange rate, subtract a daily operating cost, and then sum the commissions.
So say that on 1 January 2012, SR did $10k of business, and the exchange rate was 1:100, so ฿100 in turnover, and SR gets an average commission of 7.4%, so it would get ฿7.4.
To do this, I need to estimate the revenue each day, the expenses each day, the commission each day, and the exchange rate each day. Then I can multiply revenue by commission, subtract the expense, and sum the left overs to get an estimate of the total bitcoins available to DPR which he could (or could not) have spent.

Expenses

  1. Employees: we know that Libertas and one or two others were employed at salaries of $1-2k per week. I'll assume there were 2 others, and each was paid the max of $2k per week, which means total daily employee expenses is (2 * 2000) / 7 = $571 per day. (Unfortunately, the indictment doesn't give any clear indication of their numbers, just referring to them as 'they'.)
    This is a conservative estimate since I'm pretty sure that SR was a one-man operation until probably in 2012.
  2. The servers: we know there were at least 2 servers (the main site, and the forums). The task of hosting the sites does not seem to be too bandwidth or disk-space intensive, and servers are extremely cheap these days. The use of DataClub.biz and GigaTux suggest DPR was using cheap VPSes. I'll estimate a monthly expense of $500 ($250 a piece) which per day is $16.
    This is also very conservative.
  3. DPR: his rent of $1000/month has been widely bruited about, and in general he reportedly spent little. Makes sense to me, I've met and seen the rooms of a few well-paid geeks in SF like DPR, and I would believe them if they said they didn't spend much money on anything but rent & food. I'll bump this up by $1000 for food and all expenses, since he apparently didn't even eat out very much. So $2000/31=$65.
    Doubling his rent for total expenses is probably also conservative; for most people, rent is not >50% of income, but SF is incredibly expensive to live in.
This gives a daily expense of $652 (or a monthly total of $19.1k in expenses). As you can see, the employees are by far the most expensive part of running SR in my estimate, which makes me wonder if maybe Libertas was the only employee.

Hitmen

Assuming the details about DPR hiring hitmen in the indictments are reasonably accurate, we can throw in two large expenses:
  1. an $80k expenditure for killing his Maryland employee. The first payment of $40k was made on 4 February 2013 and the second/final payment of $40k was made on 1 March 2013 (pg9). If we use the exchange rate of those two days, then the hit cost DPR (40000 / 20.42) + (40000 / 34.24) = ฿3127
  2. the second hit was priced in bitcoins (pg23):
    Through further messages exchanged on March 31, 2013, DPR and redandwhite agreed upon a price of 1,670 Bitcoins
So the hits cost DPR somewhere around ฿4797. An extremely large and painful amount, by most standards, but still nowhere near ฿10k - much less higher.

Revenue over time: first and last days

Christin:
Table 3 provides a breakdown of the feedback ratings from 184,804 feedback instances we collected...In Figure 12, we plot an estimate of the daily commissions collected by Silk Road operators as a function of time. We simply reuse the previous estimates, and apply both the fixed 6.23% rate, and the schedule of Table 4 to each item. We find that the new schedule turns out to yield on average a commission corresponding to approximately 7.4% of the item price.
The FBI:
From February 6, 2011 to July 23, 2013 there were approximately 1,229,465 transactions completed on the site...$79.8 million (USD) in commissions.
According to Bitcoin Charts, on 23 July 2013, the MtGox price was $91. (As the most famous exchange, any FBI estimate almost certainly used it.) So that implies $79,800,000/91=฿876,923. Or to put it the other way, at $79.8m in transactions, then using Christin's 7.4% estimate, total sales were $1,078,000,000 or ฿10,780,000.
Wikipedia says "These transactions involved 146,946 unique buyer accounts, and 3,877 unique vendor accounts.", and "The total revenue generated from transactions was 9,519,664 bitcoins. Commissions collected from the sales by Silk Road amounted to 614,305 bitcoins."
(So the numbers aren't too different: 614k vs 876k and 10.8m vs 9.5m.)
We'll set 6 February 2011 to $10 in sales (probably not too far from the truth). But what about 23 July 2013? pg20 of the indictment says:
For example, on July 21, 2013 alone, DPR received approximately 3,237 separate transfers of Bitcoins into his account, totaling approximately $19,459. Virtually all of these transactions are labeled "commission".
19459 / 0.074 = $262,959 that day. $20k in commissions is extremely impressive, since Christin estimates only $4k/day commissions as late as the end of July 2012 - so SR must have grown by 500% from 2012 to 2013. We use this revenue estimate as our endpoint and interpolate from $10 to $262,959 over the ~900 days SR existed. This is a conservative way of modeling SR, since the graphs in Christin indicate that SR saw sigmoid growth in 2012, and 2013 would've seen even more growth (to be consistent with the 2013 July commission datapoint being 5x the 2012 July commission datapoint).

Exchange rate

I grab weighted price for each day between 6 February 2011 & 23 July 2013, and stuff it in a CSV.

Analysis

R> sr <- read.csv("http://dl.dropboxusercontent.com182368464/dpr-exchangerate.csv") R> sr$Sales <- c(10, rep(NA, 890), 262959, NA, NA) R> # revenue increased by $300 a day: R> l <- lm(Sales ~ as.numeric(Date), data=sr); l Coefficients: (Intercept) as.numeric(Date) -285 295 R> sr$Sales <- predict(l, newdata=sr) R> sum(with(sr, (Sales * 0.074 - 652) / ExchangeRate)) [1] 803397 
Or we can run the estimate the other way: if DPR had to spend $652 a day and converted at that day's exchange rate, and we took into account the hitmen, how many bitcoins would he have spent in total?
R> sum(with(sr, 652 / ExchangeRate)) [1] 127154 R> (614305 - 127154) - 4797 [1] 482354 

Conclusion

Obviously ฿803k > ฿614k, which implies that the linear model overestimates sales in the early life of SR; but going the other direction and estimating just from costs & hitmen & total commission, we still wind up with nearly ฿500k (and that was after making a bunch of highly conservative assumptions). The fewer sales (and commissions) early on, the less of a fixed number of bitcoins will be sold. So, while it may initially sound plausible that DPR could have been forced to part with say ฿400k to pay for SR and sundry expenses, the distribution of sales and fluctuations of Bitcoin value mean that this simply does not seem to be the case.
Unless there are some abandoned yachts floating around the SF Bay Area, DPRoss Ulbricht probably has ฿500k-614k.
submitted by gwern to SilkRoad [link] [comments]

Tax season has arrived (in the US). Maybe you didn't do things "right" in 2013. If you want to in 2014, I've made a small tool that will help you do so. [x-post /r/bitcoin]

Most of you will remember this thread by a tax attorney where he gave lots of helpful advice. The most important for the average consumer, I think, is keeping track of your basis. In order to do so, you need to know how much they were worth when you got them. This is where my tool steps in.

http://mineoas.us/bitcoin/historic

Here you can input any date1 and time and find out what the price of bitcoin was at that time at bitstamp, coinbase, mtgox, and btce (want more added? Let me know). You can even get historic data in a computer-friendly format for your automated tools like this, or like this if you'd rather.
For quick manual checks, you can input the date/time/timezone information at the url above. Or if you'd like help automating the process, see the end of this post.

http://mineoas.us/bitcoin/current

Here the process is much simplier. If you'd only like to see the current value at any of the four exchanges listed above (and for some reason you don't want to pole them directly or look at pretty graphs and such), then simply choose the exchange(s) you'd like and the format you'd like the data in.
Please post any questions or comments. Hate is also accepted in the form of private messages, though comments are cool too.
[1] any date. Data collection started January 7th, 2014 07:06:01 UTC. Therefore, I unfortunately cannot help you with prices during all of 2013 and the first week of 2014. EDIT: I've added data from at least 2011 for mtgox, bitstamp, and btce.

Automatically getting data

Current data is easy. Simply put the format and the exchange in the url, like so
Historic data is slightly harder. It requires a date, time, and an optional timezone offset from UTC.
All together you get url's like these
submitted by pointychimp to BitcoinMarkets [link] [comments]

A reasuring selection of my favourite charts and data

A friend of mine invested big near the high point recently, I created a bunch of info to help him feel reassured, thought I'd share it with all ya'll - would like to know what you think
Chart 1:
This shows 2 years of bitcoin price on a log scale with a moving average, plus a Stoch RSI indicator.
http://bitcoincharts.com/charts/mtgoxUSD#rg730ztgSza1gSMAzm1g500zm2g25zi1gStochRSIzcvzl
This shows we're still in an upward trend, despite recent very bad news, and also that the market looks due for an upwards correction soon - as it's so rare for the Stoch RSI to stay low for so long. Compare with previous major crash.
Thing 2:
http://sourceforge.net/projects/bitcoin/files/stats/map?dates=2013-12-09%20to%202013-12-17
This shows by-country download statistics for the official bitcoin client - it can be used as a crude indicator of adoption I guess. It's pretty clear from this that many major world population zones are still asleep to the entire idea, India and South Korea look set for rapid adoption soon.
Chart 3:
http://coinsight.org/graphs/reddit_flairs_weighted_30d.png
This guy shows both the number of bulls and bears on the bitcoin subreddit.
Both are increasing, so more people are gathering more info about trading, together with a huge weight towards the side of a price increase. These guys know far more about market analysis then I do.
Chart 4:
https://blockchain.info/charts/n-transactions?timespan=all&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address=
This guy shows the number of bitcoin transactions happening since the beginning of time. It gives a good indication of how many people are actually using bitcoin as a currency, rather than as magical gold bars of speculation. The higher this goes the better it is.
submitted by DonkeyScience to BitcoinMarkets [link] [comments]

The simplest form of long term prices, exponential growth and simple regression

I applied this to the Bitstamp data up to today and posted the results here. According to that chart we are now slightly under the trendline, but we were there for a much longer period after the previous bubble.
The chart also predicts $100,000 in June 2016. Though only if exponential growth holds, and this can never be sustained, it always flattens out into an S-curve. But if you look at these curves for adoption of new technology, you do see that the S-curves are exponential for quite some time until high adoption has bee reached.
So if Bitcoin is a global success and adopted as quickly as the smartphone, the S-curve holds and growth will slow down a bit near the end, thus it will take longer for it to reach $100,000. If we imagine Bitcoin being used by 5 billion people in 2020 which might well be possible since today 80-90% of people have cell phones. This would mean at $100,000/BTC and with an estimated 2 million BTC of 18 million mined being lost, there would only be $320 worth of BTC for every user.
Not completely unreasonable I say, though only possible if Bitcoin technology quickly improves up to the point that it has many extra features and advantages over current currencies, and it becomes easy and safe to use for everyone.
*Just occurred to me that the first we reach $100,000 will probably be during a bubble, I made another graph which tries to predict the price during inter-bubble periods by using only the data points I estimated to be outside of bubbles.
** Another graph, this one combines the Bitstamp data with MtGox data from before Bitstamp existed, this is the most complete timeseries possible and shifts the 100K mark a few months ahead.
submitted by cybrbeast to BitcoinMarkets [link] [comments]

Tax season has arrived (in the US). Maybe you didn't do things "right" in 2013. If you want to in 2014, I've made a small tool that will help you do so.

Most of you will remember this thread by a tax attorney where he gave lots of helpful advice. The most important for the average consumer, I think, is keeping track of your basis. In order to do so, you need to know how much they were worth when you got them. This is where my tool steps in.

http://mineoas.us/bitcoin/historic

Here you can input any date1 and time and find out what the price of bitcoin was at that time at bitstamp, coinbase, mtgox, and btce (want more added? Let me know). You can even get historic data in a computer-friendly format for your automated tools like this, or like this if you'd rather.
For quick manual checks, you can input the date/time/timezone information at the url above. Or if you'd like help automating the process, see the end of this post.

http://mineoas.us/bitcoin/current

Here the process is much simplier. If you'd only like to see the current value at any of the four exchanges listed above (and for some reason you don't want to pole them directly or look at pretty graphs and such), then simply choose the exchange(s) you'd like and the format you'd like the data in.
Please post any questions or comments. Hate is also accepted in the form of private messages, though comments are cool too.
[1] any date. Data collection started January 7th, 2014 07:06:01 UTC. Therefore, I unfortunately cannot help you with prices during all of 2013 and the first week of 2014. EDIT: I've added data from at least 2011 for mtgox, bitstamp, and btce.

Automatically getting data

Current data is easy. Simply put the format and the exchange in the url, like so
Historic data is slightly harder. It requires a date, time, and an optional timezone offset from UTC.
All together you get url's like these
submitted by pointychimp to Bitcoin [link] [comments]

Non-traditional indicators for long-term bubble analysis (hypothesis testing).

https://blockchain.info/charts/n-transactions-excluding-popular?timespan=all&showDataPoints=false&daysAverageString=7&show_header=true&scale=0&address=
While I'm not saying that there is a trend here... but there is a trend here. The most recent bubble fell a little short obviously it should have hit 100k or come a bit closer, but alas nothing is perfect. I'm targeting about 180k peak for the next time we have a major bubble, which has the potential to be shaping up sometime this summer. If I could guess a random date, I'd say late June and into July.
However, there is a direct correlation between the day that the peak transaction happens and the price. My hypothesis is that whenever the transactions per day approaches twice the previous peak, that is when the bubble will be running out of steam and you should be selling at that point. Obviously past performance does not indicate future trends, but I am very interested to see if this theory holds true.
Here are two graphs that I made, one of the last year and one since the beginning of time. I blended Bitstamp & Mtgox market data (aprox 10\26\2011) so that the extremes would represent the correct price of Bitcoin.
One Year
All Time
Thoughts? Comments? Concerns? Am I full of smoke?
submitted by lowstrife to BitcoinMarkets [link] [comments]

[Graph] Krugman's "Bitcoin is not a stable store of value" debunked.

I decided to utilize historic values to examine Krugman's statement:
To be successful, money must be both a medium of exchange and a reasonably stable store of value. And it remains completely unclear why BitCoin should be a stable store of value.
No one will deny that Bitcoin is currently extremely volatile. This is not an examination of that point. This is focused purely on the question of whether, historically, Bitcoin has proven to be a good store of value. No one can predict the future, so the best we have is historical data.
This is particularly of interest to me, give the recent tumble in Bitcoin price, as well as recent reports of the third worst collapse of the dollar in the past decade.
Methodology
To examine the quality of Store of Value, I examined the historical prices of seven different assets. I envisioned a buyer of the asset purchasing it on a given day, and holding it for some length of time (X), ranging between one day and about 3.5 years (which is all the data we have for Bitcoin).
The measurement is this: if you choose a random day to buy the asset, and you buy it at the mid-point price that day, and hold it for X days, what is the probability that it will still have 100% of its value after X days. It seems like a reasonable assumption is that an asset that is a good store of value would perform well in this scenario, and retain 100% of its value a high percentage of the time.
The seven assets were:
  1. Bitcoin purchased on Bitstamp. Data provided by BitcoinCharts.
  2. Bitcoin purchased on Mt. Gox. Data provided by BitcoinCharts.
  3. Bitcoin Freely Exchangeable: For this measurement, I used Mt. Gox prices as mentioned above, until May 13, 2013 (the day before the US Government seized funds), and Bitstamp prices since then. This is an attempt to eliminate the odd pricing on Mt. Gox due to the withdrawal challenges.
  4. The Dow Jones FXCM Dollar Index, data provided by Google Finance. The data for this index was available going back to 4/18/2011. It's an index of the dollar, presumably comparing to other currencies. (This may be mislabeled, calling it a fund. Not sure.)
  5. Spider Gold Shares GLD, an ETF for Gold. Data provided by Yahoo Finance. This data goes back to 11/18/2004.
  6. Spider Gold Shares GLD, for the period that Bitcoin has been traded. Same data source as #5, but a subset of the data.
  7. The US Dollar (1914-2013), reflecting the US monthly inflation rates. This data was provided by usInflationCalculator.com.
In all cases, I used the average of the daily high and the daily low, when available. In the case of the Dollar (1914-2013), I used monthly inflation rates.
In all cases, I set the purchase date to one of the days that the asset was traded. In the case of the Dollar (1914-2013), I utilized the first of the month. And I set the ending valuation date as the next time the asset traded, after X days elapsed. In the case of the Dollar (1914-2013), this would be the first of some future month, after X days had passed.
Results
Here's the Graph.
The best performing asset was buying Bitcoins on Bitstamp. In all cases historically, if you held the asset for 274 days, the asset was still worth 100% of your original investment.
Mt. Gox and the Freely Exchangeable Bitcoin measurements were similar: After 622 days, 100% of the time, your original invested value was retained.
The Dollar fund (index, actually) underperformed all Bitcoin options, when measuring periods less than 243 days. But for periods of between 471 days and 1033 days, 100% of the time, the dollar fund retained its complete value. (No data for periods longer than 1033 days).
The Gold ETF underperformed Bitcoin, whether you looked at the period of Bitcoin being on the market, or the life of the ETF.
And, no surprise, the dollar as measured by inflation, came in dead last. In the past 100 years, it has only retained its value month-over-month about 15% of the time. And the longer you held it, generally, the worse off you were.
All data is available at the sources above, and the computations are available.
The graph of the results is licensed for you to use widely with attribution.
I hope this helps when you are talking to the Krugmans of the world.
(Edit: it's -> its)
submitted by E-GovLink to Bitcoin [link] [comments]

Coinboss looking for a new home

Hi,
For the people who are familiar with who or what is Coinboss, it is a small irc bot that spam the #bitcoinmarkets channel on freenode irc server. He tell the channel when the mtgox whales buy or sell for volume higher then 100btc in a 1min interval, he also tell the channel when there is a movement in price higher then 1.4% in a 1 min interval, he can also generate a very lightweight graph using the data he generate, very nice to use on a smartphone since it is very light and fast to load. He can also warn about the Whale alert! and Rise/Drop alert! to your email or sms (using email to sms service of your phone provider if available).
I have moved my personal web server from windows to linux recently, using a raspberry pi, and also my jupiter bitcoin miner does not require a computer to work, so I no longer require to waste electricity to host a windows computer 24/7. I was hosting coinboss on this computer and this computer is no longer required so I turned it off.
During coinboss lifetime, i got 3 donations for a total of 7$. That is around 1 week of electricity cost. Since I do not need this computer open anymore i have decided to close coinboss.
Lalicat said he would find me a windows computer to host coinboss when he has time, but haven't heard news about this yet.
Since people are missing coinboss, I am asking here to find a new home for coinboss. Coinboss require a windows computer open all time time, mIRC program installed, optional: web server for the graph, install sendemail.exe (free app) to send email/email2sms. P.S.: Could use virtualbox or wine on a linux system as well.
If anyone want to donate such a server for this irc community please reply or contact me in private message.
Also taking donation for further development or hosting fee if anyone care. btc: 1Khk5P9KmNDYvzhFodJUrYFipT8LaWdGtZ ltc: Lairh4BShLqxvry6qETXeUvubrQ1QgGeK6
Thanks everyone!
submitted by skywalk819 to BitcoinMarkets [link] [comments]

bitcoin price Mt Gox site disappears, Bitcoin future in ... BITCOIN PRICE CRASH TO 2000 BitCoin: Transferring funds from Dwolla to MtGox and Buying at Current Exchange Price Bitcoin Price Mt Gox Site Disappears bitcoin price Mt Gox site disappears, Bitcoin future in doubt

Bitcoincharts provides real-time USD price data of the Mt. Gox exchange including charts, orderbook and more. Bitcoincharts is the world's leading provider for financial and technical data related to the Bitcoin network. It provides news, markets, price charts and more. Bitcoin USD price, real-time (live) charts, bitcoin news and videos. Learn about BTC value, bitcoin cryptocurrency, crypto trading, and more. Not sure how you got here, but mtgox is dead. This page only exists for those who wish to view some historical charts. If you want to check the current bitcoin price use some other exchange The chart below is the price change over time. The yellow line is the price [USD / BTC] at which actual trades were made. Green and red areas near the yellow line show you maximum and minimum price. Price ... Bitcoin history for 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019. Bitcoin price chart since 2009 to 2019. The historical data and rates of BTC ...

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bitcoin price Mt Gox site disappears, Bitcoin future in ...

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