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Bitcoin 13,3K USD right now, why?
- Thread starter JohnLocke
- Start date
What else is there? Stocks are overpriced and the market is run by HFT rackets. Real estate is overpriced, bond yields negative. Central banks keep a lid on gold prices. Reckless inflating of central bank balance sheets has continued now for a decade. No solutions in sight, just more of the same.
Of the all assets mentioned, bitcoin is the easiest to move and most difficult to confiscate (by the state). Central banks can't easily manipulate the bitcoin market. It is beginning to look like a real financial asset, so big boys (funds, institutions, family offices) have taken notice.
For the first time I am starting to believe $100,000 might be possible within a few years. I am not saying probable, but it is within the realm of possibility.
Of the all assets mentioned, bitcoin is the easiest to move and most difficult to confiscate (by the state). Central banks can't easily manipulate the bitcoin market. It is beginning to look like a real financial asset, so big boys (funds, institutions, family offices) have taken notice.
For the first time I am starting to believe $100,000 might be possible within a few years. I am not saying probable, but it is within the realm of possibility.
The house of cards is going to crash soon - the signs are everywhere. Those who see it are pumping money to crypto because soon everyone will out of necessity and the price will go up. Also halving is coming which supports the trend.
I don't know what will happen (no one does, no matter what they say) but 50k by the end of the year is definitely possible (not talking about probability distribution to be clear).
I don't know what will happen (no one does, no matter what they say) but 50k by the end of the year is definitely possible (not talking about probability distribution to be clear).
. I need a residency in a if your "problem" will be really bigI think you can solve it pretty quickly
Not sure about how quickly it can be solved. It is a real problem though, and is getting bigger by the day.
One solution would be to own exchange-traded bitcoin fund or be long bitcoin futures instead of owning bitcoins. In my tax jurisdiction, those capital gains would be tax-free, whereas bitcoin profits are taxed. This solution creates its own problems, such as the need to move larg-ish amounts of money from crypto exchange to a bank.
Another solution: Moving to Slovenia, Malaysia or similar and staying put for 180 days to establish tax residency.
In theory BTC is an amazing idea, but the volatility along with some other negative factors make it hard to adopt for most people. Plus, wouldn't you guys be afraid that as the price steadily goes up, some fat whales will dump all their BTC for cash? There are some really big players here. When BTC crashed from 20K, it went to 10K in less than a month. I don't think stock/real estate are losing 50% of their value barring a major catastrophe or crisis.
BTC can lose half its value and nobody knows how or why it happened, and who sold off so much btc at once.
BTC can lose half its value and nobody knows how or why it happened, and who sold off so much btc at once.
I think we are already past "mass adoption", "competitor to Visa/MC", "micropayments" and other early pipe dreams. Bitcoin will probably remain/become a digital collectible token and disappear in the wallets of institutional investors, family offices, HNWIs etc. In some ways it is superior to gold. In other ways, inferior.
People fear the unknown, so only people who never had bitcoins or are new to bitcoins are afraid of crashes. Long-term hodlers have gone through several booms & busts. Many have become insensitive to volatility.
You can't have good without the bad. An asset can't just go up, up, up, never going down. The 20K rally you mentioned started from about USD 600/coin. The crash was very bad for those who bought at 15-20K, but things were still amazing for those who bought below 1K.
I don't have high hopes for the rest of the year. I am actually hoping the price slips down a bit. Next spring the mining reward halvens again, so 2020-2021 could be interesting.
Having this information would not really benefit you.
This analysis is wrong. The volatility of bitcoin is very very closely linked to the fundamental problem of coin distribution. When coin and wealth distribution starts to decline, it's possible for volatility to decline as well. Before that, it's more or less impossible.
Given the problem of distributing, say $1 trillion efficiently using PoW, the most efficient way of doing that is to have massive volatility. Without volatility, insane amounts of electricity would be wasted both because the price would be much higher, and because the required profit margins for mining would be quite low.
Remember that bitcoin is designed for a minimum of 20% price increase y/y in order to just keep the electricity usage stable. Actual price increases have been way higher than that, but it's natural, if not a law of nature, for an asset with that sort of price increase to be volatile.
However, there is absolutely no reason to use bitcoin to price goods. It's actually quite suboptimal. Even bitcoin critic and nobel laureate Robert Shiller showed how "indexed units of accounts" are superior.
So basically using a basket of currencies (like libra), or inflation-adjusted USD is superior as the unit for pricing goods, compared to USD or (worse) bitcoin.
Now if you believe that bitcoin's success is tied to having goods priced in bitcoin, the whole South American continent wants to have a word with you. In most parts of South America they have experienced hyper-inflation, but managed fine as they did their transactions using inflation-adjusted prices.
The whole cryptocurrency infrastructure is already designed for this - separating pricing (in USD, EUR etc) from the transaction currency.
Bitcoin volatility has already decreased a lot and will continue to decrease if the market cap grows.
Where did I say that? I said bitcoin will not become a payment system. These are two separate things. We could have had a future where bitcoin was a competitive way to near-instantly settle purchases (priced in whatever currency). We are not going to have that future due to slow settlement speed, high tx costs, and a general lack of user-friendliness. The vast bulk of internet payments is going to remain as a domain of Visa/MC, and Libra-like new corporate entrants.
Feel free to disagree, but the observable trajectory of bitcoin is that of a digital collectible; a deflationary digital asset that mainly attracts investors. Nothing wrong with that, but it is a quite pale future compared to some other, early visions.
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