Slashdot Mirror
About 40 Percent of Bitcoin Is Held By 1,000 Users. If a Few of Them Want To Sell, That Could Tank Values (bloomberg.com)
On Nov. 12, someone moved almost 25,000 bitcoins, worth about $159 million at the time, to an online exchange. The news soon rippled through online forums, with bitcoin traders arguing about whether it meant the owner was about to sell the digital currency. From a report on Bloomberg: Holders of large amounts of bitcoin are often known as whales. And they're becoming a worry for investors. They can send prices plummeting by selling even a portion of their holdings. And those sales are more probable now that the cryptocurrency is up nearly twelvefold from the beginning of the year. About 40 percent of bitcoin is held by perhaps 1,000 users; at current prices, each may want to sell about half of his or her holdings, says Aaron Brown, former managing director and head of financial markets research at AQR Capital Management. What's more, the whales can coordinate their moves or preview them to a select few. Many of the large owners have known one another for years and stuck by bitcoin through the early days when it was derided, and they can potentially band together to tank or prop up the market.
https://support.bitfinex.com/hc/en-us/articles/115004555165-The-basics-of-Margin-Trading-on-Bitfinex
https://www.investopedia.com/news/short-bitcoin/
https://www.bloomberg.com/news/articles/2017-11-27/calling-a-bitcoin-top-here-s-how-you-can-short-the-digital-coin
https://www.thestreet.com/story/14414500/1/what-to-know-shorting-bitcoin.html
https://coincentral.com/short-bitcoin/
https://99bitcoins.com/short-sell-bitcoin-make-money-on-bitcoin-price-drops-thourgh-bitcoin-short-sale/
https://themerkle.com/top-7-ways-to-short-bitcoin/
http://www.telegraph.co.uk/investing/gold/can-short-bitcoin/
Even for beginners !
...because that's exactly what Bitcoin is. A pyramid.
It isn't a pyramid.
The number of bitcoins is fixed, and over 80% of them have been mined.
Bitcoin might be a scam, a bubble, a delusion, but definitely not a pyramid.
Pyramids are things like multi-level scams where an individual only profits when they recruit many others, who each in turn have to recruit many others.
Hmm. http://www.macrotrends.net/133... disagrees with you - especially if you remove inflation and turn off the log scale.
Since 2000 there's been a lot of volatility - but that's over the course of a decade, not a week.
Even the 10 year daily chart shows the maximum gain is around 10-15% over the course of four weeks (in August 2011), although there was a 15% crash over two days in April 2013 - http://news.goldseek.com/GoldS... has some analysis of that.
So no, gold is nowhere near as volatile as Bitcoin. Not even close.
Check the UID, you got trolled, bro.
I'm a good cook. I'm a fantastic eater. - Steven Brust
I believe you may have misconstrued the problem with Bitcoin. It's not so much the volatility of fiat currencies... I mean of bitcoin. Whatever. One could just as easily argue that the USD (or whatever other fiat currency one prefers) is ridiculously volatile relative to bitcoin.
No, Bitcoin is the volatile one, not USD, because USD remains relatively stable against all other currencies such as GBP, the Euro, or the Yen. Bitcoin fluctuates wildly against all of them... and it is the odd one out... bitcoin IS the one wildly swinging compared to the others.
The reason it matters is that you'd be silly to purchase anything with bitcoin at the moment, not just because of the charges involved ($20... has to be a fairly big purchase before $20 charge becomes negligible), but also because with bitcoin going up so much, what buys you a burger today will buy you a supersized combo meal tomorrow. A Ford Festiva today or an Aston Martin next week.
At the moment bitcoin is an investment instrument, not a usable currency. That doesn't mean it always will be. It will stabilize eventually... the question is- will it pop before stabilizing or will it plateau gracefully. No-one really knows. Once it's stable- it could be a meaningful exchange for large purchases... fees will probably be too much to use on a trip to Tesco for a bag of mushy peas- but if you're exchanging a million dollar transaction between two major corporations *cough drug dealers* then a $20 fee is chump change.
"That's the way to do it" - Punch