Bitcoin Starts a New Year by Tumbling, First Time Since 2015 (bloomberg.com)

Bitcoin is already having a bad year. From a report: For the first time since 2015, the cryptocurrency began a new year by tumbling, extending its slide from a record $19,511 reached on Dec. 18. The virtual coin traded at $13,440 as of 3:55 p.m. in New York, down 6.1 percent from Friday, according to data compiled by Bloomberg. That's also a fall from the $14,156 it hit Sunday, according to coinmarketcap.com, which tracks daily prices. Bitcoin got off to a much stronger start last year, and then kept that momentum going, eventually creating a global frenzy for cryptocurrencies. In a sign of its phenomenal price gain in 2017, it rose 3.6 percent on the first day of 2017 to $998, data from coinmarketcap.com show. It ended the year up more than 1,300 percent.

Comments

back to value

[iggymanz]

returning to its pre-bubble value in a hurry

that was a good pump n' dump for 2017, big players can prep for more suckers taking the next joyride

Re:back to value

[Nikkos]

"It's little more than a decentralized store of value and that value is really based on the hype around it"

There is little of the internet that has any value besides social value. Bitcoin - particularly the technology behind it - had utility as a way to store and transfer value securely and quickly across the world. It's still cheaper other cryptocurrencies to send 'money' to the other side of the world than it is to use a bank or Western Union. Not to mention that the increased competition has forced Western Union and moneygram to lower their fees, which are now half of what they were just a couple years ago.

Now btc's first mover advantage has placed it as the 'gold standard' of which an entire ecosystem of digital currencies valued at $600 Billion (of which BTC itself is less than half that) are traded against.

Remember that the USD is backed by the 'faith and credit' of the government, as every other world currency is backed by the faith and credit that their respective goverments won't fuck up their economy so much that their currency becomes worthless.

Bitcoin sidesteps all of that 'faith' by having a limited supply, decentralized management and markets, and the inability for any one organization or actor to fuck it all up (China tried, and failed) That has very clear utility for financial markets and economic systems.

Re:back to value

[Anonymous Coward]

Bitcoin - particularly the technology behind it - had utility as a way to store and transfer value securely and quickly across the world. It's still cheaper other cryptocurrencies to send 'money' to the other side of the world than it is to use a bank or Western Union.

Well no, it is not. The cost involved in making a transaction is skyrocketing, the rate at which transactions can be processed is very low and even now there exist many tens of thousands of transactions that are unconfirmed by the network with them even getting dropped after a couple of weeks. And even in the case you describe it is still just an intermediate store of value, you're going to convert your local currency to bitcoin, transfer it to another location and then convert back to the new local currency so you can actually use it for something because bitcoin itself is not useful.

But that is an aside to the fact that bitcoin has no use outside of being a store of value, other stores of value (gold, diamonds, land, etc for example) have many uses which is why they have value. Their value changes based in part on speculation but also as supply and demand for the real uses of those commodities fluctuates. Bitcoin's value changes purely on speculation because it has no actual usefulness. Other blockchain technologies that focus on being currency replacements or decentralized contract verification actually have usefulness as a technology where bitcoin does not and being a 'first mover' does not give it usefulness, it gives speculative value which is why we see the wild fluctuations.

Re: back to value

[iggymanz]

No Bitcoin is a failure, with a bottlenecked architecture that prevents liquidity, high transaction fees far in excess of bank wiring fee, high percentage of use for black market begging for government intervention, and extreme volatility making it useless as store of value

Re:1300 pct

[iggymanz]

My Zimbabwe currency holdings did better than that in 2007, over 7,000%. increase. wh0h00

Is there an actual practical use for blockchain?

[Mr307]

As a currency its a complete failure so far.

I was doing some research and some companies are trying to make it work as an inventory tracker.

Every time I see the tech in practice, it seems to be easily replaceable by a secure database, which appears to have all the features of blockchain except the supposed anonymity, and a secure database doesn't have problems like a 51% attack, nor the ridiculous time per transaction or cost per transaction problems.

Seems like blockchain so far is workable as a very expensive type of unregulated gambling.

Re:Is there an actual practical use for blockchain

[Anonymous Coward]

You are precisely correct sir. Blockchain is only useful for publicly distributed ledgers with no central authority. Outside of this scenario, it doesn't make much sense. In your case, you describe a central authority, so yeah, no point.

They have a name for the private ones: banks and exchanges, and they have worked well for a thousand years.

Re:Correction: Just a correction

[arth1]

No, just because the supply of something is limited does not mean its value will increase.

I know people who still cling on to their Beanie Babies, believing they one day will recover their losses and come out ahead.

Re:Is there an actual practical use for blockchain

[Kremmy]

The problem seems to be that you only see Bitcoin and the problems that it is facing, ignoring the rest of the cryptocurrency iceberg.
Bitcoin is less than 50 percent of the cryptocurrency market. The problems that are cited with it have been solved in a myriad of ways by various coins.
The volume of those coins is increasing every day, the ecosystem is blooming hard and most people just see Bitcoin and totally miss it.

Re: Best Sell Now While You Still Can

[FormOfActionBanana]

There is no US presidential election in 2018.

Re:Correction: Just a correction

[Applehu Akbar]

Bitcoin is only going to go up because there are only so many coins to go around...

The price bubble in Bitcoin has brought forth a plethora of other cryptocurrencies, most of them with the same algorithmically limited money supply as Bitcoin. Even putting aside such minutiae as having to figure out what in hell "tethers" are, with each new currency and with each new fork of every existing cryptocurrency, there is an additional new store of possible units that can be created. Instead of a limited money, we are approaching digital Zimbabwe.

Re:Is there an actual practical use for blockchain

[geekpowa]

The coin ecosystems currently is reminiscent of the wildcat banking era

Proponents of coins say this is a feature, not a bug.

Bitcoin is singled out because it is the oldest, most established, and if you naively believe that true value of all coins in circulation = spot price * number of coins, also the most valuable.

Sure other coins solve (or alleviate) some of the more glaring problems with bitcoin, yet other significant structural problems remain with the whole concept. One example: sometimes mediation is actually needed to resolve real disputes becasue we are afterall only human and bad actors are out there. The only way, by design, crypto coins do this is forking blockchains, a la The Dao and ETH/ETC split. Again proponents see this is a feature, not a bug.

Alot of wheel reinventing going on, done in ignorance of what has happened in the past WRT banking and finance. IT innovation in banking and finance is wild west stuff and an honest appraisal of things would be that noone knows what the fuck they are doing