It says this fund is still traded at unofficial exchanges at prices a number of times higher than the value of the bitcoin it holds. The multiple layers of speculative mania involved in that boggles the mind.
It trades on the OTC Bulletin Boards since 2014 or so, and is prime for getting easy exposure with IRA accounts simply because it can be accessed through normal brokerages.
Different prices at different trading venues speaks to the difficulty of moving funds quickly between them. When those hurdles are overcome, such a glaring arbitrage opportunity will disappear.
Would you consider it "speculative mania" if GBTC traded at a steep discount to all other exchanges?
It would generally be appropriate to say things like "was the best return" or "has been the best return" when describing past price appreciation. "Is the best return" could be reserved for something like a stable source of income.
> It would generally be appropriate to say things like "was the best return" or "has been the best return" when describing past price appreciation. "Is the best return" could be reserved for something like a stable source of income.
Kinda like how historically index funds have been the best investment but also might not be in the future? :)
GBTC is a regulatory dodge that does not reliably track the price of bitcoin. As someone who wants a bitcoin ETF, I’m certain the SEC would not have approved the listing of GBTC and very confused as to why ICE (who should know better) ever thought they would.
RIP bitcoin. Current valuation is $4142.99 higher than it should be.. Im thinking we will get there within a couple of years. $1-2 seems about right per 1 BTC.
There is utility in BTC thats why im putting 1-2$ value on it.
4000$ + per one BTC is pure insanity that will soon end badly for most "speculators".
There is nothing new under the sun. Go back to the tulips and many booms and busts after. Its happening with BTC now. And just like all the others it will end the same.
Did you read the article you posted? Actual tulip mania, as described in the article, is much more similar to what is happening in bitcoin than the mythologized tulip mania.
Frantic speculation in a narrow space with the market eventually crashing when speculative buyers are no longer willing to bid up?
What was going for tulips is that they had an "expiration date" bitcoin will probably take longer because there's no such thing.
To me bitcoin lost its appeal after transaction fees became high. The value is ok, since you can still use fractions of it, but current transaction fees and time to wait for confirmation makes it unsuitable for daily use. So in my mind bitcoin already failed what it supposed to provide.
> There is nothing new under the sun. Go back to the tulips and many booms and busts after.
Predicting bubbles is nothing new under the sun. I remember 10 years ago when craft beer was a bubble. I also remember 5 years ago when a buddy of mine in finance told me "tech is a bubble because there are too many languages". Everyone is an expert, and everyone can say "tulip" as if it's meaningful.
Craft beer is tasty, many people love it and regularly buy it to consume it; not to store it in the cellar with the hope that one bottle will cost $50000 in 3 years. That's real business that has real profits.
Regarding tulip mania: The 1841 account is based upon a 1797 account which was sourced from "three anonymous pamphlets published in 1637 with an anti-speculative agenda" contemporary historians describe as "pieces of propaganda and a prodigious amount of plagiarism"
A historically honest account characterizes tulip mania as "no more than a meaningless winter drinking game, played by a plague-ridden population that made use of the vibrant tulip market."
So, assuming you are making a parallel between bitcoin and the fictional "propaganda" narrative of tulip mania: that comparison falls apart quickly, since (1) bulbs have an exponential growth rate. (2) the 3 year crash did not feature boom + bust cycles with steadily increasing bottoms. (3) Bulbs are not permanent or fungible. (4) short selling bulbs was illegal. (5) bitcoin is not subject to a decree by dutch parliament that futures contracts must be options with the buyer allowed to back out for a 3.5% fee.
The way that bitcoin mirrors tulip mania is that it is subject to "propaganda" with an "anti-speculative agenda", and that both took place during a rapid increase in the fiat money supply.
The first time I saw someone refer to Bitcoin as tulips was in 2011 when I started in the space. I'm sure others labeled it as such as soon as it started trading in 2010 at $0.06.
a few people have been called crazy for pointing out bubbles... prematurely. it does not change the fact that its still a bubble. as i said getting the timing right is pretty much impossible. time and market will be the ultimate judge ;)
Do you think that the entire space "is a bubble" as in, "cryptocurrency itself will go away one day." Or did you mean "is in a bubble" as in, "the price will drop significantly someday."
cryptocurrency clearly has utility. it may stay as it is or most likely undergo some changes and stay in a different format. The issue is valuation - yes, it is bubble IMHO thats going to pop. Timing of that "pop" is a million dollar question.
In theory, the governments may try to kill it once it reaches too far (to the point of being considered fiat money). However, the said government will also invite lots of backlash from the people and technically, no single government can stop the blockchain network completely.
They cannot. Once the transaction becomes part of the blockchain, its replicated to each and every node in the world (we are talking about thousands) that span the length and breadth of the planet. Thus, its practically impossible.
Quick thought experiment: I just did a quick back of the envelope calculation on the brute force approach. 50% of the current hash rate would be 548 million retail - (current rate 8M TH/s, 1850$ retail Antminer S9 rated 13.5 TH/s). That's a quick thought on naive approach - not sure I have that right, so please check my work. I have a few other ideas as well. edit: of course, the existing hash rate would still be there, so you'd have to double it, not buy half. I still think the retail estimate is on the high side (markup, not leveraging economies of scale). My guess is that an organization like DARPA could buy Bitcoin for <250M$.
But large states cannot do it in a legit manner as they have to follow some constitutional rights of their citizens. Most constitutions of these countries have enough freedom rights paved into them to avoid such blatant action by the government. Besides, the backlash in the media would be unbelievable, the party that does this kind of thing may not find many voters in the next election due to the negative press (at least in technologically advanced nations like USA and Sweden where people are generally aware of online rights).
The $1 valuation strikes me as way more arbitrary than $4k. What features mean that it should be near USD parity? It should either be above or below the USD based on >>insert valuation technique here<<. But why should it land near $1-2? Why shouldn't it be $0.003 or $30.00?
If it should somehow land on parity with fiat currency then maybe it should be a weighted mean of the global currencies but $1-2 seems incredibly arbitrary.
Its been priced in that nobody expects the SEC to approve that application.
But pay attention to this space, the guy who worked on the Winklevoss Bitcoin ETF - which got rejected too - has taken the job at the SEC of approving ETFs. The last guy finally quit because of some red herring about supporting the trump administration or something (the Chairwoman Commissioner quit too)
I love when a power vacuum gets people I like in government, especially when nobody is noticing.
Crowdfunding was OK'd by Congress in the financial reform bill of 2010 and the JOBS act of 2012, it took the SEC 3 additional years of dragging their feet to be forced to be "okay" with it, and the SEC introduced many compromises which makes crowdfunding under those regulations to be dead-on-arrival with the 1 million usd limit and similar costs as other kinds of fund raising.
Despite that, understand that crypto enjoys no such luxury from Congress, and what we are talking about here has nothing to do with crowdfunding via crypto like the ICOs, but instead digital commodity trust ETFs
yes, they've brought this on themselves. there is a vast conscience of ideas and an even vaster risk taking public, that has been shut out of the markets for reasons such as lacking pedigree or preexisting wealth.
To get live data from ICE--the exchange that withdrew the request--I'm currently paying a broker $120/month.
By comparison, just about every crypto exchange currently offers push feeds and historical data for free. In most cases you don't even need to sign in.
In some sense this is a measure of the immaturity of crypto markets.
But it's also a reminder that with main institutional players moving in, the barriers to entry will go way up.
We'll probably start to see more brokers and vendors and more consolidation/buyouts of the crypto exchanges.
I believe that as small exchanges are attempting to gain market share, giving away their data makes sense. They need to advertise the liquidity on their market in order to attract business. As exchanges get bigger, they reach a point where they think, "You know what, there are a lot of people who can't run their business without quotes from our exchange." And they start charging for data. And it's true, and furthermore, there are large financial institutions that are farily price insensitive. So they keep raising and raising prices. I don't have any hard evidence of what the end result is. Price equilibrium? Implosion of liquidity because nobody wants to buy their data any more?
As a fund manager, I wish there was a data warehousing service I could pay for with a queryable by the minute (or better granularity) API that captured multiple exchanges across multiple countries for the top 50 coins.
I would pay a lot monthly for that product. Such a pro-level service doesn't exist at all yet.
Also there aren't any derivatives or futures to speak of yet (don't point out the existing futures markets, they have no volume).
Reading what you describe, I think Coinigy does this currently. I have a premium account and use it as an 'exchange aggregator' for my trade portfolio, to trade on and trade between many different exchanges with many trade pairs, and I believe it offers an API so that I could essentially abstract their frontend from the process. I pay about 20 dollars a month.
If you're interested in building this, you can easily stream data at any scale into Google's BigQuery [1] from any number of clients, using simple HTTP POST requests, and then have a single SQL-queryable interface to that data.
Given the volume of data from ICE, $120/month is reasonable. I don't think they price data to profit from it -- just to ensure their systems are used by serious actors.
I think it'd be great to be able to trade BTC on a regular stock exchange, but I'm not going to hold my breath for that to happen. Also, I think the big players who have an interest in speculating are already holding and not sitting around thinking "aww rats, it went up another 50% this week, if only we could buy it on the stock market!" Or maybe they are and once it hits the market it'll shoot to 20k. Who knows.
I dont get bitcoin. Whats the value? I dont really see where I need it.
Used to mine back in the days right after I heard about and had great hopes and fun. It was worth nothing back then, but since just had too many letdowns because of the community around this so called currency. You could literally replace "Bitcoin" with "Jesus" in any conversation online in the big bitcoin communities and it would seem just like a religious cult, which I am not too much into. Actually that would be a fun idea for a browser plugin now that I think about it :D
I transfer money regularly to asia, but Transferwise is a much better option for this. Takes 20 minutes to have the real usable money in the account.
I lost 3000 euro recently on an exchange that went bust and I almost lost 60 bitcoins on MtGox, where I was one of their 50 first users. Only saved it because I went crazy on their IRC, so I guess MagicalTux just wanted to get rid of me.
Those 3000 euros were for playing around with ETH by the way - no big deal - but I decided that was the last straw. Just had enough, I guess and I kind of hope that this will turn into the shitshow, I think it is going to turn into because these days there is really nothing I could think of doing with a bitcoin if I had one.
Seriously. If I had a bitcoin, what could I do with it except selling it??
And the blockchain? What is it good for except for bitcoin? It has been around now for 10 years and everybody has been praising it to the skies, but have we really seen any breakthrough tech come out of this? Its not super complicated tech - just an interesting solution to a computer science problem. If it was so valuable, I am sure everybody who wants to earn money would be all over it. Thats what we like, right? Earn money.
76 comments
[ 3.3 ms ] story [ 153 ms ] threadHasn't exactly been a bad bet for those people.
Would you consider it "speculative mania" if GBTC traded at a steep discount to all other exchanges?
>Would you consider it "speculative mania" if GBTC traded at a steep discount to all other exchanges?
This is as shallow an argument as "If Jimmy broke his leg getting hit by a car, would you say I got hit by a car if I broke my leg?"
If you were also playing in traffic, then yeah.
It is all a matter of perspective which simple wasn't apparent because there weren't options a decade ago.
Kinda like how historically index funds have been the best investment but also might not be in the future? :)
4000$ + per one BTC is pure insanity that will soon end badly for most "speculators".
There is nothing new under the sun. Go back to the tulips and many booms and busts after. Its happening with BTC now. And just like all the others it will end the same.
http://www.smithsonianmag.com/history/there-never-was-real-t...
> BTC is pure insanity that will soon end badly for most "speculators"
> Its happening with BTC now
Join the long line of people that have been saying this for almost 5 years and have been so soooooooooo wrong
Frantic speculation in a narrow space with the market eventually crashing when speculative buyers are no longer willing to bid up?
To me bitcoin lost its appeal after transaction fees became high. The value is ok, since you can still use fractions of it, but current transaction fees and time to wait for confirmation makes it unsuitable for daily use. So in my mind bitcoin already failed what it supposed to provide.
You're overstating your case. They just haven't been proven right.
In such a young, poorly understood, and speculative, environment it seems reasonable to suspect a bubble. 5 years doesn't prove or disprove anything.
Predicting bubbles is nothing new under the sun. I remember 10 years ago when craft beer was a bubble. I also remember 5 years ago when a buddy of mine in finance told me "tech is a bubble because there are too many languages". Everyone is an expert, and everyone can say "tulip" as if it's meaningful.
A historically honest account characterizes tulip mania as "no more than a meaningless winter drinking game, played by a plague-ridden population that made use of the vibrant tulip market."
So, assuming you are making a parallel between bitcoin and the fictional "propaganda" narrative of tulip mania: that comparison falls apart quickly, since (1) bulbs have an exponential growth rate. (2) the 3 year crash did not feature boom + bust cycles with steadily increasing bottoms. (3) Bulbs are not permanent or fungible. (4) short selling bulbs was illegal. (5) bitcoin is not subject to a decree by dutch parliament that futures contracts must be options with the buyer allowed to back out for a 3.5% fee.
The way that bitcoin mirrors tulip mania is that it is subject to "propaganda" with an "anti-speculative agenda", and that both took place during a rapid increase in the fiat money supply.
can you please connect that with logic?
The argument that anything ends at some point is fruitless. Not sure how you are separating BTC out from anything else here
Would you like to place a wager on that?
If it should somehow land on parity with fiat currency then maybe it should be a weighted mean of the global currencies but $1-2 seems incredibly arbitrary.
But pay attention to this space, the guy who worked on the Winklevoss Bitcoin ETF - which got rejected too - has taken the job at the SEC of approving ETFs. The last guy finally quit because of some red herring about supporting the trump administration or something (the Chairwoman Commissioner quit too)
I love when a power vacuum gets people I like in government, especially when nobody is noticing.
https://www.sec.gov/news/pressrelease/2015-249.html
Despite that, understand that crypto enjoys no such luxury from Congress, and what we are talking about here has nothing to do with crowdfunding via crypto like the ICOs, but instead digital commodity trust ETFs
By comparison, just about every crypto exchange currently offers push feeds and historical data for free. In most cases you don't even need to sign in.
In some sense this is a measure of the immaturity of crypto markets.
But it's also a reminder that with main institutional players moving in, the barriers to entry will go way up.
We'll probably start to see more brokers and vendors and more consolidation/buyouts of the crypto exchanges.
I would pay a lot monthly for that product. Such a pro-level service doesn't exist at all yet.
Also there aren't any derivatives or futures to speak of yet (don't point out the existing futures markets, they have no volume).
Source: I run CryptoLotus, a crypto hedge fund.
https://www.coinigy.com/bitcoin-data/
[1] https://cloud.google.com/bigquery/streaming-data-into-bigque...
I think it'd be great to be able to trade BTC on a regular stock exchange, but I'm not going to hold my breath for that to happen. Also, I think the big players who have an interest in speculating are already holding and not sitting around thinking "aww rats, it went up another 50% this week, if only we could buy it on the stock market!" Or maybe they are and once it hits the market it'll shoot to 20k. Who knows.
Used to mine back in the days right after I heard about and had great hopes and fun. It was worth nothing back then, but since just had too many letdowns because of the community around this so called currency. You could literally replace "Bitcoin" with "Jesus" in any conversation online in the big bitcoin communities and it would seem just like a religious cult, which I am not too much into. Actually that would be a fun idea for a browser plugin now that I think about it :D
I transfer money regularly to asia, but Transferwise is a much better option for this. Takes 20 minutes to have the real usable money in the account.
I lost 3000 euro recently on an exchange that went bust and I almost lost 60 bitcoins on MtGox, where I was one of their 50 first users. Only saved it because I went crazy on their IRC, so I guess MagicalTux just wanted to get rid of me.
Those 3000 euros were for playing around with ETH by the way - no big deal - but I decided that was the last straw. Just had enough, I guess and I kind of hope that this will turn into the shitshow, I think it is going to turn into because these days there is really nothing I could think of doing with a bitcoin if I had one.
Seriously. If I had a bitcoin, what could I do with it except selling it??
And the blockchain? What is it good for except for bitcoin? It has been around now for 10 years and everybody has been praising it to the skies, but have we really seen any breakthrough tech come out of this? Its not super complicated tech - just an interesting solution to a computer science problem. If it was so valuable, I am sure everybody who wants to earn money would be all over it. Thats what we like, right? Earn money.
A certain story by HC Andersen comes to mind.