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Cryptocurrencies

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orly said:
Down to $14.4k and has lost 11% of its value today

Those halycon days of 20k less than a month ago feel like a lifetime go.

Hodl me Kev.
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And up to 15.2k now... could be 17k or 11k by tonight. It's volatile and will remain so for the immediate future. The drop today came about as a result of 'FUD' over coinmarketcap removing Korean exchange values from their averages. This automatically wiped 5-10% off the average prices of the coins on their site as coins generally cost significantly more on Korean exchanges. The result seems to have been a bit of panic on top of the usual volatility.

While bitcoin is (and some others are) down today, many other coins are significantly up.
 

Ron Swanson said:
And up to 15.2k now... could be 17k or 11k by tonight. It's volatile and will remain so for the immediate future. The drop today came about as a result of 'FUD' over coinmarketcap removing Korean exchange values from their averages. This automatically wiped 5-10% off the average prices of the coins on their site as coins generally cost significantly more on Korean exchanges. The result seems to have been a bit of panic on top of the usual volatility.

While bitcoin is (and some others are) down today, many other coins are significantly up.
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This influx of competing coins surely can't be good for any of them as it dilutes the market share each time investors choose to put a dollar or a pound towards a new crypto currency rather than an existing one. The reason I think market share is important is because you can traditionally measure currency performance in terms of turnover with increased turnover representing an increased demand for supply of the currency making the existing supply increasingly valuable as a result. All the bitcoin/crypto heads talking about the horrors of quanitative easing when the crypto market can quantitatively ease itself by allowing more competing currencies into the mix.

Bitcoin at least can differentiate itself as the recognizable first mover in the market and it has a head of steam going from that but in my mind what is going to drive the "real" gains in value for one of these cryptocurrencies is going to be when they're actually being adopted and used transactionally for exchanges of goods and that rate of turnover grows "organically" from consumer use and demand and not from speculation purchases.

While we see a large market of investment in these currencies we're still seeing them mostly in the hands of private individuals for speculation and cash out rather than seeing individuals purchasing coins with their national fiat so that they can spend those currencies instead of their national fiat currency for whatever reason they choose to do so. I want to see businesses that are receiving payment in a cryptocurrency resist immediately converting it into fiat because they can use that cryptocurrency to pay its own bills.

I don't think Bitcoin as it stands right now is going to properly achieve that, not while the volatility prevents the exchanges from maintaining transaction fees at a reasonable level that wouldn't discourage someone from using the currency for a purchase instead of a fiat currency. Right now you have the negative of having to pay for your individual transactions and until that expense is balanced out by some benefit that purchasing in bitcoin provides over fiat (anonymity has been touted as one but I'm skeptical of that) as well as a lack of acceptance from most consumer facing businesses and those are two big hurdles any cryptocurrency will have to jump over if it wants to be functional as a currency in the long term.
 
Efcjake said:
This influx of competing coins surely can't be good for any of them as it dilutes the market share each time investors choose to put a dollar or a pound towards a new crypto currency rather than an existing one. The reason I think market share is important is because you can traditionally measure currency performance in terms of turnover with increased turnover representing an increased demand for supply of the currency making the existing supply increasingly valuable as a result. All the bitcoin/crypto heads talking about the horrors of quanitative easing when the crypto market can quantitatively ease itself by allowing more competing currencies into the mix.

Bitcoin at least can differentiate itself as the recognizable first mover in the market and it has a head of steam going from that but in my mind what is going to drive the "real" gains in value for one of these cryptocurrencies is going to be when they're actually being adopted and used transactionally for exchanges of goods and that rate of turnover grows "organically" from consumer use and demand and not from speculation purchases.

While we see a large market of investment in these currencies we're still seeing them mostly in the hands of private individuals for speculation and cash out rather than seeing individuals purchasing coins with their national fiat so that they can spend those currencies instead of their national fiat currency for whatever reason they choose to do so. I want to see businesses that are receiving payment in a cryptocurrency resist immediately converting it into fiat because they can use that cryptocurrency to pay its own bills.

I don't think Bitcoin as it stands right now is going to properly achieve that, not while the volatility prevents the exchanges from maintaining transaction fees at a reasonable level that wouldn't discourage someone from using the currency for a purchase instead of a fiat currency. Right now you have the negative of having to pay for your individual transactions and until that expense is balanced out by some benefit that purchasing in bitcoin provides over fiat (anonymity has been touted as one but I'm skeptical of that) as well as a lack of acceptance from most consumer facing businesses and those are two big hurdles any cryptocurrency will have to jump over if it wants to be functional as a currency in the long term.
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I did read that consumer purchases and exchange of goods accounts for only 20% of all fiat transactions so I’m not sure it’s as essential as you might think.

I agree that there are far too many dodgy coins out there now and this is a real problem going forward.
 
Kev The Rat said:
I did read that consumer purchases and exchange of goods accounts for only 20% of all fiat transactions so I’m not sure it’s as essential as you might think.

I agree that there are far too many dodgy coins out there now and this is a real problem going forward.
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But that's the start required to drive adoption by businesses and banks to do their business in it rather than exchanging it into fiat right? That's the end goal when bitcoin destroys fiat and replaces all isn't it?
 

Efcjake said:
This influx of competing coins surely can't be good for any of them as it dilutes the market share each time investors choose to put a dollar or a pound towards a new crypto currency rather than an existing one. The reason I think market share is important is because you can traditionally measure currency performance in terms of turnover with increased turnover representing an increased demand for supply of the currency making the existing supply increasingly valuable as a result.
Click to expand...

But cryptos/Bitcoin isn't a currency in the traditional sense of the word so any analogies such as this are false?

A currency is the disposable medium of a defined economic entity - and its performance in terms of market pricing is determined by two things as far as I'm aware:

1 - performance and outputs of its native economy
2 - perception of the (strengths) of that economy relative to other economies in the world

I'm very new to getting my head around this but do not see any relationship with traditional currencies. In my mind the best comparison is with the gold indexes but there, again, there's a flaw in that, at least with gold there is an underlying base value.

So taking it one step further - its more like a gold derivatives index?
 
Charlie Sweet said:
But cryptos/Bitcoin isn't a currency in the traditional sense of the word so any analogies such as this are false?

A currency is the disposable medium of a defined economic entity - and its performance in terms of market pricing is determined by two things as far as I'm aware:

1 - performance and outputs of its native economy
2 - perception of the (strengths) of that economy relative to other economies in the world

I'm very new to getting my head around this but do not see any relationship with traditional currencies. In my mind the best comparison is with the gold indexes but there, again, there's a flaw in that, at least with gold there is an underlying base value.

So taking it one step further - its more like a gold derivatives index?
Click to expand...

No - it was intended to be a currency and it should be one.
 

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