With bitcoin you cannot manipulate the supply, therefore you can't magically create $800M out of thin air.
If you cannot increase supply in response to a higher price driven by higher demand, prices will increase even more
See this Econ 101 chart [1]:
Y axis represents price, x axis represents quantity. The lines represent simplified supply and demand curves (Wikipedia can explain why they are shaped as they are)
Initial supply and demand is represented by supply "s" and demand "d". Their intersection gives us initial price "p1" and quantity produced "q1".
If demand increases from "d" to "d2", normally suppliers would produce more to meet the new demand. So the price would increase to "p2" and quantity increase to "q2". So even here you get a price increase
But with supply constrained assets like bitcoin, you can't increase quantity supplied to q2. So the only way the market can absorb new demand is by a further price increase. Basically more people want a good, but more can't be made, so sellers rationally realize they can charge more. In the chart, the new price would be the point where the dotted vertical line above q1 intersects with d2
Someone makes 1M of counterfeit US Dollars using their own printing machine and puts it in a suitcase, and they exchange that suitcase with you, and in return you give them 1M of bitcoin in their digital wallets.
Now do you understand the thread?
The price of BTC on other exchanges (which had no direct trades from that bot) was still affected and it went up across the board on all exchanges.
So the value of BTC can be manipulated...
1. Create accounts for customers. Balances are private and not connected to wallets
2. Keep Bitcoins used to cover the accounts in a single bank wallet.
3. Rely on the observation that customers won't withdraw all their Bitcoins at the same time and use bank wallet for trading in the bank's name.
This is basically how every normal bank in the world operates, except that the amount of money the have to keep in reserve is heavily regulated so that this scheme does not turn into an infinite pool of money. There is no such regulation for cryptocurrencies.
> bitcoin has no intrinsic value, just a exchange rate with other things
1. It has proof-of-work, which gives it value 2. Supply of the coin and demand for the coins determine the price.
The only thing that can vary widely is the demand, the supply cannot be fucked with (unlike fiat currency). It is impossible for whole bunch of new coins to suddenly appear out of thin air. There is no way to artificially inflate the supply.
"I burned a bunch of electricity and created a cryptographically provable magic token".
There is no value here beyond exchanges with the other bitcoin speculators around you. The value you describe is no different to the value of a pixel on the million dollar homepage.
There will be a point where the emperor is revealed to have no clothes and when you try to extract actual value from the bitcoins that you are holding (i.e. sell them), you will find there is nobody who wants to buy.
Although if you like, I'll trade for beanie babies. I've got rare ones, nobody else has these. They only made a few.
The value dictates the amount of PoW needed, not the other way round.