Bitcoin exchange rate reached $100 USD per BTC

Re:Bitcoin exchange rate reached $100 USD per BTC by calinet6 on Monday April 01, 2013 @11:32AM (#5473662)

If I see a currency rising in value faster than Gold itself, I'm going to want to get in on the value.

Fact is, if I had "invested" in 100 BTC only 5 months ago when it was hovering around USD$10, that would have cost me about $1000. And now it would be worth $10000. There are not that many investments that have that kind of return in such a short time. You'd have to be dumb to believe that people aren't doing exactly this. You don't see 1000% returns and just ignore it and wonder about its utility. Right now, it's a volatile and risky currency exchange being intentionally used to ride the rising popularity into a cash la-la land.

At some point people are going to convert this toy back to a real-world currency and take their winnings home with them. I don't know what's going to happen then, but I don't believe it will be good. Perhaps 'stabilizing' would be a good optimistic name for it.

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Re:Bitcoin exchange rate reached $100 USD per BTC by andyakb on Monday April 01, 2013 @11:56AM (#5473826)

This is not rational thinking. Simply because something has gone up in the past does not mean it will continue to. The returns for the past 5 months have been insane, but that doesnt mean it was a good investment 5 months ago because thats based entirely on results oriented thinking. In a casino, if a roulette wheel hit black 10 times in a row, somebody letting it ride on black the whole way would have made a fortune, but that doesnt mean it would have been a good bet, it means the people making those bets got lucky. It also doesnt affect the chance of the wheel hitting red or black on the next spin, so it doesnt tell us anything about the future.

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Re:Bitcoin exchange rate reached $100 USD per BTC by calinet6 on Monday April 01, 2013 @01:02PM (#5474328)

> In a casino, if a roulette wheel hit black 10 times in a row, somebody letting it ride on black the whole way would have made a fortune, but that doesnt mean it would have been a good bet, it means the people making those bets got lucky.

Equating a currency to a game of chance based on independent events—now that's irrational thinking.

My conclusions might not be valid, this isn't something I'm an expert at, but I really don't think that's a good example.

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Re:Bitcoin exchange rate reached $100 USD per BTC by andyakb on Monday April 01, 2013 @07:30PM (#5476635)

the problem is that you did not base any of your arguments on actual facts. you just said "if you would have invested 5 months ago, your investment would have grown by a factor of 10." when that is the logic presented, the analogy holds. if you were to give specific reasons why you believe bitcoins grew at that rate AND why the will continue to grow, then it would be a different argument [not that it would necessarily be correct]. however, my point is that when you do not have any sound logic underlying your "investment" it is truly the same as gambling.

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Re:Bitcoin exchange rate reached $100 USD per BTC by genwin on Monday April 01, 2013 @03:12PM (#5475214)

A better example is some stock that went up 10X in the last 5 months.

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Re:Bitcoin exchange rate reached $100 USD per BTC by AdmiralBeotch on Monday April 01, 2013 @04:22PM (#5475636)

The difference and what a lot of people seem to miss is the scarcity of bitcoin and the fact that its makers and followers are bootstrapping a new global economy. Having only $1B in liquidity is not enough to participate in all global markets. If bitcoin successfully acquires fractions of all global markets, there is but only one direction the exchange rate can go, and that is up until there are hundreds of billions of dollar value in bitcoin. Divide that by the 11 million bitcoins in current circulation, and each one will be worth thousands and thousands of dollars.

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Re:Bitcoin exchange rate reached $100 USD per BTC by 1SaltwaterC on Monday April 01, 2013 @12:36PM (#5474129)

Call me a skeptic as I see this like speculation, but where I've seen that kind of return, turned out to be really clever ponzi schemes and enough supply of dumb enough "investors". Oh yea, I remember that fun time when the housing market in my area went up 5X in 4 years. It was all fine till people ran out of actual money. The rest is history.

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Re:Bitcoin exchange rate reached $100 USD per BTC by calinet6 on Monday April 01, 2013 @01:04PM (#5474344)

A currency can't make value out of nothing for long. Eventually reality will set in. I think that's the moral of this story.

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Re:Bitcoin exchange rate reached $100 USD per BTC by miles on Monday April 01, 2013 @02:27PM (#5474923)

A currency can't make value out of nothing for long.

Why, my dear fellow, that is exactly how every government-backed currency works today!

And, thanks to its inflationary nature, it becomes virtually worthless over time:

Although inflation has remained low in recent years, it ravages the value of paper money over time. A dollar in 1900 is only worth about $0.04 in today's currency.

Quoted from: http://finance.yahoo.com/blogs/daily-ticker/bitcoin-prices-b...

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Re:Bitcoin exchange rate reached $100 USD per BTC by calinet6 on Monday April 01, 2013 @02:56PM (#5475108)

Ah yes, of course, but that currency is undergoing inflation. Bitcoin is rapidly deflating. Huge difference.

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Re:Bitcoin exchange rate reached $100 USD per BTC by miles on Monday April 01, 2013 @05:28PM (#5476035)

My point was simply that no currency is backed by "stuff" any more. I was responding to your criticism of Bitcoin ("A currency can't make value out of nothing for long").

Of course Bitcoin is deflating - it was designed that way. And of course fiat currencies are inflating - there is no limit to how much can be printed except reason, which is apparently in short supply.

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Re:Bitcoin exchange rate reached $100 USD per BTC by grovulent on Monday April 01, 2013 @11:46AM (#5473751)

Well - I was making the point that not being used as a currency of exchange does not hurt it's chances at serving as a store of value. In fact, volatility isn't necessarily bad either if you are using it to store wealth only and you take the long view. What would hurt its ability as a store of value would be a sustained and systemic trend downward in value (i.e. inflation). Short of complete collapse of the currency - this is unlikely given bitcoin's inherent deflationary nature.

Complete collapse is entirely possible. If governments crack down on exchange sites that allow for convertibility - that'll pretty much be it. I'd be very surprised this hasn't happened. I think they are waiting for all the major players to be massively invested in bitcoin so that when they pull the plug it'll take a very long time for an alternative to rise from the ashes.

I hope this doesn't happen. But what world do we think we're living in really?

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Re:Bitcoin exchange rate reached $100 USD per BTC by calinet6 on Monday April 01, 2013 @11:54AM (#5473806)

Not a world that can sustain 100% growth month-over-month :)

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Re:Bitcoin exchange rate reached $100 USD per BTC by polarix on Monday April 01, 2013 @01:45PM (#5474625)

Yeah, I think it can, if USD collapses.

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Re:Bitcoin exchange rate reached $100 USD per BTC by jaibot on Monday April 01, 2013 @11:44AM (#5473742)

What's a good way to short bitcoin?

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Re:Bitcoin exchange rate reached $100 USD per BTC by pixelcort on Monday April 01, 2013 @01:16PM (#5474433)

There are derivative markets where you could purchase an option to sell bitcoin at a set price in the future. If the price falls below your target by then, buy up cheaper Bitcoins and sell them at profit.

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Re:Bitcoin exchange rate reached $100 USD per BTC by phyalow on Monday April 01, 2013 @05:23PM (#5476003)

take some forwards @ mpex.co

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Re:Bitcoin exchange rate reached $100 USD per BTC by SlipperySlope on Monday April 01, 2013 @11:55AM (#5473817)

https://bitfinex.com allows short sales on bitcoin.

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Re:Bitcoin exchange rate reached $100 USD per BTC by 1SaltwaterC on Monday April 01, 2013 @12:27PM (#5474060)

Thinking the same thing. It'll be interesting to see somebody going out sorosing the BTC "economy".

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Re:Bitcoin exchange rate reached $100 USD per BTC by phyalow on Monday April 01, 2013 @10:30PM (#5477340)

mpex.co

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Re:Bitcoin exchange rate reached $100 USD per BTC by TranceMan on Monday April 01, 2013 @11:56AM (#5473819)

If you really want to - Borrow $x bit coins - sell $x bit coins - wait for price to drop - buy back $x bit coins - return $x bit coins to lender.

Now the speculators are in........

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Re:Bitcoin exchange rate reached $100 USD per BTC by NegativeK on Monday April 01, 2013 @01:09PM (#5474392)

Do you know of any places that make loans in Bitcoin?

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Re:Bitcoin exchange rate reached $100 USD per BTC by shazow on Monday April 01, 2013 @01:57PM (#5474697)

I know some people use https://btcjam.com/

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Re:Bitcoin exchange rate reached $100 USD per BTC by drivebyacct2 on Monday April 01, 2013 @12:20PM (#5474007)

Good luck. I hope it goes better for you than the people planning to do it 3 weeks ago. Or 3 months ago. Or a year ago.

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Re:Bitcoin exchange rate reached $100 USD per BTC by jaibot on Tuesday April 02, 2013 @01:35AM (#5477853)

Sell high, buy low.

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Re:Bitcoin exchange rate reached $100 USD per BTC by polarix on Tuesday April 02, 2013 @09:44AM (#5479185)

That strategy works unless this is the lowest it will ever be.

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Re:Bitcoin exchange rate reached $100 USD per BTC by drivebyacct2 on Tuesday April 02, 2013 @10:01AM (#5479290)

Right. Like it was higher 3 weeks ago. Or 3 months ago, or a year ago?

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