WTF Bitcoin Price ???
As you may have noticed it looks like the BTC price is skyrocketing, yet I made a prediction that the price will collapse a week or so ago:
- https://steemit.com/bitcoin/@profitgenerator/statistical-analysis-of-btc-usd
- https://steemit.com/bitcoin/@profitgenerator/is-the-correction-over
It may look like I was totally wrong, since the price actually did go up, and it may look like it's going up, like those "wave theorists", I could just draw nice waves on the chart and see that it may go up to 10,000$:
(source: bitcoinwisdom)
But that would be crazy, it may happen, but I doubt it's likely. In the previous post I really estimated that probability to be below 1% to go for 10,000$.
In fact the market looks very unnatural right now, just too many shills and trollish posts on /r/Bitcoin, seems like everyone is excited and they are patting eachother on the back and encouraging eachother to invest in BTC.
They literally posts these silly memes every time, it's so annoying. It's like an echochamber of shills over there. And okay they can be excited, I would be too, but to let off one's guard right now would be very foolish.
I see huge problems coming down the road, so I think their celebration will be short lived, and possibly will result in a big catastrophe, since I really predict the price to plummet pretty soon.
Fundamentals
When in doubt, stick to fundamentals. It's like a risk map of the market, which is probabilistic, so I can't give you exact dates or price levels, but I do know the massive bag of risk that hangs over everyone's head like the Sword of Damocles.
Maybe the shills don't see it, but it's pretty bad. I would not celebrate if I were in their position , and I would scramble to sell all my BTC right now (I did sell them a few days ago though), because this is just unbearable risk in my opinion.
1) No Use Case
Bitcoin had a massive adoption after 2014, with all the gambling websites opening up with all the ATM's and micro-service websites. It was like the "Gold Rush", everyone started joining, mostly from poor countries like India, Philippines, Bangladesh, etc..
People really got excited about it, I remember it like it was yesterday. And the user adoption was really growing together with the merchants and all other goods and services providers. It seemed like a new sector of the economy starting up.
Asian Adoption:
Well that is over now, a transaction fee now costs almost 50$, so say goodbye to Asian adoption. It's over. I mean the average salary in India is 184$/month (before taxes), in Philippines it's 161$/month (before taxes)
So these incompetent Bitcoin Core developers really think that adoption will grow and Asians will spend more than 30% of their salary to just send a freaking transaction. I guess they don't even care about them:
- https://www.reddit.com/r/btc/comments/7636d2/reminder_adam_back_ceo_of_blockstream_says_he/
- https://www.reddit.com/r/btc/comments/6ettpe/bitcoinuser_complaints_about_85_transaction_fee
- https://www.reddit.com/r/btc/comments/4ubcpq/bitcoinorg_has_changed_their_marketing_of_bitcoin
Western Adoption:
Well it's not like the westerners are richer after the 2008 crisis, and now there is some Japanese adoption too but really at best it's going to stagnate, and at worst it's going to drop massively.
Merchant Centralization:
Let me put it this way, thousands of merchants have closed up their shops and those that still stand offer some kind of intra-wallet so that people don’t have to use the blockchain for transacting.
This is literally obvious with Casinos, you know Satoshidice used to have blockchain based gambling, where all bets were on the blockchain, you just sent your bitcoin there and you got back immediately the money if you won. This eliminated counterparty risk sort of like how Shapeshift or Changelly eliminates exchange counterparty risk. Well not anymore, later on I think by 2014 they have already developed and inside wallet to hold the user’s coins, partially for the increasing fees by that time (it was really low) and partially because of the slow blocksize (a casino’s volume depends on betting speed, so a 10 min timer is really slow). This is also a hacking risk, but we will get into that soon.
Of course faucets are gone. They were booming just a few years ago, everyone started up their own website as a micro-business, imagine how many jobs that would have created. Of course Google’s Adsense immediately started banning a few participants (talking about corporate censorship), but they mostly survived on things like Bitmedia and other advertising networks. Well it’s gone now, the fees killed all faucet providers except a few big ones like Freebitco.in.
And all other websites and merchants took a massive hit. I mean they used to offer promos and low prices for purchases, even things like Xapo used to pay everyone’s fees, so your could purchase stuff frictionlessly really, but that is gone now as of 2017 as of now they reintroduced some fees.
So the costs are mounting up, businesses are being killed, both small and big, and really the commercial nature of BTC is dwindling away.
Even decentralized stores like Openbazaar have failed to take off since they mostly use BTC (they should switch to BCH though).
Ironically most Satoshidice users now are gambling with BCH not BTC, it looks like any merchant that accepts BCH will immediately have a bigger turnover than with BTC due to high fees.
2) The only volume is in-house volume
Yes, so as the BTC adoption is slowing or shrinking, the only volume in Bitcoin right now is inside the house. So literally only things like Bitfinex and Coinbase are the only active services right now and a few other exchanges, almost no other commercial activity elsewhere.
All volume is happening inside a few exchanges, nothing on the blockchain really, because there is no space. I mean I guarantee you most people hold their money inside the exchanges despite them being warned about potential custodian risk and a possibility of hacks, which we will discuss later.
But literally, that is the only activity right now, people trading in-house, inside an exchange, so it appears that the volume is huge, like 3,6 billion dollars/day, wow very massive. But it’s crap. It might just be fake volume resulting from margin trading!
I mean how comes you have 3,6 billion $ being traded, but almost no economic activity on the blockchain?
It’s because Bitcoin is a speculative bubble that is about to pop. There is no adoption, it’s just a bubble, and there is no room for adoption in the blockchain. And morons can’t see this, well we shall see who will be right.
3) Hacking Risk
And last but not least, there is a maaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaassive risk of cyberattacks against the exchanges.
So everyone is holding their BTC in the exchanges because it literally costs an arm and a leg to move it out of there, and we have 2-3 big exchanges and a few Chinese ones (which might get closed down due to regulations), that hold possibly 100 billion $ worth of assets.
Now Bitfinex was already hacked in the past, so we know that it was a possibility. Now hopefully they have improved their security since then, the question is whether it’s enough, given the size of the bullseye they have on their backs 537,199,000 $ daily.
And there is no way to tell whether the other exchanges are secure either, you might never know how clever these hackers can get once the bullseye gets way above hundreds of millions of dollars.
So it’s literally the worst risk setup ever and a massive hack is not just possible but also very probable given the way the system is setup:
- Everyone holding their BTC in exchanges despite being warned about counterparty risk constantly!
- The Top 20 exchanges probably hold the majority of the BTC in existence!
- Bad political environment in China!
- Volume & price higher than ever, which attracts cybercriminals like poop attracts flies!
- Fees are extremely high, so further centralization of exchanges is inevitable, so the risk is only increasing!
Game Over!
Thus given the absolutely no use case for BTC at the moment, it’s only a speculative asset being traded on exchanges. If only one spark comes out (like literally in a coal mine), the whole thing will implode!
Since there is really no merchant adoption behind it, it will implode like a black hole once the speculative bubble ends. And possibly Bitcoin Cash could take over, but I’d not take that risk, I’m currently just outside of BTC.
But even without a cataclysmic event Bitcoin as we know it is already dying. More and more merchants, who have any brains, start accepting Bitcoin Cash, and possibly the volume of their sales and revenue in Bitcoin Cash is already way above that of Bitcoin.
It looks like the Bitcoin Core team really made Bitcoin unusable, bravo guys, you have successfully destroyed Bitcoin with your small block nonsense:
- https://www.reddit.com/r/btc/comments/6gek0z/average_bitcoin_transaction_fee_is_now_above_five/
- https://www.reddit.com/r/btc/comments/3xrbkm/pretty_discouraging_bitcoin_core_scaling_roadmap/
- https://www.reddit.com/r/btc/comments/52l541/we_should_not_change_btc_to_accommodate_more/
- https://www.reddit.com/r/btc/comments/47js45/gavin_andresen_bitcoin_core_is_not_listening_to/
Conclusion
Well I think it’s over for Bitcoin. Either BCH will take it over, or they will both dwindle down into the abyss and things like Monero or Dash might get their day in the sun.
I don’t know and I am not taking that risk at the moment, I don’t trust BCH enough yet to switch, so currently I’d go into fiat and possibly hedge it out.
As I wrote in my previous post, this is my current strategy:
- https://steemit.com/bitcoin/@profitgenerator/statistical-analysis-of-btc-usd
- https://steemit.com/bitcoin/@profitgenerator/is-the-correction-over
And basically my action plan:
That’s it, I don’t plan any big moves for 2017, so at the moment I’d rather just chill. It’ll be interesting to see this Black Friday and Christmas how many sales we will have in BTC given that the fees might rise to 70-100$ by then. Good luck for the holiday consumption season with those enormous fees. Bitcoin is finished!
Disclaimer: The information provided on this page or blog post might be incorrect, inaccurate or incomplete. I am not responsible if you lose money or other valuables using the information on this page or blog post! This page or blog post is not an investment advice, just my opinion and analysis for educational or entertainment purposes.
Sources:
Bitcoin is doing better than ever. Even the big boys like hedge funds, billionaires, banks and even nation states are coming on board because of its perfect store of value properties.
At the moment store of value and international payments is by far the most important use case, only this can bring the market cap to trillions what will cause the price to rise another + 10x. Merchant adoption will follow when Lightning network comes online for consumers, it will replace alts like Dash, Zcash and Monero.
The future of Bitcoin has never been so bright, the looming fork is a risk but probably game theory will lead it to a positive outcome like it did the 1st of august. I think the chance that the BTC price will reach 10.000 per coin soon is way bigger than the chance that failing Bcash takes over.
P.S. Sorry that I only up voted my own text, I don't want to make FUD like this more visible
I think you are overestimating stuff here. Hedge funds are just speculating, banks are pretty much hostile right now, and governments don't really care, perhaps they just want tax revenue but dont care about the specific coin.
In fact they are more interested in Ethereum that can create some smart contracts for easier government databases management.
I'm sorry but LN is a joke, it has been proven already that it can't scale and it will introduce a lot of centralization.
I don't know in what world you are living, but the /r/Bitcoin echochamber has really clouded your judgement, you should research more into this and you will see that it's all a big sham.
Bitcoin will not succeed in it's current form.
Hedgefunds and billionairs are already starting to buy in. Banks are fighting it because they feel treated by it (proves its succes), but many of them are buying in too (may be to manipulate the market or to have a big stake if they can't stop it). Countries like Russia and North Korea are interesting in it because it undermines the USD and also Estonia, Japan and Australia are extremely friendly. I suspect these countries will start buying bitcoin for their treasury soon if they aren't doing already. Remember that when some countries start, an armsrace could start because the first to buy in buys cheap and the last one pays a high price.
On LN i disagree, it will be a very good way to scale the smaller payments, there is totally no need to do this on blockchain. It will for sure displace Dash and other alts, exactly the reason why so many alt investors are against segwit.
I have many sources of information and for sure reddit isn't my main source. Good luck staying heavily invested in alts and rejecting bitcoin, but please not try to bring this FUD to people who ARE interested in Bitcoin.
Here's an upvote from me too ;)
hmmmm, very interesting post. I appreciate it. But I would argue that BTC is being adopted in other parts of the world where their fiat currencies are more unstable and/or worthless.
One can take a look here at Steemit and see that there are many people on this platform that may have a hard time finding employment in other parts of the world. They can take the rewards and convert it to BTC. I know that isnt really what your post is about, but I think its good to note that BTC is the standard.
At this point, the mining of BCH is garbage.
There are more and more places that accept bitcoin as payment.
https://news.bitcoin.com/nordic-law-firms-now-accepts-bitcoin-payments/
This is from last year: https://99bitcoins.com/who-accepts-bitcoins-payment-companies-stores-take-bitcoins/
And this doesnt take into account all the places in 3rd world that will accept BTC. There are many.
A use case? The use case is as long as people are accepting it as a means of payment, it has a use. Pretty simple IMO.
I did enjoy reading this. And as people lose confidence in fiat, so confidence in crypto grew. It happened very quickly. Not isolated to one part of the world either.
I do agree that this is a very risky time for someone to enter the market and purchase bitcoins. But let us remember that btc is divisible, and as such, can be broken down.
I would also tell people that if they are spending 50 USD equivalent for a TX fee, they are nuts Many places in the world do not even go by USD value. A typical TX fee from exchanges can be free, as in GDAX, or up to 100,000 sats, like Cryptopia.
And that is not 30 dollars.
Yeah but if you set a too low fee the transaction can take from 2 hours to 2 days.
The average fee for fast transaction, I assume 1 block, is above 30$, and possibly higher for multi-transactions (Electrum uses that for change addresses).
I think Bitcoin as it is is finished as a payment medium, unless some real big change goes underway.
More and more people are adopting BCH, but even more are looking for alternatives like Dash and Monero.
I also agree that the BCH software is a little bit risky now, you have like 2 guys working on it, so I'd rather wait before using it, it might end up bad too.
So I am looking towards Dash and Monero.
Didnunsell ur Ppt and Veri as well?
I am holding both PPT and Veri for now, I have great hopes for them in the future.
Oh look another Bitcoin cash shiller. Get over it you should have sold when it was high, just sell now and cut your losses cause your stupid forked coin will soon be DEAD
Hey what's with the attitude, I just presented my case backing it up with solid arguments. You sound almost like a nervous troll fanboy trying to save BTC, when in fact it might wither away given the enormous fees.
I am not a BCH shill either, I don't even own BCH, but I prefer BCH now more than BTC, although not as much to make me buy some, I am waiting for the moment to decide.
You are spreading lies and fud ( e.g. 50 $ per transaction) just to promote Bitcoin cash . Don't expect to get a kind response.. bs excuses that you don't own Bitcoin cash (yeah right) won't convince anybody.
The cost per TX according to blockchain.info now is 35.55$.
It can go up to 50$ easily for a big transaction for many outputs and inputs. There is no FUD there, Bitcoin sucks, it's a shitty clogged coin, and your insults won't make it appear better.
Well I send money yesterday, paid 0.0002 btc, (which is something like 2 usd according to google), the transaction went smoothly and fast, so somebody is obviously wrong.
Well then how come you have almost 60,000 unconfirmed transactions.
https://blockchain.info/unconfirmed-transactions
You either pay a big fee or wait like 2 days for the TX to be confirmed. So either way it's a clogged unusable coin.
Just made a transaction with a 3 USD fee and it was confirmed in the first block. Probably I paid to much because I listened to the FUD about slow confirmations and I wanted it to be confirmed fast
Funny thing. You call people who support the coin and get excited with it's success "shillers" but when somebody uses the same word against you because you spread false information ( like how fees are 50 USD per transaction lol) you flag them. Nice move!
I made $50 profit on holding bitcoin for a few days. Currently it's nice and safe in my steem wallet.
The price is great but it's going to tank at some point
Yea but I am not into buying into irrational markets at the last moment especially not when the price has been going up at 90 degrees for weeks now. It is doomed to pop at some point.
I have sold most of my BTC weeks ago, and the last coins a couple days ago, now I am just sitting back and see it unfold.
Yes bitcoin is going crazy like anything i feel bad for other currecncies and thnx for this great insight upvotes , ReSteem and followed you ( you actually deserved all of them )
Haha of course r/bitcoin is going to be a huge circle jerk. If someone hated bitcoin why would they go to that subreddit.
That's like saying everyone on steemit shrills steem. Of course they do or they wouldn't be posting on steemit.
Yea but I am talking about the conflict between /r/btc and /r/bitcoin. As you can see the /r/bitcoin crowd is mostly full of shills and teenage kids posting there their feelings and emotions, while the serious talk is over at /r/btc who actually think about a responsible scaling solution and not just insults being tossed around like the Core team does mostly.