Winklevoss Forecast Bitcoin to Reach $500K News ihodl.com
Winklevoss Forecast Bitcoin to Reach $500K News ihodl.com
Winklevoss twins’ crypto exchange is expanding into the UK
Satoshi Nakaboto: ‘Winklevosses launch their Bitcoin ...
All about Gemini, the Winklevoss Bitcoin Exchange
Winklevoss Twins launch Bitcoin exchange in the UK IFA ...
We are Cameron and Tyler Winklevoss, but you probably know us as the Winklevii. We are here to talk about Gemini (gemini.com), our new bitcoin exchange. AMA, or rather AUA!
We first learned about Bitcoin in 2012. Perhaps where you'd least expect -- on an island off the coast of Spain in the middle of August -- IBIZA. Our first impression was that this was either going to be really big or a complete zero. We were immediately taken in by Bitcoin's elegance and enormous promise, and as we started to learn more, we became convinced that Bitcoin was the future of money. We began buying bitcoin, but quickly realized that there was no safe and easy way to buy and sell bitcoin in the US! So, a year and a half ago, we decided to do something about it. We began assembling a team of top engineers to build Gemini -- a next generation bitcoin exchange. This past Monday, Gemini opened its doors to the world. We are super excited for Gemini's journey ahead and look forward to sharing it with you. Please AMA, or rather AUA! www.Gemini.com PROOF: https://twitter.com/winklevoss/status/651566752187457536 PHOTO PROOF: http://i.imgur.com/W7w5qf1.jpg EDIT: Thank you Reddit for the interest in our story and hearing what we have to say. It's been a lot of fun answering questions. It's certainly and honor and flattered to be here. We appreciate the fact that you're taking time to learn more about us as people and entrepreneurs and about Gemini. We're working hard to build the next thing, which is Gemini, and super passionate about making sure that Bitcoin reaches its full potential.
/u/danielravennest responds to: We are Cameron and Tyler Winklevoss, but you probably know us as the Winklevii. We are here to talk about Gemini (gemini.com), our new bitcoin exchange. AMA, or rather AUA! [+32]
/u/JVakarian responds to: We are Cameron and Tyler Winklevoss, but you probably know us as the Winklevii. We are here to talk about Gemini (gemini.com), our new bitcoin exchange. AMA, or rather AUA! [+38]
We don't have a relationship with Mark. The last time we saw and spoke with him was at the settlement in 2008, and before that was back at Harvard. We do have a relationship with Dustin Moskovitz, we saw him at Burning Man three years ago, and we've kept in touch with him. We've grabbed coffee with him in SF and also got a tour of the Asana offices (his start-up). We're pretty friendly with a lot of people around Mark, but we don't have a relationship as of this moment with him.
Hindsight's always 20/20, but it seemed like a lot of the things that happened were unnecessary. There was a way for everyone to be happy and kind of win, and it didn't have to be a zero sum situation. Hopefully we can all learn from that as we move forward and become better people and learn to find the path of least resistance.
It's certainly quite an amazing company. I don't think any of us had any idea of how big it could actually be. I think the scariest thing is that it's probably not done growing anytime soon. We're really proud of the part we played, which we think was certainly material to getting it going and I think Mark has certainly done an incredible job shepherding it and leading the company to what it is today. I think that I'm really impressed with what it is and what it most definitely will be.
We're definitely watching the block size debate, I don't have a super strong opinion, I think everyone agrees that the block size in some way or another should increase and will have to increase in order for Bitcoin to fulfill its promise. We're keeping a close watch, I think its really interesting how the community's is proposing things and it's working in a very democratic process and people are free to propose things and obviously it's a consensus-based system. I think we're seeing that at play and it'll be exciting and interesting to see it unfold. I think that Bitcoin will get through this, it's weathered a lot already and I think its here to stay. I think its just one more of those things we'll get through.
The fact that we're twins and best friends has been a huge asset. We've definitely always used it to our advantage. It's obviously not always easy getting along all the time, but we've managed to do it and we've made a great team. Both in sports during our rowing career and now financially working together in business. I think trusting your partners is something that's super important, and we have that built in because we're twins and if I do something wrong to him then it's pretty much like doing it to myself. So it's been a great asset and we've tried to make the best of it.
I haven't personally looked that much into altcoins. I think that with a protocol like bitcoin there's a huge first mover advantage and a lot of network effects and bitcoin has a great head start in that regard in terms of the size of it's mining network and how much infrastructure it has going for itself. I think that the altcoins are very interesting. Some of the other blockchain efforts like Ripple and Ether are interesting, but we haven't spent a whole lot of time with them because we think there's a lot to be done still in bitcoin blockchain 1.0 if you will.
So first off we're here on Reddit, taking about bitcoin – we've learned about bitcoin and been in bitcoin for three years and I can tell you initially it's a lot to wrap your head around, but we've been working hard building Gemini and also we're working on our ETF that will trade under the ticker 'coin' – and so both should be friendly ways to get either bitcoin exposure or actually buy and sell bitcoin. We're trying to make very regulated, safe and secure environments for people to enter into the bitcoin ecosystem so that's what we've been putting our time towards.
I think that the immediate future for bitcoin (at least in the U.S.) is regulated businesses – licensed businesses, like Gemini. It's impossible to totally see the future but if you look back to the early days of the Internet, I feel like we're in the first or second inning of bitcoin so it's almost like 1993 or 1994 so there is tremendous potential and we think it's just the beginning.
Where Gemini comes into play is that we're New York-headquartered, U.S.-based, U.S. regulated and licensed platform to buy bitcoin. So if you make the decision to take the plunge and actually bitcoin for your portfolio and you think it's a good financial investment, then Gemini is a safe and secure home and platform to actually go and execute and buy bitcoin.
Unfortunately the ETF regulatory process is a close process and we're not allowed to discuss the latest and greatest with it. We are working incredibly hard to make this happen as quickly as possible, and rest assured that nobody wants this to come to market quicker than myself and u/winky_pop.
We're definitely looking at expanding the exchange offering but we want to stay super focused on first things first – and that was getting licensed in the state of New York and having a successful launch but suffice to say we are working hard to expand our airs of operation.
(5) We have institutional market makers who are going to be providing liquidity on the exchange and we have a lot of demand from just retail and individuals and also other institutions who want to buy and sell bitcoin, so we think the combination of all the customers and also institutional market makers will make a lively and liquid market.
/r/ethtrader quickstart guide - Acronyms, Jargon, and Personalities.
Hi there new ETH investor and/or new /ethtrader community member! Glad to have you aboard. We are a pretty lively bunch around here; inside jokes, memes, and jargon run rampant. I figured I would create a sort of glossary to help you figure out what the actual fuck we are talking about. Acronyms (thanks decronym) BGD: Big green dildo, as in a big green candlestick on the price chart. BTFD: Buy the fucking dip. ATH: All time high, the highest price of a thing ever, 1400ish for ETH. FOMO: Fear Of Missing Out, the urge to jump on the bandwagon when prices rise. DeFi: Decentralized Finance, MakerDAO and Dharma and stuff. Loans basically. CDP: Collateralized debt position. A DeFi thing. FUD: FeaUncertainty/Doubt, negative sentiments spread in order to drive down prices. MEW: My Ether Wallet, a website to make and interact with wallets. TA: Technical analysis, predicting the future of the price based on the past. 2FA: 2 factor authentication, its a security thing, a second password of sorts. ERC20: The standard for tokens built on ETH. POS: Not piece of shit, or point of sale. Proof of stake, the new consensus mechanism coming to ETH soon™. ICO: Initial coin offering, the birth of a new crypto, usually an ERC20. Like an IPO. IEO: Initial exchange offering, like an ICO, but typically a bit more scammy. EZPZ: e_z_p_z_, more on him later... BAT: Not the animal, Basic Attention Token OMG: Not oh my god, well sometimes oh my god, but mostly OmiseGo. Pronounced OH-ME-SAY GO btw. MKR: MakerDAO. REP: There is too many tokens to list here, just google it you will figure it out. DYOR: Do your own research. People want to steal your money. Make sure you know what you are buying. LN: A silly bitcoin thing. GDAX: The old name for Coinbase Pro. Jargon Bull: Confident the price will go up. Confidant: misspelling of confident from e_z_p_z_. More on him later... Bear: Confident the price will go down. Cuecomber: Cucumber, another EZPZ classic. Can be used as in cool as a cucumber, or as in BGD (see? now you know what BGD means, damn this guide is helpful.) The ratio: The trading pair ETH:BTC. The flippening: The ETH marketcap being bigger than the BTC marketcap. Coming soon™ . Soon™: The release date for everything crypto related. Donuts: Like reddit karma but /ethtrader specific, and infinitely more valuable. Legend has it that if you get 10 million donuts Vitalik sends you 10 ETH for every 1 ETH you send him. The name comes from cyounessi's post here. Moon: The price where you can buy a lambo. Mooning: The price increasing rapidly. Maybe exposed butts depending on how you choose to spend your money. Moonboy: A hopelessly optimistic/greedy person. $13: The price was stuck here for a long time. Dark days for /ethtrader. $420: The top of the bull market before last. Also weed dude hehehe. $300: The price was stuck here for what seemed like forever. Oh how easy we had it back then... $324: EZPZ's number. More on him later... $80: The bottom of the previous bear market. We will definitely never see this price again. HODL: Hold. From here. SODL: Sold, same as above. BUIDL: Build, you get the pattern. Golden cross: Moving averages of prices crossing. A TA thing. FIAT: Not the car. Fiat Money. USD, euros, pounds and so on. Sharding: An ETH scaling method. Don't make sharting jokes, they anger Vitalik. Ramen: The meal of choice when the price goes down. Pamp: Pump Bogdanoff: This. Just... Don't ask... Weeks not months: In reference to Joe Lubin's prediction for ETH futures coming out. It has been 75 weeks since he said this. The Winklevii: Founders of Gemini Exchange, the facebook guys. Updoot the diddly: Or anything with that vague collection of letters, Upvote the daily discussion. JT's fire pit: jtnichol posts pictures of food he is cooking in his backyard fire pit. Those posts make you hungry. The DAO: Tumultuous times in ethereum history to say the least.Further reading here.) Personalities vbuterin: The founder of Ethereum. We really really like him. Joe Lubin: Co-founder of Ethereum, founder of ConsenSys. Memes aside. We like him. carlslarson: Creator of /ethtrader. Overall good guy. jtnichol: A mod of /ethtrader. Overall sweetheart. The rest of the mods: Too many to list. It's a great group of people. They won't give you any trouble if you aren't being a dick. dcinvestor: DC is a smart guy with good opinions. We really like him. E_Z_P_Z_ the undisputed meme champion. A genuine crazy person. Made a bad sell on the way up, and wrote lengthy posts about how ETH was going back to $324 multiple times a day for months, often times with terrible spelling and grammar. When ETH did hit 324 he became something like a local hero. He is the heel of /ethtrader and we all love to hate him. lamboshinakaghini: A fool, not to be trusted. scienceguy9489: He used to regularly post TA. Sometimes he was right, sometimes he was wrong. The crucial thing was that he was memeable. He started to get a bit of an ego going, and was deleting his posts that were wrong, and keeping the correct ones. He recently made a return to /ethtrader and made a post that ETH was going to moon on a certain day and it ended up not being correct, which was just fuel on the meme fire. He goes by etherdamus now and runs a private TA group which has a fee to join. singlestateserenity: He posts a haiku in the daily every day until we flippen bitcoin. Reading a nice haiku is a pleasant way to start your morning. Everyone else: Well you will see them around and catch the vibe. There are just too many lovable and hateable people to list.
As far as I know there are some people which are interested into these price changes (including me), so please refrain from posting complaints and just ignore this posting if you dont feel ok with it - thanks.
I'm much less interested in talking about Bitcoin than I was at the beginning of the year. I don't want to talk about alts, trading, Fibonacci, dips, taking profits, bulls, bears etc. There's not much to say about HODLing, so I'd like to suggest we start talking about SPENDing, or SPEDNing, if you prefer. Bitcoin offers a brighter future but only if wealth is distributed in a fairer, more even way. The way it's going at the moment, we're going to end up with Wall Street playing its games at new, unprecedented levels and the World owned and run by a new elite of pre-2013 miners (who didn't bin their hard-drives), the Winklevii and Julian Assange. The exciting and interesting challenges are: How do we start to use BTC (or something similar) as a means of exchange that removes the need for periodically bombing each other? What happens to taxation when government control of money is taken away? How do non-technical people start to feel safe and confident about using cryptocurrency? Let's experiment and figure it out. Settle a debt with a friend in Bitcoin. Pay for some work on your house or car with Bitcoin. Find out if you are liable for tax on those transactions where you live. Maybe even pay! This way you get to enjoy the returns from Bitcoin without the regret of selling for FIAT. It's 2021 and yes, that $100 you gave a friend back in 2017 is now worth $10,000 but maybe it's worth that much because you were part of the mass education and wider adoption that made your mates and a few mechanics and plumbers rich too. SPEDN! edited for readability
Bitcoin's market *price* is trying to rally, but it is currently constrained by Core/Blockstream's artificial *blocksize* limit. Chinese miners can only win big by following the market - not by following Core/Blockstream. The market will always win - either with or without the Chinese miners.
TL;DR: Chinese miners should think very, very carefully:
You can either choose to be pro-market and make bigger profits longer-term; or
You can be pro-Blockstream and make smaller profits short-term - and then you will lose everything long-term, when the market abandons Blockstream's crippled code and makes all your hardware worthless.
The market will always win - with or without you. The choice is yours. UPDATE: The present post also inspired nullc Greg Maxwell (CTO of Blockstream) to later send me two private messages. I posted my response to him, here: https://np.reddit.com/btc/comments/4ir6xh/greg_maxwell_unullc_cto_of_blockstream_has_sent/ Details If Chinese miners continue using artificially constrained code controlled by Core/Blockstream, then Bitcoin price / adoption / volume will also be artificially constrained, and billions (eventually trillions) of dollars will naturally flow into some other coin which is not artificially constrained. The market always wins. The market will inevitably determine the blocksize and the price. Core/Blockstream is temporarily succeeding in suppressing the blocksize (and the price), and Chinese miners are temporarily cooperating - for short-term, relatively small profits. But eventually, inevitably, billions (and later trillions) of dollars will naturally flow into the unconstrained, free-market coin. That winning, free-market coin can be Bitcoin - but only if Chinese miners remove the artificial 1 MB limit and install Bitcoin Classic and/or Bitcoin Unlimited. Previous posts: There is not much new to say here - we've been making the same points for months. Below is a summary of the main arguments and earlier posts:
Miners should use the cryptographic code provided by those programmers. But miners should not use an arbitrary, artificial economic limit ("MAX_BLOCKSIZE = 1 000 000") unilaterally imposed by those programmers - who understand cryptography but do not understand economics.
Blockstream is planning to steal around 90% of miners' fees, by forcing most transactions off the blockchain, and onto an unproven, centralized, off-chain system called Lightning Network.
The Bilderberg Group (major investors behind Blockstream) may be motivated to suppress Bitcoin price and adoption in order to prevent it from becoming a major world currency, and in order to allow central bankers to continue to control the world by infinitely printing their debt-backed fiat.
Independent Bitcoin implementations such as Bitcoin Classic and Bitcoin Unlimited use 99% of the same tested and proven code as Core / Blockstream - but without artificial limits on blocksize.
Bitcoin is not the only cryptocurrency game in town. There are many competing cryptocurrencies. And there is billions (eventually trillions) of dollars waiting to flow into cryptocurrency. Investors will not invest in a crippled coin. The winning coin will be the coin which is free of artificial constraints.
Investors have billions of dollars (eventually trillions) waiting to flow into cryptocurrency. Investors are software-neutral. Investors only care about wealth preservation and profit.
A Bitcoin "spinoff" (based on Bitcoin's existing ledger, but using a different hashing algorithm, to exclude existing miners) can and will be launched, if miners continue to use Core/Blockstream's crippled code.
Because a "spinoff" uses a different hashing algorithm, it would destroy existing miners' millions of dollars in hardware investment.
But because a "spinoff" uses the existing ledger, it would also preserve investors' billions of dollars in wealth.
The market will eventually win - with or without Chinese miners. The market always wins.
If the Chinese miners follow the market, then they have a simple, guaranteed path towards increasing long-term profits due to continuing rise in Bitcoin price and on-chain transaction fees - using their existing hardware.
If miners follow Core / Blockstream / Bilderberg Group, they will lose potential profits in the short term (due to suppressed price), and they will lose everything in the long term (when investors massively move to another coin with another hashing algorithm).
Previous posts providing more details on these economic arguments are provided below:
This graph shows Bitcoin price and volume (ie, blocksize of transactions on the blockchain) rising hand-in-hand in 2011-2014. In 2015, Core/Blockstream tried to artificially freeze the blocksize - and artificially froze the price. Bitcoin Classic will allow volume - and price - to freely rise again.
Bitcoin has its own E = mc2 law: Market capitalization is proportional to the square of the number of transactions. But, since the number of transactions is proportional to the (actual) blocksize, then Blockstream's artificial blocksize limit is creating an artificial market capitalization limit!
The Nine Miners of China: "Core is a red herring. Miners have alternative code they can run today that will solve the problem. Choosing not to run it is their fault, and could leave them with warehouses full of expensive heating units and income paid in worthless coins." – tsontar
Just click on these historical blocksize graphs - all trending dangerously close to the 1 MB (1000KB) artificial limit. And then ask yourself: Would you hire a CTO / team whose Capacity Planning Roadmap from December 2015 officially stated: "The current capacity situation is no emergency" ?
Blockstream is now controlled by the Bilderberg Group - seriously! AXA Strategic Ventures, co-lead investor for Blockstream's $55 million financing round, is the investment arm of French insurance giant AXA Group - whose CEO Henri de Castries has been chairman of the Bilderberg Group since 2012.
Austin Hill [head of Blockstream] in meltdown mode, desperately sending out conflicting tweets: "Without Blockstream & devs, who will code?" -vs- "More than 80% contributors of bitcoin core are volunteers & not affiliated with us."
Be patient about Classic. It's already a "success" - in the sense that it has been tested, released, and deployed, with 1/6 nodes already accepting 2MB+ blocks. Now it can quietly wait in the wings, ready to be called into action on a moment's notice. And it probably will be - in 2016 (or 2017).
Classic will definitely hard-fork to 2MB, as needed, at any time before January 2018, 28 days after 75% of the hashpower deploys it. Plus it's already released. Core will maybe hard-fork to 2MB in July 2017, if code gets released & deployed. Which one is safer / more responsive / more guaranteed?
"Bitcoin Unlimited ... makes it more convenient for miners and nodes to adjust the blocksize cap settings through a GUI menu, so users don't have to mod the Core code themselves (like some do now). There would be no reliance on Core (or XT) to determine 'from on high' what the options are." - ZB
BitPay's Adaptive Block Size Limit is my favorite proposal. It's easy to explain, makes it easy for the miners to see that they have ultimate control over the size (as they always have), and takes control away from the developers. – Gavin Andresen
Core/Blockstream is not Bitcoin. In many ways, Core/Blockstream is actually similar to MtGox. Trusted & centralized... until they were totally exposed as incompetent & corrupt - and Bitcoin routed around the damage which they had caused.
Satoshi Nakamoto, October 04, 2010, 07:48:40 PM "It can be phased in, like: if (blocknumber > 115000) maxblocksize = largerlimit / It can start being in versions way ahead, so by the time it reaches that block number and goes into effect, the older versions that don't have it are already obsolete."
Theymos: "Chain-forks [='hardforks'] are not inherently bad. If the network disagrees about a policy, a split is good. The better policy will win" ... "I disagree with the idea that changing the max block size is a violation of the 'Bitcoin currency guarantees'. Satoshi said it could be increased."
"They [Core/Blockstream] fear a hard fork will remove them from their dominant position." ... "Hard forks are 'dangerous' because they put the market in charge, and the market might vote against '[the] experts' [at Core/Blockstream]" - ForkiusMaximus
This ELI5 video (22 min.) shows XTreme Thinblocks saves 90% block propagation bandwidth, maintains decentralization (unlike the Fast Relay Network), avoids dropping transactions from the mempool, and can work with Weak Blocks. Classic, BU and XT nodes will support XTreme Thinblocks - Core will not.
4 weird facts about Adam Back: (1) He never contributed any code to Bitcoin. (2) His Twitter profile contains 2 lies. (3) He wasn't an early adopter, because he never thought Bitcoin would work. (4) He can't figure out how to make Lightning Network decentralized. So... why do people listen to him??
By far, THIS is the most damning part of the "BitLicense."
Unless you're a Winklevii, most in the community seem to agree that the BitLicense regulation proposals are archaic, and that it will hinder startup growth, etc. The most important point that people seem to overlook is this piece of regulation, section 200.8(b): Each Licensee shall be permitted to invest its retained earnings and profits in only the following high-quality, investment-grade permissible investments with maturities of up to one year and denominated in United States dollars: (1) certificates of deposit issued by financial institutions that are regulated by a United States federal or state regulatory agency; (2) money market funds; (3) state or municipal bonds; (4) United States government securities; (5) United States government agency securities BitLicense businesses cannot invest or hold their ANY of their profit in Bitcoin, ONLY in US Dollars. You will be told this regulation is to protect the business (and therefore, its consumers) from Bitcoin exchange rate fluctations, but if Bitcoin businesses are forbidden from holding their profits Bitcoin, then what are those businesses forced to do? Sell their Bitcoin - driving down prices, reducing demand. This part of the regulation has one purpose, and that is to prevent the rise of Bitcoin as a reserve currency. It simply makes no sense that a BITCOIN BUSINESS cannot hold ANY of its earnings in Bitcoin. This was written by the banks, for the banks. Don't support it, and don't be blinded by the "This is actually good news!" mentality. It's not, unless you're looking forward to JPMorganCoin. EDIT: Even more telling, the specific piece of regulation that I refer to above is NOT mentioned on the summary page of the regulations provided by New York State: http://www.dfs.ny.gov/about/press2014/pr1407171.html
Where the fck are the hedge funds in the bitcoin market?
I am honestly baffled as to why hedge funds haven't swooped into the bitcoin market yet. One of the biggest knocks on bitcoin as a currency and utility is this: why would a bitcoin consumer transact in bitcoin if there is a chance that its value in USD rises by 50% the very next day? Hedge funds could sooo easily reduce volatility for more conservative bitcoin users by guaranteeing the value of those users' underlying bitcoin -- almost like a mini-FDIC. If one of the big funds threw $25mm to test this out with a subset of users, it could send enormous positive signals to the rest of the community. Then in the event bitcoin appreciated, maybe the user would reap 80% of gains, and the fund 20%. With a fund backstopping 100% of losses, it seems like there would still be amazing option value for the funds and good peace of mind for the consumers. Interested to hear the community's thoughts? Are there any legal restrictions on the funds at this point due to the unclear regulatory environment?
01-30 22:33 - 'So, this doesn't really track. A distributed, decentralized fixed supply currency would have several advantages, chief of which is that world governments can't continue to inflate them at whim, which effectively [robs] the...' by /u/paperraincoat removed from /r/Bitcoin within 0-10min
''' So, this doesn't really track. A distributed, decentralized fixed supply currency would have several advantages, chief of which is that world governments can't continue to inflate them at whim, which effectively [robs]1 their populace of purchasing power (taxation without representation). On the downside, they encourage [hoarding]2 . There was no way to fairly distribute coins here, we still have the vast majority, some 80%+ of coins in the hands of only a few hundred people and exchanges. Ideally we want Bitcoin to go to say, $100k a coin and chill there all cozy, co-existing with fiat, stocks, commodities and the like. If things go to $1,000,000+ a coin where Bitcoin is some financial black hole vacuuming up all the wealth in the world we'd be facing a very strange worldwide [deflationary spiral]3 . You can read up on Japan's woes over the past twenty years trying to get themselves out of a [deflationary economy]4 , it's pretty intense. I don't want a future where the Winklevii own 15% of the world's wealth and start construction on their own private Death Star. ''' Context Link Go1dfish undelete link unreddit undelete link Author: paperraincoat 1: *ww*f**bes.com/s*te*/bil*fl*x/2011/03/03/*ou-*all*it-*nfla*i*n-i-*a*l-*t-*he*t* 2: steemit.*om/m*ne**@calab*r24p/*un*ing*ec**o*i*s-o*f-a-fixed*cu*re*cy-s**pl*-is-a-*e***b*e-*dea-h*re-s-why 3: *n.bitcoi*.**/*i*i/De*lationary***iral 4: www.***r.org*papers/w10*7* Unknown links are censored to prevent spreading illicit content.
Where Art Thou, Bullwhale? Or, Why I Am Disappointed in the Markets Lately
I have to say, I'm a bit disappointed in the markets lately. In order to be able to say that here, though, I'll have to include a paragraph or two's worth of disclaimers throughout to head off some of the most popular retorts. Please, allow me to elucidate, and in the process indulge in a lazy Sunday thought experiment: I'm disappointed, not because the Bearwhale entity is back (after smartly waiting for the market to unwind some pent-up bullish exuberance), but mainly because the market isn't doing a damn thing about it. Again. I've bemoaned this situation in the past, but I don't think I clarified my views well enough. If I may, I'd like to take another shot: The Bearwhale's strength seems to be that that their actions, when present, serve to either establish or reinforce the prevailing downtrend. That trend is then followed by the herd, who have been conditioned so many times that "the trend is their friend" that most don't even think twice about it. While this seems to be the main feedback loop that the Bearwhale relies on, the downtrend is also further exacerbated by the constant selling pressure from miners, as well as hodlers loaning their BTC out for crumbs (not realizing that their collective actions serve to devalue their holdings way more than those crumbs they receive in return). While the Bearwhale entity's goals are nearly impossible to determine with any confidence, their tactics are certainly to be admired. They are taking great advantage of some very powerful market forces—the reflexivity of the market, combined with the "tragedy of the commons" inherent in two areas: mining, and availability of margin—to effectively corner the market downwards for their benefit. To be clear: this isn't the part I'm disappointed in, though. The fact that they're back and are continuing doesn't surprise me, either, given not only that they've been doing it so effectively and for so long, but also that exactly this sort of behavior was predicted almost three years ago:
Bitcoin takes the monetary system back essentially a hundred years. We know how to beat that system. In fact, we know how to nuke it for profit. Bitcoin is volatile, inherently deflationary and has no lender of last resort. Cornering and squeezing would work well - they use mass in a finite trading space. Modern predatory algos [...] would rapidly wreak havoc.
So, while I am weary of the effects of the Bearwhale's actions this year, I am neither disappointed nor surprised by them. After all, as Right_In-The-Pussy astutely pointed out, "free market something something". What I am disappointed by, though, is that no entity or entities in this glorious free market, throughout all this time, have deemed the situation worthy of responding by putting the screws to the Bearwhale in return. (At this point, a commotion is heard as a hundred traders rush to leave comments filled with scathing retorts of smart-assery.) Now, hear me out here, folks. Let's first take a step back, and examine the situation at large: If we surmise that the Bearwhale operates roughly as laid out above (and more or less as speculated throughout this forum) it is probably fairly safe to assume that "the beatings will continue until morale improves"; that is, that they will probably keep up their dumping scheme unless and until the market pushes back strongly enough to convince them that the support is no longer worth fighting at that level. This is a grim prospect for Bitcoin, because the longer this keeps up and the lower we go, the less likely it will seem to be that the Bearwhale is benevolent (i.e. manipulating out of self-interest or related motives, but ultimately interested in and aligned with Bitcoin's long-term success). It becomes exceedingly likely that they are purely profit-driven, and will have no qualms about trying to drive the price straight into the ground. As has been noted many times on this forum and elsewhere, this can and will wreak havoc on the entire ecosystem: mining, merchants, VC investments, adoption, exchanges...you name it. Which is why, when the Bearwhale continued to push the market downwards into the lower $300s and beyond (with more and more traders gleefully shorting alongside them), I posted this:
It's really less about profit, and more about the ratio of profit vs. progress. These days, there's too much of the former going on at the expense of the latter, and nobody seems too worried about offing the golden goose in the process.
At these price levels, we are starting to exceed certain tolerances; Bitcoin may be Honey Badger, but Honey Badger can't continue to lose this much blood without feeling some very negative long-term effects. As we continue to slide, Bitcoin's prospects (first growth, then viability in general) increasingly come into question. So, the question that should be on the mind of all Bitcoin faithful is: what can be done about this? The situation is grim: hodlers are stuffed to the gills and despondent, miners are only as faithful as the protocol forces them to be (100 blocks), margin trading is toothpaste that can't be put back in the tube, and the ten-month downtrend is a positive feedback loop that almost ceaselessly continues to spread pain and suffering....
Enter the Bullwhale: the Hero We Don't Deserve, but the One We Need Right Now
Ok, fine...we don't need a Bullwhale—the markets at large could (and probably eventually will) coalesce like a school of fish around some "way too low" price point, establish unyielding support, and send a resounding message (as happened recently at $300). In the meantime, we could all wait around and see how low the Bearwhale will take us, and what sorts of very unfortunate things happen in the interim as a result. One way or another, Bitcoin will most likely survive...and the scars will add character, right? But gosh, we certainly could use a Bullwhale's help here. We could use some now more than ever, but really, we needed one ever since the Bearwhale got started putting their boot to the market's neck earlier this year. Hell, a Bullwhale's job would have been much easier back then—having at their disposal a vast army of bubble believers and lunar lunatics which has since then gradually eroded. In the interim, bulls have not just been decimated, but almost put on the endangered species list at this point. So, who could save Bitcoin from the beatings and turn the market around? A variety of actors could step in, and like the Bearwhale, the most important factor is the scale at which they can operate—their intentions could be benevolent, selfish, or a combination; it doesn't so much matter, as long as the effected direction is up. This could be someone from the idealogical crowd like Byrne & Co., wanting to stick it to the entrenched market establishment; maybe Soros, wanting to further an Open Society (and in the process, lending more credence to his theories of fallibility and reflexivity); or Draper, the Winklevii, Silbert, et. al., wanting to protect their investments and further their Bitcoin-related aspirations; or perhaps one or more early adopters with some choice connections for fiat liquidity, weary of watching their beloved protocol get beat down and their holdings depreciate. It could be an entity with potentially mixed motivations...like Google, for example: they could adopt Bitcoin in a flash and spark a rally, positioning themselves as the market leader of an open ecosystem of the kind that they like, while also raking in a boatload of money in the process. Paypal, Amazon, etc. could make similar plays, though I suspect they're less likely to do so. Or, it could be an actor every bit as selfish as the Bearwhale entity—just a mirror image of them. Someone who realizes that there's more to be made in the long term supporting Bitcoin's growth rather than sabotaging it. After all, the powerful market mechanics harnessed by the Bearwhale can be harnessed equally well by a Bullwhale. Those that have been around long enough know what it looks like when these kinds of forces finally turn around. All it takes is a convincing reversal on high volume (like we had at $300), followed up by some continued encouragement (which we didn't have, in turn giving the Bearwhale the encouragement they needed to start messing around again). If timed right, not much encouragement is even needed; just enough to convince the market that the Bearwhale has been neutered. How? Send some chunky wires to all the major exchanges, and then simply wait to reverse the playbook on them. 400 BTC is dumped in a minute? Buy up 600 the next. 800 follows, ten minutes later? Enter a 2,000 BTC market buy. How long until the Bearwhale gets the message? And even if they don't, more critically: how long until the market does? Traders may be hard to convince at first—and the skepticism can't be blamed at this point, given how long this has been allowed to drag on. But again, a few plays straight from the Bearwhale's playbook (but reversed) will do the trick: a couple of three- or four-digit BTC buys in the morning, two or three hours apart...a couple more buys of similar magnitude in the evening...and some salubrious support in the meantime—say, a 300 BTC wall, with another 1,000 not far behind it?—will turn bears into bulls faster than you can say "irrational exuberance." The first-mover advantage will be massive. Sooner than one might think, the artificial trend will have morphed into a real one. Daily Discussions will once again be filled with traders quibbling about whether $3k or $8k will me a more appropriate cash-out point in the oncoming bubble. Miner selling will dry up, and margin longs will break the stratosphere. Potential Bearwhale-like attacks just need to be quickly countered for a little while longer, and inevitably rabid, foaming-at-the-mouth FOMO will take over, a rush of new participants will flood in...and, well, we know what happens from there. At this point in this and any related scenario, it would appear that the ceiling becomes a lot higher than the floor; that is, that we'd likely go up a lot higher than we could have ever possibly gone down (about $350, as of this writing). So...why hasn't it happened? Where art thou, Bullwhale? I am disappointed by thine absence. As always, constructive discussion is welcomed and appreciated.
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