Bitcoin crash coming (3 Viewers)

[DirtyTIVA]

I heard something interesting about the whole FTX thing that kind of relates to chips. It seems far fetched to have a valuation of 32B. What they did with their native token of FTT was create a bunch of tokens (250M) but only offer up for sale some of them, like 1 million tokens for example. By creating a market with thin liquidity the price per token trends upwards.

Say for example those 1 million FTT tokens reach a price of $75/ea. Then what FTX did was mark down the remaining 249 million tokens at $75/ea. on their balance sheet. This was a clever way to puff up their balance sheet despite there likely not being a real market for all the FTT tokens in existence. IF they did release all the tokens at once then the price would have been much lower.

I thought of the example as it relates to chips. Just because a single sells on eBay for $100 and you happen to have 4 racks of those chips it doesn't mean you have $40,000 worth of chips.

Perry I was going to say Serum and FTT are similar to a sudden influx of NAGB chips whose values are set by early auctions of a small fraction of the inventory held by one whale...

 

[softchewy]

much lost
where is moon?

 

[DrStrange]

Some great deals this week:


My favorite TexMex place is offering a 3% discount when paying with Crypto.

The Exxon station nearest my house is giving a $0.05 per gallon discount for Crypto payments, but not at the pump. Only inside.

Fancy steak house offered us a 5% discount for payments in Crypto.

Even the big liquor store gives a 2% cut if paid via crypto.





Oh fudge! Old man brain freeze. I didn't mean discounts for Crypto. I meant to say these discounts were for US Dollars - you know that obsolete paper fiat "money". None of these places takes even one of the twelve thousand crypto coins as payment for food, gas or booze.

Sorry for the confusion -=- DrStrange

 

[Tommy]

BlockFi today voluntarily filed petitions for Chapter 11 reorganization.

https://www.businesswire.com/news/h...ximize-Value-for-all-Clients-and-Stakeholders

 

[Darson]

My Mum has some inheritance sitting in a bank account in Sri Lanka where there are currently very strict foreign exchange controls from the central bank. I immediately thought of crypto as a way to get it out easily.

But then discovered that you need to find an exchange willing to take your fiat and allow you to buy crypto. And the central bank has banned exchanges. While crypto seems like the solution to a lot of these restrictions due to a country's monetary policy, if you can't get your fiat to a crypto exchange, it's not a working solution. Once you have crypto, it's great and functional, but getting your fiat to crypto is a challenge in exactly those places that crypto would help circumvent restrictions or impacts from high inflation. Inflation in Sri Lanka peaked at nearly 70% earlier this year!

 

[Lemonzest]

My Mum has some inheritance sitting in a bank account in Sri Lanka where there are currently very strict foreign exchange controls from the central bank. I immediately thought of crypto as a way to get it out easily.

But then discovered that you need to find an exchange willing to take your fiat and allow you to buy crypto. And the central bank has banned exchanges. While crypto seems like the solution to a lot of these restrictions due to a country's monetary policy, if you can't get your fiat to a crypto exchange, it's not a working solution. Once you have crypto, it's great and functional, but getting your fiat to crypto is a challenge in exactly those places that crypto would help circumvent restrictions or impacts from high inflation. Inflation in Sri Lanka peaked at nearly 70% earlier this year!

The thing is off/on ramps for crypto is hard for everyone. Try to find people that are willing to transact in person. If you want to buy BTC then there is probably someone that is trying to sell.

 

[ekricket]

The thing is off/on ramps for crypto is hard for everyone. Try to find people that are willing to transact in person. If you want to buy BTC then there is probably someone that is trying to sell.

I hear Craigslist and Facebook have a lot of people that are selling crypto. You can probably find a good person to person transaction there. One guy is selling the actual bitcoins so you don’t even need a computer.

Great advice here!!

 

[DirtyTIVA]

Actual bitcoins are fun!

 

[Rakrul]

My Mum has some inheritance sitting in a bank account in Sri Lanka where there are currently very strict foreign exchange controls from the central bank. I immediately thought of crypto as a way to get it out easily.

But then discovered that you need to find an exchange willing to take your fiat and allow you to buy crypto. And the central bank has banned exchanges. While crypto seems like the solution to a lot of these restrictions due to a country's monetary policy, if you can't get your fiat to a crypto exchange, it's not a working solution. Once you have crypto, it's great and functional, but getting your fiat to crypto is a challenge in exactly those places that crypto would help circumvent restrictions or impacts from high inflation. Inflation in Sri Lanka peaked at nearly 70% earlier this year!

Most crypto exchanges accepts wire transfer in your local currency. All countries has a portion of their fiat outside their country somehow anyways. And as suggested, there might be someone who sells their crypto to get hard cash for whatever reason, but it's a bit risky and not something I would recommend for a nest egg.

 

[MatB]

TLDR: Bought really cheap. Sells really high. NEVER BUYS/

Bitcoin success stories in a nutshell..

 

[BNM]

Thank you for this story.

Even with US inflation higher than it’s been in a very long time, the west doesn’t understand how horrible most of the worlds central banks are to the common man.

Bitcoin does give you an option, nobody is saying “sell all your gold and mansions and buy bitcoin instead”

What most responsible bitcoiners think is a good strategy is DCA (dollar cost average) a portion of your income savings once a week or month, or whatever is palatable, just chip in something for a rainy day, on a regular schedule, you will catch the highs and catch the lows just the same, and anyone who has done that for a couple years always seems to come out fine, beating the SNP and knocking the crap out of inflation.

The entire “crypto” industry and all its scams and shenanigans is an attack on the credibility of the one true asset that has the ability to turn central banks upside down.

The powers that be do not want humans to have sovereignty over their money.

The western banks do know that most central banks are “developing”. It’s part of why there is an IMF.

I think you’re saying that DCA-ing into BTC beats the S&P for returns, which seems slightly premature given its young age. Also, is it a currency or an equity? Seems like an equity based on your description.

The fundamental drive to upend “the system” has always struck me as theoretical musings of a utopian “how it could/should be” belief system which conveniently avoids the widespread chaos, war and suffering that are a virtual certainty if the current global monetary system collapses.

I am not a big brain, though, and don’t even understand what is meant by humans having sovereignty over their money, so consider the source.

 

[DrStrange]

From Bloomberg - 11/30/2022

"Miners, who raised as much as $4 billion from mining-equipment financing when profit margins were as high as 90%, are defaulting on loans and sending hundreds of thousands of machines that served as collateral back to lenders."

I often pondered what happens if bitcoin miners didn't make enough money from the effort to bother running the operation. So here we are. Mining isn't very profitable, if it is at all. The value of a bitcoin is well below its high. The price of electricity is markedly higher than historical norms. What should we expect to happen?

I don't know enough about bitcoin to answer. If mining grinds to an unprofitable halt, what are the implications for the coin? Is halving an automatic thing even if mining wasn't happening at the old price? When I read about halving, I find the most remarkable gathering of misinformation and economic ignorance. The next halving is planned for early 2024. "Blue sky plans" aside, there is no way for miners to assure themselves that the loss of half their income can be made up by forcing the bitcoin market to purchase new tokens at double the price.

If no one mines, does the coin's registry become at risk? Does the blockchain fail if no one pays the electric bill?

 

[Highli99]

From Bloomberg - 11/30/2022

"Miners, who raised as much as $4 billion from mining-equipment financing when profit margins were as high as 90%, are defaulting on loans and sending hundreds of thousands of machines that served as collateral back to lenders."

I often pondered what happens if bitcoin miners didn't make enough money from the effort to bother running the operation. So here we are. Mining isn't very profitable, if it is at all. The value of a bitcoin is well below its high. The price of electricity is markedly higher than historical norms. What should we expect to happen?

I don't know enough about bitcoin to answer. If mining grinds to an unprofitable halt, what are the implications for the coin? Is halving an automatic thing even if mining wasn't happening at the old price? When I read about halving, I find the most remarkable gathering of misinformation and economic ignorance. The next halving is planned for early 2024. "Blue sky plans" aside, there is no way for miners to assure themselves that the loss of half their income can be made up by forcing the bitcoin market to purchase new tokens at double the price.

If no one mines, does the coin's registry become at risk? Does the blockchain fail if no one pays the electric bill?

The bitcoin network operated fine when the tokens were nearly worthless. Miners shutting down is simply supply and demand driven by price. If price goes up miners will come back.

 

[DirtyTIVA]

From Bloomberg - 11/30/2022

"Miners, who raised as much as $4 billion from mining-equipment financing when profit margins were as high as 90%, are defaulting on loans and sending hundreds of thousands of machines that served as collateral back to lenders."

I often pondered what happens if bitcoin miners didn't make enough money from the effort to bother running the operation. So here we are. Mining isn't very profitable, if it is at all. The value of a bitcoin is well below its high. The price of electricity is markedly higher than historical norms. What should we expect to happen?

I don't know enough about bitcoin to answer. If mining grinds to an unprofitable halt, what are the implications for the coin? Is halving an automatic thing even if mining wasn't happening at the old price? When I read about halving, I find the most remarkable gathering of misinformation and economic ignorance. The next halving is planned for early 2024. "Blue sky plans" aside, there is no way for miners to assure themselves that the loss of half their income can be made up by forcing the bitcoin market to purchase new tokens at double the price.

If no one mines, does the coin's registry become at risk? Does the blockchain fail if no one pays the electric bill?

That was my understanding. But fret not! There are still an infinite number of other “coins” each in alleged finite supply, even the offshoots that seem as mercurial as Elon Musk’s behavior. So what if 10000 new dogecoins are minted every minute? Supply and demand is such an old timey way of looking at things.

 

[PlayerADK]

From Bloomberg - 11/30/2022

"Miners, who raised as much as $4 billion from mining-equipment financing when profit margins were as high as 90%, are defaulting on loans and sending hundreds of thousands of machines that served as collateral back to lenders."

I often pondered what happens if bitcoin miners didn't make enough money from the effort to bother running the operation. So here we are. Mining isn't very profitable, if it is at all. The value of a bitcoin is well below its high. The price of electricity is markedly higher than historical norms. What should we expect to happen?

I don't know enough about bitcoin to answer. If mining grinds to an unprofitable halt, what are the implications for the coin? Is halving an automatic thing even if mining wasn't happening at the old price? When I read about halving, I find the most remarkable gathering of misinformation and economic ignorance. The next halving is planned for early 2024. "Blue sky plans" aside, there is no way for miners to assure themselves that the loss of half their income can be made up by forcing the bitcoin market to purchase new tokens at double the price.

If no one mines, does the coin's registry become at risk? Does the blockchain fail if no one pays the electric bill?

Mining is still profitable, obviously at a much lesser margin than at higher BTC prices. There is a never-ending debate on what is more profitable, DCAing into BTC or mining BTC (good arguments for both sides, too many variables in mining to be a simple yes/no)

These companies/businesses were basically overleveraged into their equipment. Similar to any "bear market" - those who are overleveraged are likely to get burnt. It is just part of the cycles.

As hash rate decreases, so does difficulty. Meaning it takes less hash rate to discover new blocks, basically attempting to make it more profitable to mine BTC.

These articles are just showcasing those who were overleveraged and had investors who demanded a particular ROI vs time, and with recent prices they likely couldn't achieve that. BTC mining is still profitable (depending on your electric costs).

Hash rate is still way higher than it was at ATHs. (~37% higher) 175m TH/s vs todays 240m TH/s

Meaning people are continuing to build more and more miners, and they are using them.

 

[DrStrange]

Is this to say bitcoin mining provides nothing useful but is merely a pointless task? Mining can become unprofitable, grind to a near halt for months or years and then resume if/when the price of bitcoin recovers. But if mining vanished, no impacts on the operation of bitcoin?

 

[PlayerADK]

Is this to say bitcoin mining provides nothing useful but is merely a pointless task? Mining can become unprofitable, grind to a near halt for months or years and then resume if/when the price of bitcoin recovers. But if mining vanished, no impacts on the operation of bitcoin?

Mining IS bitcoin. Mining secures and confirms transactions on the network itself. If mining vanishes, the BTC network no longer exists. No more blocks would be produced, thus the network wouldn't transact again.

e/ only the historical ledger would exist

 

[Darson]

Bitcoin mining is meant to self regulate -> miners compete for the rewards (paid in bitcoin) from mining -> the bigger and better your computer, the more likely you are to get a reward -> Bitcoin prices go up and miners can afford to buy and run bigger computers so that they are more likely to get rewards -> prices go down and the expensive boys may shut down -> and the cycle continues.

The actual computing power to maintain the blockchain and transactions requires a trivial amount of computing power. The reason why huge computers abound is the competition mechanism for the right to validate transactions and receive the subsequent rewards. If the commercial miners disappeared, the blockchain would still be maintained by the couple hundred geeks who are running mining rigs in their parent's basement.

 

[ekricket]

the blockchain would still be maintained by the couple hundred geeks who are running mining rigs in their parent's basement.

Well..

 

[WedgeRock]

 

[Mike mac]

the case between the SEC and RiPPLe will end soon with clarity and regulations making it the only safe coin to be in. then the SEC will turn its guns on ETH and all the money should flow into XRP.. get in now while its 37 cents! see ya on the mooooon

 

[WedgeRock]

 

[Rakrul]

My friend who does technical analytics on crypto says that BTC has breeched some sort of ceiling at $17k and is likely to increase going forward. Gamble at your own risk. He said "likely" not guaranteed. And he didn't say 10x your money!! either. Nor 2x for that matter.
Edit: I'm staying put on Eth because I don't know wtf I'm doing.

 

[HaRDHouSeiNC]

My friend who does technical analytics on crypto says that BTC has breeched some sort of ceiling at $17k and is likely to increase going forward. Gamble at your own risk. He said "likely" not guaranteed. And he didn't say 10x your money!! either. Nor 2x for that matter.
Edit: I'm staying put on Eth because I don't know wtf I'm doing.

I’m betting 13k before we see 20k again

I’m still liking ETH more though now because of more utility

 

[Rakrul]

I’m betting 13k before we see 20k again

I’m still liking ETH more though now because of more utility

You should short then.

 

[HaRDHouSeiNC]

You should short then.

I don’t mess with markets really
Just Hold one More cycle and hope It does what I hope

 

[BNM]

My friend who does technical analytics on crypto says that BTC has breeched some sort of ceiling at $17k and is likely to increase going forward. Gamble at your own risk. He said "likely" not guaranteed. And he didn't say 10x your money!! either. Nor 2x for that matter.
Edit: I'm staying put on Eth because I don't know wtf I'm doing.

I once listened to a podcast featuring an interview with “Plan B”, and he intimated that the white paper (or whatever concept document, program, etc.) on BTC basically predicated the huge swings. I can’t remember when he said they would happen. That was the last time I tried to understand BTC. ETH seems like it has a better use case but, like you, I don’t understand it.

 

[eightyWon]

The actual computing power to maintain the blockchain and transactions requires a trivial amount of computing power

To be clear (and you likely already know this, Darson - this is for the other folks asking), the difficulty of mining a block isn't fixed but rather regularly adjusts (about every 2 weeks) based on how quickly recent blocks were mined so that the average time to mine a block stays at ~10 minutes

Tons of computing power being thrown at solving blocks=quicker blocks=difficulty goes up to balance

Less computing power (see China mining ban about a year ago)=slower blocks=difficulty goes down

edit: The amount of computing power being used to solve bitcoin blocks is called the hash rate and it's historically continued to rise - https://www.blockchain.com/explorer/charts/hash-rate

edit edit: want to see a testament to the stability and consistency of the bitcoin network, the mining and difficulty process, see this chart with the historic block mining times - https://bitinfocharts.com/comparison/bitcoin-confirmationtime.html#alltime

basically, for 13+ years, bitcoin mining has worked like clockwork and hasn't missed a beat

 

[Mike mac]

anyone get in on the flare token airdrop today? token tanked, but free money is free money

 

[waddadonk]

anyone get in on the flare token airdrop today? token tanked, but free money is free money

what did you have to do to qualify? also, how are you tracking airdrops? i look at earni.fi occasionally, but don't pay for premium so im not sure what some of these mystery drops are.