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Bitcoin Plunge Reveals Possible Vulnerabilities In Crazy Imaginary Internet Money


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2017 Dec 10, 9:49pm   7,844 views  44 comments

by Patrick   ➕follow (55)   💰tip   ignore  

https://www.theonion.com/bitcoin-plunge-reveals-possible-vulnerabilities-in-craz-1821134169
NEW YORK—Saying it may account for the precipitous drop in the digital currency, financial experts on Friday told reporters that the recent plunge in bitcoin value could reveal vulnerabilities in crazy imaginary internet money. “This should serve as a clear indicator of how susceptible weird invisible money that only exists online can be to sudden fluctuations in the market,” said economist Bernard Gregerson, explaining that the 18 percent decline in bitcoin’s value might be a predictor of more drastic fluctuations to come in the price of bizarre make-believe cryptocurrency that has no reality in the physical realm. “This volatility may be connected to the fact that we’re dealing with a pile of ones and zeros with no attachment to any bank or government and calling it legal tender, but we can’t say for certain.” At press time, bitcoin had recouped some of its losses, which experts attributed to the fact that even ghost money best suited for anonymously buying heroin could sometimes rebound.


#finance

(ok, really #humor)

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1   BayArea   2017 Dec 10, 10:28pm  

What plunge?
2   🎂 Tenpoundbass   2017 Dec 11, 5:51am  

The Onion is probably more truthful than CNN Money on economics.

We went through 8 years of sitting in a financial fart sauna and CNN and other MSM finance rags all said Obama was a genius for not letting the Billionaires lose their bad bets.
3   NuttBoxer   2017 Dec 11, 11:19am  

A currency where most of the holders are in it purely for speculation could be prone to wild dips? What!?

FYI, futures in bitcoin are soon to be available, so it can be shorted. But I'm sure that timing is just coincidental.
4   BayArea   2017 Dec 11, 12:22pm  

The funny thing about the momentary Bitcoin plunges is that by the time the doom and gloom articles are public, the price is higher than the article’s original reference point price.
5   MisdemeanorRebel   2017 Dec 11, 3:08pm  

The ironic thing is that many of the Bitcoin advocates make these wild claims about the World Reserve Currency.

The dollar doesn't lose 20% of it's value in 24 hours, yet make up the loss in a week.

But most currencies are perception and confidence.

Including Gold, by the way.
6   WatermelonUniversity   2017 Dec 11, 4:44pm  

i'd rather buy lottery tickets.
7   Strategist   2017 Dec 11, 6:14pm  

NuttBoxer says
A currency where most of the holders are in it purely for speculation could be prone to wild dips? What!?

FYI, futures in bitcoin are soon to be available, so it can be shorted. But I'm sure that timing is just coincidental.


The Bitcoin futures started trading today. They won't allow it to be shorted due to the extreme volatility.
If they introduce options on this, I would buy the puts. It's the safest way of trading a bubble.
8   Strategist   2017 Dec 11, 6:18pm  

Newbie123 says
Now we have institutional money buying Bitcoin Futures....Are they going to issue Crypto ETF's next?


They probably will issue a Crypto ETF at some point. It will be very interesting to see how it plays out.
9   BayArea   2017 Dec 11, 8:36pm  

Crypto ETF is next step
10   Strategist   2017 Dec 11, 8:42pm  

BayArea says
Crypto ETF is next step


If crypto currencies take off, what will the need for gold be?
11   anonymous   2017 Dec 12, 7:07am  

Tenpoundbass says
finance rags all said Obama was a genius for not letting the Billionaires lose their bad bets.


That's odd. Why would the financial rags say the Bush bail out made Obama a genius? Want to expand on that thought?
12   Patrick   2017 Dec 12, 7:15am  

To be honest, I like Bitcoin and the freedom it represents from government control.

Why should government be able to tax work or commerce at all? They should not. Land is the best object of taxation, and cannot be hidden. So Bitcoin helps https://en.wikipedia.org/wiki/Georgism
And fiat currency is hardly any better than Bitcoin in terms of being imaginary.
13   mell   2017 Dec 12, 8:29am  

Patrick says
To be honest, I like Bitcoin and the freedom it represents from government control.

Why should government be able to tax work or commerce at all? They should not. Land is the best object of taxation, and cannot be hidden. So Bitcoin helps https://en.wikipedia.org/wiki/Georgism
And fiat currency is hardly any better than Bitcoin in terms of being imaginary.


Agreed, I like it too. Still it's in a bubble ;)
14   anonymous   2017 Dec 12, 8:48am  

mell says
Patrick says
To be honest, I like Bitcoin and the freedom it represents from government control.

Why should government be able to tax work or commerce at all? They should not. Land is the best object of taxation, and cannot be hidden. So Bitcoin helps https://en.wikipedia.org/wiki/Georgism
And fiat currency is hardly any better than Bitcoin in terms of being imaginary.


Agreed, I like it too. Still it's in a bubble ;)


By the definition of a bubble, Bitcoin itself cannot actually be a bubble. Crypto currency in general, yes, but bitcoin specifically, nope. Bitcoin is headed for six figures valuation
15   WookieMan   2017 Dec 12, 11:06am  

errc says
Bitcoin is headed for six figures valuation

I'm genuinely not being a smart ass. Why?
16   Ceffer   2017 Dec 12, 11:11am  

Bitcoin is going to make all kinds of sloshing, extra cash hordes vaporize into screaming bits and help control inflation. Gamble on, suckers!

Screw heroin, the CIA wants to seize Bitcoin and use it for black ops arms deals.
17   anonymous   2017 Dec 12, 11:58am  

WookieMan says
errc says
Bitcoin is headed for six figures valuation

I'm genuinely not being a smart ass. Why?


They are in limited supply, while the demand is increasing
18   WookieMan   2017 Dec 12, 12:33pm  

errc says


They are in limited supply, while the demand is increasing

I understand that and there is a finite number of bitcoins. Why is demand increasing for it though? That's what doesn't make sense to me. What is "it" that's in demand?

Again, I'm being serious. I really do enjoy investment advice, but I simply don't understand anything about this. I know how to get it. I know how to sell it. But why? Why is this worth $17k and why won't it be worth $1 in 2 hours time? Until someone can explain that to me, I'm willing to watch people make millions, while I continue on my path to retire at 50. Which I'm cool with.
19   Patrick   2017 Dec 12, 12:35pm  

Tax evasion.
20   anonymous   2017 Dec 12, 1:36pm  

You can counterfeit a dollar bill but you can't counterfeit a bitcoin. Think about it. Who's crazy now?
Hopefully the IRS comes to their senses and taxes bitcoins as "collectibles" (like gold and silver).
21   anonymous   2017 Dec 12, 1:36pm  

WookieMan asks:
Why is this worth $17k and why won't it be worth $1 in 2 hours time?
That is roughly the "cost" the the equipment and energy used to "mine" a bitcoin at this time. Who's crazy now?
22   WookieMan   2017 Dec 12, 2:34pm  

anon_3e01a says
Who's crazy now?

You’ve said this twice now. Please explain who is calling someone crazy here? Sure wasn’t me.
23   Heraclitusstudent   2017 Dec 12, 2:47pm  

Patrick says
They should not. Land is the best object of taxation, and cannot be hidden. So Bitcoin helps

I never understood this claim. So a large farming operation should according to you pay more taxes than Google? Why?
24   WookieMan   2017 Dec 12, 2:49pm  

anon_3e01a says
You can counterfeit a dollar bill but you can't counterfeit a bitcoin. Think about it.

If it was created by humans it most certainly can be counterfeited. Or even easier, stolen. It’s already happened.

When someone can answer why bitcoin can’t go to $2, I’ll think about investing. Until then I’ll stick with things that have a history of consistent returns.

Again, invest in this stuff all you want. I won’t stop you and I don’t think my postings here have been negative towards those that have decided to invest. I’m just looking for someone to tell me why this is sustainable. Why there is “demand” for “it.” No one has explained this. I don’t think anyone can truthfully.
25   Heraclitusstudent   2017 Dec 12, 2:50pm  

http://www.zerohedge.com/news/2017-08-25/bitcoin-really-anonymous-irs-moves-track-cryptocurrencies-new-chain-analysis-tools "According to a contract recently obtained by the Daily Beast, the IRS can now track bitcoin and other cryptocurrency addresses. They can do this to route out potential tax evaders."
26   anonymous   2017 Dec 12, 4:13pm  

WookieMan says
anon_3e01a says
You can counterfeit a dollar bill but you can't counterfeit a bitcoin. Think about it.

If it was created by humans it most certainly can be counterfeited. Or even easier, stolen. It’s already happened.

When someone can answer why bitcoin can’t go to $2, I’ll think about investing. Until then I’ll stick with things that have a history of consistent returns.

Again, invest in this stuff all you want. I won’t stop you and I don’t think my postings here have been negative towards those that have decided to invest. I’m just looking for someone to tell me why this is sustainable. Why there is “demand” for “it.” No one has explained this. I don’t think anyone can truthfully.


I don’t hear many people referring to Bitcoin purchases as “investments”. Bitcoin can serve as a divest from the USD, or as a pure speculative gamble, which is the camp I fall into. The market for Bitcoins has seen the majority of inflows from The East, first China, now primarily Japan.

I learned long ago, that to ask “why” is anathema to investing in momo plays, the question you need to ask is “why not”, so you know when to exit.

I was first turned on to bitcoins almost five years ago, by some very intelligent sports gamblers, looking for cracks in our Horrific Anti-Freedom Republican laws. Around the time they went from the teens all the way to $30. Lol. Was BTC a bad buy at $30?
27   Strategist   2017 Dec 12, 4:50pm  

I just bought some Bitcoin..$10.00 worth from curiosity. It was the easiest thing in the world.
28   Strategist   2017 Dec 12, 4:54pm  

Heraclitusstudent says
http://www.zerohedge.com/news/2017-08-25/bitcoin-really-anonymous-irs-moves-track-cryptocurrencies-new-chain-analysis-tools "According to a contract recently obtained by the Daily Beast, the IRS can now track bitcoin and other cryptocurrency addresses. They can do this to route out potential tax evaders."


If someone figures out a way to buy and sell Bitcoins with cash, the economy will be exposed to some weird challenges.
29   MisdemeanorRebel   2017 Dec 12, 4:55pm  

WookieMan says
Again, I'm being serious. I really do enjoy investment advice, but I simply don't understand anything about this. I know how to get it. I know how to sell it. But why? Why is this worth $17k and why won't it be worth $1 in 2 hours time? Until someone can explain that to me, I'm willing to watch people make millions, while I continue on my path to retire at 50. Which I'm cool with.


Here's a BS Test for Bitcoin
If just ONE government shuts down a major bitcoin exchange... Will the price go sky high or will it collapse?

If the latter, the libertopian/technoutopian dreams are shown to be mirages since many see a currency "safe from gov't/corporate" meddling.
30   Strategist   2017 Dec 12, 5:04pm  

TwoScoopsMcGee says

Here's a BS Test for Bitcoin
If just ONE government shuts down a major bitcoin exchange... Will the price go sky high or will it collapse?

If the latter, the libertopian/technoutopian dreams are shown to be mirages since many see a currency "safe from gov't/corporate" meddling.


At the very least there will be a crash. If the USA bans Bitcoins and other countries start following, it will completely collapse.
31   anonymous   2017 Dec 12, 5:27pm  

WookieMan, I'm a pat.net oldtimer and appreciate your presence here. I don't mean to suggest you're crazy. All fiat currencies ARE an act of faith and it behooves us as investors to do our due diligence. I'm still trying to wrap my head around the Bitcoin. At this point, miners are spending thousands of dollars in "real" fiat US currency to set up farms to mine Bitcoins. A compute revolution or energy breakthrough could cause prices to go down, but because of the way the Bitcoin algorithms are setup, it takes incrementally more resources to mine the next coin. At some point miners throw in the towel, or the Bitcoin limit (21 million) is reached. At that point, other demand mechanisms sustain the currency.

And to think that people thought GOLD ETFs were crazy...
32   anonymous   2017 Dec 12, 5:30pm  

Strategist says
I just bought some Bitcoin..$10.00 worth from curiosity. It was the easiest thing in the world.

Real men Mine their own Bitcoin. Wonder if the RoR is better than selling excess solar back into the grid?
33   WookieMan   2017 Dec 12, 6:28pm  

anon_3e01a says
WookieMan, I'm a pat.net oldtimer and appreciate your presence here.

Come on out from behind the curtain my friend. Be a "new" oldtimer. I am slightly crazy though, not gonna lie.

anon_3e01a says
At this point, miners are spending thousands of dollars in "real" fiat US currency to set up farms to mine Bitcoins.

This is still what I don't get. Bitcoin will never become a mainstream (credit card use EVERYWHERE, like now) payment method. Mine away. Spend money on equipment. When the bitcoin limit gets hit, then what? I still don't understand the demand portion of this. My dollars work fine. What is bitcoin doing for me that I can't already do? If I had 10 bitcoins, can I get something for cheaper? Seriously asking. The US gov. (or any other country with the ability) isn't letting bitcoin become the worlds reserve currency. So why is there demand for it? I simply don't understand the demand side with this.

Let me finish by saying I don't begrudge anyone getting into this. I genuinely hope some/many of you hit a home run, seriously. I'm not that bitter, jealous person like it may appear with what I'm writing on this topic. As you said, I'm trying to wrap my head around it, but I'm not getting any clear answers from my research or anyone that says they know this market.
34   Patrick   2017 Dec 12, 8:58pm  

WookieMan says
What is bitcoin doing for me that I can't already do?


Cash dollars (literal paper money) has much of the same function of bitcoin locally. But bitcoin has the advantage of being instantly transmissible around the world without physical delivery of anything.
35   anonymous   2017 Dec 12, 9:14pm  

Patrick says
WookieMan says
What is bitcoin doing for me that I can't already do?


Cash dollars (literal paper money) has much of the same function of bitcoin locally. But bitcoin has the advantage of being instantly transmissible around the world without physical delivery of anything.


Yea but Western Union has done that forever, no?
36   WookieMan   2017 Dec 12, 9:32pm  

Patrick says
Cash dollars (literal paper money) has much of the same function of bitcoin locally. But bitcoin has the advantage of being instantly transmissible around the world without physical delivery of anything.

Who the hell is doing that though? Transacting with other countries and people on that level? I have zero need to be able to send money to Italy, Poland, China, New Zealand, etc. Very, very few people need that. I don't think bitcoin alleviates the current systems in place for this either. Along with the fact that no nation will ever allow bitcoin to become a world wide currency of acceptance on a governmental level. This is why it's dead in the water to me.

I've got a lot a shit out there with me being negative. I've yet to see someone post something positive about bitcoin yet outside of it's "upside." Tell me why this sticks around and doesn't go to $1. There still hasn't been a person here to explain why there is demand for this. I understand the supply is limited. By why is anyone demanding this outside of absolute speculation? This has the looks of the worlds largest pump and dump scheme I've ever seen in my opinion. And by all means, gain on the pump. Just don't get caught in the dump.
37   Patrick   2017 Dec 12, 9:48pm  

errc says
Yea but Western Union has done that forever, no?


There are records of Western Union transactions.

Maybe the people who use bitcoin do not want to leave any traces of their transactions that could be connected back to themselves.
38   anonymous   2017 Dec 14, 7:08am  

errc says
Patrick says
WookieMan says
What is bitcoin doing for me that I can't already do?


Cash dollars (literal paper money) has much of the same function of bitcoin locally. But bitcoin has the advantage of being instantly transmissible around the world without physical delivery of anything.


Yea but Western Union has done that forever, no?


Bitcoin transactions cost almost nothing. Western Union is expensive. Especially for foreign countries. Right now, if a company was to accept payments in bitcoin over credit card and other methods, their profit margin would increase dramatically based on avoiding the fees that come from the middlemen.
39   NDrLoR   2017 Dec 14, 8:39am  

anonymous says
The system’s value is entirely based on perception
Much like Enron?
40   RWSGFY   2017 Dec 14, 10:20am  

Patrick says
errc says
Yea but Western Union has done that forever, no?


There are records of Western Union transactions.

Maybe the people who use bitcoin do not want to leave any traces of their transactions that could be connected back to themselves.


"Bitcoin is not anonymous

Some effort is required to protect your privacy with Bitcoin. All Bitcoin transactions are stored publicly and permanently on the network, which means anyone can see the balance and transactions of any Bitcoin address. However, the identity of the user behind an address remains unknown until information is revealed during a purchase or in other circumstances. This is one reason why Bitcoin addresses should only be used once. Always remember that it is your responsibility to adopt good practices in order to protect your privacy."


https://bitcoin.org/en/you-need-to-know#anonymous
Basically, there's a way to connect you back to your Bitcoin transactions if you are not super-careful 100% of the time and the record is kept forever and, ulike WU, doesn't even require subpoena to be read by authorities (or bad hombres).

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