• Sprott Money
    04/29/2016 - 05:58
    There is unfortunately no basis for renewed optimism that this current litigation will have any meaningful impact on precious metals manipulation – with respect to either silver or gold.

Bitcoin Climbs To Highest Since April, Led By Chinese Actions

Tyler Durden's picture




 

Submitted by Jonathan Stacke via The Genesis Block,

The last week has seen dramatic upwards price action in the bitcoin markets, driven by a series of macro and micro events across the globe. The fallout from Silk Road’s closure turned out to be but a blip in bitcoin’s price history, with significant gains since then. Turmoil in global financial markets and recent news of leading global websites accepting bitcoin may have bolstered enthusiasm for digital currency, but most interesting may be CNY’s definitive recent price leadership.

Compared with prices before the brief Silk Road drop, bitcoin exchange rates have climbed 14% in the last two weeks. At $145/BTC on Bitstamp, bitcoin has reached a level not seen since late April, and the only time that level has been reached on more than three consecutive days was from April 3-11 during the bubble.

Notably, the market has been significantly less volatile leading up to this level recently, compared with April. The 3DMA volatility leading into this level previously was between 13% and 22%, compared with just 4% currently.

price and volatility2

US Events

A number of factors may be driving the latest climb. For one, bitcoin price increases are known to often coincide with media coverage. Accordingly, even the Silk Road closure which highlighted bitcoin’s use for illicit purposes may have helped drive new participants into the market as a result of the exposure gained. The recent Money 2020 conference in Las Vegas may have similarly driven interest from a number of established financial players.

The global macroeconomic environment may be playing a role as well. As we’ve noted previously, bitcoin shares a generally inverse relationship with USD, an asset that has been negatively impacted in recent weeks as a result of the US debt ceiling impasse.

btc vs search btc vs usd

Chinese Events

Perhaps most important was the activity out of China. The Chinese government has recently been more vocal in its ongoing campaign to see the dollar removed from global reserve status. While such calls for an international reserve note are generally assumed to refer to Special Drawing Rights issued by the IMF, it may have bolstered enthusiasm for bitcoin’s apolitical nature. Also out of China was news that Baidu, the world’s fifth largest website, is now accepting bitcoin for certain services.

cny vs usd

 

Perhaps not incidentally, CNY price movement has been a notable leader in the latest rally. Overlaying CNY/BTC and USD/BTC trading history, it becomes clear that USD/BTC trading has been largely responsive to the Chinese markets. The graph below shows bitcoin trading in CNY markets, as well as USD/BTC levels converted to CNY for comparison. Overlaid on top of them is the differential between their prices at any given time. The differential tends to normalize around 2-3% and spikes/sinks periodically with price movement. In reviewing this chart, a consistent pattern becomes clear: CNY price movement occurs first, increasing the differential, with USD catching up much later and eventually sending the differential back down towards 3%.

 

 

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Sat, 10/19/2013 - 20:31 | 4072582 Dear Infinity
Dear Infinity's picture

Meanwhile the gold/btc silver/btc ratio continues to plummet -- see www.ounce.me . The real question is what will Uncle Sam be doing with the 29,000+ bitcoins he is now sitting on?

Sat, 10/19/2013 - 20:56 | 4072634 TheHound73
TheHound73's picture

It is expected that they hold them as evidence while trials and appeals are underway, then auction them off to the highest bidder.  29,000 represents 0.2% of current supply.

Sat, 10/19/2013 - 21:12 | 4072664 el Gallinazo
el Gallinazo's picture

Just like the French Connection heroin.  I was a New Yawker at the time, and the word on the street was that the NYPD only kept a little as evidence prior to trial and most went into "auction" almost immediately :-)

Sat, 10/19/2013 - 21:45 | 4072726 knukles
knukles's picture

What do you get when you hold a $100 bill between your chin and chest?

A good imitation of Steven Hawking at a strip club.

Sat, 10/19/2013 - 21:52 | 4072740 TeamDepends
TeamDepends's picture

budumpshhhhhhh!!

Sat, 10/19/2013 - 22:17 | 4072782 Herd Redirectio...
Herd Redirection Committee's picture

So is the price of Bitcoin going up, or the value of the USD going down?  Or both?

Sun, 10/20/2013 - 08:11 | 4073141 GetZeeGold
GetZeeGold's picture

 

 

Travel lite....carry Bitcoins.

 

When you get to the border....pray you have some gold.

Sun, 10/20/2013 - 09:16 | 4073208 TwoShortPlanks
TwoShortPlanks's picture

Gold is Equity in the SDR IPO of the next Global Financial System

http://twoshortplanksunplugged.blogspot.com.au/2013/10/gold-is-equity-in-sdr-ipo.html

Sun, 10/20/2013 - 10:06 | 4073303 CH1
CH1's picture

Gold is good, Bitcoin is good. You should own both.

Sun, 10/20/2013 - 10:59 | 4073422 BitStorm
BitStorm's picture

Finally, someone gets it.

PMs don't get pissed off once you download the Bitcoin client. Although Queen Elizabeth on my Canadian Maples have been giving me the stink-eye lately.

The Bitcoin client doesn't give a fuck what you own. Each has positives and negatives, the smart people see it.

Sun, 10/20/2013 - 16:07 | 4073994 Scarlett
Scarlett's picture

Xenofrog better get learning some mandarin

Mon, 10/21/2013 - 08:07 | 4075480 gold-is-not-dead
gold-is-not-dead's picture

pfff, bitcoins, you can't even roll them and snort charlie...

 

but if you don't own them, you'll just loose money... hyperdeflation should not be overlooked...

 

Sun, 10/20/2013 - 18:40 | 4074306 Dick Buttkiss
Dick Buttkiss's picture

Right you are, BitStorm, PMs and BTCs being the buddy system for protecting yourself against the coming collapse of the global money and banking cartel: BTCs until the Internet kill switch is flipped (but only temporarily) and PMs to see you through that and whatever else comes along, as the world as we know it goes the way of the typewriter.

Sat, 10/19/2013 - 21:55 | 4072743 Bunga Bunga
Bunga Bunga's picture

So the Federal Government will recognize the value of Bitcoin and use it as source of income. What better references can Bitcoin get?

Sun, 10/20/2013 - 14:42 | 4073816 MarcusLCrassus
MarcusLCrassus's picture

So according to the government:

 

Gold = not money.  Nope.  Its just a relic left over from barbarians who lived during the stone age.  Its anything but money, yeah, that's the ticket. 

 

Bitcoins = money money yes this sure is money!

 

Sun, 10/20/2013 - 21:51 | 4074726 TheHound73
TheHound73's picture

After all the T's are crossed and all the I's are dotted, their 29,000 coins might pay their budget for a year or decade.

Sat, 10/19/2013 - 21:15 | 4072670 Cabreado
Cabreado's picture

"what will Uncle Sam be doing with the 29,000+ bitcoins he is now sitting on?"

29,000 bitcoins?

That is huge, in the context of things.

Maybe he'll use it to pay Biden's expense report for muffins(?)

 

Sat, 10/19/2013 - 21:50 | 4072737 knukles
knukles's picture

Wait a sec.....

Everybody was touting how the gubamint could never take your Bitcoins away from you, how secure they were, how hidden from confiscation. So what's the gubamint doing with these in their possession that they expropriated, stole from somebody else?
Oh, not so secure after all, no?

Just like gold confiscation.

Jesus, people

Sat, 10/19/2013 - 22:13 | 4072775 fnord88
fnord88's picture

You're confused. Talk about jesus people. ....why comment when you're so ignorant. Dread has 800000 bitcoins....and the feds cant access those without his password....and he has backups.....can u back up and encrypt encrypt your gold? The seized bitcoins were not his u clueless monkey. His 120 million is 100% safe....unless the the government tortures his password out of him. 

Sat, 10/19/2013 - 22:59 | 4072832 Balanced Integer
Balanced Integer's picture

Question: Dread has backup? How does that work? He backs up his BTC into another wallet or something? Can he activate these backups and use them, canceling out the BTC in his confiscated wallet?

If he can't do any of those things, knux is right. His shit is confiscated and useless to him.

Sat, 10/19/2013 - 23:09 | 4072843 Toronto Kid
Toronto Kid's picture

Why do I think the Feds have Dread locked up away from any computers and without any means to access any?

Sun, 10/20/2013 - 03:04 | 4072988 Non Passaran
Non Passaran's picture

And as a comment above said, if he has a copy, all he needs is a visitor to tell him to access his wallet and send those Bitcoins elsewhere. That would empty (invalidate) coins in copy of the wallet that the Feds have in their possession.

Sun, 10/20/2013 - 10:51 | 4073399 CPL
CPL's picture

The wallet apps are pretty snazzy nowadays.  The dead man's switch is my favorite option on them. 

If he doesn't type the passphrase once in a while they transfer out of their hands and into a backup somewhere in a scripted fashion. 

Of course the wallet doesn't have to be on his PC.  It can be sitting in a server farm anywhere buried as a cron job.  Or on a cell phone buried in a box.  Or a sim card the size of a finger nail.  Today's age and the reinvention of portable applications that can be managed on a 10 dollar thumb drive, I'm willing to bet that what they seized has nothing on it.

 

Sat, 10/19/2013 - 23:25 | 4072860 aphlaque_duck
aphlaque_duck's picture

Yes you can and should encrypt your bitcoin wallet and make several backups.

If the copy you normally use is lost/stolen, a theif can't do anything with it without your encryption key.

You would simply get any one of your backups (USB stick buried in the yard) and you again have access to your coin.

Coins SPENT from any copy of the wallet will be "spent" from all copies. They're all the same. Your balance is recorded in the public ledger, not in the wallet per se. The wallet gives you access to your coin, it doesn't contain the coin. 

Sun, 10/20/2013 - 06:55 | 4073104 Skin666
Skin666's picture

The feds have the public keys (his wallet), but not the private keys (the password).

 

Whoever has the private keys, can unlock the bitcoin wallet.

 

The feds have fuck all until they can break/beat/torture the private key out of DPR

Sun, 10/20/2013 - 10:23 | 4073340 unununium
unununium's picture

Your bitcoin wallet is not a wallet. It does not contain your bitcoins.

Your bitcoins sit in a huge pile in the cloud with all the other bitcoins.

Your bitcoins are yours because you have the keys to them.

Your bitcoin wallet contains only the KEYS that let you spend (send, transfer same thing) the bitcoins you control.

When you make a backup if your wallet, you are making a copy of the keys.

If someone else has a copy of the keys, you are sharing control of your bitcoins. This includes hosted wallets.

Sun, 10/20/2013 - 13:03 | 4073635 granolageek
granolageek's picture

If someone else has a copy of your safe deposit box key, or the Musgrave ritual to find the buried Stuart treasure, you are equally scrod.

Mon, 10/21/2013 - 15:11 | 4076877 MeelionDollerBogus
MeelionDollerBogus's picture

Which is a lot easier than finding where gold is.
I guess Knuks is right again.

Sun, 10/20/2013 - 01:26 | 4072989 Non Passaran
Non Passaran's picture

They need to be able to decrypt your wallet. And find it before that. It can be stored on Amazon S3 or somewhere in Russia
Fail.

Sun, 10/20/2013 - 10:08 | 4073308 CH1
CH1's picture

Everybody was touting how the gubamint could never take your Bitcoins away from you, how secure they were...

Bitoins can be stolen, just like anything else can be stolen.

Give the reflexive hatred of BTC a rest!

Sun, 10/20/2013 - 00:40 | 4072946 diesheepledie
diesheepledie's picture

I didn't think Bitcoin would survive the demise of the Dread Pirate Roberts. I guess people use Bitcoin for more than just "Nos' Awesome Rock Cocaine".

Sun, 10/20/2013 - 10:19 | 4073334 CH1
CH1's picture

I think that very few ever used it for coke - that was just a slogan used by its enemies.

Sun, 10/20/2013 - 16:27 | 4074005 Scarlett
Scarlett's picture

Most people I know use it as gold.  That is, it just sits there, untouched, for a long time.  

 

Junkies don't hold the value.  They would buy $500 worth of BTC (at whatever price), then send it to get their hit.  They don't *hold* value.  Strong hands do.

 

I've enjoyed the BTC bubble but now it's time to get the gold bubble starting.  I want to see some bankers taking dives off the broklyn bridge in their speedos.

Sun, 10/20/2013 - 01:19 | 4072986 Non Passaran
Non Passaran's picture

Who cares what they are doing?
They can (assuming that guy gave them password to his wallet) sell all 29,000 at 8am tomorrow. So what?

Sun, 10/20/2013 - 16:29 | 4074025 Scarlett
Scarlett's picture

flash crash + thank u note from China with love

Sun, 10/20/2013 - 05:23 | 4073079 Quinvarius
Quinvarius's picture

If they are on someone else's USB stick, nothing.  The NSA doesn't crack anything.  They get let in the front door and the back door.  In fact, I would say that their raw capabilities are weaker due to dependency on corporate cooperation and mainstream software.  If you are not on Facebook, and you use a home grown linux distro, they probably don't even know you exist.

Sat, 10/19/2013 - 20:39 | 4072592 PaperBear
PaperBear's picture

What is stopping BTC going to $1M ?

Sat, 10/19/2013 - 20:43 | 4072597 CunnyFunt
CunnyFunt's picture

EMP & HERF

Sat, 10/19/2013 - 23:57 | 4072894 SpykerSpeed
SpykerSpeed's picture

Bitcoin is redundant on thousands of hard drives across the Earth, and as soon as power returns you can spend your Bitcoins again.  Or in a worst case scenario, you can leave the area where the EMP blast happened and go to a place with Internet access and access your Bitcoins there.

Unlike gold, which is easily detected and confiscated by government agents - you can't leave the country with your gold in a post-apocalyptic scenario.

Sun, 10/20/2013 - 08:17 | 4073147 CunnyFunt
CunnyFunt's picture

"in a post-apocalyptic scenario" I don't think you will be recovering your BTC at all.

Mon, 10/21/2013 - 14:57 | 4076845 MeelionDollerBogus
MeelionDollerBogus's picture

Gold is harder to find using government detection agents than bitcoin.
And gold will pass borders (or borders will be gone), while electronic routes will be bombed, cut or restricted at top-level servers so you can't use them at all. period. no bitcoin shall pass. None.

Sun, 10/20/2013 - 01:15 | 4072984 Non Passaran
Non Passaran's picture

Nice try, troll.
I can have copies of my wallet on different continents and also protected from EMP.

Sun, 10/20/2013 - 08:15 | 4073146 CunnyFunt
CunnyFunt's picture

Pity you can't print a hard copy of your BTC, then you might have something tangible.

Sun, 10/20/2013 - 08:58 | 4073177 BitStorm
BitStorm's picture

http://blockchain.info/wallet/paper-tutorial

Here ya go. Three seconds of research.

Sun, 10/20/2013 - 09:16 | 4073201 CunnyFunt
CunnyFunt's picture

... And you're left with ... wait ... PAPER !!!

 

With a choice between having hard copies of

http://blockchain.info/Resources/promo/bitaddress.png

or

http://spectrum.ieee.org/img/0831_gold_630x420-1358881868486.jpg

I'll choose the latter any day.

Sun, 10/20/2013 - 09:56 | 4073287 BitStorm
BitStorm's picture

...and this is the mentality of the ignorant....

You don't have to make a choice. You can ....wait... DIVERSIFY! "But how?", you say? "Won't my PMs disintegrate as soon as I download the Bitcoin client?"

No, you silly mumpkin! Trick is that you have stores of value in multiple formats. If you go all-in with one format, you wind up becoming a "true-believer", hoping against hope that your single store of value (in your case, PMs) triumph over all.

I didn't make a choice between X and Y. I have both, and will continue to have both. I've been averaging my 1oz gold maple purchases (due to BTC) at about $200/coin this year. How you doin?

Anyways, you can't argue the numbers. BTC is here to stay, just like gold . Have fun averaging in your purchases with $.

Sun, 10/20/2013 - 10:44 | 4073314 CunnyFunt
CunnyFunt's picture

I'm doing just fine, thank you. Most of my metals were acquired in the '80s and '90s when I was young and reckless, working for a silver refiner who paid bonuses in silver bullion when it was $5/ozt.

As far as diversification, I have real estate (including standing timber and artesian springs), art work and fine jewelry, cash, machinery, dry goods, weaponry, several mining claims, livestock and pure-bred Asian Shepherds to guard them.

Have fun with your bits and bytes.

Sun, 10/20/2013 - 11:28 | 4073483 FeralSerf
FeralSerf's picture

The economy must be bad if Ted Turner here needs to moonlight as a shill on ZH.

Sun, 10/20/2013 - 11:57 | 4073528 CunnyFunt
CunnyFunt's picture

Man, I just love all you "virtual" fucks living in your binary world, most of whom couldn't even change a car tire.

Do NOT follow this link or you will be banned from the site!