Early Market Indications: Bitcoin Soars To 2015 Highs, Stocks Tumble

Tyler Durden's picture

Yesterday, when it was becoming increasingly clear that Germany has had it with Greece - as was confirmed moments ago when the Eurogroup failed to reach a deal despite the "absolutely final" ultimatum it itself had imposed on Greece, we made a quick observation:

Since then bitcoin has soared by 5%

 

... and is now at its highest price in 2015:

Why not gold? Because between the BIS endless selling of paper gold  - hi Benoit Gilson - and Citi and JPM's relentless pounding of physical via record notionals of derivatives, not to mention China's liquidation selling, gold will likely tumble here just to give the illusion that central banks still have some control, which would mean that various mints are again about to run out of gold. It also means that courtesy of constant price suppression as a policy tool, the precious metal continues to trade at a huge discount to physical value.

What are other markets looking like right now? We won't know for a while until USDJPY opens, which as the central banks know is how you manipulate the E-mini, in a few hours, and certainly not until ES opens in 7 hours, but thanks to UK spread bettors things are not looking good right now.

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SHEEPFUKKER's picture

Pump it back over 1 grrr and then dump it again? 

Stackers's picture

grabbed some more yesterday at $299 :)

0b1knob's picture

And 2015 high is less than a third of the all time high for bitcoin?

Stackers's picture

Pull up a long term chart. It moves in waves.

If it follows the same pattern as the past, it should move to $2,500-$3,500, than pull back to $500-$750

It has "bubble exploded" multi times by 1000%, then crashed back 50-75%, but keeps stair steping higher.

CaptainAmerika's picture
CaptainAmerika (not verified) Stackers Jul 12, 2015 1:00 PM

Chuck E Cheese tokens now worth more than Dollars... Good Night USA

 

SERReal1's picture

Shit, I guess my kids are rich then. Time to steal their tokens!

philipat's picture

Because, so far, they have no way to manipulate Bitcoin. Gold should be doing the same thing but is still being capped by the Cartel. Perhaps Bitcoin is the new Gold as the Canary in the Coalmine? On the other hand, in the endgame, Central banks and Governments can revalue Gold so that their Balance Sheets well, balance. And I don't think there are many Bitcoins on their Balance Sheets?

Captain Debtcrash's picture
Captain Debtcrash (not verified) philipat Jul 12, 2015 10:43 AM

Gold and silver manipulation will eventually fail but your right bitcoin is doing what PM's should be doing.  A point that should not be ignored.

Consuelo's picture

Bitcoin is doing what PM's should be doing, because Bitcoin poses no threat.   It can be easily co-opted and maneouvered, just like the masses who will inevitably jump on board.   Intelligence can just sit back and wait to see when and how the swarm begins to take shape and take action from there. 

 

 

Captain Debtcrash's picture
Captain Debtcrash (not verified) Consuelo Jul 12, 2015 11:02 AM

Certainly a possibility I can't discount.  That's why I advocate a small allocation.  We don't fully know the vulnerabilities yet.

CPL's picture

Because they would actually have to WORK to make them and be as dismayed as anyone that mines them at how fucking hard it is to make them.

  • It's limited 21 million in total, 21,000,000.000000000
  • The technology to finish the entire set has yet to be invented (and won't be a for a while),
  • The decimal point slides to the right which makes current lending practices obselete (better make damn sure you are lending to someone that can pay it back)
  • The decimal point slides to right and as adoption continues it rewards savers against the deflationary pressures.
  • It is built to be fungible, as it is impossible to charge interest on, it is also impossible to gain interest on.  IOW the horse has legs and is built to run steady for 100 years.
  • By proxy designed to move the goalpost on technology.  Look at ASIC designs today versus three years ago, far superior to the AMD/Intel branches.  New developments that are 99.9% more energy efficient, 2000% faster and cost fractions of pennies to manufacture in an open source model versus the old CPU's on the market.
  • The organic growth pattern over 7 years on it's deployment, it will be the only functional international currency in 7 years.

With the improvements in CPU ASIC designs that are freely available it will completely renovate everything in term of governance, governments, and how economies actually work.  All fully transparent.  

Now where it get interesting is when the clodhoppers running economies today understand they can back their PM's into a crypto to assign a market value then and only then will anyone see the value of their PM's.  Additional if looking at a commodities based international trade system then it would be advisable for commodity producers to produce their own crypto currency to trade their commodity as a crypto currency to formulate a trade token.

e.g. Bananas.  Brazil and Jamacia produce lots of Banana's for the world market.  The Banana cartel renders 'banana coins' using the open source of the BTC base to match their production of Banana's to the crypto being produced and the exchange rate pair is tied back to BTC to accomodate a fair trade market practice as the "BananaCoin" is exchanged directly to the value of BTC.  In programming it's called weighing a metric in an array. 

And anyone else that produces Banana's can join the existing network of 'BananaCoin' to sell their commodity.  Or whatever commodity is there.  Lumber, silver (LiteCoin), gold (BTC), Platnium (DRKCoin last I heard), oil, widgets, whatever.  As long as the amount of coin matches the supply of whatever, which can be programmed easily.  The thing is the fiat doesn't availability or supply, but a crypto coin can provide supply, trade/swap value against other commodities based on a metric without the horse shit of people getting in the way.  Eventually a nice steady economy based on trade NEED, rather than the warehousing horseshit that only produces loss and has killed more industries that can be counted.

This is how an entire planet gets migrated to a single currency, that isn't a currency, it's an anchor to facilitate commodities in trade instead of the usual middle men arbitrage that has put everyone on the planet in the hole.  It's the start of the equivalent of sharing fairly.  Once BTC is in place, it is recommended that most commodity producing nations look at their various sectors and make a coin.  LobsterCoin, LumberCoin, EducationCoin, ProgrammerCoin, etc.  Doesn't matter.  BTC is a single horse that can pull them all and help manage the true value of trade/swap of the commodity in a completely transparent manner and level the playing field with nice agnostic math.  Pretty sure most countries have math departments, business groups and computer science groups to figure out how to implement their own crypto coin against a commodity against the BTC to cross trade a commodity for a commodity using BTC as the pinon.

fiftybagger's picture

We still don't know if BTC will be the one.  It still has some issues, transaction time is one, and there are others.  The 61.8 percent Litecoin crash was a good opportunity to get into that coin, but it is rallying quickly.  There are now a number of proof of stake coins that are still very cheap that hold some promise.  Unlike Bitcoin and Litecoin they don't require a huge army of miners to support them, but rather the wallet does it all, and also rewards you with more coins based upon your stake.  2 coins that I've been accumulating are PHS and ZEIT as they are so cheap you can get a decent percent of the entire market cap for a few Bitcoins. I also like FLO, Florin coin because it is going to be used to permanently circumvent the shutting down of torrent sites by creating an uncensorable peer to peer library

This latest surge in buying is mainly out of China which accounts for nearly 70% of all volume

We are still at the very early stages of this thing.  Very exciting times.

The Bitcoin Channel

crazytechnician's picture

Well I think bitcoin already is the one.

Condition 1SQ's picture

And when governments around the world dump cash for e-currency, you can bet it won't be Bitcoin.  That will be the nail in the coffin.  Bitcoins are nothing more than watts consumed to make a shared ledger entry.

Condition 1SQ's picture

Great rebuttal, genius.

If anyone wants to know why XBT is pumping, look no farther than the compulsive gamblers in China.  Chinese equities in the shitter, so they're going to hump Bitcoin once again.

HowdyDoody's picture

Can they run naked shorts on BitCoin? Can they run BitCoin ETFs?

commander gruze?'s picture

In theory - yes, they can, but in practise certain characteristics of Bitcoin make it difficult.

First, taking delivery in Bitcoin is infinitely easier than doing so with gold. In fact, it is encouraged that you take "your" bitcoins from custodial account directly into your own possession. Otherwise you're risking getting Goxed (a.k.a. Corzined). Therefore, the chasm between bitcoin and its derivative is easy to cross.

Second, settlement and clearing in old-fashion industry, where ETFs live, is an expensive and error-prone operation. Transactions move over legacy networks with friction, whereas the bitcoin network itself provides means of clearing and settlement without external oversight and tedious reconciliation. This characteristic is the very reason Blythe Masters jumped on the "digital ledger" bandwagon (watch her patethic linguistic tricks trying to avoid word "bitcoin").

Third, with bitcoin you can actually run a computationally sound proof of resources. Thus, anyone running Bitcoin ETF would be subject to scrunity and operating under fractional bitcoin reserve would have been revealed in no time.

So, to summarize, one can do naked shorts in Bitcoin or run BTC ETF, but doind so would be monumentally dumb idea.

Bunga Bunga's picture

A lot of shady Wall St tricks don't work with bitcoin, because the "real asset" can be transfered worldwide within an hour or less, no excuse - in contrast to stocks where the normal clearing takes days and the naked short sellers can just fail to deliver in addition without legal consequences. There is a whole set of shell games which can be played with paper, but not with bitcoin.

The only way to play tricks is to establish bitcoin derivatives and manipulate the price over them, but I doubt that many investors will hold an IOU, when you can get the control over a bitcoin in the blockchain easily, and that much faster and cheaper. 

Another alternative would be establishing a major bitcoin exchange on Wall St which controls most of the volume, but there are already tens, if not hundreds of bitcoin exchanges around the world and technology allows to trade them even p2p without any middleman. In addition there are decentralized bitcoin exchanges in the works, which can't be controlled by an owner or a small interest group.  

Bitcoin is a monetary revolution, you must throw most of your conventional thinking of traditional finance over board completely. 

PaperWillBurn's picture

But more than 20x higher than the start of 2013. 

cheech_wizard's picture

So still pissed off you bought bitcoin far above it's current price and haven't been able to dump it yet?

Standard Disclaimer: That background noise you hear is the monotonic bleat of the "pump and dump"...

Captain Debtcrash's picture
Captain Debtcrash (not verified) cheech_wizard Jul 12, 2015 10:28 AM

Hey I'm a bitcoin skeptic as outlined here, but am humble enough to know that I don't know everything nor what the future holds. I started buying very small amounts with this purchase program at around 200.  I'm not going to ignore Bitcoin's reactions to small monetary crises (Russia Greece Cyprus), when I believe we are going to have an unprecidented world-wide crisis in the not to distant future.  To each thier own, but I think a small allocation makes sense, no reason to get your panties in a bunch.  If it goes up, fine, if not, I am willing to lose my investment. 

indygo55's picture

Captain, where did yo buy bitcoin? You can't buy it in the US without paying a huge fee and dealing with the sketchiest playes ever. So how exactly did you purchase bitcoin?

 

Captain Debtcrash's picture
Captain Debtcrash (not verified) indygo55 Jul 12, 2015 10:40 AM

www.coinbase.com.  1% fee and they give you a 5 dollar activation bonus. Essentially break even on your first 500 invested, plus significant referral bonuses.  I felt most comfortable with their security and ‘vault’ storage.  Certainly lower premium than PM purchase, and I have made many of them. 

Very easy process, though there are some security hoops, but they are worth it for me. 

 

JustUsChickensHere's picture

Using any exchange, web wallet or vault, is the same as using bank to hold your gold.... it introduces counter party risk that can be avoided.

For PM's security and storage costs are what it costs to avoid that counter party risk.

For Bitcoin, you can use self educataion and the many tutorials to learn how to hold your own funds. Either on a local wallet - frequently on your phone - or for better security, offline in 'cold storage'. The simplest cold storage is a paper wallet... and there are hardware solutions too.

https://en.bitcoin.it/wiki/Cold_storage

Once you understand the various techniques, it becomes trivial to secure Bitcoin.  Normaly, larger balances held in multiple cold storage wallets, with a small amount held on your phone for ordinary usage.

fiftybagger's picture

I trade on many exchanges:

 

Cryptsy

BTC-E

Bitfinex

These are the my main 3.  Due to the risk of them being shuttered I keep all coins downloaded to their respective wallets when not being actively traded.  Imagine being able to take the money in your futures account and keep it in your mattress every night.  Most of the transaction costs are so low that it is very cheap to do: .001 percent.  bitfinex now allows margin trading and shorting in the trading account.  This operates like a ticket in the old bucket shops having a liquidation price, so you cannot lose more than you have bet.   If you only deposit BTC then Fincen and KYC rules don't apply.

The Bitcoin Channel

 

Global Douche's picture

I'm with the other commenter on paper wallet or cold storage security, the latter only requires the specific private key which the balance is stored. Bitcoin is powerful to those with the foresight and wisdom to learn and use it. Quite addictive, really. 

Equinox's picture

Troll, or knowledgeless fool

Global Douche's picture

It ain't none of your snooping business to know where I got mine, but I had no problem in getting it through an exchange. Just start researching and learn which ones are worthy of trust before you entrust your fiat.

crazytechnician's picture

Cue the ZH Flat Earth Society:

 

B,B,B,But it's a Ponzi Scheme Tulip Bulb controlled by the NSA , and the government will shut down the power grid and the internet to stop bitcoin and it's controlled by the CIA and the banks it's worth nothing without electricity plus I cannot hold it in my hand so it's worth zero you pump and dumpers scammers that bitcoin is a SCAM!!!!!

KnuckleDragger-X's picture

Bitcoin prices are pointing directly at the problem with Euro and the EU will blithely continue to ignore it. They are playing Russian roulette complete with Russians. They are the new aristocracy, but they should read some French history about Robespierre and the revolution.......

automaton's picture

Concur.

 

When BTC was stagnant in the low 200s and this Greece turd of a crisis became big news in the mainstream again, I bought a little.  I'll sell it once I'm able to cash out and buy that antique table I want.  Better to have an old handmade table than BTC anyway.

Kaervek's picture

Enjoy flipping your table after BTC hits double the price you cashed out at

Buckaroo Banzai's picture

Paging Fonestar...will Mr. Fonestar pick up the white courtesy phone please...

No not the red phone, the white phone...

disabledvet's picture

"All euro gold belong to IMF now.

Thanks for playing/Bon apetit!

Mintcoin's picture

Bitcoin overrated/overvalued. Invest in other crypto coins. For example, Mintcoin is 30x faster, energy efficient, etc. Superior technology.

crazytechnician's picture

Fuck Off. Just another shitty Alt-Coin soon to bite the dust like the rest.

Bunga Bunga's picture

Platinum is superior to gold (scarcity, counterfeiting) too, but gold is tradition, culture ... so is bitcoin.

Jonas Parker's picture

Grab those bitcoins there, Stacker (though I figure they'd be hard to stack)! Thar just leaves more gold and silver for the rest of us...

Soul Glow's picture

When fiat money dies, use crypto-currency?

No thank you, I'll keep stacking.

F0ster's picture

Bitcoin is great if you want to move your savings around the world, but I would NEVER hold it in BTC form for very long. You need to hold your wealth in hard assets once you have found a financially safe country to live in.

JustUsChickensHere's picture

Try to diversify your holdings. That means keeping a (small) allocation of your savings in BTC, some in gold, some in silver, some in productive land, some in shares.... very little in any bank, and a little bit in your local national fiat (cash) under the mattress.

 

The percentages of each of these allocations is an interesting discussion, but should simply reflect your own risk appetite. 

Greenie's picture

"You need to hold your wealth in hard assets once you have found a financially safe country to live in."

Good luck finding that.

Dancing Disraeli's picture

Just imagine the global assets that would flow to any "financially safe country" if one could be found.

disabledvet's picture

Europe can Say Uncle here...

blueRAP's picture

More like: When fiat dies, protect your money in crypto/precious metals.

Crypto was never meant to replace cash, government notes, or gold, but to add to the whole financial system an upgrade in security, decentralization, and overall technological advancement.

Anyone with an hour of time and a willingness to learn more about bitcoin would benefit greatly from this video of Andreas Antonopoulos: https://vimeo.com/130761491

F0ster's picture

Phyisical and paper price of gold and silver being forced apart. Thanks Benoit Gilson!!