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Bitcoin Surges To 1 Year Highs, Up 100% From "China Capital Controls" August Lows

Tyler Durden's picture




 

Bitcoin, at $400, is now at its highest since November 2014, having surged over 100% since the late-August 2015 lows when we first warned of China capital outflows using the virtual currency conduit. As we suggested, and was confirmed overnight, it appears the Chinese are just getting started...

 

 

As we noted previously, here is the validation that, just as predicted here two months ago, bitcoin has become the go-to asset class for millions of Chinese savers seeking to quietly and under the radar transfer funds from point A to point B, whatever that may be, in the process circumventing the recently expanded governmental capital controls:

While he didn’t provide any concrete numbers, he did comment last week on what was driving the adoption. “Some Chinese traders are expressing a view on the CNY exchange rate after the last devaluation and you have interest by mainland speculators to move to other assets after the stock market fallout,” he explained in an interview with Bitcoin Magazine.

Which again brings us back to our conclusion from two months ago:

... if a few hundred million Chinese decide that the time has come to use bitcoin as the capital controls bypassing currency of choice, and decide to invest even a tiny fraction of the $22 trillion in Chinese deposits in bitcoin (whose total market cap at last check was just over $3 billion), sit back and watch as we witness the second coming of the bitcoin bubble, one which could make the previous all time highs in the digital currency, seems like a low print.

As of this moment, the total value of bitcoin is up from the $3 billion two months ago to a little over $5 billion. That means the ratio of Chinese deposits (at around $22 trillion) to bitcoin, is down to a far more "conservative" 4,400x.

And now, again, imagine what could happen if these same Chinese depositors realize they have been lied about the non-performing loans "backing" their deposits and that instead of the official 1.5% bad debt ratio, the real number is really far greater, somewhere in the 20% ballpark as we will show shortly, suggesting major deposit impairments are no longer the stuff of Cypriot nightmares but just the thing hundreds of millions of Chinese depositors have to look forward to, and that they have just two possible choices to avoid said impairment: reallocating their savings into bitcoin or, of course, gold.

 

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Tue, 11/03/2015 - 13:14 | 6744377 Takeaction2
Takeaction2's picture

Blaah Blah Blah.....Look at metals fall...It is Christmas in November...Woohoo...back up the truck...or raft...

Tue, 11/03/2015 - 13:17 | 6744397 HedgeAccordingly
HedgeAccordingly's picture

did you know that...  Bitcoin Exchanges In Europe Are Tax-Free 

Tue, 11/03/2015 - 13:23 | 6744428 keremetski
keremetski's picture

I see Blyze Msters bitch craft. Pump and Dump.

Tue, 11/03/2015 - 13:26 | 6744447 crazytechnician
crazytechnician's picture

Admit it dude , she's not only rich , she's hot ,,

Tue, 11/03/2015 - 13:40 | 6744508 coinhead
coinhead's picture

OMG SATOSHI WE LOVE YOUS!!!!!!!!!!!!!

Tue, 11/03/2015 - 13:49 | 6744547 38BWD22
38BWD22's picture

 

 

I just confirmed buying some gold with Bitcoin at $410 / BTC.  

providentmetals.com

But, I still have Bitcoin left for future purchases.  

:)

Tue, 11/03/2015 - 13:58 | 6744584 Prisoners_dilemna
Prisoners_dilemna's picture

I haven't taken that plunge yet, buying PMs with BTC.

I like that with BTC I can use my electrum wallet to get my funds out of the US.

 

I hear theres a successful bearing provider in South America; I might beg them to give me a janitorial job if things get worse in the states. When the FedGuv comes for the metals, me and the BTC are headed to greener pastures.

Tue, 11/03/2015 - 14:03 | 6744606 coinhead
coinhead's picture

Teh we is just waiting for the latest round of corporate news lulz regarding Bitcoin.  Bitcoin is a cult, Bitcoin has died, Bitcoin is funding ISIS, Bitcoin is......?

Tue, 11/03/2015 - 14:46 | 6744806 Herd Redirectio...
Herd Redirection Committee's picture

IDK, Bitcoin just seems like one more way to lessen demand for actual physical precious metals (with paper precious metals still leading the charge, by some distance).

Tue, 11/03/2015 - 14:48 | 6744818 coinhead
coinhead's picture

...teh exact opposite of that.  Bitcoin will break teh dollar system that is used to manipulate metals.

Tue, 11/03/2015 - 15:13 | 6744971 Dethrone The Ba...
Dethrone The Banksters's picture

teh yous type like a bunch of retarded 12 year old children from 1997

Tue, 11/03/2015 - 14:16 | 6744673 38BWD22
38BWD22's picture

 

 

Just wait until the BTC infrastructure goes in to be able to buy our bearings from Korea, Japan and China.  

That would be a game changer.  BTC to the moon, Alice.

We'll have to our accountant figure out how to have BTC properly accounted for for the local tax authorities...

Tue, 11/03/2015 - 14:17 | 6744680 LowerSlowerDela...
LowerSlowerDelaware_LSD's picture

Thank you CIA!!!!!  Please drive BitCoin up to $5000.  I'm tired of stawk speculaiton.  BitCoin speculaiton is the wave of the future.

Tue, 11/03/2015 - 14:23 | 6744712 coinhead
coinhead's picture

...right.  And your theory is based upon what evidence?  The CIA has spent the last 50 years assassinating leaders and performing coups to prop up the dollar system.  But in 2008 they had a change of heart and said, "you know what, we're actually going to kill the dollar, replace it with Bitcoin that we have no control over and basically kill ourselves."

Great "theory" you've got going there.

Tue, 11/03/2015 - 15:05 | 6744913 LowerSlowerDela...
LowerSlowerDelaware_LSD's picture

Stop it!!!  You're going to RUIN both your and my BitCoin speculation efforts.  BitCoin is the BEST.  Just keep saying that as a response to every post about BitCoin.

Tue, 11/03/2015 - 15:07 | 6744933 coinhead
coinhead's picture

Bitcoin is teh best.

Tue, 11/03/2015 - 16:03 | 6745269 LowerSlowerDela...
LowerSlowerDelaware_LSD's picture

Very good.  Thank you.  BitCoin up again...

Tue, 11/03/2015 - 14:06 | 6744623 coinhead
coinhead's picture

silvergoldbull.com also accepts Bitcoin as well.

Tue, 11/03/2015 - 13:42 | 6744512 coinhead
coinhead's picture

Blythe and that Mellon tard is sweet fuck all compared to the power of Bitcoin!

Tue, 11/03/2015 - 13:30 | 6744473 sam i am
sam i am's picture

 

Ukraine SITREP, November 3rd 2015 by the Saker

www.zerohedge.com/news/2015-11-03/russia-set-host-negotiations-between-a...

Tue, 11/03/2015 - 13:50 | 6744529 coinhead
coinhead's picture

Bitcoin is tax free and ultimately, Bitcoin will cause a "black hole" scenario for all fiat currencies.  Bitcoin is literal Kryptonite to the fiat world.

Tue, 11/03/2015 - 14:50 | 6744831 BadLibertarian
BadLibertarian's picture

I like that imagery - a financial singularity. That's precisely how I think about it.

Tue, 11/03/2015 - 13:19 | 6744413 Maplehood
Maplehood's picture

Funny, that's what the silver chart looked like right before an epic slam

Tue, 11/03/2015 - 13:21 | 6744418 highandwired
highandwired's picture

ain't gonna happen

Tue, 11/03/2015 - 13:48 | 6744539 coinhead
coinhead's picture

..sure it will Bitcoin will boom and crash all over the place until it becomes mainstream.  But what would you rather buy, "volatile" $500 BTC or "stable" $5,000,000 BTC?

Tue, 11/03/2015 - 13:52 | 6744560 highandwired
highandwired's picture

Oh I didn't claim that it won't crash EVER!  Just not right now like the guy above suggested.  I believe BTC will have a huge run BEFORE it crashes again

Tue, 11/03/2015 - 13:56 | 6744572 coinhead
coinhead's picture

...yep.  And it will "crash" back to $500 or $1000 and then all the moon-howlers will come out claiming that Bitcoin has "died" (again for the 7,368th time).

Tue, 11/03/2015 - 13:53 | 6744550 FlacoGee
FlacoGee's picture

Metals - SELL ALL RALLIES

Will be another 15 years for another batch of suckers to come of age.

At that point, metals will peak again and then crash again...  Rinse repeat.  30 year cycle.

 

 

Tue, 11/03/2015 - 13:15 | 6744383 Bank_sters
Bank_sters's picture

Shitcoin is all well and good until it isn't. 

Tue, 11/03/2015 - 13:20 | 6744409 crazytechnician
crazytechnician's picture

Won't be any good for you Flat Earth fools that's for sure. Why don't you crawl back into your basement , you can eat some more stale prepper food and fondle your eagles in the candle light.

Tue, 11/03/2015 - 13:22 | 6744426 highandwired
highandwired's picture

the trolls are still out, wonder when they will change their mind...maybe when bitcoin hits $1000 or maybe $10,000...

 

Tue, 11/03/2015 - 13:25 | 6744436 Bank_sters
Bank_sters's picture

Shitcoin is going to hit 1000 or maybe 10000 and you will have gained what exactly in real terms?   

Tue, 11/03/2015 - 13:27 | 6744450 Oldballplayer
Oldballplayer's picture

As I did last time, I started putting money a couple of weeks ago.

Every couple of days I pull out 1/2 the gain.  I buy metals with it.

Rinse and repeat.

This is "stoo-ped" money the last couple of days.  Just stoopid.

Tue, 11/03/2015 - 13:56 | 6744573 38BWD22
38BWD22's picture

 

 

I just did the same today, turned in some Bitcoin for gold.

Tue, 11/03/2015 - 13:28 | 6744457 crazytechnician
crazytechnician's picture

Fucking hell you should be called Einstein.

It's actually quite simple really , it's called GAINS

Tue, 11/03/2015 - 13:37 | 6744496 Bank_sters
Bank_sters's picture

And you are the master of your destiny because you had the foresight to 'invest' in what, exactly?

Tue, 11/03/2015 - 13:41 | 6744510 crazytechnician
crazytechnician's picture

Technology.

Tue, 11/03/2015 - 13:29 | 6744470 Grave
Grave's picture

i already doubled my money this year in bitcoin, and thats pure clean trading with zero leverage

and bitcoin bullrun is just getting started by the looks of it haha

Tue, 11/03/2015 - 13:40 | 6744507 highandwired
highandwired's picture

remember buying some litecoin for my retired father for father's day...seems like I was buying at the bottom...

did those litecoins gain in purchasing power since then?

 

Fuck yeah!!!!  100% they did!!!

Tue, 11/03/2015 - 14:47 | 6744808 Grave
Grave's picture

:)

Tue, 11/03/2015 - 14:27 | 6744714 cheech_wizard
cheech_wizard's picture

So you went from poverty level to no longer being able to qualify for food stamps?

Standard Disclaimer: You didn't make "fuck you" money because you're still posting. 

Tue, 11/03/2015 - 14:29 | 6744743 coinhead
coinhead's picture

fonestar will still be here trolling your sorry asses at $1,000,000 BTC cos that's we pathos.

Tue, 11/03/2015 - 15:00 | 6744819 Grave
Grave's picture

2013 bullrun:
-bought bitcoin at 100-150 usd, sold between 1000-1100 usd
-bought unnamed alt at 2-3 usd, sold between 40-45 usd
-bought unnamed alt for 10 usd worth of btc, sold for 17000 usd worth of btc (yes thats 170k % profit)

2015:
-bought bitcoin in low 200's, waiting for 4-5 digits
-and lets just say i've got a bunch of bitcoins invested in alt profit amplifiers :D

Tue, 11/03/2015 - 15:09 | 6744939 highandwired
highandwired's picture

Altcoins have been taking a beating like never before the past couple weeks, but...

it's a good time to accumulate

Tue, 11/03/2015 - 15:26 | 6745039 Prisoners_dilemna
Prisoners_dilemna's picture

I wouldn't touch alt-coins with a 10ft pole.  Except namecoin.  I'd use a 5 footer.

Tue, 11/03/2015 - 16:20 | 6745384 Grave
Grave's picture

you must hate massive profits :D
a well selected alt can go up in value by orders of magnitude, you just have to know when to accumulate and when to sell :p

Tue, 11/03/2015 - 14:08 | 6744636 commander gruze?
commander gruze?'s picture

the trolls are still out, wonder when they will change their mind...maybe when bitcoin hits $1000 or maybe $10,000...

The price is not going to be the catalyst. It's going to happen when draconian capital controls bite their arses and PMs go bidless. Or when their so-so security goes tits up while their workmates would still enjoy non-state funded Ethereum+Bitcoin social insurance contracts. Or when they see people trading stocks on T0 platform ejoying direct registration and immediate settlement and negligible fees while they still use expensive DTCC-linked brokerage account that clears in weeks rather than hours. Or when they will dispute their purchase on ebay and get declined while their work mates will be leaving their boring office jobs to become pooled escrow agents gaining reputation and charging microfees for dispute resolution in their niche. Or when they will still be milked dry by notary public when selling their house while their neighbours would be just going for blockchain-based, no third party notarization.

Then they MAY change their mind. When they see the Bitcoin has evolved into entire Internet of financial services. But I wouldn't hold my breath for now.

Tue, 11/03/2015 - 14:28 | 6744735 cheech_wizard
cheech_wizard's picture

Because bitcoin is only as good as the electrical grid. Keep that in mind when the emp's go off.

Tue, 11/03/2015 - 14:43 | 6744789 crazytechnician
crazytechnician's picture

Yawn.

Tue, 11/03/2015 - 14:45 | 6744803 highandwired
highandwired's picture

When the electricity goes out, you will have more to worry about than how to unload Bitcoin.

What a stupid argument...pleeease

Tue, 11/03/2015 - 14:49 | 6744826 Grave
Grave's picture

erm, its backed by math algos
you can do the calculations even on paper....

Tue, 11/03/2015 - 14:56 | 6744859 danster82
danster82's picture

People are asking what is backing the price and of course it is not math algos. If it was you could just run your own fork and it would have the same value because it has the same math algos? No.

All value of all currencys are backed by the time and energy of its users.

Tue, 11/03/2015 - 15:06 | 6744926 Grave
Grave's picture

simply put, bitcoin is the reward for solving math calculations (verification and recording of transactions into blockchain)

people compete for the reward therefore need to make calculations faster than others

more computing power = more calculations = more energy needed

Tue, 11/03/2015 - 15:28 | 6745048 Prisoners_dilemna
Prisoners_dilemna's picture

Like paisleys ties, the abacus will be making a comeback.

(I kicked off the return of the paisley tie back in 2002, so I suggest you start looking for an abacus, preferably one that can handle SHA256 operations.)

Tue, 11/03/2015 - 13:19 | 6744412 blabam
blabam's picture

Investment wisdom. 

Tue, 11/03/2015 - 13:15 | 6744385 arbwhore
arbwhore's picture

Not gold. At least not for the last week. Chinese have been net sellers. Now that gold has broken $1120, new lows beckon. The Comex is in control and the Chinese know it. There is no hedge.

Tue, 11/03/2015 - 13:16 | 6744394 Philo Beddoe
Philo Beddoe's picture

Good for all the Bitcoin dudes. I just do not get it at all. One more part of the world that is a complete fucking mystery to me.  Stuff of real vaue is worth shit and paper and digital are all the rage. 

Tue, 11/03/2015 - 13:23 | 6744430 herkomilchen
herkomilchen's picture

No offense, but you don't understand money.  If you think long enough and hard enough about why gold is money, you'll understand why bitcoin is too.

Tue, 11/03/2015 - 15:30 | 6745065 Prisoners_dilemna
Prisoners_dilemna's picture

Gold and BTC are scarce, divisible, portable, fungible, and durable??

I've posted this so many times but here it is again, http://moneyandstate.com/bitcoin-libertarian-introduction-used-care/

 

Then go download electrum.

Then find a seller on localbitcoins.com with 100% positive rating.

Then go buy $50 worth of BTC and ask the seller to show you how to you a BTC wallet.

Tue, 11/03/2015 - 13:23 | 6744432 crazytechnician
crazytechnician's picture

Value only exists in the mind. There is no such thing as intrinsic value , it's a myth. Gold is ultimately backed by the energy required to dig it up and a shovel. bitcoin is backed up by energy and a lot of computational power. Basically it boils down to Shovel vs. Computer ,

Tue, 11/03/2015 - 16:03 | 6745266 Anopheles
Anopheles's picture

The value of gold (and bitcoin) isn't even determined by the energy required to dig it up.

Both gold and bitcoin already have huge unused reserves that are just sitting doing nothing.    All gold mining could stop today and there's enough gold bullion in vaults to sustain industry for hundreds of years. 

That's why the price of gold can easily go below the price needed to mine it.  It's never actually used or lost. 

Tue, 11/03/2015 - 13:24 | 6744435 highandwired
highandwired's picture

hey, I see that you must be using some sort of digital device to post your comment...

is the operating system on your device "real"?

Tue, 11/03/2015 - 13:39 | 6744505 Philo Beddoe
Philo Beddoe's picture

It is windows 10 so the answer is up for debate. 

Tue, 11/03/2015 - 14:48 | 6744817 38BWD22
38BWD22's picture

 

 

LOL.  Nice comment.

Tue, 11/03/2015 - 13:28 | 6744462 Oldballplayer
Oldballplayer's picture

What is not to get.  On October 20th I put in $100.  Today I took out $130.

I don't have a ton of money in BTC, but it has been pumping money like a Norfolk whore.

Tue, 11/03/2015 - 13:54 | 6744567 38BWD22
38BWD22's picture

 

 

Philo Beddoe

When you buy gold for Bitcoin, then you understand the power of BTC.

HODL Bitcoin.

Hold gold.

Tue, 11/03/2015 - 14:14 | 6744670 Bunga Bunga
Bunga Bunga's picture

Value is not real, it's a product of our imagination.

Tue, 11/03/2015 - 14:28 | 6744733 seek
seek's picture

"Stuff of real vaue is worth shit and paper and digital are all the rage."

This is what deflation looks like. Just like the 1930s.

Tue, 11/03/2015 - 14:46 | 6744804 38BWD22
38BWD22's picture

 

 

I always take the time to read and think about your comments.

ZH members might be smart to do the same.

Tue, 11/03/2015 - 15:01 | 6744892 BadLibertarian
BadLibertarian's picture

Very good observation, seek. There's a lot to unpack from that one simple statement.

Tue, 11/03/2015 - 14:44 | 6744751 danster82
danster82's picture

Its not so hard to understand, its really just an understanding of value. Currencys like Bitcoin or USD have zero value its true, but currencys are tools that facilitate the exchange of value they themselves are not value they simply represent value. All value is the time and energy of people, therefore anything can act as a means of exchange for this value as long as it has the right attributes. scarcity, securiy, fungeability, divisiability, easily transported, easily transacted etc etc. 1oz cups of sand could be used as a currency for the exchange of peoples time and energy if people agreed on it but they never will because it wouldnt have said attributes. Gold had some and at the time when it was used as currency had the most and best attibutes but it doesnt today, fiat has many but not all and is losing a key attribute (scarcity). Bitcoin currently is the best currency we have because it has all attibutes we can currently imagine desriable for a currency.

Furthermore unlike fiat Bitcoin is not a debt based currency, each bitcoin carries zero interest unlike fiat where each unit carries interest as it was issued with interest attached.

After saying all that Bitcoin is currently capped at its current capacity of just 2.5 transactions per second, this can easily be increased and likley will soon but if it doesnt beware because it will most likley result in a crash.

Tue, 11/03/2015 - 15:04 | 6744910 BadLibertarian
BadLibertarian's picture

Depending on how parabolic this rally becomes, I'm concerned that we might be at risk for hitting that chokepoint sooner than we hoped. And if that were to happen sometime in the next few weeks, what do you think would happen - would the XT fork suddenly become the only option, or could BIP 100 be introduced fairly quickly?

Tue, 11/03/2015 - 15:11 | 6744957 crazytechnician
crazytechnician's picture

bring on XT.

Tue, 11/03/2015 - 15:15 | 6744981 BadLibertarian
BadLibertarian's picture

I've been going back and forth on that for a few weeks, but I agree (at least until I hear a better anti-XT argument).

Tue, 11/03/2015 - 15:13 | 6744970 Grave
Grave's picture

sidechains, treechains, lightning network
not everything needs to be recorded on main blockchain
you can put a number of layers on top of it

Tue, 11/03/2015 - 15:18 | 6744998 BadLibertarian
BadLibertarian's picture

Yep, but those things aren't quite ready yet, particularly lightning. Not sure that that's a near-term solution. 

Tue, 11/03/2015 - 15:24 | 6745033 highandwired
highandwired's picture

"but those things aren't quite ready yet..."

altcoins are

Tue, 11/03/2015 - 16:18 | 6745368 Grave
Grave's picture

look up the author of treechains, his work on bitcoin's op_hodl and which alt project is he also working on
(imo that alt is going skyhigh if the things work out as i expect them to, by orders of magnitude)

Tue, 11/03/2015 - 15:35 | 6745083 Prisoners_dilemna
Prisoners_dilemna's picture

The near term solution is that the transaction fee goes from a tenth of a penny to 3 pennies.

Ledger space is scarce, the market will determine the transaction fee.

 

Bitcoin won't be used for micro transactions any time soon. Then again Gold isnt used for micro transactions either.

So litecoin is to Bitcoin as silver is to gold???

What's copper??

Tue, 11/03/2015 - 19:16 | 6746329 Grave
Grave's picture

not really, more like a cheap chinese knockoff :)

Tue, 11/03/2015 - 13:26 | 6744445 adr
adr's picture

As with anything speculative, the people buying in are expecting huge returns based on nothing more than the expectation that someone will pay them a whole lot more for what they just bought.

There isn't any real reason behind the Bitcoin surge other than greed. Just like there wasn't any real reason for the first major rip your face off surge.

People that bought in at $250 are trying to stoke the fire in the hopes they can induce another mania phase where they can cash out big. Bitcoin is an easy scam to run because you don't have to hold anything physical while you are waiting to unload to the next mark.

I don't think people will wake up to the fact that anything other than honest labor and the goods produced from it is a total scam. Everyone just wants to get rich without having to lift a finger to do so.

Fuck working. If I buy one tulip bulb and sell it, I'll never have to work again.

That line of thinking only leads to pain.

Tue, 11/03/2015 - 13:31 | 6744476 Oldballplayer
Oldballplayer's picture

Yes.  I have read your post and I feel shame.

I will use my bitcoin profits for the past two weeks.  30.46%.  Not annualized.  I will go buy a hoe and start farming.  Because making money is all about work.  Hard fucking work.

Jeez...why not be happy for the folks that can take advantage without getting fucked.

I dont think its going to $1,000 again.  But when your base is $100 lower than the current price, what the hell?  Why not?

Tue, 11/03/2015 - 13:50 | 6744546 highandwired
highandwired's picture

judging from your comment, you were not invested in BTC when it went to $1000 last time, or when it went from $20 to $260 in a couple weeks in 2013.

Get ready because when bitcoin starts running, the gains will be EXPLOSIVE

 

Your 30% gains are peanuts in Bitcoin land

Tue, 11/03/2015 - 14:58 | 6744872 Grave
Grave's picture

last time bitcoin bust through weekly ichi cloud its value went up by an order of magnitude

and it looks like its busting through the weekly cloud again

Tue, 11/03/2015 - 15:53 | 6745189 Anopheles
Anopheles's picture

The clouds you speak of must be fog, becasue it's on it's way down again. 

Tue, 11/03/2015 - 13:45 | 6744527 MoonSun
MoonSun's picture

Lots of people are working hard to make Bitcoin mainstream.

First of all, mining is real work. More importantly, the best cryptographers are extending Bitcoin to make it fast, secure, scalable and extensible. Don't get surprised if this industry is the main driver to get out of the crisis by creating as many jobs, or even more, as the internet did 20 years ago.

Tue, 11/03/2015 - 14:25 | 6744725 cheech_wizard
cheech_wizard's picture

First of all, mining is real work. 

True...

Mining bitcoin is not real work. If I am reading your above statement correctly, you're an idiot.

Tue, 11/03/2015 - 15:14 | 6744975 highandwired
highandwired's picture

Do you even understand how Bitcoin is mined?  Nope, didn't think so

Tue, 11/03/2015 - 15:58 | 6744937 Anopheles
Anopheles's picture

And everyone will be driving a Segway and have a hydrogen power car in the new hydrogen economy.... 

The problem IS that people have to "WORK HARD" to make bitcoin work.   When something is truly successful (revolutionary), it doesn't take a lot of hard work to keep pushing and expanding it. 

Biggest problem with bitcoin?  Women don't use it.  Since women do the majority of shopping for families, without their adoption, bitcoin will never be a success. 

Tue, 11/03/2015 - 14:03 | 6744610 Prisoners_dilemna
Prisoners_dilemna's picture

Tulip bulbs are't scarce, divisible, fungible, or durable. They are portable.

 

You're more dense than lead ADR.

Tue, 11/03/2015 - 13:44 | 6744525 Seasmoke
Seasmoke's picture

I can honestly say I cashed out at the very very top of the Bitcoin chart. Probably only time I can say that. Yet it pisses me off to see it go up these past months , when gold drops $20 every fucking day. I don't hate BitCoin, but this ain't right. Something is very wrong in the universe. Gold should be going be going up higher than Bitcoin !!!

Tue, 11/03/2015 - 13:50 | 6744556 Grave
Grave's picture

dont be silly, bitcoin market cap is only 5 billion
this is just the beginning
if it one day gets to be on par with golds market cap.... well lets just say 1 bitcoin will be worth 7 digits in debtfiat

Tue, 11/03/2015 - 15:36 | 6745093 Prisoners_dilemna
Prisoners_dilemna's picture

5 billion is so this morning.

We've passed 6 billion today.

;)

Tue, 11/03/2015 - 14:05 | 6744604 taopraxis
taopraxis's picture

Bitcoin has a high profile in the press and that tells me all I need to know, i.e., I do not want to own it.

The markets always create a coherent picture though it certainly may seem otherwise if one does not know what is creating that picture. And, of course, one never does know with certainty. However, look at the picture: Bonds are weak and gold is weak and the dollar is strong. Stocks are strong, oil seems to be stabilizing and the talk is of recovery and Fed tightening. Economic data make the recovery story questionable. Stock strength in the face of rising interest rates and a Fed tightening also looks odd. Crashing gold and rising oil, ditto. Then, there are the wars...

So, I ask myself this question: If the markets were being manipulated according to a central bank and/or government central planning agenda, what would that look like? I think it would look very much like the picture on display: I think the banksters want me to buy the recovery story, buy stocks, avoid cash and cash equivalents, e.g., short term Treasuries, and, especially, shun gold.

If I am the type that likes gold and dislikes fiat currencies, the central planners have a brand new option for me: Bitcoin, i.e., anything but gold because they really, really do not want me to buy gold. I know that because there is an article in the propaganda press every single day telling me how stupid it is to hold gold.

Yet, the banksters hold gold...go figure.

Long story short, I am going to buy gold all the way down and, make no mistake, gold can go down...be ready.

But, bitcoin? I would not touch bitcoin...

Tue, 11/03/2015 - 14:14 | 6744667 coinhead
coinhead's picture

We would say that Bitcoin does not have a "high profile" in teh press at all.  They only began reporting on it when they couldn't ignore it anymore without losing all credibility.  And even then, 85% of the articles were negative in tone.  Teh one reporter from Bloomberg even purposely mispronounced it "Bit Con" live on air.

Tue, 11/03/2015 - 14:21 | 6744708 Grave
Grave's picture

i still remember how people were laughing at the very idea of internet back in 1995 - and here we are today, with everyone and their dog using it

bitcoin is the internet of financial world
your children will laugh at you

Tue, 11/03/2015 - 15:15 | 6744922 Anopheles
Anopheles's picture

"bitcoin is the internet of financial world your children will laugh at you"

 

Hahahahahhahaha, ROTFLMAO

What about "the knowledge economy" or how about Betamax, or Blackberry, or thosands of other big ideas that flopped.   What about pre 2008 when housing prices were forever going to keep increasing. 

Bitcoin will always be a bit player, it's incredibly wasteful of resources. 

Tue, 11/03/2015 - 15:16 | 6744987 highandwired
highandwired's picture

"incredibly wasteful of resources"

?????

Tue, 11/03/2015 - 15:23 | 6745001 Anopheles
Anopheles's picture

It takes about $200 to $300 worth of electricty to mine one bitcoin with the newest AISC processors.   Mining is only profitable in locations with cheap power. 

Tue, 11/03/2015 - 15:29 | 6745025 BadLibertarian
BadLibertarian's picture

Mining provides security for the Bitcoin network. No mining, no trust network. Right now, it costs about $300 million per year. So what? How much does the fiat infrastructure spend to secure itself each year? Is that a "waste" too?

In the future, we'll pay even more for that security to protect a much larger market cap. That's just called sanity.

That fact that access to cheap power is important isn't a bad thing. Mining rigs move. Many of them moved to Iceland, where electricity is cheap to produce and very expensive to export. 

Tue, 11/03/2015 - 15:36 | 6745069 Anopheles
Anopheles's picture

No, mining is INTENTIONALLY made more and more difficult. 

Has nothing to do with security and everything to do with control and issuance of new coins.  Complexity of mining is NOT the same as security. 

If the "value" of bitcoins were, say, $10,000, then the difficulty would automatically increase so it would take $9,500 worth of electricity to mine one bitcoin. 

Tue, 11/03/2015 - 15:48 | 6745150 BadLibertarian
BadLibertarian's picture

Yes, mining is intentionally made more difficult - that's where the security comes from. If the difficulty level for calculating nonces were still back at 2011 or 2012 settings, then it would be relatively cheap and easy to mount a 51% attack on the network, because the miners who find it economically viable to mine would be working at a fraction of their capacity to calculate nonces (and they'd eventually replace their mining equipment with less capable systems to increase their margins).

This is why I keep trying to explain to you that you need to read up on bitcoin to understand how the various pieces work together.

The increased mining difficulty is a security feature, because that's what prevents a would-be 51% attacker from double-spending coins.

And who cares if the mining price increases as long as miners still have positive margins. If that ever gets out of balance and hashrate power leaves the system, do you know what happens then? The difficulty decreases.

Imagine that.

Tue, 11/03/2015 - 14:30 | 6744744 All Out Of Bubblegum
All Out Of Bubblegum's picture

Bitcoin is a hedge, not a totality.

Tue, 11/03/2015 - 15:37 | 6745108 Prisoners_dilemna
Prisoners_dilemna's picture

Nice to see oldheads coming back around.  Welcome back.

Tue, 11/03/2015 - 15:17 | 6744995 Anopheles
Anopheles's picture

The banksters don't hold a lot of gold.  Countries and bank clients hold the gold. 

Bankers are the middlemen and try to make a profit regardless of which way the market goes. 

Tue, 11/03/2015 - 15:21 | 6745015 taopraxis
taopraxis's picture

My, look at the red flags...those negative waves tell me all I need to know but, then, I already knew. Bitcoin is even worse than regular fiat trash, in my opinion.

Tue, 11/03/2015 - 14:19 | 6744697 venturen
venturen's picture

Who thinks Google Could Mint Bitcoin

Who thinks Google Can't Mint BitCoin

Tue, 11/03/2015 - 14:23 | 6744716 highandwired
highandwired's picture

It's called "mine" not mint

 

Tue, 11/03/2015 - 14:50 | 6744809 crazytechnician
crazytechnician's picture

There is nothing to stop google mining bitcoin , in fact they more than likely are mining bitcoin in their software labs so they can see how it works so they can build their next wave of search tools for use with the blockchain.

Tue, 11/03/2015 - 15:00 | 6744889 Latitude25
Latitude25's picture

Who thinks that a better substitute for bitcoin can be found?

Tue, 11/03/2015 - 15:11 | 6744953 BadLibertarian
BadLibertarian's picture

Sure. Bitcoin 2.0, 3.0, ...

One of the great things about software is that it's relatively easy to roll out a new 'model.' 

Tue, 11/03/2015 - 15:18 | 6744999 highandwired
highandwired's picture

Personally I like LTC

Tue, 11/03/2015 - 14:23 | 6744717 Latitude25
Latitude25's picture

It's your last chance to sell BTC and buy PMs or does anyone suggest that it is better to buy high and sell low?

Tue, 11/03/2015 - 14:37 | 6744766 38BWD22
38BWD22's picture

 

 

Looks like I should have waited just a few minutes more to buy that gold for BTC...

BTC price is $417 as I write.  Bought gold at $410.

Maybe you're right.  I have plenty of gold, but I would still suggest that anyone who is comfortable with BTC (and keep it below 2% or so of net assets) buy and HODL some Bitcoin, as it is a great speculation.

Tue, 11/03/2015 - 15:04 | 6744906 Latitude25
Latitude25's picture

I look for fundamental value in an undervalued investment.  As a speculator I would be a total failure.

Tue, 11/03/2015 - 15:42 | 6745136 Anopheles
Anopheles's picture

You actually did very well.   Back down to below $400

Tue, 11/03/2015 - 14:31 | 6744750 cheech_wizard
cheech_wizard's picture

Does it not surprise anyone, that when bitcoin goes up, the shills come out every time?

Standard Disclaimer: And yet not a single one of them has made "fuck you" money, because they are still here trying to get you suckered in.

Tue, 11/03/2015 - 14:56 | 6744816 crazytechnician
crazytechnician's picture

fuck you

Do yourself a big favour a stay well away from bitcoin , it's a Ponzi scheme Tulip Bulb scam run by the NSA / CIA that will crash when they shut down the internet and power grid and the EMP's all go off my old grandma said it was invented by little green men who beamed down from mars and want to take over earth. Don't say I did not warn you. Scam Alert.

Tue, 11/03/2015 - 15:40 | 6745125 Prisoners_dilemna
Prisoners_dilemna's picture

Not only is BTC a scam, but it's dead, repeatedly dead.

https://99bitcoins.com/bitcoinobituaries/

Tue, 11/03/2015 - 15:33 | 6745079 taopraxis
taopraxis's picture

Funny the way the money powers love to enlist political flacks to flame ordinary people who express "incorrect" views. These people spew hatred and start flame wars...you just know that they're not your friends.

Tue, 11/03/2015 - 15:02 | 6744898 Latitude25
Latitude25's picture

So this news would indicate that the Chinese are buying BTC and not physical gold, which would be an incorrect assumption by orders of magnitude.

Tue, 11/03/2015 - 15:37 | 6745103 Anopheles
Anopheles's picture

The Chinese aren't buying a lot of gold either. 

Tue, 11/03/2015 - 15:43 | 6745139 Prisoners_dilemna
Prisoners_dilemna's picture

Bitcoin is pseudonymous but due to it's digital nature we can draw conclusions about the money itself.

Google "Bitcoin exchange volume" and see for yourself who is buying.

Unfortunately we can not do the same thing for gold although GATA and WGC sure try, Bless their golden hearts.

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