Bitcoin’s Berserker Run Resumes After Exchange Breaks; Novogratz Says “Not Close To The End"

Tyler Durden's picture

Bitcoin is extending its gains after the 25-minute shutdown on GDAX...

*  *  *

Mike Novogratz - self-described as the "Forrest Gump of Bitcoin" - is on the wires calling Bitcoin a "cultural revolution."

"The world is in blockchain speculative phase... not close to the end of the speculative phase"

 

Novo added that Bitcoin futures will give rise to ETFs and even broader adoption and a "sell-off after the speculative phase is complete."

 

"Cryptokitties will be a fad"

 

"It's hard to mitigate volatility risk in Bitcoin"

 

Novogratz says "banks will be slow to move into the industry and doesn't see quick adoption of Bitcoin as a currency"

 

For now he has 25% of his net worth invested in Bitcoin/Blockchain and warns investors to "be careful" in non-Bitcoin tokens.

GDAX is back up after a 25 minute 'glitch'... and Bitcoin is rebounding

*  *  *

GDAX just broke...

Additionally, Bitfinex says it is under a significant denial of service attack.

As Bitcoin tumbled $4,500 from its highs...

 

And now the giveback...Bitcoin is down $3000 from its $19,600 highs...but is still up 30% on the day

 

Bwuahahaha... $19k...on GDAX

After tagging $19,697, Bitcoin prices tumbled to $17,900...

Prices are varying dramatically across exchanges with $2000 differences.

For those keeping track, this is how long it has taken the cryptocurrency to cross the key psychological levels:

  • $0000 - $1000: 1789 days
  • $1000- $2000: 1271 days
  • $2000- $3000: 23 days
  • $3000- $4000: 62 days
  • $4000- $5000: 61 days
  • $5000- $6000: 8 days
  • $6000- $7000: 13 days
  • $7000- $8000: 14 days
  • $8000- $9000: 9 days
  • $9000-$10000: 2 days
  • $10000-$11000: 1 day
  • $11000-$12000: 6 days
  • $12000-$13000: 17 hours
  • $13000-$14000: 4 hours
  • $14000-$15000: 10 hours
  • $15000-$16000: 5 hours
  • $16000-$17000: 2 hours
  • $17000-$18000: 10 minutes
  • $18000-$19000: 3 minutes

Coinbase is struggling to keep up...

*  *  *

 

Update: $18,000, that is all!

*  *  *

Update: WTF! $17,000...

We do note that GDAX pricing appears to be at a significant premium to several other exchanges.

*  *  *

Update: Bitcoin just surpased $16,000... speechless...

*  *  *

In the last 36 hours, Bitcoin has blasted through $12,000, $13,000, $14,000, and now $15,000 levels in an unprecedented 28% surge...

With a market cap of around $250 billion, Bitcoin is bigger than Proctor & Gamble and approaching the size of Wal-Mart as the 12 biggest 'company' in the S&P 500.

As CoinTelegraqph reports, the price is likely being driven by news of the imminent launch of Bitcoin futures trading. CBOE will be launching their futures market this coming Sunday, December 10, with CME Group following on December 18. Nasdaq plans to launch futures trading in the summer of 2018 and Japan’s Tokyo Financial Exchange is preparing to launch futures trading as well.

Bloomberg has announced that brokerage firms TD Ameritrade and Ally Invest will be offering Bitcoin futures trades to their clients. Even J.P. Morgan Chase may follow suit, despite CEO Jamie Dimon’s infamous views on the digital currency.

GDAX, Coinbase’s digital currency exchange, has been leading the rally all day. The price on GDAX is currently about $500 ahead of other Western Bitcoin exchanges. The likeliest - and most bullish - explanation is that Coinbase is the easiest way for new Bitcoin investors to get involved. Consequently, when GDAX leads the charge as it has today, it probably means new “retail” investors are fueling the rally.

Meanwhile, as CoinDesk reports, Ron Paul wants to know: would you take $10,000 in bitcoin, cash or something else?

The former U.S. Congressman from Texas is currently holding a poll on his official Twitter account that asks in which form they would take $10,000 from a "wealthy person". The catch: you can't get rid of it for 10 years.

Paul – who earlier this year called for the U.S. government to "stay out" of bitcoin – put the question to his more than 650,000 followers, asking if they would take $10,000 in the form of bitcoin, dollars, gold or 10-year U.S. Treasury Bonds. The result thus far – one hour remains in the poll at press time – indicate that of the more than 70,000 responses, 54 percent expressed support for bitcoin.

Gold took the second-highest amount with 36 percent, followed by a mere 8 percent for the 10-year bonds. Just 2 percent indicated that they would take the Federal Reserve Notes if offered.

Speaking with TheStreet in October, Paul conceded that he's no expert on cryptocurrencies (back in 2014, he argued that bitcoin wasn't "true money"). That said, he voiced his support for cryptocurrency in the most recent interview, arguing that it lends credence to the emergence of alternative currencies against the U.S. dollar.

And while Bitcoin's eye-popping price movements have some observers saying the market is in bubble territory, Naval Ravikant, the co-founder of AngelList, while he's not ruling it out entirely, holds a less alarmist view.

"Money is a bubble that never pops," he said at yesterday's Token Summit II in San Francisco.

He told attendees:

"It's a consensus hallucination."

And speaking to the newfound attention to bitcoin, Ravikant said people are interested in growing the wealth that they have. With most savings accounts returning zero these days – as central banks conduct what Ravikant called their "grand money printing experiment" – the general public is looking for alternative places to store their money and watch it grow.

Bitcoin and other protocols seem to offer that, as even the less-developed cryptocurrencies are showing substantial returns.

"I think people are looking to solve their money problems," he said.

Additionally, Coindesk notes that the former chairman of the U.S. Federal Reserve, Alan Greenspan, has joined the many financial luminaries to recently criticize bitcoin's value.

Speaking to CNBCGreenspan compared bitcoin to that of an early American form of money called "Continental currency" that came into use in 1775 and had become worthless by 1782. The paper-based legal tender was used at the time of the American Revolution and was not backed by a commodity such as gold.

Noting that bitcoin will likely suffer similar fate, Greenspan said that a "significant share" of  Continental currency was still used to create "real goods and services," even though it had no ultimate worth.

He continued:

"Bitcoin is really a fascinating example of how human beings create value, and is not always rational ... It is not a rational currency in that case."

Greenspan's comments come as the value of a bitcoin is soaring beyond most expectations, having gained thousands of dollars in value in the last two days.

And in response to that...

And finally, for those calling this a "bubble" - we would humbly suggest you ain't seen nothing yet...

 

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ZH Snob's picture

they would have to actually buy the BTC and LOTS of it.  some have thousands, tens of thousands of BTC and theoretically can do this.   perhaps they already do.  that would account for these multi thousand dollar drops and subsequent climbs.  have you ever seen a more buoyant commodity?

but it's only the traders who are at risk at any given point.  HODL is and will continue to be a safe and profitable position in BTC.

Bumpo's picture

The thing is, there really isn't that much Bitcoin out there. If you want it, and want to get it out of the hands of the "Hodlers", it won't be easy. But I agree, you can't control the price of Bitcoin, without out real Bitcoin. Problem is, if you buy a bunch, and try and dump it, what happens if its just scooped up? Its not like shorting Bitcoin hasn't been attempted before. Problem is, shorting since $5000 has been met with massing buying as soon as the selling stopped. In the Bitcoin world, that's a matter of hours now.

dark pools of soros's picture

there arent dumb sucker gold bugs accepting a shit price so that is why they cant manipulate it

FactDog's picture

"Everyone is going to get wiped out!"

 

Depends on when you bought your BTC,  old boy, it depends. ,  Where is Fonestar?

SixIsNinE's picture

he's tied up with decorator on one of his yachts, "The Regal Bitty McBitcoinface", who overcharged him - out in the Aegean....

but word is he's still a player, with several lil' fonehacks doing his bitty bidding

we've not heard the last of ol' Foney

ZH Snob's picture

I think he's come back with other logins, but he needs to come back in as fonestar.  the gloating possibilties would be enourmous.

mtl4's picture

The money needs to come into the market before they can manipulate it (hence the parabolic change in value over the past year or so) and this also comes in the form of derivatives which are only just coming of age on Bitcoin now.

Stackers's picture

Now where did I leave the shit bag that I store everything that double talking jew bankster known as Greenspan says ?

wren1700's picture

bitcoin is fractional. you don't have to buy one bitcoin, you can buy fractional units. likewise with usage.

peekster's picture

Once futures start trading. Nothing.

Hugh_Jorgan's picture

Even if there is no direct manipulation through a market backchannel. There are always the computer algos that can bend-fold-manipulate to achieve the price movements that their masters desire.

The markets are and will always be a farce, that is until some unforeseen paradigm shift occurs in the future. But who knows what/how/when that happens. A new dark age is upon us.

balanced's picture

Those in power use exchanges like the CME which offer only contracts which can be settled in dollars. They don't actually trade the commodities most of the time, they simply trade what are essentially bets on commodity prices. They then allow naked shorting, which means that people who don't even own a given commodity, can push down the price. This means that whomever has the most dollars sets the price.

Bitcoin on the other hand is traded on many exchanges from all over the world, so those in power cannot control and rig a central point of trade. They are going to try. That's why the CME will start trading Bitcoin futures next week. They won't actually be trading Bitcoin, only bets on the Bitcoin price in an attempt to drive down the price. They will fail, and it will be awesome to watch. Hopefully it will lay bare the scam which is the CME, and hopefully inspires new PM exchanges which actually trade commodities.

CJgipper's picture

They can't print bitcoin.  And it's easy to take possession of, so futures aren't as attractive as the real thing to actual buyers/investors/savers/speculators.

HardAssets's picture

They can print the fiat to buy cryptos, however.

CJgipper's picture

which would just reinforce the point of btc replacing dollars as a savings account

The Wizard's picture

Can someone explain to me what is stopping the usual suspects from manipulating bitcoin price, the way they are manipulating everything else?

The argument is because bitcoin is controlled by robots (AI algos) there is "honesty" built into it. I wonder who is controlling the design of the algos.

Something to consider. Does irrationality exist in the individual decision making process? If rationality is based on the cost/benefit perceptions of an individual at a given point in time, what the indidual decides to do is rational to him, though it may be "irrational" to others or societies norms.

richdemetri's picture

They can't manipulate it so far because supply is truly limited and enforced by thousands of computers in a decentralized manner. Perhaps bitcoin is one of the few remaining markets that is actually representing actual inflation and money printing.

moselywrong's picture

16.7 million bitcoin mined. Perhaps only 50% maximum of them being traded. The rest being held for the long term. At least 100 million "rich" people in the world with cash to invest. Equity markets overvalued. Real estate fully valued. Negative net return on bonds. Precious metals going nowhere. 100 million people chasing 8.5 million bitcoins. Anyone shorting bitcoin will be smashed by a mass of people looking to buy and hold.

You cannot just put your credit card # down at coinbase and start buying. Well, you can but only $1k - $2k a day. There are maximum daily deposit limits. Right now huge numbers of new acounts have been set up which are being loaded with money, most of them wanting to buy a bitcoin and hold, not trade. These new accounts have only just begun to influence the market, hence massive acceleration in price increases. A lot, lot more to come. Try shorting that market and see what happens

crusty curmudgeon's picture

[Comment removed by manipulators.]

eclectic syncretist's picture

Right now it's not possible to manipulate Bitcoin price down, as there is no mechanism in place to short-sell it. All that will change when the money-changers open up a futures market in it.

richdemetri's picture

The futures markets will base their pricing on the actual exchanges, so their ability to supress the price will only go as far people are willing to trade on their exchanges, as opposed to the exchanges that sell real bitcoin. Shorting bitcoin will be a very very dangerous hobby indeed, and increase volatility even more. I imagine much of the shorting will not be naked.

richdemetri's picture

For that to happen, as it does in the gold market, they would need something like comex where it is accepted as the default pricing mechanism. However comex is not backed by gold and has unlimited supply, hence the price suppression. Bitcoin on the other hand is currently truly based on supply/demand. And the new futures markets will base their pricing on the actual bitcoin exchanges, which trade actual bitcoins. But for them to supress the price they would need to be the price setters on their paper markets. But that wont happen very easily, and many people would rather hold the actual coin. This is the sad thing about gold, although it is superior in so many way to bitcoin, the supply side is heavily, and legally manipulated by unlimited paper contracts. 

HardAssets's picture

Nothing.

Say you’re a central bankster and the cryptos were an actual threat to you. Why not fabricate your own unlimited digital nothings with a few key strokes and then run up the price. And when enough of the serfs have jumped in, sell quickly and crash it.
The serfs may have had to work hard & risk to get the fiat to buy cryptos, but the banksters can just make it outta nothing, backed by nothing.

Arnold's picture

Your youthful fog is starting to clear, Grasshopper.

Herd Redirection Committee's picture

Basically, if you want to buy, they frontrun you, there is quote stuffing and spoofing, they keep a floor under the price, and when you try to sell they call it 'suspicious activity', esp. if trying to sell 'in size'.   So selling is difficult, and buying boosts up the price a lot more than one would expect, in any other market.

HowdyDoody's picture

"Can someone explain to me what is stopping the usual suspects from manipulating bitcoin price, the way they are manipulating everything else?"

Well there is that massive computer farm the NSA has in Utah close to a source of cheap electricity. Which is worse - them mining personal data or them mining BTC? Ditto for the Banksters with teir bottomless printing press - all that high performance CPU power - for HFT or BTC?

Run for your lives when someone comes out with a BTC ETF - 'cos BTC is too expensive or too difficult to trade for John Doe (just like gold used to be).

Buckaroo Banzai's picture

"Well there is that massive computer farm the NSA has in Utah close to a source of cheap electricity. Which is worse - them mining personal data or them mining BTC? Ditto for the Banksters with teir bottomless printing press - all that high performance CPU power - for HFT or BTC?"

The NSA's supercomputers are useless. BTC is mined using highly customized ASICs. These specialized mining rigs are in such demand that they are sold out months in advance. They couldn't get in this business even if they wanted to.

bluez's picture

Those old NSA fuddy duddies don't know anything about application specific integrated circuits. They are so backward their computers still run on DOS. No worries there.

Attitude_Check's picture

There is no way to financial ideas it via derivatives -  yet.   When that happens Katie bar the door.

RedBaron616's picture

And a very good question too. If someone with deep pockets wanted in, just buy a lot of Bitcoins and then dump them back on the market to crash it. Since there isn't any real transparency in this market, I would suggest that it is more susceptible to the market being manipulated than the usual markets.

Blue Dog's picture

Actually, cryptos are the least manipulated market. The others are being artificially suppressed or artificially propped up.

Blue Dog's picture

The Bitcoin price can't be controlled the way the stock market, bond market, real estate market, and precious metals markets are. The Fed is buying up everything except the precious metals markets. Those markets are controlled by the paper markets. The paper markets sell 100 to 200 shares of paper precious metals for every once they actually own.

We've seen algos set up to buy a Bitcoin or two every minute for weeks. Then they're suddenly dumped on the markets all at once to crush the price. There's also spoofing where big pending buy or sell orders are placed to trigger other buy and sell orders then they're cancelled.

maxblockm's picture

Usual suspects use naked shorting. Can't naked short BTC, but you can manipulate it, or at least you used to be able to. Google "Spoofy Bitcoin"

lew1024's picture

Because 'the usual suspects' don't own much bitcoin, those are in the miner's wallets. A high proportion of all bitcoins are there, of course.

So the miners might be manipulating the price, but would have to have outside money to do so.  That isn't their pattern, they continuously sell enough to keep the power bill paid.

Besides, until there is a futures market, you can't do serious price manipulation. 'Pump and dump' hasn't worked. Who is pumping? Just the price, I think.

This is the first large-scale example of a new concept, the blockchain and the first world-wide adoption of a new means of commerce. Of course we are uncertain as to the ultimate value of that new thing.  Of course it will look like a tulip mania if it fails, or like a normal network-effect of value-usefulness being exponential wrt total number of people using it, compressed into a single number, if the future is like some of us expect.

Cryptocurrencies will succeed. Bitcoin may be out-competed by better models, other methods of maintaining the block chain. It may even disappear.

Pretty much the way other network-effect, e.g. software startups work. Google wsn't the first search engine, Facebook wasn't the first social media site, both had many predecessors. Random walk or judicious adoption of different strengths, it took a few tries to get them right, and then 2 companies exploded in value.

On the other hand, Intel was the first company to get the microprocessor right, and they are still #1, probably 50 microprocessor startups based on better CPU architectures or other-than-cpu architectures have failed.

That is what the bet on Bitoin and cryptocurencies is all about. imho, of course.

Crisismode's picture

They ARE manipulating it . . .

They are manipulating it UP!

Have you ever heard of the phrase "Painting The Tape"?

Well, that's exactly what it is.

 

Irving Phelps's picture

I'm holding my breath that the opening or BTC futures isn't the gateway to hell as it is for everything else that's manipulated. The crime cartel is in full offense with their naked shorts so I will be watching nervously.

Fail2Deliver's picture

wait until the etf's and futures markets open.Then there will be a way to short bitcoin and profit on the decline.

kamikun's picture

>> ...what is stopping the usual suspects from manipulating bitcoin price, the way they are manipulating everything else?

I'll offer my reason as to what is happening. First - btc (and all other cryptos) do not enjoy significant advantage from being abstracted into paper claims. IOW, gold is heavy, burdensome, and always at risk of being stolen. Many investors don't bother with physical gold because securing it, and spending it, is a pain in the ass.

With proper management - that is actually pretty easy to learn and follow, and low-cost - you can safely store your own cryptocurrency keys and be almost 100% sure that they can never be stolen from you (except under direct duress). So, with no custodian, there is no chance of people creating 'paper bitcoin' or 'claims' on bitcoin. 

And those paper claims would be worthless in the exchange market. You have to have BTC to trade BTC - no one is going to accept a claim on a digital asset. Why would they when it is as easy (or easier) to trade the actual asset - and also avoid all counterparty risk!?

With no way to create leverage at will, the price is what the market thinks it should be. And the hard limit in supply also makes the token exceedingly rare. BTC is doing what gold could have done, but was limited by its physicality.

zebra77a's picture

Are Central Banks Secretly Buying Bitcoin?

The dollar value flow into Bitcoin is eclipsing the ability of anyone outside of a Central Bank.

Here is the logic :
   Hedge Funds / Institutional investors do not have the liquidity to move that much money outside the trackable / taxable controlled bank acccounts
   Members like Bill Gates and Warren Buffet would of run out of money ($100 Billion inflow in the last week)
   Saudi Arabian royal family ARAMCO was unable to raise the necessary funds.

Central Banks could be seriously challenged by all  cryptocurrencies that is front running, non-taxable, non-regulated, cannot be inflated, and cannot be controlled.
 
To combat crypto they secretly are buying as much as possible, however it looks like it is back firing by feeding the crypto ecosystem.

 

https://www.reddit.com/r/Bitcoin/comments/1lfobc/i_am_a_timetraveler_fro...

BigJim's picture

They may well be at the buying stage. Once they swap enough costless fiat (costless to them, agents of central banks that thet are) and own enough, they can just dump $5B at the drop of a hat, wipe out the bid stack, do it again and again and again until "investors" get sick of the volatility and believe it's a bad store of value.

That's what killed PM's demand as a safe haven. TPTB just kept dumping tonnes of it whenever the price "should" have risen, and investors finally learned - like Pavlov's dogs - to associate PM ownership with losing money.

The fuckers won.

Colonel's picture

Heads up about Bitcoin in 2018. Don't believe for second the "state" won't get involved. Shocking prediction from SaxoBank, see page 15

https://www.home.saxo/-/media/documents/campaigns/outrageous-predictions...

 

Supafly's picture

The more I see the same assholes who missed the dotcom and real estate bubble, not to mention our current stock market bubble continue to call bitcoin a bubble, the more I see it going up.  As soon as they endorse it, I'm out.

Hugh_Jorgan's picture

Caution... By then it could be too late. The doors to this theater are narrow and it will be crowded.

Read my lips... seven transactions per second. And this is IF everything keeps working and doesn't crash during the freak out.

When you leave BTC you DO NOT want to be waiting in line to do so.

balanced's picture

Unlike stocks, there are many doors for "exiting" Bitcoin. You can actually spend it at most major retailers including Amazon via Gyft. Not to mention the fact that even if bitcoin crashed to $100, it would still be preferable to many local fiat currencies around the world, many of which have exchanges. In addition, it is the only safe place to store wealth in many parts of the world, especially while crossing borders.

Thinking of Bitcoin as a stock is a mistake. Its the first real global currency. The world is slowly moving into it, as fiat currencies collapse. This is only the beginning.

BigJim's picture

"Not to mention the fact that even if bitcoin crashed to $100, it would still be preferable to many local fiat currencies around the world, many of which have exchanges."

Right, if I swapped USD $19k for a single BTC and its value dropped to $100, I'd be better off than if I'd held onto the USD.

Christ this place is full of retards these days.

Not My Real Name's picture

"The more I see the same assholes who missed the dotcom and real estate bubble, not to mention our current stock market bubble continue to call bitcoin a bubble, the more I see it going up.  As soon as they endorse it, I'm out."

You mean guys like ex-precious-metals cheerleaders who have jumped on the bitcoin bandwagon like Bix Wier and Andy Hoffman?