Bitcoin loses over a fifth of its value in less than 24 hours

[Eugene]

Source: Reuters

#BUSINESS NEWS NOVEMBER 30, 2017 / 9:08 AM / UPDATED 2 HOURS AGO

Bitcoin loses over a fifth of its value in less than 24 hours

Abhinav Ramnarayan
4 MIN READ

LONDON (Reuters) - Bitcoin slid to as low as $9,000 in volatile trade on Thursday, having lost more than a fifth of its value since hitting an all-time high of $11,395 on Wednesday.

The cryptocurrency fell as much as 8 percent on Thursday on the Luxembourg-based Bitstamp exchange to hit $9,000 exactly, marking a fall of well over $2,000 in under 24 hours. It then edged back up to trade at around $9,400 in the hour that followed, still down roughly 4 percent on the day. (Graphic: Bitcoin searches exceeds that of Trump - reut.rs/2zSavA6)

One market-watcher attributed the fall to outages in bitcoin exchanges and the heavy price surge of recent times.

“Naturally a few of the early bitcoin traders are taking some profits off the table,” said Charles Hayter, founder of CryptoCompare.com.

-snip-

Read more: https://www.reuters.com/article/us-global-markets-bitcoin/bitcoin-loses-over-a-fifth-of-its-value-in-less-than-24-hours-idUSKBN1DU1Z3

[PoindexterOglethorpe]

1. Bitcoin is the Ponzi scheme of the 21st century.

[grantcart]

17. Actually it is the Tulip Mania of the 21st century lol

https://en.wikipedia.org/wiki/Tulip_mania

[Binkie The Clown]

2. Hmmm. Wasn't it just yesterday they were saying it could only go up? nt

[Wwcd]

3. Good. Bitcoin is used to avoid sanctions based on real money, & a go-around for international laws

It is the untouchable dark money. Putin is vying for bitcoin mogul of the world. China is close behind him.

Anything the world can do to halt this shady shit is welcome.

[Brother Buzz]

4. I'm happy Lieutenant Dan got me invested in some kind of fruit company instead of this

I got a call from him, saying we don't have to worry about money no more. And I said, "That's good! One less thing".

[Orrex]

5. On the plus side, you can still buy Baltic and Mediterranean with it.

[C_U_L8R]

6. Easy come, easy go

Anyone wanna buy some tulips?

[Iggo]

8. Give me your lupins!

[tandem5]

11. You mean the flower, lupins?

[Iggo]

12. Well, I don't mean the lentils.

[MineralMan]

7. Yah, people are cashing out their Bitcoin

because they either think it has peaked in value or they have a need for some real money.

Bitcoin is a commodity. Its value is based on how much people are willing to pay for it. Right now, apparently, some people have decided to convert their holdings to a different sort of currency, based on current value.

Bitcoin has no intrinsic value, only a market value.

[ProudLib72]

10. The dollar is a commodity, but we don't recognize it as such

Difference being the dollar is under federal control.

As of November 2017, Fort Knox holdings are 4,582 metric tons (147.3 million oz. troy), with a book value of $6 billion. In contrast the entire Unites States economy was $19,400 billion as of 2017 April.

https://en.wikipedia.org/wiki/United_States_Bullion_Depository

Last year I listened to an interesting program about Bitcoin. It seems that Bitcoin is not the only cryptocurrency in existence. Several African countries use a similar cryptocurrency because their governments are shaky and they don't actually have banks. So cryptocurrency is a decent idea for some situations. In fact, it's the only way for some economies to survive without being reduced to a barter system.

Here is an article about cryptocurrency in Africa. It's not the one I listened to, but it gives some idea of why people resort to using cryptocurrency:

https://www.bloomberg.com/news/articles/2017-11-03/diary-of-an-african-cryptocurrency-miner

[grantcart]

14. The dollar isn't really a commodity because it doesn't have a certain amount

US dollars are created every time someone accepts a future obligation or loan, car loan or mortgage for example. Most US dollars are created in the private sector by people accepting a paper for future payment.

The value of the US dollar is its universal acceptance. The US dollar is the default currency for sovereign funds and can be easily traded instead of the local currency all around the world.

In some cases the US dollar is preferred over the local currency. When I was in Vietnam you had to pay in US dollars rather than the local Yuan.

[ProudLib72]

15. Maybe "commodity" isn't the best term

My point is that the dollar is not actually backed (as a lot of people think) by gold reserves; there simply is not enough gold to accomplish that. I was responding to MM's post because, from what I have heard and read from economists, Bitcoin is somewhere between currency and commodity.

Calling it a mere commodity undermines the idea of Bitcoin. Separating currency value from a regulating government sounds radical and anarchist when considered from an American perspective. After all, we don't have a rapidly fluctuating national currency. The dollar is fairly stable. But in those countries whose national currency is volatile, cryptocurrency makes a lot of sense. I fully understand that the point of the OP is that Bitcoin is a volatile currency; however, the Bloomberg article I posted demonstrates how Bitcoin and other cryptocurrencies are a much better option than national currencies for some countries. In other words, even though it is difficult from our perspective to see Bitcoin as stable against the dollar, there are actually parts of the world where Bitcoin is much more stable than any government backed currency. If you did not have a bank (and many of these countries lack a widespread banking system) and your country's inflation rate was high, the best place to keep your funds would be in Bitcoin.

[grantcart]

16. Agree on part of your statement

I don't believe that cryptocurrencies are better than any currency because I believe someday someone will be able to establish a counterfeit (I could be wrong but for enough money I believe that any system can be compromised). While their are counterfeit dollars there aren't enough to undermine the value of the dollar.

If even one counterfeit Bitcoin is confirmed then the Bitcoin will become worthless because it is its scarcity that creates the value.

There is an interesting historical parallel to cryptocurrencies, I believe, in the Tulip mania. Are you familiar with it?

https://en.wikipedia.org/wiki/Tulip_mania

[ProudLib72]

18. I'll agree with you but for a different reason

Counterfeiting is possible, but on display here is speculation. Actually, speculation may just be a lot more dangerous than any counterfeiting. You are aware that you or I could create Bitcoins? That's what the man in the article is doing for a job. I'm not so familiar with all the details of the process, but Bitcoin actually relies on people to create currency.

My concern is different. I'm no economist, but I suspect that the value of any cryptocurrency becomes loosely tied to national currencies and that connection is usually going to be with the currency of whatever nation the majority of Bitcoins reside in. If Bitcoins were traded in America only, then they would just be tied to the dollar. If they were traded in America and Europe only, they would be tied to the dollar and Euro. I know this is exactly the opposite of what the creators of Bitcoin wanted to happen, but I really don't see how a cryptocurrency that exists alongside a national currency could not become tied (I actually want someone to come along and show me how I am wrong). If I am correct in my assumption, then what happens when ten percent of all Bitcoins reside in a country with massive inflation rates?

While the idea of using cryptocurrency in some countries seems like a good idea at present, I don't think that it offers long term security.

[moriah]

20. It's pretty much hit "peak mining" on several currencies.

I knew someone who did make some early money but cashed it all out long ago, when mining actually made money. He said he wished he'd left some in just a "change drawer" now. And his was when Litecoin, not Bitcoin, mining was the money maker.

I probably contributed to the fall because I cashed out what had been like $2.00 in faucet earnings a few years ago. Had a nice dinner, so put it into the USD circulating economy.

[ProudLib72]

21. Is there some way for us to track Bitcoin flow?

I think there ought to be a way to see where Bitcoins are in circulation. I went to Blockchain, but I didn't see that information.

[moriah]

23. I doubt it.

Most faucet apps are designed by people getting paid for ads and so they were entertaining for like 5 days. I'd made a Coinbase wallet and it really had paid. But it wasn't above minimum withdraw threshold.

I imagine the volatility right now is because of people remembering old wallets from 5-6 years ago with what had been valued at $5 or less.

At the same time, people buy Bitcoin through the same wallets like Coinbase. And yeah, the professional ones that let you yank out/buy like Coinbase demand you do identify verification before purchase or withdrawal, though I hadn't done it to just make my original wallet for the faucet (you can receive just btc without verification).

Coinbase itself crashed several times yesterday and today. Those crashes have contributed potentially either to stopping volatility (making it impossible for people to trade), but J noticed both today and yesterday have recovered so far back to the 9500+ I'd originally seen earlier in the month and thought "Holy shit" over.

[tandem5]

9. In 2012 it went from 16 to about 6...

In 2013 it went from 250 to 50. In 2013-2014 it went from 1000 to 250. Now its going from 11000 to, what, 3-4000? I see extreme volatility. I do not see a downward trend.

[LanternWaste]

13. I've wondered what would be the next bill of goods on the market would be

I've wondered what would be the next bill of goods on the market would be after the Pet Rock and Cabbage Patch Kids hit their market saturation point. Trump and BitCoin fills that void splendidly.

[Blue_Tires]

19. life comes at you fast...

[Flaleftist]

22. Cryptocurrency is very volatile.

A 20% drop in one day isn’t unusual, especially after a major increase. If you look at long-term charts for any cryptocurrency you will see such violent swings.

[fescuerescue]

24. back to $9000

It was $9,000 just a week or two ago. Imagine getting whipsawed like that. buying at $1100 and then getting kicked back down to $9k.

I've been watching bitcoin since the bubble started around $200 ~3 years ago. I felt bad for all these folks losing money at $200. I can only imagine how much worse it is at $10,000