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Why has the price of Bitcoin been falling?

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The price of Bitcoin isn't falling. It is far above its true value: Zero.

3 ( +14 / -11 )

currency fell nearly 30% at one point

The Turkish lira is a more stable currency than Bitcoin, and that’s saying something.

2 ( +6 / -4 )

The Turkish lira is a more stable currency than Bitcoin, and that’s saying something.

Bitcoin is not currency, Bitcoin is an asset.

-6 ( +3 / -9 )

Why has the price of Bitcoin been falling?

People are starting to wake up.

3 ( +8 / -5 )

There's nothing mysterious, people got scared Tesla would dump their 1.5B USD/BTC...

2 ( +2 / -0 )

Bitcoin is neither a currency nor an asset. It’s an illusion.

3 ( +12 / -9 )

A world currency is a great idea.

but I can’t use bitcoin in the combini

2 ( +7 / -5 )

A speculation cult. It will end in tears for some while those in and out early will make a fortune.

Store of value? Hardly. Usable currency? Not likely.

2 ( +4 / -2 )

Loaded up on the dip!

2 ( +5 / -3 )

Price volatility is one reason why Bitcoin, Dogecoin and the like won't replace paper currencies managed by legitimate governments. Business and households need a stable store of value in their currency so they can make and execute plans. If your company revenues are rising and falling in double digit percentages every week how do you run a business? Pay rent in Bitcoin? So my rental income is going to go up and down every week? No. I want something more stable than that. In addition, the Dollar, Yen, Euro, Yuan, value of a Bitcoin is so high you are not going to do the weekly grocery shopping in Bitcoin.

0 ( +3 / -3 )

@Dessert

Bitcoin is still a new technology and idea that is finding its place in the world and hence going through price discovery. So you are right, it is not currently good for the things you list above. The question everyone should be asking themselves is what role can Bitcoin play in the next 10, 20, 30+ years. There are plenty of ideas and opinions out there on what this could be and no one knows what will happen. To me, I buy into the argument of a store of vale and inflation hedge. I can also imagine it becoming a base settlement layer at some point in the future. It's all about risk/reward and I see a very asymmetric risk profile here. Get your position size right and its a good speculation. Personally, I did not lose a moment of sleep last night after watching the 50% decline unfold.

0 ( +2 / -2 )

Maybe I should create Bitcoin 2 and start my own pump and dump in order to retire early. I wish I could go back to 2010 to get in on the scam then dump the Coin for real US currency. It's open source so just make other coins to take on the BC bubble...create your own bubble

Personally, I did not lose a moment of sleep last night after watching the 50% decline unfold.

If you get in early enough, ideally if it's 2010, but once I reach 7 figures I would dump it and just enjoy the retirement bonus. I would not invest on this now. But I should have started getting in on the scam ten years ago

3 ( +4 / -1 )

Lots of technophobes here. Its just a correction. The reality is, if you invested in BTC 1 year ago, you have tripled your investment. Stocks and real estate are laughable by comparison. Fact.

China is clearly playing a role trying to destabilize foreign cryptos while starting up their own (which will fail, BTW). They wont win.

Get in now to solid assets like BTC and DogeCoin while their still affordable.

1 ( +6 / -5 )

Lotsa people playing Elon says... that's why

0 ( +0 / -0 )

Central banks and governments will never allow crypto to replace currency for daily use. So it will eventually rely solely on the greater fool theory. Could be wrong but with no real utility or inherent value they are unlikely to have much value

1 ( +2 / -1 )

As far as I am concerned, if you don't put every last penny you earn and sell your stocks, bonds and real estate and pour everything into bitcoin, then you are a fool.

1 ( +3 / -2 )

Central banks and governments will never allow crypto to replace currency for daily use.

Countries could make a crypto version of their respective currencies to take advantage of blockchain tech but traditional financial institutions would probably be against it

0 ( +0 / -0 )

Countries could make a crypto version of their respective currencies

Central Bank digital currencies are now a certainty and the traditional banking sector is toast. Many people will wrongly conclude that cbdc’s negate the need for bitcoin. Those people completely misunderstand what bitcoin is. CBDC’s create an even greater need for bitcoin or something like it.

0 ( +2 / -2 )

Central Bank digital currencies are now a certainty

Have not been reading much lately and certainly not about finance, thanks for the input.

I'm interested, will look it up when I have time

1 ( +1 / -0 )

@ian

The Chinese are already way ahead on this and the US are discussing it. Imagine a world where the central bank can deposit stimulus/UBI directly into your digital wallet. Then realise that what they give, they can just as easily take. Maybe you have to spend your stimulus by a certain date, or on certain items. Maybe your tax rate is higher than your colleagues because you have a negative 'social score' i.e. they don't like your tweets or JT posts! I'm not a tin foil hat kind of guy, but the potential for abuse of CBDC's is frightening. I'd encourage everyone to do some research and think through the implications of all of this. Add to this the fact that governments cannot grow their way of the massive debts they have accumulated, they can only debase their currencies, thereby reducing our purchasing power. Then maybe bitcoin will start to make more sense.

2 ( +2 / -0 )

@Fuzzy

Yeah potential for abuse is immense and plain to see, haven't even read a thing and it seems to explode.

1 ( +1 / -0 )

FuzzyToday  04:22 pm JST

@ian

The Chinese are already way ahead on this and the US are discussing it. Imagine a world where the central bank can deposit stimulus/UBI directly into your digital wallet. Then realise that what they give, they can just as easily take. Maybe you have to spend your stimulus by a certain date, or on certain items. Maybe your tax rate is higher than your colleagues because you have a negative 'social score' i.e. they don't like your tweets or JT posts! I'm not a tin foil hat kind of guy, but the potential for abuse of CBDC's is frightening. I'd encourage everyone to do some research and think through the implications of all of this. Add to this the fact that governments cannot grow their way of the massive debts they have accumulated, they can only debase their currencies, thereby reducing our purchasing power. Then maybe bitcoin will start to make more sense.

Well put.

0 ( +0 / -0 )

It's just a dip. The roller coaster ride will start in later half of the year.

0 ( +1 / -1 )

Bitcoin is neither a currency nor an asset. It’s an illusion.

So is the dollar ever since they moved away from the gold standard. The dollar, like Bitcoin, is only back by people's confidence in it.

1 ( +2 / -1 )

Because its a bubble.

2 ( +2 / -0 )

Took advantage of the dip! See you guys at the top!

-2 ( +1 / -3 )

Could it be because it’s a vehicle for speculators. Tax frauds, cyber ransomers and Monet laundering drug dealers.

-2 ( +1 / -3 )

So is the dollar ever since they moved away from the gold standard. The dollar, like Bitcoin, is only back by people's confidence in it.

Not exactly. It's not the same type of confidence.

The confidence in a state-backed currency depends on the state's ability to control territory and excercise violence against people who refuse to buy the national currency to pay income taxes, sales taxes, customs duties, fees etc. These compulsory purchases create the confidence that there will be a certain level of demand for the currency in the foreseeable future.

None of this applies to Bitcoin. Nobody has to buy Bitcoin and nobody will be arrested if they don't. The confidence in Bitcoin is just confidence in Bitcoin's continued popularity. That's a very different type of confidence.

0 ( +0 / -0 )

I bought and sold at 54K I am glad I did. I took the money and ran, my belief is all good things come to an en

0 ( +0 / -0 )

So is the dollar ever since they moved away from the gold standard. The dollar, like Bitcoin, is only back by people's confidence in it.

There has not been an effective gold or silver standard anywhere in the world since the beginning of the Industrial Revolution. You are fooling yourself to think otherwise. To grow an economy banks have to make loans. The never loan gold. No, they make an entry into a passbook and that entry instantly becomes spendable money. The bank has to have maybe 4% of the value of outstanding loans on hand as a reserve, the rest is cash out of thin air, and since it is done on paper it is effectively paper money. It's real money too and the borrower has to use it to build a business that makes enough income to pay the loan back with interest and still make a profit. There has never been enough gold or silver to back a currency with either so over time the amount of paper currency "backed" by specie becomes so huge that it is no longer possible for a treasury to redeem those paper notes in gold. The reality is that central banks have had to regulate lending to control the growth of paper money to regulate the inflation rate, and that has been true with or without a gold standard. The US had booms followed by depressions and major deflations on a pretty reliable 20 year cycle while on a claimed "gold standard". The Great Depression happened when the US was on a gold standard. The reason for the Great Depression had nothing to do with gold, it was a lack of regulation of the banking industry by the Federal Reserve at a time when it was politically impossible for a central bank in the US to exert any authority over banks. You had banks printing their own notes and stores would have exchange rates between the bank "Dollar" and a US Dollar, and between the notes of different banks. People alive today don't know these things but they are part of US banking history. There was no control over lending back then and it led to depression after depression. Having a gold standard did absolutely nothing. What works is a pro-active central bank that regulates lending by commercial banks to control the growth of the money supply so prices are stable. Bitcoin and the like, along with gold and silver, have no such mechanism to regulate their value. In addition gold and silver both have industrial uses that affect their value. Gold is an outstanding conductor that does not corrode so it is used in high end electronics where reliability and signal quality are most important.

0 ( +0 / -0 )

The Chinese are already way ahead on this and the US are discussing it. Imagine a world where the central bank can deposit stimulus/UBI directly into your digital wallet

In a practical world, how is a "digital wallet" any different than paying electronically from a bank account, say using your debit card? It's a fancy name that sounds cool and techy, but I can buy just about anything I want on line or in a bricks and mortar store with a credit or debit card. I can even set up automatic payments from these cards and trusted vendors will keep the card numbers on file so when I buy something check out is simple and fast. What is different about a "digital wallet" in a practical sense? It strikes me people are being sold crap they don't need because it sounds cool to have. Pardon me for being an iconclast but it's my nature to question the received, cough cough, "wisdom" of marketing types.

0 ( +0 / -0 )

This article is wrong on so many levels. TOTAL FUD!!!!!!!

0 ( +0 / -0 )

This doesn't even come close in scope to the Derivatives market. Any quantum computer can crack Bitcoin like an egg. Money is pulled out and put back in then dividended out over a length of time by the reinvestment strength of other depositors. Digital records reflecting what the coding creates. What is the reporting government agency that has oversight when this all takes place internationally?...

0 ( +0 / -0 )

@Desert

Bitcoin and the like, along with gold and silver, have no such mechanism to regulate their value.

Exactly. That is one of their key features/benefits. That's what makes them a good store of value vs fiat currencies. No disrespect Desert, but you are looking at everything through your Keynsian view of how the economy should work. Put that framework aside for awhile and do some thought experiments. You might start to see what others are seeing in bitcoin.

In a practical world, how is a "digital wallet" any different than paying electronically from a bank account

There's different ways to answer that depending on if you're talking about CBDCs or decentralized blockchains like Bitcoin. If CDBC's, one key difference is the ability for central banks/governments to completely side step banks. They no longer need to rely on banks to make a loan to create money. They can inject (and extract) directly into the real economy. If you're talking about Bitcoin, there are fundamental differences, and the convenience features you're focusing on are way down the list.

0 ( +0 / -0 )

This article is wrong on so many levels. TOTAL FUD!!!!!!!

Just curious, why do you say that?

0 ( +0 / -0 )

*18.7 million Bitcoins in circulation and *only 21 million will ever exist.

I wonder how that is possible? If miners earn Bitcoin for conducting Blockchain transactions do they expect that such mining will suddenly cease when the 21 millionth Bitcoin is mined? What happens to Blockchain? It just seems like an odd statement to make and I can't imagine such an arbitrary, or should I sat arBITrary, limit would have any practical value

0 ( +0 / -0 )

 If you're talking about Bitcoin, there are fundamental differences, and the convenience features you're focusing on are way down the list.

I have a small business. I have a lot of bills to pay and rent to collect. I haven't made a transaction of a value equal to even one Bitcoin in over ten years and I have never received a payment of any kind of an amount even close to the value of one Bitcoin. Of what possible value is it to me? It's like having a gold bar sitting somewhere. It is useless to me. I would have to sell it to do anything with it and at that point I am back to using a normal government backed currency. Why bother? I am being very practical here. I have no time for futurist trendy bs. If it isn't making it easier to run my business I could care less.

0 ( +0 / -0 )

Exactly. That is one of their key features/benefits. That's what makes them a good store of value vs fiat currencies.

That is not what I wrote? I wrote that gold and silver are not good stores of value. Their value fluctuates over a wide range values. As a business person I need to know the value of the currency I use to collect my revenues with, save with and pay bills with will maintain a stable value over time. This is the only way a person in business, or a family, can plan for the future. It does no good to save up a bunch of gold that today has a value of x, only to see the value drop 20% right before you need to, say, pay your taxes or insurance, or buy a car you were saving for. The value of a regulated paper currency is that if the central bank is doing their job and the US Fed does, you know the currency is going to maintain a stable predictable value over time so you can plan. You cannot do that with specie or with Bitcoin. That, btw, is classical macroeconomics.

0 ( +0 / -0 )

@Dessert

I haven't made a transaction of a value equal to even one Bitcoin in over ten years and I have never received a payment of any kind of an amount even close to the value of one Bitcoin. 

Sorry, but you've just shown complete ignorance here. When using Bitcoin you do not need to transact in complete Bitcoins. They are divisible in what are know as Satoshi's, or more commonly just Sats. Each sat is 100 millionth of a bitcoin. Put another way, you could transact in values less than a cent. Maybe do a little research beyond what you see in media headlines. How can you be so against something that you have clearly spent zero time trying to understand?

0 ( +0 / -0 )

That is not what I wrote? I wrote that gold and silver are not good stores of value. 

I understood you. I am arguing the opposite, that they are better stores of value than fiat currencies. Store of value and transactional utility are not the same thing.

you know the currency is going to maintain a stable predictable value over time so you can plan

Yes, a stable, predictable, DECLINING value.

0 ( +0 / -0 )

The collapse of cryptocurrencies is extremely funny.

0 ( +1 / -1 )

Yes, a stable, predictable, DECLINING value.

And that is a rational, deliberate and absolutely necessary choice. Do you know what happens when the value of your currency is increasing? Prices and wages decrease. You have deflation. Buyers hold off buying because they anticipate prices will fall. When enough of your population anticipates falling prices and holds off buying you create a recession/depression. Nobody and no business will borrow because as the value of the currency rises their effective debt obligation also rises. The dollar value of the debt doesn't change but the company is earning less revenue due to falling prices. At some point there isn't enough revenue to service the debt and the company must declare bankruptcy. Same thing for most homeowners. Their wages are falling but not their debt. Like those businesses at some point their income is insufficient to service their debt. This is why central bankers strive so hard for low steady predictable inflation. Deflation is the automatic result of a currency that rises in value and once it gets going, once a people have the expectation of ever falling wages and prices is extremely destructive to an economy. Buyers hold off buying so business across the board declines and everyone holding debt ends up bankrupt. You cannot grow your economy when the value of your currency is rising, especially if it rises sharply or rises erratically in spurts, which is what happens with all specie based money (gold, silver, kina shells, even for a time in the US tobacco was used as a currency). Nothing beats a well managed national paper currency for promoting economic growth and prosperity.

0 ( +0 / -0 )

the CCP is clamping down on its use ... which has been to transfer money out of its country.

Likewise Western Governments are thinking its a Tax evasion route - thanks to Elon Musk's recent revelations - but not after he dumped his holdings of course.

NFT's are also now taking a hit... as people start realising the Fools Gold, although its shiny, may not really be useful practically, and is probably just worthless.

0 ( +0 / -0 )

@Desert

And that is a rational, deliberate and absolutely necessary choice. 

I'm not trying to run an economy. I'm trying to take care of myself. Why would I hold an "asset" that is designed to decline in value over time. That would be completely irrational. That's why people who can afford to buy assets. Property, gold, silver, stocks, commodities, art and more recently bitcoin. Have you stopped to consider why all of these assets appear to be in a massive bubble? It's not because their value is increasing. Their value is reasonably static. What is changing is the denominator that they are priced in losing value i.e. fiat currencies. This is all being driven by reckless central bank policies. You've clearly drunk the Fed's kool aid, but there are plenty of people who can see clearly that they are the problem, not the solution.

0 ( +0 / -0 )

CS

Bitcoin is not currency, Bitcoin is an asset.

Bitcoin may be an asset, but it's a non-productive asset. Bitcoins are the most demonstrably valueless financial asset ever created.

0 ( +0 / -0 )

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