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Bitcoin price discussion and analysis

Discussion in 'Forex and Cryptocurrencies' started by greggles, Nov 28, 2017.

  1. DB008

    DB008

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    Great insight into Bitcoin.
    People should get the full story of r/bitcoin (Reddit sub) because it is probably one of the strangest of all reddit subs.

    r/bitcoin (Reddit sub), the main sub for the bitcoin community is held and run by a person who goes by the pseudonym u/theymos.

    Theymos (u/theymos) not only controls r/bitcoin (Reddit sub), but also bitcoin.org and bitcointalk.com.

    These are top three communication channels for the bitcoin community, all controlled by just one person.

    For most of bitcoin's history, this did not create a problem (at least not an obvious one anyway) until around mid-2015. This happened to be around the time a new player appeared on the scene, a for-profit company called Blockstream.

    Blockstream was made up of/hired many (but not all) of the main bitcoin developers. (To be clear, Blockstream was founded before mid-2015 but did not become publicly active until then). A lot of people, including myself, tried to point out there were some very serious potential conflicts of interest that could arise when one single company controls most of the main developers for the biggest decentralised and distributed cryptocurrency. There were a lot of unknowns but people seemed to give them the benefit of the doubt because they were apparently about to release some new software called “side-chains” that could offer some benefits to the network.

    Not long after Blockstream came on the scene the issue of bitcoin's scalability once again came to the forefront of the community. This issue was discussed within the community a number of times since bitcoins inception. Bitcoin, as dictated in the code, cannot handle any more than around 3 transactions per second at the moment. To put that in perspective PayPal handles around 15 transactions per second on average and VISA handles something like 2000 transactions per second. The discussion in the community has been around how best to allow bitcoin to scale to allow a higher number of transactions in a given amount of time. I suggest that if anyone is interested in learning more about this problem from a technical angle, they go to r/btc and do a search. It's a complex issue but for many who have followed bitcoin for many years, the possible solutions seem relatively obvious. Currently, the limit is put in place in just a few lines of code. This was not originally present when bitcoin was first released. It was in fact put in place afterwards as a measure to stop a bloating attack on the network. Because all bitcoin transactions have to be stored forever on the bitcoin network, someone could theoretically simply transmit a large number of transactions which would have to be stored by the entire network forever.

    When bitcoin was released, transactions were actually for free as the only people running the network were enthusiasts. In fact, a single bitcoin did not even have any specific value so it would be impossible set a fee value. This meant that a malicious person could make the size of the bitcoin ledger grow very rapidly without much/any cost which would stop people from wanting to join the network due to the resource requirements needed to store it, which at the time would have been for very little gain.

    Towards the end of the summer last year, this bitcoin scaling debate surfaced again as it was becoming clear that the transaction limit for bitcoin was semi-regularly being reached and that it would not be long until it would be regularly hit and the network would become congested. This was a very serious issue for a currency. Bitcoin had made progress over the years to the point of retailers starting to offer it as a payment option. Bitcoin companies like Microsoft, PayPal, Steam and many more had begun to adopt it. If the transaction limit would be constantly maxed out, the network would become unreliable and slow for users. Users and businesses would not be able to make a reliable estimate when their transaction would be confirmed by the network.

    Users, developers and businesses (which at the time was pretty much the only real bitcoin subreddit) started to discuss how we should solve the problem r/bitcoin. There was significant support from the users and businesses behind a simple solution put forward by the developer Gavin Andresen. Gavin was the lead developer after Satoshi Nakamoto left bitcoin and he left it in his hands. Gavin initially proposed a very simple solution of increasing the limit which was to change the few lines of code to increase the maximum number of transactions that are allowed. For most of bitcoin's history, the transaction limit had been set far higher than the number of transactions that could potentially happen on the network. The concept of increasing the limit one time was based on the fact that history had proven that no issue had been caused by this in the past.

    A certain group of bitcoin developers decided that increasing the limit by this amount was too much and that it was dangerous. They said that the increased use of resources that the network would use would create centralisation pressures which could destroy the network. The theory was that a miner of the network with more resources could publish many more transactions than a competing small miner could handle and therefore the network would tend towards few large miners rather than many small miners. The group of developers who supported this theory were all developers who worked for the company Blockstream. The argument from people in support of increasing the transaction capacity by this amount was that there is always inherent centralisation pressure with bitcoin mining. For example, miners who can access the cheapest electricity will tend to succeed and that bigger miners will be able to find this cheaper electricity easier. Miners who have access to the most efficient computer chips will tend to succeed and that larger miners are more likely to be able to afford the development of them. The argument from Gavin, and others who supported increasing the transaction capacity by this method, as follows; there are economies of scale in mining and these economies of scale have far bigger centralisation pressures than increased resource cost for a larger number of transactions (up to the new limit proposed). For example, at the time the total size of the blockchain was around 50GB. Even for the cost of a 500GB SSD is only $150 and would last a number of years. This is in comparison to the $100,000's in revenue per day a miner would be making.

    Various developers put forth various other proposals, including Gavin Andresen who put forth a more conservative increase that would then continue to increase over time in line with technological improvements. Some of the employees of Blockstream also put forth some proposals, but all were so conservative, it would take bitcoin many decades before it could reach a scale of VISA. Even though there was significant support from the community behind Gavin's simple proposal of increasing the limit it was becoming clear certain members of the bitcoin community who were part of Blockstream were starting to become increasingly vitriolic and divisive. Gavin then teamed up with one of the other main bitcoin developers Mike Hearn and released a coded (i.e. working) version of the bitcoin software that would only activate if it was supported by a significant majority of the network. What happened next was where things really started to get weird.

    After this free and open source software was released, Theymos, the person who controls all the main communication channels for the bitcoin community implemented a new moderation policy that disallowed any discussion of this new software. Specifically, if people were to discuss this software, their comments would be deleted and ultimately they would be banned temporarily or permanently.

    This caused chaos within the community as there was very clear support for this software at the time and it seemed our best hope for finally solving the problem and moving on. Instead, a censorship campaign was started. At first it 'all' they were doing was banning and removing discussions but after a while, it turned into actively manipulating the discussion. For example, if a thread was created where there was positive sentiment for increasing the transaction capacity or being negative about the moderation policies or negative about the actions of certain bitcoin developers, the mods of r/bitcoin would selectively change the sorting order of threads to 'controversial' so that the most support opinions would be sorted to the bottom of the thread and the most vitriolic would be sorted to the top of the thread. This was initially very transparent as it was possible to see that the most downvoted comments were at the top and some of the most upvoted were at the bottom. So they then implemented hiding the voting scores next to the user's name. This made impossible to work out the sentiment of the community and when combined with selectively setting the sorting order to controversial it was possible to control what information users were seeing. Also, due to the very very large number of removed comments and users, it was becoming obvious the scale of censorship going on. To hide this they implemented code in their CSS for the sub that completely hid comments that they had removed so that the censorship itself was hidden. Anyone in support of scaling bitcoin were removed from the main communication channels. Theymos even proudly announced that he didn't care if he had to remove 90% of the users. He also later acknowledged that he knew he had the ability to block support of this software using the control he had over the communication channels.

    While this was all going on, Blockstream and its employees started lobbying the community by paying for conferences about scaling bitcoin, but with the very very strange rule that no decisions could be made and no complete solutions could be proposed.

    These conferences were likely strategically (and successfully) created to stunt support for the scaling software Gavin and Mike had released by forcing the community to take a "let's wait and see what comes from the conferences" kind of approach. Since no final solutions were allowed at these conferences, they only served to hinder and splinter the communities efforts to find a solution. As the software Gavin and Mike released called BitcoinXT gained support it started to be attacked. Users of the software were attacked by DDOS. Employees of Blockstream were recommending attacks against the software, such as faking support for it, to only then drop support at the last moment to put the network in disarray. Blockstream employees were also publicly talking about suing Gavin and Mike from various different angles simply for releasing this open source software that no one was forced to run. In the end, Mike Hearn decided to leave due to the way many members of the bitcoin community had treated him. This was due to the massive disinformation campaign against him on r/bitcoin. One of the many tactics that are used against anyone who does not support Blockstream and the bitcoin developers who work for them is that you will be targeted in a smear campaign. This has happened to a number of individuals and companies who showed support for scaling bitcoin. Theymos has threatened companies that he will ban any discussion of them on the communication channels he controls (i.e. all the main ones) for simply running software that he disagrees with (i.e. any software that scales bitcoin).

    As time passed, more and more proposals were offered, all against the backdrop of ever-increasing censorship in the main bitcoin communication channels. It finally came down the smallest and most conservative solution. This solution was much smaller than even the employees of Blockstream had proposed months earlier. As usual there was enormous attacks from all sides and the most vocal opponents were the employees of Blockstream. These attacks still are ongoing today. As this software started to gain support, Blockstream organised more meetings, especially with the biggest bitcoin miners and made a pact with them. They promised that they would release code that would offer an on-chain scaling solution hardfork within about 4 months, but if the miners wanted this they would have to commit to running their software and only their software. The miners agreed and the ended up not running the most conservative proposal possible. This was in February last year. There is no hardfork proposal in sight from the people who agreed to this pact and bitcoin is still stuck with the exact same transaction limit it has had since the limit was put in place about 6 years ago. Gavin has also been publicly smeared by the developers at Blockstream and a plot was made against him to have him removed from the development team. Gavin has now been, for all intents and purposes, expelled from bitcoin development. This has meant that all control of bitcoin development is in the hands of the developers working at Blockstream.

    There is a new proposal that offers a market-based approach to scaling bitcoin. This essentially lets the market decide. Of course, as usual, there has been attacks against it, and verbal attacks from the employees of Blockstream. This has the biggest chance of gaining wide support and solving the problem for good.

    To give you an idea of Blockstream; It has hired most of the main and active bitcoin developers and is now synonymous with the "Core" bitcoin development team. They AFAIK no products at all. They have received around $75m in funding. Every single thing they do is supported by u/theymos.

    They have started implementing an entirely new economic system for bitcoin against the will of its users and have blocked any and all attempts to scaling the network in line with the original vision.

    Although this comment is ridiculously long, it really only covers the tip of the iceberg. You could write a book on the last two years of bitcoin. The things that have been going on have been mind-blowing. One last thing that I think is worth talking about is u/bashco's claim of vote manipulation.

    The users that the video talks about have very very large numbers of downvotes mostly due to them having a very very high chance of being astroturfers. Around about the same time last year when Blockstream came active on the scene, every single bitcoin troll disappeared, and I mean literally every single one. In the years before that, there were a large number of active anti-bitcoin trolls. They even have an active sub r/buttcoin. Up until last year, you could go down to the bottom of pretty much any thread in r/bitcoin and see many of the usual trolls who were heavily downvoted for saying something along the lines of "bitcoin is ****", "You guys and your tulips" etc. But suddenly last year they all disappeared. Instead, a new type of bitcoin user appeared. Someone who said they were fully in support of bitcoin but they just so happened to support every single thing Blockstream and its employees said and did. They had the exact same tone as the trolls who had disappeared. Their way of talking to people was aggressive, they'd call people names, they had a relatively poor understanding of how bitcoin fundamentally worked. They were extremely argumentative. These users are the majority of the list of that video. When the 10's of thousands of users were censored and expelled from r/bitcoin they ended up congregating in r/btc. The strange thing was that the users listed in that video also moved over to r/btc and spend all day every day posting troll-like comments and misinformation. Naturally, they get heavily downvoted by the real users in r/btc. They spend their time constantly causing as much drama as possible. At every opportunity, they scream about "censorship" in r/btc while they are happy about the censorship in r/bitcoin. These people are astroturfers. What someone somewhere worked out, is that all you have to do to take down a community is say that you are on their side. It is an astoundingly effective form of psychological attack.
     
    Skate likes this.
  2. Skate

    Skate

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    I usually get exhausted reading long posts, but this post was informative & so well written.
     
  3. OmegaTrader

    OmegaTrader

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    Very interesting,

    Human nature corrupts the idea of freedom. The alternative becomes the mainstream and copies the very thing it was trying to be free from. All the laws and regulators can't fully stop the big banks only limit them.

    You can't change human nature it will always find a way no matter how smart the computer system seems. First the true believers, then the speculators pushing it way past utilitarian value now the big boys ripping out the heart of the technology and capitalising on the hype and hope.No doubt the technology will be used but will the coins still be valuable?

    I made a big mistake not betting on the downside. The dragon might awake again or not, but that will have nothing to do with the fundamental utility of the coin only fear and greed.btc coindesk.PNG

    But people are making an even bigger mistake believing in the ideology.

    No ideology has ever been able to change the reality of human nature.
     
  4. DB008

    DB008

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    I should give credit to the person who wrote that response - username is u/singularity87

    Yes, it certainly is. I thought it was a bit long, but it is really a good read and insight into how Bitcoin is manipulated. This is just one side of the Bitcoin manipulation, l'm there are many, many other ways is it also manipulated also....
     
  5. Skate

    Skate

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    Manipulation goes on more than we think or know, the uninformed and most Bitcoin traders never realises that this practice is highly orchestrated and planned with precision.

    Skate
     
  6. greggles

    greggles I'll be back!

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    Bitcoin just holding above the US$6,000 level and back at October/November 2017 prices. There is a definite negative sentiment hovering around it at the moment that is weighing it down.

    screenshot-www.coindesk.com-2018-06-23-10-24-37.png
     
  7. noirua

    noirua

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    Bitcoin has fallen to its lowest point since November and will probably be totally wiped out
    01/07/2018
    https://www.msn.com/en-gb/money/new...-totally-wiped-out/ar-AAzofJv?ocid=spartandhp

    My own view is that a floor for Bitcoin is around US$2,000. I always thought that late this year may well prove the time to buy but I doubt a high in 2019 will be above $4,000. The long term chart seems to see $2,000 as the right price.
    A general floor at $2,000 but occasional opportunistic dips much lower.
     
  8. SuperGlue

    SuperGlue

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    Bitcoin (currently A$8,888.88 good sign) and others are slowly climbing after tax time.
    Wonder how many traders/investors are claiming losses for their taxes.

    Might put a hole in the ATO tax collection due to cryptocurrencies losses.

    When it was booming ATO wants your profit and now it is down ATO will have to cop it

    Just my 1/2 bitcoin thoughts.
     
  9. greggles

    greggles I'll be back!

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    Bitcoin making gains again. Up more than US$2,000 in the last 10 days and looking bullish.

    laIDKSK7.png
     
  10. greggles

    greggles I'll be back!

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    The Bitcoin roller coaster ride continues.

    CNN is reporting that the latest plunge is due to Goldman Sachs possibly dropping plans to launch a crypto trading desk.

    yrjkGJWk.png
     
  11. trading_rookie

    trading_rookie

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  12. Wysiwyg

    Wysiwyg Everyone wants money

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  13. greggles

    greggles I'll be back!

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    I hadn't checked the Bitcoin price for a while until today and boy, has it taken a tumble in the last week and a half. From US$6,500 to US$4,400 since 8 November. What a flogging.

    Cryptocurrencies have been off the boil for a while, but now it's like they have leprosy. Ugh! :wtf:

    coindesk-BTC-chart-2018-11-20.png
     
  14. sptrawler

    sptrawler

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    Hopefully no asf members have been bitten, in the collapse.
    IMO it was a great trading opportunity, but you would have had to be a great trader, to capitalise on it.
    It certainly scared the $hit out of me.
     
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  15. cynic

    cynic

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    I think I can vaguely recall, one particular member, after some years absence, reemerging to sing of glorious victories from adventures within the cryptocurrency realm, before again disappearing.

    A bit like cryptocurrency values I suppose - here one day, and gone the next!
     
  16. moXJO

    moXJO menace to society

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    The drop is imo due to the current war after the hard fork. Hoping bcash might reply to the other thread.

    If you were talking about me, I made a sht ton of money in the coin from selling half my postions. I've pretty much traded small short term postions since the crash. But nothing serious.
    The money I lost , is from not selling my full position. In saying that I'm still deeply deeply in profit at the current price.

    I bought in early and reaped the rewards. I didn't buy in late as I thought it was overpriced and I'm a cheap bastard.

    I'm currently looking at the current crop of coins at this time.
     
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  17. moXJO

    moXJO menace to society

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    People that got in early are still rich and deeply in profit on bitcoin.
    The guys crying about crypto are the ones that bought during the spike, or those that missed out.

    For me crypto was the greatest trade ever. I don't care about where things are now. I care about how much I made on the trade.

    Same with property. I use to biatch and moan about property crashing and it being too high. Until a poster on this board convinced me otherwise and to get in. I bought with my ears pinned back and reaped the rewards.
     
  18. cynic

    cynic

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    This was an occasion when my wariness was, almost undoubtedly, the primary thing standing between myself and sensational investment returns.

    As you are no doubt already aware, with the exception of the mining/generation aspect, crypto appears to be an essentially "zero sum" game. As such, a mixture of winners and losers was inevitable.

    So I do not begrudge you your handsome profits. Your foray, presumably, entailed some level of speculative risk, and you are to be congratulated on having navigated yourself into the ranks of the winners.

    Bravo!
     
  19. greggles

    greggles I'll be back!

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    Bitcoin continues its recent decline. Currently down to US$3,406.4 and looking very sick. Volume has increased substantially since it slipped below US$6,400 last month so it looks like a race to the door at the moment.

    jTMze2lm.png
     
  20. verce

    verce

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    Is the bottom in?
     
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