Wait, by "contacts" you guys do not mean those things that get electrical types turned on, do you?

Jon Holmquist was also public relations of Sunlot:
https://bitcointalk.org/index.php?topic=587295.0
but he stopped answering posts in that thread, months ago.

I have seen the name Stefan Thomas somewhere else.  Didn't he do a "bitcoin audit" for some exchange, soon after the MtGOX collapse?

He may have needed the money for something, urgently.

Or he may have become convinced that price would never get substantially higher than 300$, and could quickly get much lower. In that case, selling as quickly as possible was not a bad strategy.  Moving part of the coins to another exchange would have taken time, and he may have felt that it was not worth running that risk.

It seems that he is running some sort of role-playing game, using Monero as the currency.
https://bitcointalk.org/index.php?topic=819073.0

He does not seem to be interested in bitcoin any more.

Why are you folks interested in her optometrist's prescription?

Isn't that very old stuff (2011-2012), now moot after MtGOX's collapse?

"Government gag order" is a convenient excuse; wasn't it used in another scam before?  But if the coins had been seized, there should have been charges pressed and  arrests by now, as in the SilkRoad case.

If the coins had been stolen by hackers, Mark should have provided details and asked the community for help to track him down.  If he had lost the coins, he should have publicized the address so that everybody could check that the coins were not moving anymore.

Another possibility is that it was an inside job, perhaps an attempt to trade with client coins that collapsed.  In this case, there must have been several other people involved.  People with far more money than respect for the law.  Talking may be dangerous, one may get this sudden urge to jump from a tall building when there are no witnesses around.

Gee, and all this time I thought that it was this thing called "arbitrage".

That is weird.  It makes sense for the SEC to prohibit trading between customers, and the selling of additional shares.  That would be in line with their mission to protect the general investor.  But what reason could make the SEC suspend liquidation?  Isn't that harming the investors?

If the ETF is rejected by the SEC, could they force SMBIT to refund all the customers at their entry price, instead of the current price?

What sort of reply do you expect by asking what he means by "lame"?

As the technical experiment that it was meant to be,  indeed bitcoin has not failed so far. Namely, the protocol designed by "Satoshi" has motivated enough volunteers to keep the blockchain updated and secure, non-stop, for almost 6 years now; and no fundamental security problems have been found.  (I gather that a bug made it necessary to rewind the blockchain some years ago, but it was not fundamental and quickly fixed.)

However, the experiment cannot yet be called a success, because it is not finished yet.  Mining is still supported by an "inflation tax" that increases the money supply to 5-10% per year.  At some point, that reward will be insufficient, and miners will have to depend on transaction fees.  In theory, the protocol should still work in that regime; but the point of the experiment is checking that the theory works in practice.  The experiment will be a success only if the network continues to function after that transition.

While the experiment has not failed so far, some developments, which may have been unexpected, suggested some potential problems that have not been adequately dismissed yet.  In particular, mining turned out to have substantial economies of scale, so that it has become concentrated in a handful of large companies and pools.  That increases the likelyhood of "51% attacks" and double spending in transactions with few confirmations.  It may also give the large mining companies the same oligopoly power that banks now have over international money transfers, with the same results.

Moreover, if there will be a large decline in price, difficulty will have to drop while some of the hashing equipment will have to be switched off.  Thus, at some point there may be enough idle hashing power in the hands of a single entity to mount a surprise 51% attack.

Also, its apparent anonimity (which was not a design goal, but merely an inevitable consequence of the "trustless" goal) attracted substantial criminal use.  It also made bitcoin theft and scams easy, profitable, and difficult to fight.  The huge price increase (partly driven by its illegal uses) caused all sorts of problems in itself.  It attracted people who were not interested in the technical experiment or its real goal, but only in the speculative potential.  A few people accumulated large hoards of cheap coins, reducing supply and leading to even higher prices (and unheard-of volatility).  Some investors have been trying to convince computer-naive people to buy bitcoin as a get-rich-quick scheme, or as a way to escape inflation.  As a result, bitcoin got a bad public image and hostility from many governments.  These developments do not yet threaten the technical experiment directly, but could do so if bitcoin gets banned over most of the world.


The jury is still out on that.  There have been many things "backed by nothing" that were highly prized and profitable -- for a while.

That is not bitcoin trading, in fact it does not use bitcoin at all.  It seems to be just a glorified gambling site, where one can bet on bitcoin price swings using ordinary money.

That is a big exaggeration.

The ultimate goal of bitcoin was the development of an e-payment system that did not depend on a trusted authority (including a centralized server).  It was not to develop a great investment opportunity, a long-term store of value, a way to hide money from the IRS or your spouse, a way buy illegal drugs or child porn, or a way to drive banks and governments to bankruptcy.  It was not even meant to replace credit cards, cash, gold, or old paper checks. 

Indeed, bitcoin was not even meant to be an e-payment system itself; it was only a technical experiment, meant to prove that a certain protocol could solve ONE particular obstacle in the development of such a system, namely how to motivate volunteers to maintain the blockchain rather than sabotage it.  For that experiment to be carried out, all that was needed was an open community or volunteers willing to maintain the network and trade BTC among themselves, plus a few friendly pizza parlors and merchants to make the test more realistic.  That, AFAIK, was the bicoin community in 2009; and the experiment would have worked if it had been remained that until now.

You probably do not want to know that I guessed "330$ by Halloween" on Adam's  poll, right after it was posted. 

(OK, OK, "even a broken clock"...)

Yes, those venture capitalists surely expected to make profit from their investment.  They may have made a bad decision, betting that the price would recover and attract more customers to their businesses.  However, even if the price keeps falling at the present rate, they can still have a profit.

SMBIT, for example, charges fees whether people stay or leave.  They buy BTC with money from customers (those who buy SMBIT shares), not from investors (those VCs who have equity in the company that manages SMBIT).  If the BTC price keeps dropping, the SMBIT shares will drop too, but only customers will lose their money; the managers and their VC partners will still collect fees.  By my estimates, they have already collected a few million dollars in fees, with very little expense.  Even if the price drops to zero over a couple of years, they may still make more than they invested.

Plus, the managers sold an initial "endowment" of 18'000 old coins to their customers in September for 120$ each, and that adds to their profit too.  Indeed, starting a bitcoin fund (or buying equity in a fund management company, paying in BTC; like Fortress did earlier this year with Pantera) is a good way to sell a large amount of old cheap coins at the current market price, with little slippage; while keeping those old coins out of the open market for six months at least, together with any additional coins that the fund then buys from the open market.

Well, I always understood that, in the basic rule "buy low, sell high", the word "low" means "lower than TOMORROW", not "lower than YESTERDAY".   

I don't see how one can make money with a pure pump-and-dump strategy (buying to increase the price, then selling at the higher price).  Sounds like those old perpetual-motion machines where falling weights are supposed to pull other weights up.  A successful pump-and-dump must include substantial misleading marketing as well.

Venture capital (which seems to grow 2--3x each time the original estimates are re-quoted  ) has been going mostly into auxiliary services like exchanges, payment processors, fund management, gambling sites, etc.  Those enterprises do not profit from BTC price increase, but from fees collected from BTC users.  While increasing price and/or usage would increase their fees, the investment they would have to make in order to pump the price is much more than what they expect to profit from the resulting price increase.

There is no data on actual BTC usage for e-commerce.  More shops accepting bitcoins may be just splitting the same market niche (owners of old coins who decide to cash in by shopping) over a larger merchant base.  Ditto for the increasing numbers of payment processors, funds, gamblings sites etc..

I edited the Wikipedia article on "cup and handle" for style.  Is that "pro" enough?  

The Janyary--April 2013 bubble took the price from ~14$ to ~120$ (steady-state after the oscillations died out), and the November 2013 bubble took it from there to ~800$ (ditto).

It seems pretty certain that the Nov/2013 bubble was due to demand by the "popular" commodity speculation market in Mainland Chinese, opened to bitcoin by Huobi, OKCoin and other Mainland exchanges. That is supported both by articles in the media at the time, and by how the price reacted (and failed to react) to news since Dec/2013.

The Apr/2013 bubble too may be due to China; specifically to BTC-China catering to a different population in Shanghai, a special economic zone in China.

The "mini-bubble" at the end of May/2014, from ~450$ to ~650$, remains unexplained.  However, its rise was sudden and not exponential.  It may have been a few whales (perhaps only one) who got some insider info or original analysis, and "panic bought" a large amount.

From Feb/2014 to May/2014, the price dropped nearly 400$.  Again, that drop was almost certainly due to shrinking of the  Chinese demand in the wake of government decisions.  The overall trend in that period was roughly exponential decay (rouhgly straight in the log-scale chart).  Extrapolating that trend to the present gives ~130$, plus or minus some 30$.

The price is now ~130$ lower than it was at the start of the May mini-bubble. Therefore the drop since Jun/2014 cannot be due solely to that mini-bubble deflating.  On the other hand, the difference between the price extrapolated from Feb--May (~130$) and the current price (~330$) is 200$, the same as the mini-bubble rise from May to June.

There is no sign that large stashes of OLD coins are being sold.  Presumably, those who bought at 10$ or less are not in a hurry to sell, and may choose to hold for another few months in case there is another mega-bubble.  Those who bought in November or later must be feeling very bad and presumably are more likely to sell in order to cut their looses losses.

Therefore, my theory is that the decline since Jun/2014 was due mainly to the Chinese pulling out, according to the same exponential decay trend from Feb to May; while those buyers who caused the May mini-bubble are still holding.

If this theory is correct, then the price should gradually drop to the price before the November bubble (~120$) plus the increase of the May mini-bubble (~200$); that is, only a bit lower than now.  

If the April 2013 bubble too is deflating, but the May mini-bubble is not, then the price should continue to drop gradually to about 14$ + 200$, that is, about 215$.

If the May mini-bubble is deflating too, but the April one is not, the bottom should be ~120$.

If all three bubbles are deflating, the bottom should be in the low double digits.

The markets that were responsible for the pre-2013 bubbles may have continued to grow.  However, the price during their steady-state phases (such as Mar--May 2012) was quite flat, suggesting that the market growth was small or zero.  Also, there is no evidence that use of BTC for e-payment has increased since January, and the attractiveness of BTC as an investment cannot be growing (net sales of SMBIT shares, for example, have been nearly zero for several months.) .  Moreover, the influx of the newly mined coins would cancel some or all of that "vegetative" growth in older markets.

Can't you ask "how am I supposed to answer this with a question?"?

What should we do to a user who answers the previous question with two questions (instead of one, as the thread creator requested), threatens to vandalize a concrete floor by throwing an egg at it, and does not know that the appendage that an elephant uses to grab things is called a "trunk", not a "hand"?