If you bought Bitcoin on Friday, you have lost almost 28%

You either post a trade in real time or predict something. 20/20 trades don't cut it, because it is in the past.

Now I predicted BTC will bounce back to 2200 and sure it did, Bitstamp was 2248 so you could have made 10%, had you came off of your high horse...

 

@Pekelo Apparently people on ET have massive reading comprehension issues which even yourself is not immune to.

My posts are not about 20/20 calls, it's about how many of you, yourself included by your post above^, are doing nothing but commentating about crypto and not trading it. Meanwhile major asset vol is at all time lows. And people on ET wonder why they don't make money.

 

Whether it is a currency or not is for me not important. I don't understand bitcoin and the huge volatility.
I only trade things from which I can manage the risk. +30% and then -30% in about 48 hours is not a thing I can manage. So I keep my hands of it. I am sure that I will make more money with less risk trading the ES. So why take extra risk for less profits?

Bitcoin is not "just" another currency. From the top 20 currencies not a single one moves up and down 30% in less than 48 hours.

 

You should see everything from both sides, from the optimistic and from the pessimistic side.
The fact that they don't trade it had nothing to do with their comments. They have an opinion and they don't trade it as they think they cannot make money. That would sound logic.

The fact that vol is low in the major assets does not automatically mean that they will make money trading bitcoins. These two things have nothing to do with each other.
It is not a good idea to start trading bitcoins because you cannot make money in anything else. Trading bitcoins might even increase the losses.

You should only trade something if the probability of making money is bigger than the probability that you will lose money.

And if you cannot make money in anything: DON'T TRADE and wait till chances turn in your advantage. NOT trading is also trading.

 

Bubbles come and they go - the late stage participants driven by greed get drawn in near the tops - they parrot out the hype from the mob - picking a round number significantly higher than the current bubble price and insist that is must be worth that much based on nothing but their delusions - they fear missing out on any more upside so they jump in and hope to make a fortune - instead they get slaughtered.

 

I think it's really important to understand the concept of "limited supply" and how this might affect the future value of bitcoins?

The degree to which supply is limited is "unique" to bitcoins and a major factor influencing its demand and subsequently its value.

I've been reading different opinions with some suggesting its value could appreciate to USD$50,000 (based on a formula of expected market capitalization and total supply (21m)) and others saying limited supply doesn't guarantee any price appreciation. Who is correct?

 

What is the purpose of bitcoins?

1. A Currency like another currency to pay for goods and services?
2. A new form of gambling/investing?

Let’s suppose it is for the first option. I buy goods and sell them to distributors. There are several different scenario’s possible. But let’s just take 2 of them:

1. I pay with cheap bitcoins and sell with expensive bitcoins. I make a lot of extra profit. My client takes a huge loss.
2. I pay with expensive bitcoins and sell with cheap bitcoins. I make a huge loss. My client makes a huge profit.

Remarks:

• My core business is to buy, and sell later with a certain profit margin. But as the bitcoin has a big volatility I have to lock in my profit with a hedge. So the bitcoin creates an extra risk (and extra cost?) that I would not have if I would buy and sell in $$$. What is the advantage to use bitcoins? It only complicates things.
  
• When I sell I have the same problem again. Between the purchase and the sale the bitcoin can jump around in any direction in massive moves. So I have to hedge this risk also.
• I also have operational costs in my US company in $$$ but my profits comes in bitcoins. So again a risk.
• If I could just do my business in $$$ all these problems that are not my core business would not exist and would not create a risk.
  
• Another problem is that a currency that should be used all over the world should be available in massive amounts, and the bitcoin is just the opposite of that.
• If you buy goods at 1 bitcoin ($2,500) and sell them the next week for 1 bitcoin ($1,900) you have a problem. In $$$ you would never have this problem.

 

So now its worth $50,000 ? For that to happen the S&P 500 would have to decline about 99%.

Try reading 'Devil take the Hindmost'. The best book on crowd behavior in bubble mania's.

 

I noticed you only described the currency aspect of it. Not a mention as to the actual blockchain itself which is the real tech.

 

"You lost almost 28%". It is when you sell that counts.