Comments on: How the Bitcoin 1% manipulate the currency, deceive its user community, and make its future uncertain

By: Alex

Alex — Tue, 22 Dec 2015 23:26:00 +0000

I liked your post. Have you considered that almost every market (AAPL, FB, etc.) is essentially what has been going on in the Bitcoin market. So we’ve got this Bitcoin market which has a limited supply, most of the float is not active, and there’s a minority that control a significant stake in the market. This is a perfect market to manipulate, refer to markets of the early 1900’s, Bitcoin looks just like those markets.

“If the early adopters were to cash out and place their hoards on the market, the exchange rates (as denominated in anything) would dive through the floor, never to recover. The hoarders, in effect, possess an off switch for Bitcoin.”

Every market has a kill switch, but the ‘powers’ that control this kill switch with a majority shares will never dump their shares on the mtk immediately, that’ll kill their profits.

If their good traders with a majority stake, then the ‘kill switch’ will only happen when the market has been run up to create enough volume to sell their shares without depressing the market price. If a professional minority holder is trying to get out a majority stake, you will see volume created by raising prices. Then you’ll know something is going on.

I don’t understand where you got ‘to never recover from’. If the hoarders are selling because they’re poor traders, then good traders will step in and buy the market up. Then they’ll help promote news articles that’ll generate public interest for Bitcoin again.

So basically what I’m saying is what you’re talking about is literally how all markets work and allow me to make money off of the manipulation of floating supply. You use price to create volume, to sell your shares into without break the stock.

By: erick vallely

erick vallely — Thu, 12 Dec 2013 09:23:52 +0000

i do not have any confidence in bit coin

By: Stu

Stu — Mon, 21 Oct 2013 11:21:07 +0000

“through the floor, never to recover. The hoarders, in effect, possess an off switch for Bitcoin.”
Whilst I agree that your article is well written and talks of the risks of Bitcoin this statement is a misleading personal opinion not based on facts or science.

Flooding the market with millions of coins won’t make them less useful, it merely means the price drops as supply outstrips demand temporarily, it’s the purest economics demonstration around. The surplus of coins doesn’t suddenly change their usage and they certainly don’t vanish. Would it knock confidence, yes probably, especially greedy types wanting to make a quick buck but this would be temporary just like the annual crash where it bounces back still to be worth far more by the following year.

If those coins enter the regular day to day transactions yes the price per coin will drop lower to match demand and will eventually regain value as they continue to be scarcer. A more likely scenario however is people quickly buy the cheap coins to invest. This means the price returns to what they were since once again, if I saw coins drop to around £10 each again I’d be buying as many as I possibly can now and know I’m not alone.

I’m not saying the experiment is infallible, there are issues that need to be addressed before this can go mainstream but can say that someone selling a lot of coins is far from a built in kill switch.

By: Carl Lundström

Carl Lundström — Mon, 21 Oct 2013 11:17:54 +0000

The mega-owners have an interest in keeping the currency valuable. So, if they are rational, (which they have been so far) they are more of a guarantee for stability than you are. If it ain’t broken, don’t fix it.

By: John

John — Wed, 03 Jul 2013 05:04:29 +0000

Bitcoin(s) is money only in the very loosest meaning of that word; money. I am not that familiar with it but even US fiat dollars are backed by ‘something’ in the end. Is Bitcoin backed by anything? It seems to me that casino chips have a more solid backing than bitcoins.

By: Dav

Dav — Tue, 02 Jul 2013 16:08:49 +0000

What’s so newsworthy about another deceptive & manipulated market? Aren’t accounting rules such as REPO 105 and mark-to-market specifically used to deceive the small investor? Don’t get me wrong, there is huge money to be made in the markets – it’s just that today, you DO NOT want to be the guy without a chair when the music stops.

Middle-class investors must keep in mind that when a bubble bursts, the end result for them is often disaster, while the end result for the top 1% is a buying opportunity.

By: Lelala

Lelala — Tue, 02 Jul 2013 11:04:46 +0000

Regarding the use of just “a new protocol”:
Since BitcoinQT, the standard client, is ranked #1 by far in comparison to all others – one just need to manipulate/”update” that specific client 🙂
But, i think they’d rater crash than adapt to a more sustainable “currency setup”. We will see… Today announced: The Winkelvoss Brothers are planning to launch an ETF for/based-on Bitcoins.

By: thomas

thomas — Mon, 01 Jul 2013 18:33:07 +0000

There were only like 4-5 mln bitcoins in existence at the end of 2010.
Today there are about 12.5mln bitcoins, i don’t know what people are trying to do, scare people into selling and buy cheap? But this ‘most bitcoins are owned by a few people’ is utter nonsense.
Yes, there are a few people that have a lot of bitcoins, but it’s far, far from ‘most of the bitcoins’.
These are the people that have been very active since the beginning and helped build the economy and infrastructure of what we see today.
Also a lot of bitcoins have been lost over time, since they had extremely low value during 2009-2010, people just deleted their wallets and didn’t think anything of it.
A friend of mine just deleted bitoin including his wallet with 5000 bitcoins because he felt it was a useless project. And i’m reasonably convinced he’s not the only one.

Anyway, don’t believe these random fud articles, do your own research and draw your own conclusions based on facts.

By: Just some guy

Just some guy — Mon, 01 Jul 2013 17:09:46 +0000

First of all, this bitcoin-P solution of yours disgusts me. People should not lose their wealth because of other people feeling the need to take it. This is specifically one of the reasons why bitcoin was designed. If people have more money, shouldn’t they have more bitcoins? And if they do have more money it is harder to spend in all so yeah, I imagine some of it is ‘out of circulation.’ People from Cypress literally dumped their fortunes into bitcoin because there government was seizing their wealth. If I were them, I’d probably go through efforts to remain anonymous too.

By: bitcoinator

bitcoinator — Mon, 01 Jul 2013 13:09:38 +0000

Shameless price manipulation attempt. Here is the original article: http://newswax.com/2012/10/bitcoin-has-a-kill-switch-and-how-to-disconnect-it/ (it is pretty old). Here is some competent critisism: https://gist.github.com/jgarzik/3901921