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58

If you bought a bar of gold at $1200 / ounce, then the price of the gold drops to $600 / ounce, you wouldn't actually lose any money at all unless you decided to sell your gold at that time. However, if you wait until the price of gold rises to $1800 / ounce, then sell it, you will gain money. The key is an ounce of gold is still an ounce of gold, ...


28

If you bought one bitcoin and the price goes down, you still have one bitcoin. If the price goes up...still one bitcoin. This is just like everything else, including groceries, gasoline, gold, stock certificates, etc... Measurements of value in fiat (such as dollars) does not affect the amount something you own, only the price at which you will be able to ...


26

The Scenario is confused, because it assumes that there is only one side to a trade. The scenario assumes that the money goes "into the Bitcoin economy" when people buy bitcoins. This is confusing, because it sounds as if there were only one side to the trade. You will find that the scenario doesn’t imply Bitcoin to be a Ponzi scheme, once you take ...


13

tl;dr- This is called a capital loss. You're said to realize the capital loss if you sell the Bitcoins at the lower price, such that you lost money due to having bought/sold them. However, note that this isn't legal advice and I'm unsure about what the current legal statutes are surrounding Bitcoin. Bitcoin's a capital asset (at least conceptually; dunno ...


12

As @RedGrittyBrick says, change the word "bitcoin" to "euros" and see if that helps you. All currencies work this way, not just cryptos: Is money that has gone into euros already spent? When I buy a euro from someone and they get USD I get euro. They go buy lambos or real estate for their gains. So the underlying currency is spent, but ...


11

The answer is not unique to bitcoin. It would be the same if you're dealing with (non-crypto) foreign currency, stock, a stock derivative or commodity or commodity futures. When you buy something like the above, you are giving up your "real money" (fiat currency) to take possession of said commodity/stock/bitcoin/etc (let's call these assets in general). ...


10

This more of a question about excel than it is actually about Bitcoin. But the answer is actually pretty easy. The first thing is that the data that you want to import from the web may not be easily isolated, so you might have to import much more data than you want into a second excel sheet, then link the cell with the data you are interested to a cell in ...


10

Bitcoins are no different from any other commodity in this regard. We say that the price of a car is $45,000, but that doesn't guarantee that you can sell one for $45,000 unless you can find someone willing to buy one for $45,000. When we say some particular number is the price, we mean that's basically the number that buyers and sellers both agree that it ...


9

Yes, you lose a quantity of your money, at the time you gave it away in exchange for the bitcoin you received. Subsequent changes in the exchange rate only vary the hypothetical value of what you would get if you wanted to trade back.


8

This is really asking about basic trading economics: if I have some new product X, what price does it have? I can set a price and see if anyone buys it. If not, I might lower the price or auction it to see what someone might pay for it. That is the starting value, but it doesn't really mean much as it hasn't been field-tested (so to speak). If others think ...


7

There are really only two things driving the increase in price you are talking about. Supply and Demand Greed and Fear Supply and demand is simple, there is a virtuous cycle at work here: Increasing demand drives price increase due to limited supply Increasing price drives increasing demand as knowledge spreads in the media Repeat Greed and Fear are ...


7

A Ponzi scheme is characterised as follows (this is according to Wikipedia, rather than for example the US Department of Justice, which would focus more on the criminal culpability in its definition): A Ponzi scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital ...


6

Whether it fluctuates or not depends on how you express value. If you happen to be one of them American folks, who use dollars to express value, then a fixed amount of money in other currencies (such as euros or bitcoins) will fluctuate. But similarly, a $10 dollar bill will fluctuate in value, if you express value in euros or bitcoins (basically, that is ...


5

Taking your questions in order: How yet another "currency" will solve anything, or what Bitcoin is supposed to be solving? Because this is a currency that has different properties that avoid the properties of other currencies that create these problems. For example, the supply of Bitcoins is fairly precisely defined and nobody can devalue them through ...


4

The system is protected by an incentive mechanism. As Satoshi said in the paper itself: He ought to find it more profitable to play by the rules, such rules that favour him with more new coins than everyone else combined, than to undermine the system and the validity of his own wealth. This means that if someone has access to a supercomputer, more ...


4

Amounts in a Bitcoin transaction are set in bitcoin. That is, if you want to receive $5, when the current bitcoin price is $234.97/bitcoin, then you might make a request for 0.0212 bitcoin inside the QR code. If the price changes between you making the request and the other person sending bitcoin, then you will still receive 0.0212 bitcoin, but it might be ...


4

There is no such thing as a the "real" value. The value of Bitcoin as denoted in another currency (USD, EUR, etc...) is based on how many people are buying and selling, and in what quantities. On different exchanges, there are different numbers of people buying and selling different amounts of bitcoin. Each exchange calculates its current posted value ...


4

You seem to have a misunderstanding: anyone could create an infinite quantity of their own cryptocurrency right now This is not accurate. The breakthrough that enabled Bitcoin (and other cryptocurrencies) was the ability to make a digital asset scarce without trusting a central authority. In the past, currencies (digital and otherwise) have required an ...


4

not sure what you mean by logarithmic graph. The time in a logarithmic scale, or the value? On both, there is a "log" button below the graph. And you can export as CSV or JSON: https://blockchain.info/de/charts/market-price?timespan=all or alternativly: https://coinmarketcap.com/currencies/bitcoin/


3

Here is the link. Just insert this into your excel file =IMPORTXML("http://coinmarketcap.com/currencies/bitcoin/","//span[@id='quote_price']")


3

Recognizing that Bitcoin has no INTRINSIC value, we look for its USE value, so to speak. The primary value of BItcoin is the reliable and indefeasible transfer of property title (money) between two users. Ever since the first use of the Nakamoto protocol in Jan 2009, there has been a proof-of-concept that has remained valid for almost five years and ...


3

No, at least not for the original Bitcoin and all those altcoins that do not change this aspect. But you are almost correct: Each Bitcoin is divisible into 0.1 billion (which is 100 million or a 1 followed by 8 zeros) actual units, called Satoshi after the pseudonym of Bitcoin's creator. In fact, the protocol only uses these; displaying them as Bitcoin is ...


3

I think the best reasons right now are: Marketing: being the first to do something attract a lot of interest and media. No chargebacks: Bitcoins does not allow any kind of chargeback, which is not true for main payment systems (Paypal, Stripe, Credit Card). Lower fees or no fees, just depends on how you use it. Investment some people wants to hoard some ...


3

Bitcoins are traded on many different exchanges. The prices are varying constantly just like any currency. As an example: at this time three rates are Mt.Gox - $143.0983; CampBX - $125.8000; and BTC-E - $124.0000 (all USD). As I learn more, and become familiar with the exchanges, I may try some arbitrage. I have a feeling there are problems, or people ...


3

If you see bitcoin as a currency, mining is issuing new bitcoins. It is analogous to a central bank issuing (or printing) new currency. What product is produced for the world? Mining for coal produces coal to be used for energy production. Mining for precious minerals provides metals for use in products all humanity can use. You could ask the same ...


3

Spending Bitcoins requires the knowledge of the private key corresponding to the address holding the funds. These keys are managed by each user individually. Without the key, the coins are rendered unspendable. Given the lack of details, I assume that you no longer hold a copy of the wallet that held the private keys. If that is the case, your funds are lost....


2

TL;DR: It was not its creator who did that. Bitcoin's economic significance was gained similarly to any other money; but here, it started with pizza... Let me answer by refuting the most persistently recurring false argument: Crypto money has an intrinsic value created by clever design to provide utility in the form of safe/free/practical/... (i.e. "...


2

Although a simple question, "What gives Bitcoin value?", the answer is not as simple as the question. What gives Bitcoin it’s value, can best be answer by the formula PB = (SW + TX) / BC The value of a Bitcoin is derived from the total value of the Bitcoin used for storage of wealth (SW) plus the total amount of the Bitcoin required for concurrently ...


2

Like fiat money, the valuation of BitCoin stems from its changing share per unit of world GDP transacting in it - the share of world economic activity expected to transact in BitCoin vs. the supply of BitCoin. Consider what gives fiat money value: is it the “faith in and credit of” the issuing government or its quantity relationship to real GDP? The CPI ...


2

It looks like blockchain.info is using different conversion rates in different places. Why they are doing this (and where they are getting their data) is really something only the owners know. I'd like to thank you for bringing this to our attention; however as blockchain.info is an important source of data for the entire community and it's important that ...


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