Quote from: oda.krell on May 13, 2015, 01:51:33 PM

Quote from: Fatman3001 on May 13, 2015, 01:09:29 PM

Quote from: oda.krell on May 13, 2015, 12:17:05 PM

Not wrong, but not the full picture either:

a) true, it might quite well go down in flames, and that early VC capital will be lost like tears in the rain;

b) then again, it's a (controlled) gamble on their side, similar to early dotcom seed/investments: if it pays off, it'll pay off rather royally, if not, it's a (comparably) minor hit to their total holdings. Which brings me to:

c) on a different scale, through a different aspect of the market, that's similar to the "bet" we're making here as well: most who hold some long-term BTC position do so because of the chance (by his/her best judgement) that there's a big unrealized economical potential for the Blockchain (emphasis on the Blockchain), which (again, by his/her best judgement) in turn would likely lead to a major appreciation of market value per token.

The flip side of this bet just as the one by VC: it might not work out that way - alternative blockchains might take the lead, public and business interest might stay comparably small (i.e. "solutions looking for problems" turns out to be true and stay true), etc.

Some people here conveniently ignore the latter point, only going on about the limitless potential. Others pretend there is no potential, only risk, and eventually: doom. Personally, I think it's simply too early to draw either conclusion, 6 years since launch, and ~2 years since VC started pouring in for real.

But why won't the same people more consistently invest directly in BTC? It wouldn't take much for all those VC investors to prop up the currency/token such that their more indirect investments stands a much better chance of succeeding.

I would guess: because it's VC, not quasi-Forex gambling money. Also, because the market is rather illiquid. Paper profits are extremely far from actually realizable profits at current levels. Finally, they probably do hold some stake in the native tokens. So it's really asking "why won't they prop up price?". Only, why would they?

There is no function the Blockchain would suddenly & magically be able to perform just because total valuation is twice of what it is now, at least not without public interest growing equally as well. Probably the only thing price affects right now is speculative interest, but I see it as largely unrelated to fundamental growth of the Bitcoin economy, as long as per coin price is high enough to make the network "secure enough" - which it is, despite the sometimes desperate seeming attempts of Sirer, Stolfi et al. to prove otherwise.

Why continue building your position if you're not also working on building the economy that eventually, hopefully, leads to an increase of valuation of position? From that point of view, it makes sense to me that any accumulation that might occur from the VC side would be rather marginal compared to current inflation... Let's say $50M of VC capital are flanked by the same amount of "accumulation effort". At ~$300 per coin, that would have soaked up around 50 days of block reward. So even if it would be on the program (which I doubt, they might be perfectly happy with their position built at vastly lower prices), it wouldn't single-handedly turn the tables on the greater market situation.

If the price has stopped collapsing I guess I shouldn't complain, but a lot of the companies that have seen investment the last couple of years (not all) have products that are sensitive to sudden and massive falls in price. Which is why I would have thought that some of the people who invested in the industry would want to invest in a stabilization fund to keep the prices from hitting the customers of the businesses they have invested in over the head. I know a lot of people think that this is against the free unregulated nature of Bitcoin, but if it is free and unregulated it shouldn't be a problem to do something like that as well.