I find a bit funny when people put imaginary barriers to the price of btc (*) on their speculations. Why people say $50 instead of 53 or 51.3 or even sqrt(3210)?
It's like they find the 0 positioned into the least significant digit as something relevant...
Maybe some people says 50 as an approximation, but what would you put in your ask price: $97 or $100?
I would love to see how many people choose "nice numbers" (like 100) instead of primary number (97)
What could happen if we all start using any other numerical system, like hexadecimal? I don't think we are going to say "Hey, it will break at 0x3C, I'm sure!". And what the number of digits would mean? it would be less accurate than now?
Does anybody knnows if there is there any study about this kind of stuff?
cheers!
EDIT: (*) to be fair this happen on any market/society, not only bitcoin
EDIT 2:
I found a some research's about this topic:
http://mro.massey.ac.nz/bitstream/handle/10179/2695/02_whole.pdf?sequence=1 (a mbs thesis)
http://www.cepr.org/pubs/Bulletin/meets/1180.htm
https://en.wikipedia.org/wiki/Psychological_pricing
It's like they find the 0 positioned into the least significant digit as something relevant...
Maybe some people says 50 as an approximation, but what would you put in your ask price: $97 or $100?
I would love to see how many people choose "nice numbers" (like 100) instead of primary number (97)
What could happen if we all start using any other numerical system, like hexadecimal? I don't think we are going to say "Hey, it will break at 0x3C, I'm sure!". And what the number of digits would mean? it would be less accurate than now?
Does anybody knnows if there is there any study about this kind of stuff?
cheers!
EDIT: (*) to be fair this happen on any market/society, not only bitcoin
EDIT 2:
I found a some research's about this topic:
http://mro.massey.ac.nz/bitstream/handle/10179/2695/02_whole.pdf?sequence=1 (a mbs thesis)
http://www.cepr.org/pubs/Bulletin/meets/1180.htm
https://en.wikipedia.org/wiki/Psychological_pricing
What you are talking about is an emergent phenomenon.
People looking for reasons to buy or sell.
If the trader doesn't have a rational prediction about future price he will usually go for 'feeling' and then feelings of familiarity begin to have an effect. Round numbers feel more special to us because of extra connotations we have in our memory. 100 is 10 x 10 and you have 10 fingers! woo! 100 is also easy to remember because you only need the first two numbers of the numerical alphabet.
50 is of course 100 / 2
So these numbers give extra 'feeling' to a number.
What will happen is that the masses of blind traders will try to feel out their strategy.
They notice a statistical change around the nice numbers and their memory gets triggered enforcing the feeling of that number having significance. This process then snowballs up to a certain point.
So it's mostly about unjustified feelings about certain numbers in a social feedback loop.
Which in the end makes them justified in their own right.