Hello

These are my thoughts. Was wondering what other people felt and having a bit of sense check. I base my thoughts below on limited experience (i first heard of bitcoins last monday, first bought last thursday)

Thoughts:
This is a fast moving upward spiralling self fulfilling style market where money is chasing a limited supply of a security, which behind it has no intrinsic value and is not actually actively being used to trade goods and services (although it can be and might be in the future, it is not now - I am aware that there are some sellers of real goods but not in the context of a £75m mkt)

This px is moving higher as more people become aware of it and are putting money in. News is moving from online blog to mainstream media. Last week there were 300-700 pounds moving through the gbp exchange britcoin per day, today it is closer to £10k per day. In the US they are already well into the $ millions trading per day.

Current total market size is about £75m, I think that it has the potential to go up to £1-10bn order of magnitude as it would be a shadow retail market. There would be a price barrier around the £1,000 GBPBTC mark. From there to go further it would need to have a purpose (i.e. literally moving money from china offshore in USB sticks, main instrument in the black market) to go bigger

Downside is pretty large - it is used in blackmarkets (trafficking, drugs, etc) and at some point it will be attempted to be shut down by authorities.

Facts:
Market is growing exponentially

Very illiquid, when it drops, it will go to zero

Emotional market, not moving on any fundamentals
 

Strategy:
Take emotions completely out of it, recognise that it is an upward spiral self fulfilling mkt but work with it and not against it knowing that it will drop suddenly at some point

Derisks logarithmically that will leave exposure to upside but also constantly taking profit and defined intervals (i.e. sell half when px doubles or sell one third when price triples, etc, depending on your risk appetite - my example of quadrupling is below)

The end idea is to set up some explicit trading rules, not be greedy and have some fun.
 

Numbers:
Have 200BTC bought at an average px of 12.285 GBP

Have put a sell order of 50BTC for 49.14

i.e once it has gone up by 4x (initial investment is back)

Will be left with 150 BTC

When it hits 196.56 will sell 37.5BTC for £7,397

left with 112.5 coins

When it hits 786.24 will sell 28.125 for £22,113

left with 84.375 coins

And so on, but as i said i dont think it will move much further than around that price point

Thoughts comments and suggestions more than welcome.

Fanks