Quote from: Impaler on January 26, 2014, 06:24:21 AM

Very good analysis Mat, I'd like to voice my speculation on WHO the manipulators are and WHY they act as they do.

First off WHO, the simple answer is 'deeper pocketed versions of the same zealots who have been railing against you in this thread', I know this seams almost anti-climactic doesn't it. You normally think of manipulation as being done by people who are fundamentally different from the 'small fry' both in the depth of their pockets AND a more 'predatory' nature. We don't expect manipulators to be delusional zealots but in BTC I think they are. First off we know for sure the big holders of BTC are early adopters who drank the kool-aid very early, these folks have now accumulated sums of USD in the several million range (all still on exchanges mind you) and they thus have leverage on both sides to control the price. 'New' investors might come in with huge sums of USD but they can never match the BTC holdings of the early adopters so they can't do the kind of narrow-holding range manipulation your seeing, they can only cause a price spike as China effectively did when it entered the market.

And the WHY should be evident from some of the posts earlier, the manipulators feel they are 'saving' BTC from the evil forces of the Persian Army THIS IS BITCOIN!!! HODL!!!!! This meme is very telling, we see that people equate the price of BTC with the success of BTC, this view is reinforced by the detractors that call BTC a bubble. If the supporters 'HODL' the price up high enough then they are 'right' about BTC and everyone else is wrong, and most importantly their Libertarian wold-view is right and everyone else is wrong. And these people see libertarian/Austrian economic theory as something that needs to be promoted and defended at any cost. All of this is to ultimately as you said yourself fell that this is the "result of something inherently great about themselves", an ego trip that completely validates their political beliefs and ideologies.

Now what dose this mean for the long run price, are they preparing to crash the market some day and leave the rest of us holding the bag. NO!! These people will WILLINGLY go down with the ship if BTC ever finally tanks, nigh they would flaunt their martyrdom saying they 'lost everything because they had FAITH and held to the end, if only the wretched weak-handed fools had not crashed the price of BTC we could have defeated the evil gobermint and the FED and the USD and ushered in a libertarian Ann Randtopia!!! The know that a fast-crash attempt to empty the exchanges and exist with the USD will net at most a ~40 million in exchange CREDITS which have very little chance of actually being redeemed for real USD at that scale, indeed most of the credits are on Gox which may not even be solvent and which will de-facto force them to put thouse credits back into the market, so for the whales BTC is like a tuna-net in the ocean, they can swim around and seem liquid but are really quite constrained, they realized their BTC AND exchange-credit wealth is illiquid and they like it that way, weakness should be PUNISHED not rewarded after-all (I wouldn't be the least surprised if their are intentional retaliations against anyone who breaks ranks and tries to cash-out). So they are happy to just get a trickle of USD as they so very slowly sell, it's still enough for them to practically live off and it's more then they deserve anyways so why not keep this whole BTC thing going as long as possible, when it looks like 'stability' is what is needed then they create stability until it looks like another crop of new adopters is ready to be lured in, to them BTC is like that Spartan army doing a simple 'charge', 'fallback (as little as possible) and 'hold' pattern, claiming 'ground' is the goal and ground is measured in exchange rates.

The question is now, can they keep this up? And for how long? I think it will eventually break them, the waning availability of new suckers, the exodus of China, and the declining profitability of mining hardware which will force more coins to flow into exchanges will exert enough pressure to break out of this ~850 band and bring a correction down to a more sustainable level. Sustainable here simply meaning how much actual USD per day that libertarians can find out of their own pockets to throw at buying up the ~5k new BTCs per day that come into existence. This should not be confused with the LONG term sustainability issue which involve a whole slew of legal and economic factors beyond the scope of just throwing USD purchases at BTC. But for the short and mid term I feel we will see corrections in which small fry run for the doors but whales do not.

+1

I have seen so many "cultish" beaviour here on the board in the last time, that really worries me most about BTC. Like only true "believers" hold and will be rewarded (coz it might jump to 10000$ in 3 seconds, and nobody should miss the train. Also all the requests that everyone should immediately tell his friends that they should invest money, right now, coz it´s 100% that it´s goin to .. whatever. Most of them don´t see the slightest possibility that it possibly might not go up forever in this rate. All of the bad news are easily turned into good news, in fact every news is good news that show that Bitcoin will 100% go to the moon very soon. Everyone who is not overall positive for the Bitcoin technology itself or it´s actual price is an enemy and liar that must be fought, an idiot and what else. Altough it´s common sense that those enemies will not be able to surpess the rise to the moon, they can at best only delay it. So every true Bitcoiner should missionize as many new so far uninvolved peopele(and their money) as possible, so that they will be able to "see the light" .

Join the Cult!

Btw i am an early adopter and used BTC first about more than 2 years ago and can see some positive advantages of the BTC technology, but i´m still scared of this behavior.

Kill the naysayers!!!