Quote from: tertius993 on Today at 11:26:09 AM

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Quote from: tertius993 on Today at 10:06:37 AM

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Quote from: Biodom on November 22, 2021, 08:32:04 PM

I think that bitcoin cycles are already largely diminished, therefore the price dynamics will follow a random trajectory with a trend up, but we are not going to get an average of 200% per year anymore (maybe 50-100%).

I, too, a few months back suggested that the halvings are getting less and less relevant. Of course I didn't have this insight myself - it's something I read during the 2017 bull run. I got picked by a few fellow WOers, and there was a little discussion - quite civilized actually, no flame wars. After all that, however, I'm still not sure how "relevant" the last halving is going to be.

I definitely agree with this: over time as more coins are minted the relative impact of the halving reduces and so I think it is reasonable to expect the effect of the halving to reduce over time - probably resulting in lower peaks and a "rounder" more smoothed top.

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So as each halving occurs its influence on the total supply will get smaller and smaller and so I would expect we will see a steady smoothing out of the halving impact, like a wave decaying over time.

That is a good explanation of the chart-pattern we have been seeing over the last year. The lack of an exponential peak was leading many observers to conclude that this bull run was only in an early stage. However that does not fit the pattern very well.

It would seem logical that, as the market matures (and stock/flow, halving influence is part of that maturity, as well as adoption) the chart patterns will evolve and change. There will still be waves, but they are changing and flattening.

Personally I don't see the relationship between the halvings and the scale of market tops. Each halving the impact on supply/demand is simply halved, so the idea of it's impact reducing like a wave breaking sounds about right, without needing to over-complicate the idea. But the tops are driven by the volume of rampant speculation that lacks rationale, I therefore don't see any price correlation with the halvings, only time-based.

The reasoning why tops are less parabolic and blow-off as each cycle passes, is simply due to the shift from retail to institutional investors, the need for an increasing amount of money to move the market. Along the lines of the first blow off top in 2011 being caused of nerds going a bit wild, followed by the 2013 top based on market-based speculators following suit. The 2017 top was retail based, when there was more mainstream adoption. Based on the amount of volume now required to have a parabolic blow off top, it would need to come from institutions, now that Bitcoin is a trillion dollar asset class. The reason it might not, is because institutions are usually more financially conservative and patient than retail investors, and less like to fomo, as well as panic sell for that matter.

Unless Bitcoin suddenly get's adopted by most US/EU banks when reaching 6 figures, and becomes easily accessible to vast percentages of population, or something similar, I don't see how retail investors can really create a bubble top this time around, especially while in the background many institutions will be taking profits. I still think the chance of a blow-off top coming from institutional investors, or more likely bored billionaires, is more than possible, but simply less extreme. There are many that won't invest until it's worth $2 trillion, $3 trillion, even $5 trillion. Despite the trend recommending to remain patient, there will be certain funds required to start investing their 1-2%, regardless of the short-term, because the market has reached a certain threshold required for long-term investment.

To me this explains why BTC spent a while above $60K early in the year before crashing, as it had reached a $1 trillion evaluation, and therefore required investment from certain institutions.

I would say that is more or less right as well (see qualifying note below), however, the investor profile (retail vs institutional vs ...) is independent of the halving cycle and the points made about the reduction of the halving impact over time was entirely responding to that point, i.e. will we see the relative size of the "cycles" reduce as the halvings get smaller over time.

Yes am aware I was going off point, simply to provide a perspective as to why prices will be less parabolic/volatile as each cycle passes, in order to shift away from halving speculation on price impact. Also agree the size of such cycles, or ups and downs let's say, will be reduced as the impact of the havlings are reduced. Even if this correlation isn't related, nor a cause and effect.

Quote from: tertius993 on Today at 11:26:09 AM

Qualifying point: I think the market cap or $1 trillion valuation is a very misleading figure - the market cap is a purely mechanical construct that has very little do do with the money required to move the market, as that depends on the volume of coins that are actually available on the market (a tiny fraction of the total) and the demand for buying them.

I'm aware it has nothing to do with how much money is required to move the market etc, this is based on liquid supply as well as demand, but it's incredibly relevant to institutions. Many of which aren't able to touch an asset, or consider Bitcoin as a reserve asset, unless it's worth >$1 trillion. Others will be more conservative, they won't go near BTC until it's valued at $2 trillion, $3 trillion or even $10 trillion (private banks). Some will even be patiently waiting until it's worth Gold's $20 trillion, and won't touch it with a barge pole until then. State banks I imagine. The lower the risk required, the longer they will wait before adopting Bitcoin as a reserve asset. Bare in mind very few institutions are currently using BTC in this manner so far, even if enough have already dipped their toes in the water.

My point was, when a certain valuation threshold is reached, there are certain institutions that will be forced into purchasing in order to reduce risk, hence $60K holding for so long earlier in the year imo. The market was overvalued but remained as such for 3 months around $50K-60K, much longer than many expected. Whereas previously consolidation at such overbought levels is unprecedented for BTC.