Quote from: Redtea on May 14, 2014, 04:43:26 PM

Any attempt to apply traditional market analysis techniques to Bitcoin is just nonsense. Bitcoin is not a stock, option, currency or commodity in the traditional sense and trying to apply market analysis techniques, developed for analyzing the trading patterns of actual stocks, options, currencies, and commodities, is not going to yield supportable results. Bitcoins are literally nothing but encrypted blips in a distributed network of computers, that belong to the person holding the proper cypher.

While I agree that we are looking at a different investment vehicle than there ever has been before, the analysis that has been done has often been just as effective as stock market analysis. Which is pretty much crap also. It's info worth looking at, but don't put your life savings into "chart porn."

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The only difference between Bitcoins and dollars is that dollars have the full faith and credit of the United States of America standing behind them, and that actually means quite a lot out in the real world.

I disagree with you that that is the only difference, or even the most important difference. The biggest difference is that the US dollar has 7 billion people that believe in it as a currency, while we might be lucky if 7 million people believe in Bitcoin. The cool thing here for us Bitcoin believers is that our numbers are growing much more quickly than the believers in US dollars.

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If you buy Bitcoin today, youre almost guaranteed to lose money on the purchase.

First you say you can't believe the analysis, and then you make an absolute statement based on 5 months of history.

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If the price of General Electric stock declines, I know the company can restructure, add new product lines, and make other changes to recover and grow. With Bitcoin theres nothing putting a floor on that price, and no avenue for growth.

Companies as big as GE go out of business also, and Bitcoin is currently restructuring, adding new product lines, and making other changes to recover and grow. And what's better about these innovations is that if one doesn't work it doesn't drag the company down as much as it does in a traditional business.

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The influx of venture capital money and involvement of players like Richard Branson is a clear indicator that there is value in the Bitcoin concept. Right now that value is Bitcoins potential for the technology to democratize banking and that potential is huge, but how do you price that? The simple answer is that, right now, you cant.

I agree with you here. We don't know how to price Bitcoin. My analysis is that we have needed the speculators to raise interest in Bitcoin, but now, as we move into more adoption as a currency (though this is still in its infancy) the speculation will continue to have less influence and the bubbles will get smaller.