Why Crypto Crashed Today | Hacker News Reader

Why Crypto Crashed Today

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I am economist and I have expressed deep reservations about bitcoin (generally, any currency, including crypto-currencies, that have a finite supply https://medium.com/@jamesjunghanns/my-0-00000173120-btc-a-pr...).

I am always extraordinarily suspicious of any explanation of a large market movement (downwards or upwards) that is attributed to somebody saying or doing something. The reason is it's fair that there be a few market participants are so uncertain about the value of their assets and their prospective evolution that they react suddenly, but if the market is so shallow that apparently most participants just react to technical trends, then you have a problem.

I wish also to add that the market turning “just about now” had been predicted quite a long time out (30 November) on the public record by the application of the well-known financial model Log-Periodic Power Law (LPPL), whose application to the BTY/USD exchange rate can be read here: https://mynabla.com/2017/11/30/bubble-trouble-exploring-an-l...

So no, bitcoin did not tank because some “idiot swede” said something inopportune. It tanked because the market was totally disconnected from reality (and has been for ages, maybe forever), and because apparently a large proportion of participants are trading purely on technical and not fundamental valuations, and therefore act in unison and pro-cyclically in a shallow and illiquid market. Add to this that it is probably noxious for any economy to adopt a fixed-quantity, deflationary currency, and... there you have it.

Bubbles can last very long though, to a certain extent gold itself has been in a bubble for decades.

The real advantage of bitcoin is a bit of a paradox.

Precisely because it has no value (and it's unsuitable as a currency) it can work as a pure game of musical chairs which can in theory go on indefinitely (technical limits aside).

Yeah, they can... I sure hope the cryptocurrency champion becomes some other “Generation 2.0” implementation that figures out how to use the BlockChain to implement a variable-supply inflationary currency (as BaseCoin, that I like the idea of, but have no affiliation to, and no interest in).

To save everyone's time - It is because of....FUD!!

The favorite go-to explanation for everything in cryptocurrencies.

That said, why is this being voted up? It fails the basic test mentioned in the guidelines:

https://news.ycombinator.com/newsguidelines.html

Note that he's asking for to be flamed in a forum notorious for banning critics.

The 'idiot felon Swede' is making great moves in promoting his fork and Bitcoin in general. I think the Bitcoin community should be glad for the attention this drama generates.

I didn’t even know about this ‘drama’. But then, having reasoned from first principles that any currency that has a fixed supply (and is thus deflationary) is noxious, I just tend to ignore most of the references thereto.

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