Time Will Tell

There is a lot of excitement about Bitcoin Cash. It became a thing yesterday and is up almost 100% in the last 24 hours according to Coin Market Cap.

It reminds me of the way hot IPOs trade. Snap went public at $17/sh, traded up to north of $24/share on it’s first day, and is currently trading at just under $13/sh.

I am not comparing BTC Cash to Snap. I am just saying that time will tell whether BTC Cash, or frankly any ICO, is going to be valuable long term.

But one thing is for sure, hard forks create something from nothing and we will see more of them as a result.


Comments (Archived):

  1. LE

    Part of the issue with this type of price gain (hate to use pop) is that it is being seen and stoked by what I have called in the past ‘the newly hatched’. Those types of players tend to have a much different seat of the pants take on events because they have no sense and knowledge of history. And even if they read about dutch tulips and so on the greed and chance to make money clouds their judgement. So you get enough of that type of thinking and you get a nice price rise. You get enough new players and it keeps going. At the end even rational people will then jump in for fear of missing out. (Happening with NY real estate where everyone now thinks of themselves as an investor and developer..)Making money like this short term is definitely possible. Just like you can win at a casino but generally long term the house has the edge. The question is always when do you get out and walk away.

    1. Michael Brill

      But in this case, it’s like you walked into the casino with $2800, the dealer walked up to you, gave you $700 and then you walk out with a puzzled smile on your face. If you were committed to holding a BTC investment, this was just free money

      1. LE

        Explain what you said relative to what Fred said:and is up almost 100% in the last 24 hoursFor it to go up, wasn’t their ‘newly hatched’ participation?Or is this closer to something like this.There is currency we call the US Collar. Someone decides to print a US2 Collar and gives everyone who holds a collar a US2 collar. In that case there is not only value in the US Collar but the alternate US2 Collar.

        1. Matt A. Myers

          It has to be just anyone spending $xxx to purchase some, and then others to be like – “Hey, I can afford to spend $100 USD to buy some of this to help the global appearance that it has value – and I trust that others holding the crypto-asset will do the same.. and then the big speculators who control a lot of money will get convinced [tricked?] it has value and slowly trickle huge amounts of money stabilizing it.” The scary part is if you could have a bad actor or finance person who wants to “pump and dump” $1-$10 billion USD into it over some time.. blah. It’s crazy.

          1. LE

            have a bad actor or finance personBad in what way? If I go into a neighborhood and start buying real estate and appear to be over eager and making bad deals and that causes the price to rise (people smell some opportunity that I have created) and I then sell off my holdings does that make me ‘bad’? Or isn’t that just a business strategy? Behavior like that is not illegal it is not like shill bidding at an auction. Or stock pump and dump.

          2. PhilipSugar

            Bad is just a relative term. I can in fact be “bad” for you if I decide to do something crazy, but maybe I’m crazy like a fox.Is it bad for me if a super well funded VC firm comes in and starts giving stuff away, that I sell? Is it illegal? No Do they believe in what they are doing? Yes. Is it bad for me? Hell yes.

          3. Matt A. Myers

            I wasn’t referencing buying up some property and selling it at a profit. IMHO that’s not a fair comparison to crypto-assets either. The gains and margins and potential is far different for fixed assets like land vs. a comparison of creating a new planet (each crypto-asset) worth of land.

          4. PhilipSugar

            You have beat me to the punch. If you don’t know who the sucker is, it is you. That is what scares me.People look at this and say “free money!”I say not only do I not know how to play the game, I don’t even know the rules.

          5. Matt A. Myers

            The rules are of new casinos being built with a new game that’s connected worldwide that could let everyone playing it make a ton of money, and the earlier you play the game – the more you could potentially buy. And everyone’s excited talking about these new casinos, and they’d be happy to hold “$100” worth and say positive things about it to whomever they speak. This is what’s so dangerous about it all.

      2. Matt A. Myers

        The use of the term ‘free money’ that people are using is really odd to me.

        1. Michael Brill

          Why does it seem odd? Again, predicated on a commitment to hold BTC, how is this not free money?

          1. PhilipSugar

            Because free money doesn’t usually last. Now how long it lasts? Nobody can predict.Am I kicking myself in the ass I didn’t invest last year? Sure. Is it tempting to invest now? You bet. Might I continue to miss out? Certainly.But what I do know is that you better have some serious fundamental value and I believe they do, but when things get frothy usually that measure gets way overvalued. My broker wanted me to invest in Castalight I wanted to short: https://www.google.com/sear

          2. Michael Brill

            Again, my point is that if you had already made the decision to hold BTC (and thus ignore its price variation) at the fork then BCH was free money (assuming you sell before it hits zero) vs. getting no BCH (Coinbase, et al).

          3. LE

            Am I kicking myself in the ass I didn’t invest last year? Sure. Is it tempting to invest now? You bet. Might I continue to miss out? Certainly.You can’t think like that and here is why.If you had invested in that you probably would have also invested in other speculative things and would have most likely lost out on those other investments potentially in a greater amount. The reason is there was no fundamental reason or edge to feel that the price would rise for this particular item. That is the nature of this game. It’s a gamble.And honestly if you are just investing small amounts (that you can afford to lose) then we are really just talking about entertainment and fun not investing or something that will change your life or lifestyle.You know at any point in time you evaluate the landscape and decide whether it pays to invest or not.Want to know where there is potential to make a great deal in real estate if certain things happen? Atlantic City. Some nice places dirt cheap. Really. I am not talking about drop from runup prices either. I am just talking about prices so low they seem as if you can’t loose. However honestly it has seemed like that for so many years now that I can’t remember. And it would take a big changes to get the upside. Which don’t appear to be on the horizon. That is why the market isn’t taking chances down there and the prices are low. That is also why to make money you have to take multiple gambles like that with the hope that one will pay off. So you need more than 1 Atlantic City. Same with buying land. 1 lot not the same as 25 lots bought right.My uncle bought years ago in a hot place (now) in Philly. So bad they had to tear the building down because of the drug crime. Sold the empty lots last year for 3.5 million for upscale housing. Nominal carry costs, just land taxes cheap. At the time they bought it there was zero chance of thinking it would ever change. They just needed a warehouse for merchandise so they bought it probably for like $40,000 or something like that. By the time it was worth something my Uncle died and his kids got the money. That many years.Am I kicking myself because I didn’t buy property there? Of course not why would I in that neighborhood and think that many years later it would be of value because millenials want to live in the city? We couldn’t wait to get out of the city.

          4. Matt A. Myers

            If the U.S. prints $1 trillion and distributes it amongst citizens, it’s diluting the value of the other money – that’s not $1 trillion of free money. Adding to that, the ‘free money’ isn’t even liquid as a whole – it will only be liquid once the speculators are able to convince/manipulate to get whole societies using it at whatever hopeful value they have in mind, so real currencies are acceptable as the value they assigned to crypto-assets.How is this free money? How can it even be called money or a currency?

          5. Michael Brill

            Your USD analogy is that 1 BTC turned into 2 BTC. That’s not what happened. Instead 1 BTC turned into 1 BTC + 1 of something else that is largely unrelated to BTC. Crypto, as an asset class, isn’t a zero sum game, so whatever that “something else” is, as long as it has value > 0, is free money. But, let’s say in some weird universe it was somehow dilutive of BTC… my point was that “given a commitment to hold BTC”, then this is definitely free money if the alternative is ignoring the BCH component as was being proposed by Coinbase.Point taken on the word “money.” However, even if BTC holders got one goat per BTC, I’d still call that free money. It just so happens that it’s easier to convert BCH to USD, which I did. That money got intermingled with USD I earned the old fashioned way. Whether it’s “free money” or “free asset class that is easily converted to fiat currency” is a semantic distinction that I’m willing to gloss over.

    2. creative group

      LE:People who invest in the market (At a high level) require fundamentals. There are none in crypto-currency at the moment. The smart money is deep in crypto-currency because they think they can control it. (The crypto-currency direction, not fluctuations)

  2. William Mougayar

    Yup, lots of speculative forces seem to be driving this for now.

    1. creative group

      William Mougayar:Speculative forces were not fueling BTC?All markets, investments, etc. are speculative unless it’s a ponzi scheme.

    2. jason wright

      speculative forces dominate. i’m thinking about how the power of speculation can be channelled more constructively at the network level to encourage active participation and deter passivity. networks succeed when token holders are involved and not just invested in the tokens.

  3. Scott

    The market dynamics are so funky with a chain split like this. Exchanges supporting the forked coin before wallets means that there’s a huge lack of liquidity. Timing for wallet support is unclear – Trezor tried but has to bug fix. I suppose the analogy here is an IPO lockup period, but that’s a clearly defined timeframe.

    1. WA

      Nicely put.

    2. creative group

      Scott:”Lockup period”Requires centralized body to enact. The Cowboys at the table haven’t shown an ability to regulate and govern like the fiat currencies which they criticize.

  4. WA

    Liquidity constraints at this time – would that be contributing to less exit activity? Less exit activity (beyond holder control currently) lending to a greater percentage of positive flows in versus negative flows out? Skewed demand numbers then? Watching price activity based on not having full information publically available? So many questions, so many coins…

  5. chhhris

    It’s too bad Coinbase is keeping everyone’s Bitcoin Cash whereas other wallet-exchanges are passing it through to their users.

    1. jason wright

      theft?EDIT 9:18 GMT;The problem with Coinbase is that it was an opportunistic creation cast in a traditional form that is antagonistic to the principles of decentralisation. it is not native to decentralisation. it’s a piece that doesn’t ‘fit’ the blockchain jigsaw puzzle.

      1. Donna Brewington White

        Yet for me it provided a “familiar” avenue into an unknown world while I gained a greater comfort level.

        1. jason wright

          Yes, that was the opportunity. Someone was always going to serve your need (and mine back then), and Coinbase has just about cornered that market…and that cost. It looks unsustainable…from the outside.

    2. Dennis Mykytyn

      If a stock brokerage firm kept the shares of a stock dividend or a spinoff, it would be a crime. Not sure why Coinbase thinks they can keep something of value. At a minimum, they should have committed to selling all the Bitcoin Cash and depositing the proceeds in their user accounts, if they did not want to support ownership on their platform.

  6. LIAD

    Bitcoin Cash to me just seems an opportunistic shakedown, however, forks generally are open source democracy in action. Very easy for people to vote with their feet.Copy and paste the entire code-base, make a few tweaks if you so desire. All the infrastructure and userbase is served to you on a plate.Should serve as a warning to all greedy protocol creators and token sale founding teams.Don’t play nice. We’ll take our ball and go somewhere else.

  7. Kevin Hill

    “hard forks create something from nothing”That’s not how this works. That’s not how any of this works.

    1. Donna Brewington White

      Why do you say this, Kevin?

      1. Kevin Hill

        Because it means Bitcoin isn’t a technology. It is a fad.Technologies don’t “create something from nothing” they increase the efficiency of human effort. That has been true for 30,000 + years and to dismiss that it’s pure hubris.

  8. Donna Brewington White

    Would be interesting to really thoughtfully consider the implications of being able to create something from nothing in this day and age.

    1. PhilipSugar

      This reminds me of “the it’s different this time” which always seems to end badly.

    2. mtaysic

      This shows how trivial it is to copy code. However, it’s hard to gain the support Bitcoin Cash has amassed already. That’s been gained over a long period of time and is far from nothing

  9. creative group

    CONTRIBUTORS:A few people who designed this fork (knife) in BCC are playing chess and the us too people are playing checkers and are unaware.

  10. jason wright

    the price of Bitcoin Cash is a snapshot taken with a pinhole camera. open the aperture and it fades.

  11. Vince Kuraitis

    I just read this post/comments and the post/comments from 3 days ago.As of 5:30 Eastern on 8/2, Bitcoin Cash is now the 3rd highest cryptocurrency in market cap https://coinmarketcap.com/, having surpassed Ripple in the past day. It’s now trading around $420 but was around $800 earlier in the day.Quoting Buffalo Springfield, “There’s something happening here…What it is ain’t exactly clear”.I’m surprised how many commenters have been dismissive or incurious about BCH… so I’ll ask the question “What’s the bigger picture of what’s going on here and what’s the potential?”I’ll also admit the possibility that BCH could still implode tomorrow, but IMO if it were going to implode it likely would have happened within 24 hours…and we’re past that.As I ponder this myself, I’m wondering about the potential for BCH to become a leader in retail, i.e., potentially disrupting PayPal, credit cards, etc. There ‘s no clear leader here yet.

  12. creative group

    CONTRIBUTORS:If COINBASE isn’t supporting BCC then how will the holder exit from doubling or tripling your positions? Are people holding for higher returns which may never come…..

  13. mtaysic

    It’s not something from nothing as I’ve seen many mention. The current BTC is changing. It is not standing still. BCC is bitcoin with a different trajectory. It is simply the same code – two different trajectories.The issue is that people think one BTC is real, and this is created from nothing. Nothing about Bitcoin is inherently sacred … it can be easily copied and if the market prefers the trajectory of another, so be it.The great irony is that the vision of Bitcoin Cash is more conservative and closer to the original Bitcoin than the other.

  14. Staska

    Why the heck do we all call Bitcoin Cash a fork or a split of Bitcoin? Like this is a real split thing? When it is really nothing more than any other altcoin?Still anonymous guys (no one has an idea who they are) copied Bitcoin code, altered 1MB to 8MB limit, and declared – all your 1MB bitcoins also have 8MB version!With a really small fraction of miners and else maybe supporting that.While no one has the slightest idea what the rules are.Or how secureOr what notAnd – killing segwit in their split chain too?!Looks weird – this acceptance in several days of this fork by who knows who, who look like a talented con men, when I still do remember UASF/SegWit2X discussions