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The life and times of the Cryptocurrency markets

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Cryptocurrency markets are still very immature, arguably they started when the first Bitcoin trade happened, back in 2008.


My history in terms of trading is that previously I traded options, then futures, I didn't achieve any real success with futures, so I pulled my money out of my brokerage account December 2016 and started taking a serious look at the Cryptocurrency markets, since I'd bought Bitcoins back in 2014 and they were doing very well.

BTC - 10d : 2mos : 32-months

: all-data :




Some sites I use;








My original intention was to make an assessment of the top 100, but there are far too many, so I initially looked at the top 20.


Of those I bought;


Dash at about $20 on 19th February

Ether at about $20 on 2nd March

Ripple at $0.01 on 24th March (nearly an historic low)

PIVX at $1.88 on 13th April (close to the top)

Stellar Lumens for $0.045 on 16th May

Humaniq for $0.052 on 16th May (a few days after the ICO)

The largest positions I have are in Bitcoin, Dash, Ether and Ripple, I only put 1-2% of my funds into the others.


What happened?


The charts begin at the point I bought.


Dash went up 750% so I sold a third on 24th May (for Bitcoins)



Ethereum went up 2000% so I sold 20% on 24th May (for Bitcoins)



Ripple went up 3300% so I sold a third on 16th May (for Bitcoins) (the next day it went to 4200%!)




I sold the PIVX for a 45% loss (was originally small hedge for Dash and very small position of 2%).


I sold a third of Humaniq on 24th May after a 300% increase to take my risk off the table.


I also sold some bitcoins for cash.


I am now in the very fortunate position of a having a free ride in the Cryptocurrency markets.


These are the craziest, most captivating and lucrative markets I have ever seen in my entire life, these gains are completely absurd. The majority of money in these markets is pure unbridled speculation so there is a very real risk of a huge collapse here. It's very very tricky to value these assets, but because these are new assets with in some cases great characteristics, use cases, communities and backing, they could potentially become extremely valuable, one day. But not yet, I believe it's too early.

I think that yesterday may have been a top in the cryptocurrency markets. Why?


This is a chart of the marketcap of the top 100 crytpocurrencies.



I can tell you from experience that this is not a sustainable direction for asset prices. These assets are overvalued. Current valuations for these assets I think reflect the value they should be once they have significant penetration and use in real world applications. Present valuations reflect an overly optimistic view.


Here is how the Cryptocurrency markets looked on 27th November 2013


Very few have survived.

There are some incredible dynamics in current cryptocurrencies that bear the hallmarks of reflexive processes. The market price history certainly seems to evidence this - I will try to explain this and post more on this later. Also I will explain what attracted me to the ones I bought.

Advice - DO NOT store significant amounts of currencies or funds in exchanges.


Anyway - I Must DASH




(I used to post a lot on these forums however family work, other interests etc mean I can only pop in now and again.)

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Its clearly not a top in terms of a bubble. Its merely the first sell off after too much new money came in too fast too soon.


"Now this is not the end. It is not even the beginning of the end. but it is, perhaps, the end of the beginning."

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MORE charts


Bitcoin prices could (should?) come back to $1900 or so; then $1600


BTS ... 5mos :



ETH : was $141 when I made the chart. now $128



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The total market cap, and it's constituent assets have come off a fair bit now, although Bitcoin and Ethereum are still very strong.


It topped out at around $89 billion, down to $72 billion as of now;





What is Ripple?


Ripple is a permissioned blockchain, working with a number of banks to reduce costs of global payments.

XRP is the native asset on the blockchain. SBI holdings found using XRP on the Ripple blockchain would reduce cost of global payment settlement;




There are quite a number of banks working with Ripple. Ripple is not popular on bitcoin forums and amongst crypto anarchists because some are purists who believe that cryptocurrencies should be a separate system, excluding the banks, whereas Ripple is deliberately targetting banks as their prime market. Ripple payments are near instant, between 3 and 5 seconds for settled pyaments. IN Q1 market participants bought $6.7 million of XRP direct from Ripple, although it is not clear whether these purchases were at open market prices. The Bank of England's fintech accelerator are conducting a proof of concept test with Ripple. Ripple's USP is near instant payments on a permissioned blockchain.


The cost of the XRP asset was extremely low at the time I bought so I saw it as great risk/reward ratio.



Ethereum is dominant in the space in terms of smart contracts on a blockchain. I think this tech is really advanced, and they have many global businesses signed up to the Enterprise Ethereum Alliance. It really looks like a growing ecosystem and applications for deployment seem at this point only limited by the ideas people have, so long term the asset will hopefully grow in value as demand increases. I picked this one up just as an upswing was beginning. Ethereums USP is the first smart contract capable blockchain.



Dash for me is particularly interesting. Dash is the first Decentralised Autonomous Organisation (DAO). What this means is that some of the functions of the organisation are deployed direct from the blockchain. Dash's goal is to become the paypal of the cryptocurrency world. Dash payments can be sent as normal, with it taking a few minutes to arrive as each new block is mined, but they also have another tier of nodes, called masternodes, these are collateralized nodes, paid to provide services to the network. If someone wants to send DASH as an instant payment, is it the masternodes that perform this function by relaying the funds to the destination account instantly.


Dash blocks are mined, but the DASH that is mined does not all go to the miners, 45% of funds go to masternodes, 45% go to miners, and 10% goes to the treasury. The treasury disburses funds through a proposal system, each proposal is voted on by masternode owners. So the core developers are paid direct from the blockchain in DASH for their work developing the code adding new features, upgrading the core wallet etc. They are developing something called Dash evolution with which their goal is to revolutionize the usability of cryptocurrency for mass market adoption. Currently using wallet is cumbersome and problematic, wallet addresses are really long, there are no usernames, so it would be difficult for John Doe to use. They want to change all this and through their Dash evolution system, want to develop crypto currency your grandmother could use.


The payment of new block rewards direct from the block-chain to the treasury (the 10%) creates a reflexive process, a positive feedback loop. Treasury funds are paid to developers, marketers, and successful proposals, as their efforts increase the value of DASH over time, the overall block reward increases in value (in $ terms). This means that as the price of currency increases, the value of the block reward that goes to treasury becomes higher, so treasury can hire more developers, fund more types of activity that increases the ecosystem, the value of the network, the attractiveness of DASH as currency, and the price increases. I believe DASH currently have 37 developers working full time being paid high market rates for their work. They have someone that has worked extensively in the payments industry, Ryan Taylor, he was director of finance, he is now CEO. I think DASH has a strong a growing team, a great product and there is potential for it to become a huge business in the future. Again I picked this one up just as there started to be a decent uptick in price. The positive feedback loop embedded within the DAO is a very attractive feature.

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Humaniq is a very interesting one.


Humaniq is targetting the unbanked markets of the world where people have mobile phones but no banking services.


The Humaniq USP is a clever combination of Biometric technology along with blockchain tech. They've created an asset HMQ on top of the Ethereum blockchain, and an app to facilitate transactions. Many of the worlds unbanked have no papers, no id whatsoever, so there is no prospect of them ever having an account with a typical financial institution.


Instead of having a username and password, the access to the system is a Biometric face check, The individual users face is scanned by the app, and if it matches the one used on set up, theh user is granted access to their funds and the apps functions. Further, the app has no language within in it aside from numbers. All of the features and functions are indicated by use of symbols. This means it could be used in any market. There is an incentive structure built in, so the user obtains HMQ coins when setting up an account, and for various other activites that are designed to encourage the spread of the system. Their app and currency would be particularly useful in local communities where the currency is one which is inflating. Although not currently a feature of the app, in the future instead of paying an account number I am assuming that a user could simply select a face on the app, with the payment going to the individual.


I think the innovative combination of Biometrics and blockchain technology combined with the incentives model, means this is potentially a very interesting entrant into the cryptocurrency world.



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  • 2 months later...

I've fortunately being doing particularly well with these cryptocurrency markets however I had the most ridiculous idea today. I was walking round the supermarket picking up our requirements and thought that it would be a really good idea to buy a bottle of champagne, to celebrate my success in the cryptocurrency markets. I immediately realised that this is probably an internal indicator of a top in the market. Needless to say I did not buy it. Here are some other alarm bells to consider....

Exhibit 1;

John McAfee says that not only Bitcoin isn't a bubble but that you cannot call it one.

JOHN McAFEE: Here's why you can't call bitcoin a 'bubble'


"Likewise, what people see as a bitcoin "bubble," from the perspective of the new paradigm, is merely the predictable and systematic devaluation of fiat currencies that will continue, with obvious ups and downs, until all fiat currencies reach the zero point."

The price of gold however, is not currently reflecting the "predictable and systematic devaluation of fiat currencies " so it is as yet unclear why this devaluation would only be reflected in the cryptocurrency markets.

Exhibit 2;

The shoeshine boys are getting in on it;

Middle America is in love with Bitcoin


"One of them, Ryan Williams, a 35-year-old school bus driver, admits he doesn't fully understand how Bitcoin or its rivals work."

Exhibit 3;

A successful boxer is now exhorting on all things crypto;

Floyd Mayweather Just Joined the ICO ‘Coin’ Craze


"I'm gonna make a $hit t$n of money ... on the Stox.com ICO"

Could you imagine Mayweather being the figurehead for an Initial Public Offfering? I don't see that would fly unless it was boxing related.

I have various interests in Cryptocurrencies but bailed out of 1/5 of my bitcoin, dash and ethereum holdings today.

The rest I will leave as a long term investment (2 to 5 years).

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I'm not aware of direct markets for Ethereum to GBP. I use an online exchange to move to BTC, then dispose of the BTC to GBP via Local Bitcoins.


I'm not really a fan of Ethereum, I'm just capitalising on the growing market. It could be a future Google of the Cryptocurrency markets, hard to say.


At this point I'm just looking to "Be right and sit tight" - Livermore

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It is very possible we HAVE seen a Major Top


Big crash in the cryptocurrency markets- potentially a major top has passed...



$5000-ish was an obvious "ultimate" target - which I identified when the price rose thru $4600.

Now the sell off is heavy


BTS - 6-mos



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Bitcoin dips another $300 after China’s cryptocurrency crackdown

  • Bitcoin hit a low of $4,037 Tuesday - falling by more than $300 - as it continued to digest a Chinese clampdown on cryptocurrencies
  • The latest drop indicates a 20 percent fall following the coin's $5,000 high over the weekend
  • Several Chinese regulators announced a ban on initial coin offerings (ICOs) on Monday

Bitcoin fell by another $300 on Tuesday after the fallout of a Chinese ban on cryptocurrency crowdfunding methods saw the price of the digital coin slump earlier this week.

The virtual currency fell from $4,584 to $4,350 on Monday...

"The price action has certainly been led by this Chinese salvo - but healthy profits and moving traders to take gains off the table too until the panic calms," Charles Hayter, chief executive and founder of digital currency comparison website CryptoCompare, told CNBC via email.

The bitcoin analyst said that the cryptocurrency crackdown was expected due to "irrational excesses" in the Chinese market.


> https://www.cnbc.com/2017/09/05/bitcoin-dips-another-200-after-chinas-cryptocurrency-crackdown.html

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Looking at recent charts of the market cap for cryptocurrency in general this morning, and considering that regulatory storm clouds appear to be darkening, I've now sold down further so I'm now at 2/3rds crypto, 1/3rd cash.












Interesting article on Seeking Alpha that seems to have a realistic perspective on the situation;




I'm actually going to Amsterdam for a business trip at the end of the month. If I can manage the time, I'm planning on visiting the tulip museum there.



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Deeper Pullback?

Looks like the Overall Crypto MarketCap ...




... can experience a Deeper pullback, such as about $120 billion,

or if that is broken to maybe $75B or lower


During that drop (if it comes) BTS might pullback to $3600-3800 or lower ... update




Hi Positive Deviant

Thanks for your recent posts.
I am sure you have noticed that the image in your signature is not working properly.
Maybe you can replace the OLD one with this - from Imgur



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Yes it should. Major respect to Vitalik Buterin for calling the ICO craze a bubble.


This crash should wipe away all of the speculative excesses and leave the genuine players behind.


I would expect it could be a matter of years before the next bubble, but the next time the general public will likely be involved as cryptocurrencies will be more integrated with the current system.

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I wonder what the "clever" home seller will do with BTC in a crashing market?




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It's hard to say at this point. Seems like the Chinese are very concerned about Bitcoins use to circumvent their capital controls. The weak link in this market is the centralised exchanges, vulnerable to regulation and targets for hacking.


When Bitcoin got to $5000 it really seemed like a mania, so I would be very surprised if it quickly got back to $5000.


I think it seems more likely that we switch into a bear market. Cryptocurrency has exploded into the mainstream this year, which was the premise behind all my purchases earlier this year, but I reckon it's gone too far so we need to consolidate for a bit. Bitcoin went to $1200 then back down to $100 a few years back. I don't think we will see that style drop again, but I do think we should get down to $2000/$2250 mark at some point.


It's still very early days, Joe public is not in this trade, this is a revolutionary technology wrapped up in a lot of hype and speculation.


I definitely think this could be an interstellar market in coming years once we get more infrastructure in the space, more mainstream adoption etc.


I'm planning to make some more purchases in some cryptos that might have long term potential.


A couple that look interesting;



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Interesting article




"Natural News) In a recent CNBC interview that’s being widely touted by self-deluded Bitcoin promoters as some kind of “smack down” of JP Morgan CEO Jamie Dimon, Bitcoin advocate John McAfee accidentally admitted why Bitcoin is a total fraud that’s doomed to fail.

In answering Jamie Dimon’s recent declaration that Bitcoin is a fraud, McAfee replied: (see the video at The Daily Sheeple)

"However, sir… you called Bitcoin ‘a fraud.’ I’m a Bitcoin miner. We create Bitcoins. It costs over one thousand dollars per coin to create a Bitcoin. What does it cost to create a U.S. dollar? Which one is the fraud? Because [the dollar] costs whatever the paper costs, but it costs me and other miners over a thousand dollars per coin – it’s called ‘proof of work.’

Behold the logic of artificial work: How John McAfee just embraced Paul Krugman’s ditch digging fable

The problem with John McAfee’s explanation, of course, is that it admits Bitcoins can only be created through the practice of computational wheel spinning operations where the difficulty and duration of such wheel spinning is artificially made needlessly complex by the Bitcoin algorithm. In a world where Bitcoins used to be created for less than one penny’s worth of computational work, a single Bitcoin now requires over US$1,000 worth of “artificial work” to be achieved. A rational person must ask McAfee, “Why did Bitcoins used to cost just a penny to create, and now they cost a thousand dollars?” The 100,000 X increase in complexity for generating a Bitcoin, it turns out, is an artificial work algorithm known as “computational difficulty” in mining.

This admission should be shocking to all Bitcoin holders for the simple reason that if Bitcoin drops below $1,000, mining now becomes unprofitable, rendering a very large part of the entire Bitcoin mining infrastructure instantly obsolete. The only thing keeping Bitcoin mining profitable right now is the bubble pricing of Bitcoin itself, and because all bubbles eventually burst, Bitcoin mining will sooner or later reach a point where it’s not worth the investment of hardware, electricity and time. (There’s also the 21 million coin limit that’s rapidly approaching, by the way, which will spell the end of Bitcoin mining as it is conducted today.)

Furthermore, the “artificial work” aspect of Bitcoin mining and its artificial computational complexity is the digital equivalent of paying people to dig ditches and fill them in again while claiming the activity boosts economic output. This idea, believe it or not, is the classic economic paradox routinely pushed by left-leaning economic myth-meisters like Paul Krugman. Those of you who follow economic news know that Krugman openly and wholeheartedly believes that government could boost the economy by literally paying millions of people to dig ditches and fill them in again. This artificial work generates real-world abundance, according to economic fools like Krugman. That’s why Zero Hedge rightly posts an article entitled, “Why Paul Krugman Should Go Back To 5th Grade.”

And yet Paul Krugman’s ditch-digging artificial work is actually no different than John McAfee’s Bitcoin mining artificial work. In both cases, McAfee and Krugman ridiculously claims that work along has intrinsic value, even if little or nothing is actually accomplished in the real world. According to McAfee, computational expenditure automatically equals value, even when the notion is patently absurd to any rational person. If CPU cycles equaled wealth, then no one in the world would ever have to work again because people could just run computers all day and let the CPUs create wealth.

Any belief in such a system is, of course, irrational and absurd. There is no such thing as a perpetual wealth-generating machine unless you own the money supply itself and can hoodwink others into trading their effort for your currency. That’s what the Federal Reserve does, of course, and that’s the entire con of the Bitcoin Ponzi scheme: To recruit as many people as possible into the Bitcoin scheme so that they pay you cash in exchange for your CPU cycles.

To produce artificial work, Bitcoin consumes enormous resources

Bitcoin’s “proof of work,” in other words, is nothing more than artificial work. Yet what is the real world result of such artificial work? While generating absolutely nothing that’s real in the real world — remember as Steve Quayle says, “If you can’t touch it, you don’t own it” — the Bitcoin mining process consumes enormous amounts of electricity, computing hardware and time. Yet in the end, there’s nothing to show for all that work except for carbon dioxide emissions and mercury pollution from the Chinese coal plants that power nearly a third of global Bitcoin mining. Bitcoin, in fact, has become one of the key vectors of environmental pollution that’s causing hazardous air in California’s cities.

McAfee claims that “artificial work” is actually “proof of work.” In reality, it’s proof of nothing more than the incredible stupidity of the mining infrastructure which is now burning more electricity than a city of one million people just to keep the Bitcoin blockchain from collapsing.

“Surely there’s some value in the work that we did to create the coin,” McAfee stated. But actually, there isn’t any real-world value in it at all. Bitcoin is a digital fiat currency backed by nothing, and all the “work” used to create Bitcoins is actually “artificial work” that’s made artificially complex for no logical reason other than a crude mechanism for artificial scarcity. Yet even that scarcity is a complete failure, since any person can create and launch their own cryptocurrency alongside Bitcoin, instantly creating a massive new supply of crypto coins that flood the marketplace. (And many newer cryptos are vastly superior in design to Bitcoin. For example, Z-cash…)

On top of all that, Bitcoin is clearly not a store of value, and recent research by Princeton scientists found that Bitcoin isn’t anonymous, either. Bitcoin is also highly subject to government regulation, as the recent market plunges clearly demonstrated, following the announcement of China’s largest Bitcoin exchanges closing their doors. Liquidations of Bitcoin by Chinese investors are already underway and will continue through September 30th.

One by one, all the promises we were told about Bitcoin have unraveled: It isn’t anonymous, transactions aren’t “instant,” transactions aren’t “free,” Bitcoin isn’t a reliable store of value, it isn’t immune to government regulations and so on. Yet John McAfee, in his self-deluded cluelessness, points to artificial work and says, essentially, “See? We’re expending CPU cycles for all this! Doesn’t that have value?”

Actually, it doesn’t, Mr. McAfee. It has no more value than the GPU calculations of a nine-year-old kid playing a first person shooter on a Saturday afternoon. Yeah, his rig is running all sorts of complex calculations, but at the end of the day, there’s nothing to show for it other than Cheetos crumbs that fell between the cushions of the couch.

Computation does not automatically equal value

Computation alone does not equal real-world value. John McAfee’s attempt to conflate the two ideas only shows how deeply he has deluded himself about the future of Bitcoin. And those who falsely believe that computation equals value are only allowing themselves to be fooled by this non-logic for the simple reason that they all own Bitcoin — i.e. Bix Weir and others — and can’t come to grip with reality without admitting they were wrong all along.

The bottom line? Bitcoin is headed for failure, but cryptocurrency is here to stay. The most likely long-term scenario in all this is that we’ll see a cryptocurrency backed by JP Morgan and the government — a blockchain with built-in NSA snooping and an identity layer so that all transactions can be tracked by the IRS to enable government confiscation and criminalization as deemed “appropriate” by the crooks in Washington.

Once this “approved” blockchain is rolled out, it won’t be long before government finds a way to criminalize all “unapproved” blockchains such as Bitcoin, Ethereum, etc.

And how hard is it for government to criminalize Bitcoin? Not hard at all: It’s a simple matter to run a false flag dirty bomb operation — the FBI already masterminds and executes terrorist plots every day across America — then make sure the “bad guys” who are recruited into the sting operation are fully funded by Bitcoin.

A few hours later, the fake news New York Times will declare, “CHICAGO DIRTY BOMB TERROR PLOT FUNDED BY BITCOIN.” And the house of cards falls like dominoes. The entire media will be directed by the CIA to describe Bitcoin as a “currency for terrorists, murderers and drug dealers,” and Bitcoin will be targeted in exactly the same way the Silk Road was taken down. A few Bitcoin promoters will be imprisoned, the government will claim it’s “fighting terrorism,” and the clueless sheeple of society will applaud the news that they are being “protected” by authorities.

Seeing all this play out is as clear as day. And why is this so obvious? Because we are all living as slaves in a totalitarian society run by fake news, fake terrorism and fake authority.

Will that totalitarian regime allow all their central banks and government currencies to be made obsolete by a libertarian cryptocurrency they don’t completely control? Of course not. And anyone who believes Bitcoin will overthrow the globalist money / debt cartels is naive and stupid. Trust me when I say a bunch of geeks aren’t going to overthrow centuries of globalist money domination that now rules our corrupt world."

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