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Comment by imron | Hacker News Reader

So now it's what, only 10x what it was this time last year?

How will Bitcoin ever recover?!

I don't own any bitcoin, but I remember when it first hit $1,000 and a few months later it was back down at $200 and I thought, hah, those people who bought in at $1,000 will never make their money back.

If it drops down to $200 again, this time I might even be tempted to buy some.

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You and everyone else, which will drive up demand and price, and thus the cycle continues

I guess bitcoin is a great tool for studying human psychology related to speculation. As it is the most virtual asset one could imagine, backed by absolutely nothing real, there is nothing you can base your analysis on other than « what people think other people will do ».

Not only that, but there is a robust set of public data unlike any before.

> bitcoin is a great tool for studying human psychology related to speculation

It’s distilled animal spirits. No pretense of utility, no room for analysis. A number you can buy and watch go up and down.

I feel like Semper Augustus bulbs and the first bubbles of joint-stock companies give us the flavour of bitcoin and ICOs respectively.

Fiat currencies are a bit similar in that regard (except taxes).

Except they're the official money of a country. that is something the general people often don't understand with fiat currency. The fact that they are the official currency for a country, used to pay the salaries of state employees, and to pay taxes, as well as the central bank policy. All of this gives it an official utility, and thus an official value.

It's also has legal requirements to accept it for settlement of debt, and in practice is issued almost exclusively as repayable debt...

It's way more than that. Currencies vary based on the entire productive capacity of a country. When people decide that Japanese cars are reliable, that Costa Rica's beaches are lovely, or that the Russian private banking system can't be trusted, that dramatically affects the price of currencies. Currencies are a proxy for a country's whole economy not just the public sector.

You could imagine the private sector running on a different economy than the country’s one. It happens when the government has gone bankrupt ( because of war or unsustainable debt, for example). But even in that case, the money still has some value, and can’t completely disappear, even if state employees run to the bank to exchange their salary against us dollar. Their value are correlated to the trust and ability to function of a state.

Some of the cryptocurrencies attempt to have baked in functionality that allows it to have utility past speculation.

The advent of regulation is a new piece of the puzzle however, and more information related to the coins' susceptibility to market manipulation without the scrutiny of regulation may make people think twice. Betting that it will rebound yet again is as much of a gamble as it ever was.

Based on transaction volume the low is going to be much higher than the low last time around. I'd guess under 2k but over 1k.

I think that's a fair guess. I'd also guess there are plenty of people who bought in at around 1k and are thinking to lock in at least some of the gains that were made over the last year.

Maybe they don't get 1,900% gains, but 1,000% gains or even 'only' 100% gains in a single year is still an impressive return on investment and so selling anywhere above 2k is going to be a viable choice for many speculators.

Since we are leaving predictions set in stone (well after delete comment time has passed anyway) here's mine.

Low is around 5K for BTC. Appreciation is much less volatile in the future.

That's a reasonable lower bound. I'm guessing based on the previous major corrections in its value.

I too look forward to finding these comments in the future.

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