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    [Daily Discussion] Sunday, December 31, 2017 Bitcoin Markets

    [Daily Discussion] Sunday, December 31, 2017 Bitcoin Markets


    [Daily Discussion] Sunday, December 31, 2017

    Posted: 30 Dec 2017 08:05 PM PST

    Thread topics include, but are not limited to:

    • General discussion related to the day's events
    • Technical analysis, trading ideas & strategies
    • Quick questions that do not warrant a separate post

    Thread guidelines:

    • Be excellent to each other.
    • Do not make posts outside of the daily thread for the topics mentioned above.

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    submitted by /u/AutoModerator
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    Pump and Dump groups

    Posted: 31 Dec 2017 06:08 AM PST

    Careful out there people. A ton of these "bump and dump"groups have formed. They are not here to help you. They begin before communicating, get their position and let you take all the risk, while they profit. Just use your brain and invest wisely. Just manipulation at baby guppy level,

    submitted by /u/Thump604
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    Bitcoin Tech Rant - Happy New Year: Atomic Cross Chain Swaps

    Posted: 30 Dec 2017 04:50 PM PST

    Hola,

    I didnt have much success with the last Tech Rant, so I decided to do another. Please provide feedback.

    So the topic for this tech rant is Cross Chain Swaps. They're pretty simple, but require a bit of understanding of Bitcoin Script. I will start off with on-chain swaps.

    So, let's assume I want to swap testnet BTC for mainnet BTC with you (for instance if someone wants millions of testnet coins and is willing to pay 0.01 BTC for them). How would you be able to pay me and ensure that you actually get the testnet coins? Well, the easiest way is for us to agree that u/jaderadej will be our escrow. We both trust him, so we he generates an address and provides this address to the both of us. We then each generate a new address and provide it to u/jaderadej. At this point we both send our coins to the address he generated. One tx on testnet and the other on mainnet. As soon as u/jaderadej receives the coins from both of us, he does the swap (minus his "fee"). If I send coins but you dont, then he sends them back to me. If you send coins but I dont, then he sends them back to you.

    Now, this works fine as long as we both trust u/jaderadej, and we do, but what if the only person willing to do it is u/pineconecandle. Well, I dont trust u/pineconecandle ;), so why would I do this deal? I wouldn't. Hence, we need to do it without a third party. And this is possible in Bitcoin.

    The first thing you need to understand is how OP_IF works. Basically OP_IF allows you to create a conditional branch of your PubKey Script. The second thing you need to udnerstand is how OP_CLTV works: OP_CLTV stands for Check Lock-Time Verify. It is an OP_Code that accepts an integer as input, which is either interpreted as a unix timestamp or as a block number (there is a convention on when the integer is interpreted as which, you can google it if you care). So now we can create a PubKey Script on a UTXO that has one PubKeyScript branch OP_IF OP_CLTV <lock time> {Script1} OP_ELSE {Script2}

    Ok, so enough with the preliminaries. On to the actual protocol.

    I have testnet coins and you want to buy them. So what you do is you generate a random byte string (some random sequence of bits with enough entropy to ensure I cant brute force it before the lock-time we agree upon is up. If you use a cryptographically strong random number generator that will be fine. You generate this random number and hash it, i.e. OP_SHA256 or OP_RIPEMD160, whichever of the two is fine. Usually you would SHA.

    I generate an address and provide you with the hash of my public key.

    You then also generate a new address and send both the hash and the new hash of the public key to me. You now spend you 0.01 BTC to an output with a PubKey Script like the one above where Script 1 is just a normal P2PKH for your new address and Script 2 is a simple pre-image check combined with a P2PKH for my address, i.e. first hash the first element in the SigScript, compare that it matches the commitment value for the hash and finally check the standard P2PKH Script, i.e. soemthing like

    {Script1}: OP_DUP OP_HASH160 <YourPubKeyHash> OP_EQUALVERIFY OP_CHECKSIG

    {Script2}: OP_SHA256 <HashOfRandomNumberYouGenerated> OP_EQUALVERIFY OP_DUP OP_HASH160 <MyPubKeyHash> OP_EQUALVERIFY OP_CHECKSIG

    Now, eventually I will see this transaction show up on the mainnet blockchain. Since you are the one looking to buy from me, you pony up the cash. Now, if I change my mind and walk away your coins are not gone. Once the lock-time is up, you can just use you knowledge of the private key to your address to create a SigScript that satisfies Script 1 above. So far no trust needed... you will NOT lose your coins.

    Ok, but I want to sell my testnet coins, so I decide to Pony up the testnet coins. I spend them to an output with the same PubKeyScript, only that I reverse the roles of our public key hashes AND more importantly, I cut the lock-time in half. Since you have the hash, I want to make sure I get my coins back before you can take your BTC back, otherwise you could take both.

    So now I spend to that and you see it show up on the testnet blockchain. If you decide to walk away, thats fine. I can just get my testnet coins back in half the time you can. Again, no trust needed. Why? Well, even though you know the secret random number, since you dont control the private key associated to my address, you wont be able to satisfy the pubKey Script to take your BTC back and you cant take my testnet coins without revealing the secret random number in the SigScript of the spending transaction. Since all SigScripts are public information, you cant spend my testnet coins if you want to keep the random number secret.

    Let's assume we went through all this hassle to actually do the deal. So, now you spend the testnet coins to a new address that you control (P2PKH) by revealing the random number and providing a SigScript for the address you control in the OP_ELSE branch of the PubKeyScript.

    As soon as you do that, I see the random number, and I can now spend your 0.01 BTC to an address I control using the Secret Random Number You revealed to me, along with the SigScript for the P2PKH of the address I control.

    And voila. We just exchanges testnet BTC for mainnet BTC in a trustless fashion with no trusted third party using some pretty simple Cryptographic primitives. Done deal.

    Now, notice a few things:

    1. You need to wait a bunch of confs before this can be done, because you want to avoid double spending of your counterparty (whom you do not trust)

    2. Tetsnet is kinda a stupid example, because its pretty easy to reorg the chain. I just didn't wanna mention another coin.

    3. In Lightning this can be done instantly. No need to wait for confs and no need to wait too long for lock-times to expire. Basically it is achieved by routing the payment to yourself on the Lightning Network. You can also combine on-chain swaps with off-chain swaps. Pretty cool stuff. This is basically how decentralized exchanges would work on Lightning.

    Ok, done. Hope you like it!

    submitted by /u/L14dy
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    Prediction markets

    Posted: 31 Dec 2017 09:16 AM PST

    Hi all,

    In 2015 there was a big hype around prediction markets. I am wondering if this has become a thing already. If so, which markets are people using nowadays?

    Thanks

    submitted by /u/arivar
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    Is there evidence of Elliott's Wave theory on Bitcoin market trends?

    Posted: 31 Dec 2017 07:45 AM PST

    Thought experiment: what happens to Bitcoin market cap if mBTC is the base unit (1 mBTC = $13.08)?

    Posted: 30 Dec 2017 06:49 PM PST

    I've recently been thinking that a lot of the price action has been driven by new market entrants feeling 'priced out' of BTC – meaning they feel that if they can't afford a 1 btc, why bother. That has driven a lot cheaper, less fundamentally promising (imo) coins to insane levels.

    If exchanges moved to mBTC as the base unit, do you think Bitcoin market cap would explode and accelerate adoption? Or do you think this has nothing to do with it, people genuinely believe in the underlying tech of other coins.

    submitted by /u/rab_eye
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    Aftermaths of the August 2016 Bitfinex Hack.

    Posted: 30 Dec 2017 12:36 PM PST

    In August 2016, Bitfinex was hacked for about 120 000BTC, which was valued at about 72$ Million at the time. Following the hack, Bitfinex put in place some mechanisms to repay their customers, including the Recovery Right Token (RRT). This token can be redeemed at a value of 1$ in the event some of the stolen BTC were found. In total, about 30 000 000 RRT were created.

    One year later, the stolen BTC have not been returned, but they are stricly monitored on about 2000 different addresses.

    About 30 000 000 RRT are in circulation, and they are valued at about 0.18-0.23$/ RRT. Because BTC value exploded in the last year, only about 2300 BTC need to be returned to bitfinex to repay each of the 30 000 000 RRT at a face value of 1$. This represents 2% of the stolen BTC.

    You can also see that there is a volume surge on the RRT/BTC graph in the last few days. https://i.redd.it/ogr5nj8t1j601.png

    This surge amount to about 100 000 000 RRT in trading volume, which is 3 times more than the total amount of RRT in circulation. This seems oddly strange.

    How would you rate the chances of these token being redeemed at face value in the future?

    submitted by /u/KingVW
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    Would you still hold onto an expensive Porsche you bought because it hasn't technically depreciated all the way but can't accelerate faster than 20MPH?

    Posted: 31 Dec 2017 07:32 AM PST

    Serious inquiry contemplating all the previous HODLER posts. Let's talk theories of "value" in the comments. What makes something worth something. Etc. Because this community doesn't seem to grasp simple economic concepts.

    submitted by /u/HardRealist
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    which country for low tax or 0% tax on crypto trading/scalping

    Posted: 30 Dec 2017 04:54 PM PST

    Hi do you know where i should go to have low tax, i heard ukrain but cant find any confirm, if someone can help me 100% it would be very kind, i am a bit in emergency

    submitted by /u/sellthetop
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    At what stage of a trade are Exchange's fees deducted?

    Posted: 31 Dec 2017 05:11 AM PST

    If I sell 0.1BTC for LTC - is 0.25% of my 0.1BTC deducted first, or is 0.25% of the final LTC amount deducted after the trade?

    submitted by /u/PM_ME_WELSH_STUFF
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    Some noob questions

    Posted: 31 Dec 2017 01:32 AM PST

    Hi all. I have known about bitcoin for a few years but have only just started investing. Right now, I have got a similar amount of coins in several altcoins. I have a few questions.

    1) I am buying ETH on Coinbase, transferring this to GDAX (ETH to ETH), then transferring this to Binance (ETH to ETH). I can then use it to buy altcoins. Is this the best way to do it?

    2) If I wanted to transfer from altcoins back to FIAT would I do the opposite of #1? What kind of fees would be incurred (GBP)?

    3) I buy ETH on Coinbase using debit card. This costs me about 4% in fees. Is there a way to avoid this or reduce fees? Note that I am only dealing with amounts of ~£1k (GBP) right now.

    4) Since altcoins are extremely volatile right now. What is the best way to store profit when an altcoin goes high so you can buy back in later? Most coins seem volatile at the moment. ETH seems the most stable? Or should profit always go back to your FIAT wallet on Coinbase? Again, what kind of fees would this incur?

    Thanks for any help offered.

    submitted by /u/ColdfusionD2
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    Remember 'big money' looks at the 1 day candle charts, so lets join them

    Posted: 30 Dec 2017 11:22 AM PST

    This is a repost of one of my steemit posts, you can find the original here

    As the title says the most looked at chart by experienced traders is the 1 day candle. By 'big money' and 'experienced traders' I am referring to the wave of institutional money that is hypothesized to be flowing into the space.

    So I thought it might be useful to look at the 1 day chart and highlight a few of my thoughts.

    ![](https://steemitimages.com/DQmPfvFgUSYR9Fn2zs9KKmZc1KVWRv2vtwonAmnG3vGE7aU/image.png)

    The chart covers the last 4 months, most of the lines are from the indicator 'ichimoku cloud' which has the standard values.

    Also here is the green, orange, red and blues lines that are the 30,50,100 and 200 moving averages.

    The 2 parallel straight yellow lines are lines I drew in the represent the top and bottom of a year long channel I believed we were in, which we broke out of around 26 november.

    Mostly bullish

    Firstly I'd like to point out that the chart is mostly bullish and you can still defend a long position using it.

    The cloud is green and price is above it, the price is above the 50,100 and 200 day averages and price is still above the year long trend channel.

    Most positive and recent is the fact that in has twice bounced off the 50 day moving average and in the last few hours may of bounced a third time (it will require a few days to confirm this)

    Warning signs

    ![](https://steemitimages.com/DQmPNZxKEsuZa3qsyXPRUromENa6ydyv8sJzLNm57J3QYL3/image.png)

    Between the 7th and the 17th of this month we got a bit of a divergence on the RSI, the red lines. Which likely would of got you reducinging your long, at the least.

    Then just a few days ago we got the tenkan (light green) and kijun (light red) lines cross bearish. Again not a sign to short but definitely a sign to reduce your long more and maybe close it.

    What to look for in the next week or 2

    I will be looking at whether that 50 day moving average holds as a support, especially with it being so close to the long term trend line.

    I have/had buys set at both points, the low 12's hit and I am long again. I will be looking to increase to those the next day or two if the 50 line holds.

    Bearish possibilities

    The aforementioned long term trend line, currently at around 11k which is also the recent low, needs to hold or we could see a retest of the bottom part of the trend (bottom yellow line). This edge to edge fall would likely take weeks and could put us somewhere in the 7k region.

    ![](https://steemitimages.com/DQmQXpYSxrvdQ2KhHTYJpsPNpJzVgWw8DkJ9agz5Kq2yWSC/image.png)

    My plan

    As said I had some buys hit at low 12's and will add to them if we are above ~$13500 tomorrow.

    I then have buys set around 11K for an expected bounce of the long term trend line. Stops for both of these are soft stops around 9.5K.

    This will also be the spot where I will think about getting into a short down to the 7k region, I am quite long term bullish with the expectation of an ETF and institutional investors continuing to enter. So I may just use the fall as good entries rather than a small short.

    Thanks for reading. Would love to hear some feedback and what you agree with and/or disagree with.

    p.s As I wrote this it seems the bounce on the 50 average might be real




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    submitted by /u/kilmarta
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    Cost Effective BTC to fiat conversions for a UK Bank Account

    Posted: 30 Dec 2017 12:50 PM PST

    Hi All,

    Newbie question here.....

    I'm thinking about cashing in some of my crypto profits to use as a deposit for a house.

    I'd like to transfer the money to my HSBC Bank Account but am struggling to figure out the best way to do this.

    Does anyone have any experience of doing this in the U.K? Whats the quickest, easiest, cheapeast and most secure way of doing this? Is there a one stop shop?

    I see Coinbase lets me transfer into GDP or Euro but has a limit of €16,000 per week and I imagine the fees are quite high too.... I've spoken with my bank and the good news is they do accept 'SEPA' transfers.

    I also need to ensure I comply with UK Capital Gains Tax- anyone know a good accountant to speak to?

    Thanks!

    submitted by /u/kirkey21
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    Why are you requesting a higher limit?

    Posted: 30 Dec 2017 10:51 AM PST

    Edit: I meant the withdrawal limit for withdrawing fiat to my bank account.

    Hey people!

    On some exchanges you have to give up a reason for why you want to increase your daily withdrawal limit. What kind of answer would be appropriate for this? I mean, what if your reason is just that you want to trade with big amounts because you expect to make big profits?

    Is that a sufficient reason or are they very strict and want a specific kind of answer? If so, what kind of answer would be good?

    Looking forward to your opinion. Thank you!

    submitted by /u/xbcc
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    Shorting Bitcoin as a US resident?

    Posted: 30 Dec 2017 04:29 PM PST

    I can't use Bitfinex or Bitmex for obvious reasons. Are there any reputable markets that will let me short Bitcoin?

    submitted by /u/EatsButt
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    "Bitcoin will trade under $5,000, warns Dennis Gartman" - what would you have said one year ago if someone had predicted this headline to appear end of 2017?

    Posted: 30 Dec 2017 01:41 PM PST

    Looking for the ability to chart two exchanges on the same graph?

    Posted: 30 Dec 2017 01:14 PM PST

    Hello

    Specifically, I'm looking for the ability to have a live chart of Bitstamp & GDAX LTC/BTC overlayed on each other.

    Is this possible anywhere?

    submitted by /u/PM_ME_WELSH_STUFF
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    Can I margin trade BCH on GDAX?

    Posted: 30 Dec 2017 04:23 PM PST

    I have some magic internet money from the fork. I would like to margin trade the BCH. I already have a coinbase account, can I margin trade on GDAX? I've been playing around with it the last 15 minutes and can't figure out how to do it. I use to play around with margin trading BTC on bitfinex and figured that out just fine but this is alluding me. Thanks.

    submitted by /u/Spaceman_Spliff
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    Are you killing it at trading because of how informed you are? We Want You.

    Posted: 30 Dec 2017 11:51 PM PST

    Whats up guys? We are launching a news app Q1 thats in beta. Our goal is to bring together great trading minds who keep well informed on breaking news, so that we can push news to all our followers fast. If this sounds like you and you're interested in being a staff member for our app team then please PM me.

    We plan to release the iphone and android version within 2 weeks to beta testers, our goal is to allow the average day trader to be informed immediately of big news which could affect the price of coins.

    submitted by /u/ThinkCryptocoin
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