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    Cryptocurrency Daily Discussion Megathread - November 23, 2018

    November 23, 2018

    Cryptocurrency Daily Discussion Megathread - November 23, 2018

    Daily Discussion Megathread - November 23, 2018

    Posted: 22 Nov 2018 09:42 PM PST

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    submitted by /u/CryptoCurrencyMod
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    This sub is a mess and needs to get out of the anger stage: How to move forward from the crash if you're a bagholder

    Posted: 22 Nov 2018 10:46 AM PST

    Back in December 2017 I did a valuation attempt of Bitcoin on this sub and got around 5K with some grossly optimistic assumptions. Its taken a long time but finally gone down below that.

    You've probably heard many people tell you it would eventually happen back in December 2017 and to reduce expose to crypto (including me), but when you're hyped up on 20% gains every week its hard to be cautious or engage in defensive measures. To many the last quarter of 2017 and into early 2018 was like a beach party with coke and Victoria Secret models. Who wants to listen to someone tell you about how you're gonna crash hard with a headache the next morning?

    With this latest crash, Bitcoin's price is back to roughly mid October 2017, which is roughly when the mainstream mania started. Many on this sub entered after October 2017 and hence are now left holding heavy bags. Many are down 80% or even 90%. Here is the current losses from ATH for the top cryptos:

    Asset Loss from ATH
    BTC -77%
    XRP - 88%
    ETH -90%
    BCH -95%
    XLM -79%
    EOS -83%
    LTC -91%
    ADA -96%
    XMR -85%
    TRN -96%

    Who do we blame?

    At a time like this its easy to get angry, to look at someone to blame. Whether Roger Ver and the hash wars, whether BAAKT delay, whether whales or SEC or institutions, everyone has their favorite boogeyman. No one thing is the reason why the market is down 80%.

    The reality is that Bitcoin (and all other crypto by extension) was ovevalued even by grossly overoptimistic measures. Its not BAKKT or the whales trying to get your coins for cheap. The same people who were buying at near peak bubble thinking they were getting into the chance of a lifetime are prone to look for someone to blame for their losses, when it was actually their fault for buying near the end of a mania.

    Nobody wants to admit that it was their own greed, lack of research and irrational behavior that lead to the gross overvaluation of all cryptocurrency.

    Is it over yet?

    The $6K consolidation was likely a result of the market coiling tighter and tighter around the mining breakeven point for some of the smaller miners. The big firms in China are profitable mining below 6K, but many smaller ones in the US and Europe aren't. You can actually see the total hash rate going down. Once it broke it was a big fall straight down.

    Bitcoin is mined at 12.5 BTC. per block at 10 minute blocks, which comes out to around 1800 BTC every day. This 1800 BTC has to be absorbed by every day, which means the following at different price levels:

    Price Level Daily net buying needed to absorb mined coins
    6000 $10.8 million/day
    4500 $8.1 million/day
    3000 $5.4 million/day

    At the current price, at least theoretically $8.4 million in demand is needed to cover the mining output. Of course the miners don't immediately dump it all, but it shows why miners have an incentive to keep the price high and try to incite FOMO with a BGD.

    I can also see that after this latest drop, the "buy the dip" sentiment had substantially gone down, at least compared to the other fast drops in price. This is especially discouraging those who were waiting for the "November bull run", which never came. Its clear to more people now that this probably isn't just downward correction that will reverse, but a multiyear bear market. This is why the bounce has been so weak compared to earlier in the year. Compare that to the last two big 2 day drops:

    • March 29 - April 1st (drop from 8K to 6K): Within 2 days it bounced back up to 7.5K

    • June 22-24 (drop from 6.8K to 5.8K): Within 2 days it bounced back to 6.3K

    The weakness of this current bounce says it all, people are no longer optimistic that BAKKT or ETF or any other catalyst will lead to a bull run that they can cash out quick. It may be a period of stagnation followed by further drops as big holders take profits.

    I also think that the FED tightening with rate hikes is leading to a lot more volatility not only in stocks, but crypto as well. Right now asset deflation seems to be a global macro risk as cheap credit dries up, and Bitcoin surely isn't immune from this.

    My personal view is that at this point we may see further declines, but calling what's going to happen next is always dangerous. A whale (especially a big mining operation) with a series of large orders to clear out the order book on Bitfinex could give us a BGD out of nowhere at any time and take us back to 6K, it would be interesting to see how the market reacts to something like that. But I'm not betting on it leading to any sustained rally past 10K. Quite the opposite.

    So what's a crypto shrimp to do? I'll split my thoughts into two, for those who are still in the green and those in the loss.

    If you're still in the green

    If you're still in profit, this is a great time to consider how much more downward selling you can take and also how you can hedge downward risk.

    If you're someone who purchased when Bitcoin was below $1000, you should calculate your compounded annual ROI and decide if that return is good enough for you. For equities, the long term average is about 10% per year, 20-30% in a good bull market.

    Its your decision, but taking out profits that exceed principal and reinvesting the principal is not at all a bad idea. For those who invested before Bitcoin reached $1K (April 2017) the current price is still an insane return that no other asset class can match.

    Another important thing is to think about how you can hedge the risk of downward movement. This is where derivative exchanges are very useful, although you do need to do some research on how derivatives work and how to not get liquidated. If you have substantial holdings, the effort to learn this is worth it.

    The basic idea is that you can buy short contracts that increase in value as Bitcoin goes down, proportional to the amount of leverage you put to finance the contract. If managed correctly, you can protect your entire stack with a portion as leverage. Its something commonly done by miners, who short Bitcoin with derivatives to hedge their holdings.

    If you're in the loss

    The untold reality is that HODL is a meme told to newbies to prevent panic selling during a downturn while the smart money cashes out in a more orderly fashion. But does that mean you shouldn't hold if you're already down massively?

    Well that depends on your own life situation, how much you've invested, and if you don't need the money for the next few years.

    Mathematically, whether it drops to 4.5K or 3K from the reference of 6K is highly meaningful, its a drop of 25% or 50%. But if your reference starting point is much higher, then it really doesn't matter all that much. A drop from 17K to 4.5K is a 74% loss while down to 3K it would be 82%, massive losses either way. In that sense if this is money you don't need, it makes sense to simply have it stored in a wallet and forget about it for a few years. Who cares if it drops further after a certain point if you don't plan to take it out for a while? Its like in equities markets where people with massive losses don't sell, but instead move the loss position into their retirement fund where they don't plan to take it out for a long time and thus are giving it time to rebound back.

    But what if its money you need? What if like many out there you took out loans hoping to catch a run to 50K? If you have high interest debt (credit cards...etc), focus on paying that down first. Credit cards generally have high interest and many compound daily, so pay down the debt first rather than trying to pay your debts off with a crypto bull run that may take years to materialize.

    This is also a good learning opportunity. It is worrying how few people who hold crypto have a clue what any of this even is or how it works. I've always recommended this video to explain how Bitcoin (and other cryptocurrencies) actually work.

    A good thing to do during catastrophic losses is to honestly access why you got suckered into buying high in the first place. Most people here are young, and this is a valuable lesson in why you shouldn't follow the herd. Everyone is a genius in a bull market, everyone is chasing the next hype. Crypto tends to attract people looking for a get-rich-quick-without-effort crowd, but it takes some mental effort to understand this beyond the buzzwords. Take the time to understand the fundamental reasons why an asset has value and what factors would drive its rise once the hype dies down. What makes Bitcoin valuable, what makes some of the other cryptoassets valuable? If those fundamentals in some way changes, so should your opinion.

    Its also a great opportunity to help in its adoption by using it. The irony of it all is that people demand that they get rich because of the hard work of buying a bunch of crypto in an exchange and transferring it to their wallet, without any understanding what they're buying into.

    Also don't be angry. Don't look to blame. Look to learn and improve next time you invest.

    submitted by /u/arsonbunny
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    Weekend Meme: Bitcoin Cash - Satoshi's True Vision ™

    Posted: 23 Nov 2018 02:31 AM PST

    GloBee discontinues BCH / BAB support for over thousand merchants

    Posted: 22 Nov 2018 07:23 PM PST

    Embrace the bear market! Let the bear hold you, lick you and sniff you. If you try to run, the bear will maul you!

    Posted: 22 Nov 2018 02:30 PM PST

    IOTA Outlines Plans To Remove 'Coordinator' Nodes

    Posted: 23 Nov 2018 02:18 AM PST

    Bitcoin is close to overtaking MasterCard by the amount of value transferred daily

    Posted: 22 Nov 2018 11:29 PM PST

    Bitcoin is close to overtaking MasterCard by the amount of value transferred daily

    Bitcoin is close to overtaking MasterCard by the amount of value transferred daily, with bitcoin moving $8 billion in the past 24 hours while MasterCard averages $11 billion a day

    https://i.redd.it/7100z9yw81021.png

    We can't see Ripple's data as they're not really a public blockchain – or a blockchain at all – but all cryptos in combination probably transfer about as much value as MasterCard despite having a far lower capacity in transactions per second.

    That may be because one cryptocoin is usually worth far more than a dollar. A crypto transaction, moreover, can be in the billions, while MasterCard is usually used to make very small purchases of $20 dollars or so.

    Visa handles far more at about $30 billion a day or $11 trillion a year according to their self-disclosed stats. That's with a capacity of 65,000 transactions a second.

    Bitcoin can handle only about 7 tx/s on chain, or about 0.01% of Visa's. Yet bitcoin transfers about 25% of Visa's amount of value processing.

    It isn't very clear why so many bitcoins are moved daily, usually at circa 5%-10% of its market cap. One could say these are transfer to and from exchanges, but all bitcoin exchanges handled about $7 billion in trading volumes during the past 24 hours.

    Many of those trades would have been different people trading the same coin on the same exchange without touching the blockchain. So without having hard stats, it is probable that much of this $8 billion is economic activity but of a different kind to credit cards.

    While credit cards handle small transactions, the media value of a bitcoin transfer is about $400, with the average being circa $27,000. Meaning bitcoin is being used as a sort of settlement layer by businesses.

    Businesses specializing in international transfers, for example, could make just one high value transaction to transfer the funds. Likewise, for someone like BitPay, they could bundle transactions to pay merchants weekly or monthly.

    Much of the activity, therefore, probably occurs off-chain, with the public blockchain used sparingly. Yet that off-chain activity must be very considerable if $8 billion is being transferred daily on-chain.

    That's a substantial portion of the entire economic activity in US and Europe. Partly perhaps because bitcoin is fully global, giving it a bigger market and thus presumably giving it more use cases.

    Source

    submitted by /u/blockchainified
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    Watching the market charts be like

    Posted: 22 Nov 2018 05:45 PM PST

    November, 30, 2018, just after Disrupt Berlin. r/PandoraBoxchain Meetup: Building Decentralized #FREEAI.

    Posted: 23 Nov 2018 03:12 AM PST

    Shoutout to kucoin

    Posted: 22 Nov 2018 11:22 AM PST

    The other day I was real drunk and I accidentally deposited a lot of PCHAIN to the matrix ai deposit address on kucoin. I figured I was probably toast and there was no way I would ever get it back. The support from kucoin actually gave a brotha a hand and returned my funds very quickly with only a very small fee. Very pleasant surprise from an honest and great company big smiles for kucoin.

    submitted by /u/xTremeSwag
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    Warning: KYC procedure with passport scan and selfie.

    Posted: 22 Nov 2018 06:22 AM PST

    Dear all,

    Over the last couple of months I've seen many posts of people that got their funds stolen from exchanges. In some cases 2FA was reset without the user's consent.

    What I have also noticed during that period is ICO's popping up everywhere, asking for KYC before getting "free" tokens airdropped.

    The KYC procedure often requires sending a passport scan and/or selfie.

    Now know this...The average price of a digital passport scan on the dark web is $14.71. If proof of address or proof of identification (a selfie, utility bill and/or driver's license) is added to a passport scan, the average price jumps to $61.27.

    That's one way for people to make money using your information. The next step however could have far bigger consequenses when they use the info to steal your funds from exchanges.

    Eg.

    • The target has an account with a cryptocurrency exchange. They've set up two-factor authentication on their account, so a code is sent to an app on their phone to verify logins.

    • Through some other means, the scammer steals the user's password (perhaps through phishing or a data breach or by simply using the same password the user used to create an account on an ICO website). But because 2FA is enabled on the account, they can't get in.

    • Instead, the scammer poses as the victim and approaches the cryptocurrency exchange, saying they've lost access to their phone and cannot get the authentication PIN, and thus cannot log in.

    • The cryptocurrency exchange requests the account holder send a scan of their ID to prove their identity before resetting the 2FA on the account. In many cases, companies will require the person take a selfie while holding the ID, hence the higher price for passport scans with selfies.

    • The scammer modifies the scans from the dark web as necessary to match the demand of the exchange (Eg. name of exchange with date), then sends it to the exchange, still posing as the victim.

    • Upon receipt of proof of identity, the cryptocurrency exchange resets or removes the 2FA on the account, allowing the hacker to access and drain the victim's crypto assets. Hackers routinely change the passwords and email addresses associated with accounts to make it harder for the account owner to regain control.

    So be careful who you send your passport scans and selfies to, use a different password for any website/account that is linked to crypto and use cold wallets as much as possible.

    Needless to say that people that sign up for an ICO will most likely have one (or multiple) exchange account(s) aswell...

    submitted by /u/Gamm86
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    How the cryptocurrency market really works

    Posted: 22 Nov 2018 06:38 AM PST

    Once upon a time in a village, a man appeared and announced to the villagers that he would buy monkeys for $10 each. The villagers, seeing that there were many monkeys around, went out to the forest and started catching them.

    The man bought thousands at $10 and as supply started to diminish, the villagers stopped their effort. He further announced that he would now buy at $20. This renewed the efforts of the villagers and they started catching monkeys again.

    Soon the supply diminished even further and people started going back to their farms. The offer increased to $25 each and the supply of monkeys became so little that it was an effort to even see a monkey, let alone catch it!

    The man now announced that he would buy monkeys at $50! However, since he had to go to the city on some business, his assistant would now buy on behalf of him.

    In the absence of the man, the assistant told the villagers; "Look at all these monkeys in the big cage that the man has collected. I will sell them to you at $35 and when the man returns from the city, you can sell them to him for $50 each."

    The villagers rounded up with all their savings and bought all the monkeys.

    They never saw the man nor his assistant, only monkeys everywhere!

    Now you have a better understanding of how the cryptocurrency market works.

    submitted by /u/muchacho_pl
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    Medal of Rekt Giveaway round 2, cos why the fuck not

    Posted: 23 Nov 2018 12:44 AM PST

    Medal of Rekt Giveaway round 2, cos why the fuck not

    ​

    https://i.redd.it/1w47wfuel1021.png

    Will start sending medals at 18:00 UTC time today.

    Its erc1155 token, so for receive you will need ETH address.
    For see/send/melt you will need ENJ wallet.

    If interested , make comment .

    20 left.

    Edit: don't post ETH addresses directly here, DM.

    ​

    submitted by /u/j4c0p
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    Blockchain Platform Eliminates Brokers in Derivatives Trading

    Posted: 23 Nov 2018 01:01 AM PST

    Happy Thanksgiving! Remember that things tend to look the darkest before dawn appears. There may be a rocky and long road ahead for many of us HODLERs but take the time to be thankful in the meantime for what you already have. We can make it through this ����

    Posted: 22 Nov 2018 06:07 PM PST

    On the subject of "I am not fucking selling"

    Posted: 23 Nov 2018 02:58 AM PST

    December 2, one year ago, I started a website with a friend of mine, to manage our crypto "fund". I believe that linking that may be spam. But I am going to link a short blog post, apltly named.

    ​

    https://gromperekichelcher.wordpress.com/2018/11/23/bloodbath-panic-news-and-seas-of-red-a-cryptoland-update/

    ​

    I hope all your bears survive this winter. Keep your collective chins up chappies.

    ​

    Regards

    submitted by /u/CharlerBubbenstein
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    Gibraltar Stock Exchange’s Blockchain Platform Secures Licence From Financial Regulator

    Posted: 23 Nov 2018 03:15 AM PST

    Hoskinson: Satoshi Did “An Amazing Thing”...But There Are Lessons to Learn

    Posted: 23 Nov 2018 12:25 AM PST

    Crypto Losses Near $700 Billion in Worst Week Since Bubble Burst

    Posted: 23 Nov 2018 01:37 AM PST

    LAUNCHED: First Phase of AE Token Migration

    Posted: 23 Nov 2018 03:11 AM PST

    Coin360: Daily Market Overview, November 23.

    Posted: 23 Nov 2018 04:10 AM PST

    Sasha Ivanov on Twitter: Why Proof of Work really sucks

    Posted: 23 Nov 2018 02:58 AM PST

    Even my news is trolling me now...!

    Posted: 22 Nov 2018 11:45 AM PST

    Historical sheet of top 10 crypto by marketcap

    Posted: 22 Nov 2018 10:08 AM PST

    It's official...DORADO(DOR) IS A SCAM☠️ Telegram group is shutting down this week. Find out what to do here!

    Posted: 22 Nov 2018 08:48 PM PST

    Their telegram group is shutting down in a week, there hasn't been any communication from the team for a few months, coin burn and payouts have been delayed and the list goes on of things the team of this shit coin have done.

    If you are a member of Telegram and want more information join a new group that is available when the Dorado group shuts down. @DoradoCommunityUncensored is a place for community members to continue to discuss Dorado and share information that may stop people from buying into this scam.

    The group has grown tremendously in only a couple of days, stop by and ask questions or voice your concerns and see what information community members who have been ignored by Dorado and BCH Support Team have to offer.

    submitted by /u/cb0585
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    Just being a realist here . I am sold my bags

    Posted: 22 Nov 2018 05:29 PM PST

    For those who bought at the top, did you sell already?

    Me i bought at 11K, sold at 6K for a loss. To be honest , i am not seeing this going up anymore (within 5 years) . Its time to stop.

    All of the "optimist" here in there are just bag holders waiting to dump at 10K . And if BTC price is based on the "demand" then its just gonna be dumped and dumped again .

    It was a bubble , im just being a realist here. People keep telling the "greater fool" buy the fuckin dip, just to unload their own steaming pile of bags.

    Name one decentralized app that you use everyday. How can you even say its a "technology" when loghtning network that has been promised for years is still not working and did not improve the TPS of bitcoin, not a bit! (Pun intended)

    All thiis ETH dapps are just for gambling, all this TRX dapps are just for gambling , what the fuck is the use of it . I dont even have money.

    All this "to move 100,000,000,000 dollars" you only have to pay 0.1 cents. Well who gives a shit! I dont have enough money to move , and if i have a million dollars , i wont be giving a fuck about thousand-fuckin-dollars "transfer fee" from banks just as long it gets to where it supposed to be , and have a peace of mind that if ever i get hacked, the funds are secured.

    Store of value? How the fuck can this be the gold when some "imaginary" whale dumps a 1000 bitcoin and the price tanks ? How can this be a store of value when im being taxed by the government for trading this ? 40% per trade btw.

    Whats the use of this? We got ETH, ETC ,Eth Gold and the list goes on and on and on. Whats the difference? I dont know what, the "technology?" ,

    In conclusion, i was drunk with the whole kool-aid of cryptocurrency and now im sobering up.

    Remind me in 5 years or when the promises of a "decentralized" world comes to fruition..

    submitted by /u/jsidethecat
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