Investing

Do you think that bitcoin is a bubble?

  • Last Updated:
  • Dec 11th, 2017 6:16 pm
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Poll: Will bitcoin crash?

  • Total votes: 171. You have voted on this poll.
No
 
52
30%
Yes, to less than $6000 USD
 
21
12%
Yes, to less than $4000 USD
 
13
8%
Yes, to less than $2000 USD
 
7
4%
Yes, to less than $1500 USD
 
2
1%
Yes, to less than $1000 USD
 
27
16%
Yes, to less than $500 USD
 
6
4%
Yes, to less than $100 USD
 
43
25%
Deal Addict
Jun 27, 2007
3246 posts
532 upvotes
xuemike wrote:
Dec 7th, 2017 9:59 am
Look at the CME futures, they do not have underlying asset, it's a buyer and seller market. You can definitely bet against something without the underlying asset, simply put there is someone on the other side betting against you. So no borrowing necessary
you're surely kidding, right?
most futures are backed by some asset. take gold, silver, oil, corn, wheat, treasurys, etc. Except for index futures such as YM, ES, EMD, NQ, VIX
After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: it never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!
Sr. Member
Dec 12, 2009
525 posts
24 upvotes
dlhunter wrote:
Dec 7th, 2017 1:52 pm
you're surely kidding, right?
most futures are backed by some asset. take gold, silver, oil, corn, wheat, treasurys, etc. Except for index futures such as YM, ES, EMD, NQ, VIX

I'm not kidding, it's settled in cash, no delivery of underlying asset.
Deal Addict
Jun 27, 2007
3246 posts
532 upvotes
xuemike wrote:
Dec 7th, 2017 1:54 pm
I'm not kidding, it's settled in cash, no delivery of underlying asset.
corn? soybeans? oil? gold?
Soybeans specs
Gold specs
Crude oil
US 30 year bonds

Settlement Method - Deliverable
After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: it never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!
Sr. Member
Dec 12, 2009
525 posts
24 upvotes
dlhunter wrote:
Dec 7th, 2017 1:57 pm
corn? soybeans? oil? gold?
Soybeans specs

Settlement Method - Deliverable
I'm not sure, those probably have deliverables. However, AFAIK bitcoin does not, so i guess it's not treated as a commodity?
Deal Addict
Jun 27, 2007
3246 posts
532 upvotes
xuemike wrote:
Dec 7th, 2017 2:01 pm
I'm not sure, those probably have deliverables. However, AFAIK bitcoin does not, so i guess it's not treated as a commodity?
nope, it will be like ETN - tracking some exchange.
CBOE will be tracking Gemini price
CME average price on 4 exchanges.

so when one shorts bitcoin future, the outcome will be based on physical trading price. To make sense, they need market makers on the exchange - otherwise it will be similar to bucket shop trading from 100 years ago.
After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: it never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!
Sr. Member
Dec 12, 2009
525 posts
24 upvotes
dlhunter wrote:
Dec 7th, 2017 2:08 pm
nope, it will be like ETN - tracking some exchange.
CBOE will be tracking Gemini price
CME average price on 4 exchanges.

so when one shorts bitcoin future, the outcome will be based on physical trading price. To make sense, they need market makers on the exchange - otherwise it will be similar to bucket shop trading from 100 years ago.
Yes outcome will be based on physical prices. But the settlement doesn't require the contract seller to go on Gemini or the 4 exchanges to buy those coins and then give it to the buyer.
Deal Addict
User avatar
Oct 9, 2008
4099 posts
894 upvotes
Thornhill
xuemike wrote:
Dec 7th, 2017 2:10 pm
Yes outcome will be based on physical prices. But the settlement doesn't require the contract seller to go on Gemini or the 4 exchanges to buy those coins and then give it to the buyer.
I believe the clearing house has the responsibility of this on behalf of the buyer if I'm not mistaken?

Clearing houses stand between two parties in a trade, managing the risk to the rest of the market if one side should default. They are mutually funded in part by banks to guard against the failure of their largest members.
Deal Addict
User avatar
May 11, 2014
1699 posts
708 upvotes
Iqaluit, NT
xuemike wrote:
Dec 7th, 2017 12:32 pm
You were clearly chiming in with the talks quoting me with someone else's talks, so I assume you knew the context.
His point is still valid. You were claiming that brokerages don't call back items shorted, but they do.
Support your local Credit Union! PM for different options available!
Sr. Member
Dec 12, 2009
525 posts
24 upvotes
Jeenyus1 wrote:
Dec 7th, 2017 2:14 pm
I believe the clearing house has the responsibility of this on behalf of the buyer if I'm not mistaken?

Clearing houses stand between two parties in a trade, managing the risk to the rest of the market if one side should default. They are mutually funded in part by banks to guard against the failure of their largest members.
From what I read, the buyer will receive it in cash equivalent.
[OP]
Deal Addict
Jun 6, 2013
2198 posts
1580 upvotes
Toronto
my instinct tells me that the bitcoin price is (cleverly) manipulated by certain people who hold a large amount of coins each. i can't pinpoint exactly how, but i feel that it's something like this:

Image

where the big ball is the financially illiterate mass, and the small ball is the bitcoin "whales"
It's always good to be underestimated.---Donald Trump

I never downvote anyone and I try to help everyone.
Deal Addict
Jun 27, 2007
3246 posts
532 upvotes
Apparently, IB will not allow shorting Bitcoin futures and buying privilege comes at 50% margin.
Definitely not touching it until CME launches its version. I sense markets will be skittish and not many folks participate.
After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: it never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!
Newbie
May 5, 2012
73 posts
15 upvotes
This is what everyone new to bitcoin feels right now......................

Image
Member
May 15, 2005
322 posts
106 upvotes
Of course it's a bubble, talking to our waitress yesterday she was telling us about how she's going to a meeting at night with a group of people who are all going to invest in bitcoin.

It's becoming mass hysteria and everyone has a FOMO feeling. Problem is, Bitcoin's future is controlled by a very relative few. When those few feel it's time to take their profits, the whole market is going to crash. (My opinion of course)

These wild swings are not good for the adoption and normalization of cryptocurrency. The most successful currency ultimately has to be one which can have some semblance of consistency to it's value.

A lot of people are going to lose a lot of money on this.

On the flip side

A smaller minority will make a great deal of money.

Which side, at this stage of the game do you think you are on?

That's the question.
Jr. Member
Jan 15, 2010
140 posts
103 upvotes
Toronto
If Bitcoin was usable as a currency (wasn't that the original purpose of crypto?) in a timely/reliable manner I might think it wasn't a bubble. But if people aren't using it as a currency what purpose does it serve aside from being a speculative store of wealth?

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