Depends on what you mean by the manipulation. Many stock, future, precious metal prices are affected by actors who want to temporarily move it for profit. Some are illegal, some perfectly legal.
In what way do you expect Bitcoin to be different? This is a technical question, once you define it one could debate if this particular behavior is present in BTC.
Fair point. I'll use the SEC's definition: "transactions which create an artificial price or maintain an artificial price for a tradable security". What the author described is exactly this.
> Some are illegal, some perfectly legal.
Agree. My point is probably more about the ease of manipulation when you have a completely deregulated environment.
With this definition my guess is there is likely to be some manipulation. But as BTC is not regulated by the SEC I personally do not see a major problem with it, either.
My guess is that most people that I know that buy BTC, either directly or via some holding schema, do it for the speculation and in this environment they should expect other players to use any method available to them which is not explicitly prohibited. I would treat it like a poker game, where some action happens outside the strict definition of the gameplay (reading facial expressions, probing reactions, etc.). Just my 2c.
I think the vast majority of the people buying gold bars (or their digital equivalents, like shares of physical gold holding funds) do this to hedge a variety of life risks and value a relatively low volatility.
Gold prices do fluctuate, but over the long term (decades and centuries) an ounce of gold generally held its inflation-adjusted value. I suspect buyers of gold would see a lot of problems with BTC price swings and risks that it would be outlawed or restricted in some unknown ways.
Now if you're talking about centuries then sure, but thats a pretty much impossible comparison to make since the advent of alternative investing strategies.
> You sure about that? You woulda been better off holding SPY for 50 years than gold.
Holding its value in inflation-adjusted terms is very different than getting the highest return. I think most gold investors want the first and ignore the second: if I want profits, holding a piece of metal is the last thing I would do long-term; no question there.
The links you posted did not convince me, sorry (no offense). Yes, you can pick a 5-10 year period when gold did very poorly compared to inflation (and vice versa). But the value drop is not huge. And long term, if you look at food, clothes, housing, etc. you will find that they cost roughly the same in gold 100 years ago as they do today. When I wrote that gold held its value I meant exactly that: preservation of value.
For me (and I am not claiming that this is a universal approach), physical gold is a catastrophic risk protection. I have seen, twice, the currency of the country where I grew up become worthless over a pretty short term: a bill that would be sufficient for a vacation earlier would not buy a loaf of bread anymore. And 5 years earlier I would never have thought it possible.
So I am perfectly happy to put 1-2% of my net worth into gold. If fit hits the shan, it could buy my family a passage and some time of living expenses somewhere quiet and far away; if it does not, my grandkids can laugh about their crazy old man while enjoying most of the value that I originally put into it.
> When I wrote that gold held its value I meant exactly that: preservation of value.
Re-read the articles. If you're looking for short/mid term inflation protection (5~10 years) then gold doesn't hold (unless you happen to get lucky for that period over a 100 year period). If you're looking for long term inflation protection (50+ years) then it doesn't either. If your assumption is that gold is valuable because it stood the test of time during the 1700's and 1800's then
> If fit hits the shan, it could buy my family a passage and some time of living expenses somewhere quiet and far away
If shit really hits the fan, you wouldn't be able to convert to a currency that you could actually live on so this point is moot.
> I have seen, twice, the currency of the country where I grew up become worthless over a pretty short term
This context makes more sense than anything else. I'm talking about USD here.
>> When I wrote that gold held its value I meant exactly that: preservation of value.
> Re-read the articles. ... If you're looking for long term inflation protection (50+ years) then it doesn't either.
How about some specific references? This was not productive (especially since the second reference is behind a paywall). Quote a specific statement and we can drill into this.
> If shit really hits the fan, you wouldn't be able to convert to a currency that you could actually live on so this point is moot.
Forgive me for what I am saying next (it is not a payback for your "re-read the articles" comment; honest), but I find statements like this incredibly naive. I think you have a pink pony view of the "catastrophic risk". Have you seen civil wars? real hunger? deaths from easily treatable infections? cannibalism?
Throughout this type of crap having some physical gold is one of the most reliable tickets out. You can often trade it (with significant haircuts) for stuff you need or a safe passage. Yes, you have to deal with underworld or gangs, but this is still much better than the alternative.
I am now one of the "rich, soft americans" and I hope my kids do not have to go through any of this. And I personally do not see it likely in the US, at least in the next 10-20 years. But the world can change fast and I still want to have a few gold coins in my physical possession, together with a good knife. No offense, mate, and good hunting!
It does, I think, and you make a good point; there's big players who bet on it going down, there's big players that bet on it going up. In a perfect world, their intents would cancel each other out.
I've been told there are hundreds of crypto hedge funds operating now. I happen to have a connection to a friend who runs one. Since most of them can't actively advertise and only cater to accredited investors, I suspect it's harder to "find" them.
I think that every and all markets are manipulated by groups with money and power. Everyone wants to game the system to act in their favor right? What would I want with more money? To earn more money of course.
First, let's start by using a valid comparable. Fiat currency has the feature of "medium of exchange", at present BTC does not (technically it does but its adoption for exchange is abysmal).
> So the real question is whether a coin is being manipulated, but what kind of manipulation you can accept.
The NYSE is a better comparable. In the US we have the SEC which does regulate against market manipulation: https://en.wikipedia.org/wiki/Market_manipulation I do believe there is some level of market manipulation not captured by the SEC, however there is at least some baseline level of control against it.
>First, let's start by using a valid comparable. Fiat currency has the feature of "medium of exchange", at present BTC does not (technically it does but its adoption for exchange is abysmal).
You're changing the topic. You asked whether BTC was being manipulated, and were asked to compare to the US dollar. Whether the dollar is as "medium of exchange" has no bearing on that, you're just unhelpfully switching to an unrelated issue that will make the dollar look better in orthogonal ways.
The original blog article was about the BTC/USD market being manipulated; hence the title "Bitcoin price", in which "price" assumes you are converting one currency to another (in this case USD/BTC).
The person that replied to me asked "so what, every coin is being manipulated". If anything the replier was changing the topic. The assertion that the coin itself is being manipulated is irrelevant and a red herring. In the context of the US stock exchange the SEC defines manipulation as "transactions which create an artificial price or maintain an artificial price for a tradable security". This concept isn't even a concept when it comes to the value of the medium of exchange for a currency, hence why I posited "why is this even relevant"?
You're claiming the dollar can't be manipulated and/or no one is allowed to care about it, because one agency doesn't have jurisdiction over said manipulation?
No, I'm not claiming anything about a currency being manipulated. I'm saying the idea that a currency in and of itself is being manipulated is completely irrelevant to this discussion. Currency manipulation, in the context of the OP's discussion, implies one currencies relation to another one, in this case USD and BTC.
Federal interest rates affecting the value of your dollar making purchases for goods and services is completely irrelevant.
I knew when I bought crypto it was being manipulated. I don't give a fuck, I use it as a medium of exchange usually dumping it within a few minutes of buying it in order to buy some goods online to avoid credit card fees (precious metals).
It's true dollar is manipulated. It is true crypto is manipulated. It is true many people such as myself purely is it as a medium of exchange. Just like with dollars, I dump it as quickly as possible to buy physical assets or other investments, lest the government inflate my fiat or manipulators manipulate my crypto.
In short, currencies are usually bad choice for store of value. Fed intentionally destroys USD by target of 2% a year to intentionally sabotage store of value.
Back to the point. Pretty much all coins are manipulated. Even commodity money. Best to avoid regulation so government's hand is out of the pot. Also I recommend people not use crypto as investment, that is probably not smart idea to consider long chain of cryptographic signatures and hashes as a large portion of investment on your future. Or piece of paper with a president and a number on it on it either.
The definition of "manipulated" which allows "the dollar and BTC are both being manipulated" to resolve as true is so broad that it is effectively meaningless. The dollar is not being manipulated in the way that reasonable people understand the word to mean. BTC obviously is.
No true [reasonable] Scotsman would believe monetary policy by fed is manipulation. Got it; your definition of unreasonable is so broad that it is effectively meaningless.
Ah I see, it's not manipulation because you perceive the fed as acting virtuously.
That's actually not the mandate of the fed.
The mandate is:
The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy's long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.
Whether prices are currently stable or interest rates are moderate are a lively source of discussion. Regardless of opinion here, I think you have a generous definition of manipulation to exclude acts operating under a nominal mandate of some vague interest of society (and I may add many other acts made under pretext of interest in society are source of outrage on HN).
I, an anonymous actor beholden to no authority nor regulation, can manipulate Bitcoin _directly_ with sufficient capital and a sufficiently intelligent bit of code. It's fun and intellectually pointed to say this is just a _version_ of the kind of "manipulation" performed by the Fed against the dollar but it's transparently and categorically a different thing. It's an obviously specious argument and it diminishes whomever makes it.
>I, an anonymous actor beholden to no authority nor regulation, can manipulate Bitcoin
Yes yes we already agreed, I think, that bitcoin can be manipulated. I admitted this right off the bat.
>It's fun and intellectually pointed to say this is just a _version_ of the kind of "manipulation" performed by the Fed against the dollar but it's transparently and categorically a different thing. It's an obviously specious argument and it diminishes whomever makes it.
So it diminishes no one, because I never said the manipulation performed by the fed was the same 'version' or 'kind' of manipulation -- whatever that means. Are you just kind of arguing with yourself at this point?
> In short, currencies are usually bad choice for store of value.
> Also I recommend people not use crypto as investment, that is probably not smart idea to consider long chain of cryptographic signatures and hashes as a large portion of investment on your future.
Re-read what you wrote there again for me. How do you pay for any goods or services if you:
> dump it as quickly as possible to buy physical assets
So, like cars that depreciate in value the second you buy them? (note - I recognize the last 2 years this has not been the case...but thats a historic anomaly) What other physical assets are you aware of that consistently outpace inflation? Housing? What else?
I pay for goods and services with USD. I get USD either by liquidating non-USD denominated asset for USD or from income-stream (wages). I didn't say I don't use USD, I said I hold it as short as possible just like with crypto.
>So, like cars that depreciate in value the second you buy them?
Generally worst example, although a few cars have held their value (some Porsche, but I'm not good enough car guy to execute this.)
>Like ones denominated in....US currency?
Like the ones not denominated in US currency, like stocks denominated in shares.
