http://www.forbes.com/forbes/2011/05...-currency.html

didn't check but don't think I saw this linked itt

My 'most likely' scenario is $25/btc.

We may be fools, but if you plug the current numbers into a black-scholes option pricing model, given the essentially unprecedented implied volatility of the past 6 months, It shows a 3 mo call at 25 strike should be priced at 4.87btc per 100.

I'd sell some in that range, let me know.

I think your numbers are off because you want it to succeed so badly. It's easy to get blinded by something you want. To get to the numbers you want, you have to try to understand what it would take for someone who has no interest in BitCoin to adopt it at that level. Most people will adopt something new if it's a ton better or if they have no choice. The early adopters are still coming on board, and there's a real critical time coming up between when the early mainstream jumps on board and before the early adopters just get bored and move on. Something needs to drive that.

I don't think that mining was implemented properly to drive widespread adoption. Something like this will take a LONG time for people to come to. However, 1/3 of all coins are already mined. I would have liked to have seen a mining pattern much closer to the number of users expected to adopt. Stretching out the current pattern from 4 years to 20 years between drops would have been better IMO. We basically have a bunch of people who got in there early and have a TON of coins, and then everyone fighting for table scraps later. I think you get a lot better adoption by having more people getting significant chunks of the mining action (people love getting stuff for free), rather than blowing its load early. But it's too late now, and not a huge flaw.

But think about for each situation you listed *why* the laggards and mainstream people would actually adopt BitCoin. What advantages does it have to them over the current system? What disadvantages does it have? What would it take to switch? Even if something is better, switching is costly for big business.

You discount BitCoin^2, but that's absolutely essential to judging valuation. You claim you could get out before most, but that's more of an exit strategy than valuation.

I didn't mean fools derogatorily, sorry. Supposed to be funny since I know I seem like a fool.

I'd have to think about that if it was the only place to get options, but I think most people set them wrong. I'm holding a 3 month with 2 months left strike of $3. I'd love to see what prices emerge out of a good options market though.

Yeah, maybe I should discount for Bitcoin^2. I definitely didn't leave it out because I think it was tiny probability. It just doesn't change much for me. I'm not hooked on Bitcoin, I"m hooked on finite, divisible, transferable, secure, fast money. I will get on the next ride too.

I"ll write more later, but for now I'm just going to plug my ears and shout "Normalcy bias. Normalcy bias!"

Should be coming (at least a beta) within the next couple of weeks.

That 25 USD strike price option quote is no longer valid.

Broke thru some pretty decent resistance at $6.

<insert quote of 70 cent guy>

This rally is nuts. Damn thing triples just in the time it takes for me to get money to mtgox. I'm almost not liking it as a gambling investment now. I was going to plow a few hundred in now, sold some stock and by the time that swings over, I was going to buy a bunch more, but now it's looking very unattractive. This rally is just madness. But no guts, no glory, right?

I really wonder if it is mostly a few number of people buying a large amounts with the intent of actually doing something big.

At this price is it not now a much more attractive idea to acquire radeon 59xx rigs?

I ran the math on it. The answer is, it depends. I wish I had my spreadsheets. If you can get them cheap (you already have machines and just want to upgrade your computer), then it's absolutely worth it. The problem is difficulty is doubling every 20 days or so. It takes time to get it delivered. It takes time to get set up. If you believe the price is going to rise a lot more, you are definitely better off buying them. If you think the price will stay flat, you are better off buying a rig, although you may not make much profit for a while. Difficulty is going to keep going up, even if the price stays the same until there is little profit to be made. However, if price rises, it's hard for difficulty to keep up. Even so, you'd be better off just buying the coins now and having them appreciate the whole time. If you already have a decent machine and a decent graphics card, you absolutely should be using it to its full potential. If you just need a $2-300 card, you'll come out ahead barring a complete crash.

you understand people have been saying this since $.70, then $1.4, 2.1, and exactly 5 days ago at $3.40 ?

I understand people will always think 'fml, I missed it'- but if you think it's viable long term even as a niche currency, $6.50 is the bargain of the decade. Well,other than getting some for .17 less than 6 months ago, lol.

Probably will be $70 by the time mtgox ever gets money from me. fml then.

Mining is a bet on price/difficulty and a claim that you can be more efficient than the average miner. I think most miners also bet on bitcoin by holding their coins for some time after generating, but that's kind of separate.

It's funny, but at the time some people thought .17 was outrageous. After all it was almost 200% up from sitting at .06 where it was steady for a few months.

I actually bought a 6990 and a new 2500K sandy bridge computer. But, it was real hot that day and I was worried about generating heat all summer and the electricity consumption. Then I saw someone returned the same card to Frys on a youtube video and I bought a returned card for $658. So I took the case and video card back and got a H67 motherboard since it had onboard graphics, however I took that back now since you can't overclock it. I am waiting on a Z68 (since Frys didn't have it) that just came out yesterday that allows overclocking and a 5830 card that was on sale for $94 at tigerdirect.

I wish I kept my original setup I that was 10 days ago, I would have 50 BTC by now and we well on the way to have everything paid for in about 1 week.

So frustrated because I saw it all coming and I have little BTC.

I love the smell of e-money in the morning. That's a 10-bagger since this post 6 weeks ago. hatersgonnahate.jpg ?

The bragging is getting really old, dude.

Have you actually cashed any out? If not, you just have bits. If so, congrats.

Each 10 bagger makes it a ton harder to move the market. The exponential rise the past week means even fewer people want to sell, so price is going to keep going up until something happens. Gonna be at least a week before I get all the money I want over to mtgox, ugh. Please crash in that time down to sane levels.

Ya, I sold enough to have a double even if it goes straight to 0, holding the rest. Obv should have held all but this way I sleep at night.

Ok, will stop quoting him, but the fact is people don't understand what a remarkable achievement the design is. In years when there are tons of variants: corporate issued bitcoin^3s with all coins mined in the originating block by the company, blockchains for data storage, monetary theory based-blockchain-coins (inflationcoins, lotterydistributioncoins) - people will look back at this original Bitcoin as the genesis - and it will be in the history books.

But people on the street and our famous doubter don't understand that. They understand price. The understand making money or not. So the impressive upward price move is a validation to them.

It's hard to tell whether you were lucky or good. So much of this feels speculative bubble that it's hard to call the top. Someone is going to be left holding the bag. It's a gamble and takes some balls. Hopefully there are more fools behind me, though!

The obsession with all these variants is quite hilarious on the forums. I guess that's what happens when you get geeks involved, they like building stuff, even if it's useless (not saying bitcoin is, but a lot of variants are).

The fact it's rising this much this fast scares the piss out of me. But my most pessimistic valuation of it has this is not that big of a gamble, so perhaps it's worth gambling. Never thought I would have seen a 10 bagger in 1 month from this, and the next one surely won't be in a month (although who knows, everyone hoards, only a few people sell, and the demand goes up, price goes right up).

I wish I'd heard of this earlier, have just gotten into anarcho-capitalism ideas and this just seems like a really powerful idea. Would like to buy just like 20 for ftp for a play if anyone would sell a few, pm me.

bought some coins today, and i am impressed by the speed of the transactions. thought it would take several hours.

additionally the spread and the liquidity are better than expected

One of the more interesting posts about BitCoin:

http://www.fatwallet.com/forums/fina...435/?start=192

Fairly realistic portrayal of the bubble. I think he's missing on one key point- using his calculations to figure out value. Counting all the coins in circulation I think is a mistake. It's really like there are only 500,000 coins in existence, and the rest are held by true believers who sell at such a gradual rate or hoard them, they might as well not exist. That is until something finally convinces them to sell. Say we go to 500,000 actually being used in a year, what value does it need to be 1% of PayPal's reserves? That's $60 just to get to 1% of PayPal. As the price goes up more, people will start dumping more, so say half are being dumped if it gets to 10%. Say it's 4 million coins at that point actually in play. $100/coin there.

Really to figure out any short term value is figuring out how many are actually in the economy and what it would take to get people to actually sell.

In a bubble it's hard to say when panic selling will start. But bitcoins have certainly increased beyond their fundamental value. You don't see 25% increases in value in a day when you're talking about fundamentals. Of course a poker site coming in and beginning to accept them as payment would greatly change the fundamentals.

If someone is about to release something like poker they'll get it priced in before they do if they are smart.

I can see buying up a ton of coins if I was going to do something huge that would drive it up. This run really makes me think something like that *might* be going on. But it just as easily could be a reasonable rally followed by a ton of people thinking "oh ****, I better get in while I can!")