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Why Bitcoin price is falling?

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zeus

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I can understand China news and MtGox etc but it appers that we are over that now, VC investments are happening in Bitcoin, the FBI auction went pretty well,no China banning lately, I read good news all the time and yet the price is falling...

Can someone explain this to me please? Was the October - December price pump in reality only due to a couple of trading bots? Or simply there is no new demand for Bitcoin and the trading bots don't do their part as previously?

Please share your thoughts.

Posted on July 16, 2014 at 3:37 PM

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• adam

  

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  Location: California, USA

  @zeus I can understand China news and MtGox etc but it appers that we are over that now, VC investments are happening in Bitcoin, the FBI auction went pretty well,no China banning lately, I read good news all the time and yet the price is falling...

  Can someone explain this to me please? Was the October - December price pump in reality only due to a couple of trading bots? Or simply there is no new demand for Bitcoin and the trading bots don't do their part as previously?

  Please share your thoughts.

  Well, if the willy report is to be believed if Mt.gox is dead and Mt.Gox was the tail wagging the dog, this is a real market and before it was a market rigged to go up.

  My feeling is this is the cycle, excitement, investment, then the long wait of investment to turn into something tangible during which time people get nervous and the price drops.

  Once the new uses hit and improve the value proposition by making things more usable or increasing utility or demonstrating something new etc. the media starts again and the attention refocuses, which reminds people they should have purchased some and the price starts going up which causes the price to go up more until it overshoots and the "bubble" pops and people get burned, but during that mania period a lot of investment is made and some of it pays off which powers the next cycle.

  Posted on July 16, 2014 at 3:41 PM
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• zeus

  

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  I agree with your explanations. However the centralization of mining power in few hands around bitcoin is a very serious problem. I still believe that at some point Bitcoin will overshoot again (maybe $2k - $5k) but after that I think it might be the end. Whales will dump, price will plunge at current levels or below, miners will lose incentives and bitcoin will eventually fail..

  Do you believe in such a scenario? Do you believe that another crypto could eventually replace bitcoin or do you think bitcoin will always be the king?

  Posted on July 16, 2014 at 3:54 PM
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• Spengler

  

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  @zeus I agree with your explanations. However the centralization of mining power in few hands around bitcoin is a very serious problem. I still believe that at some point Bitcoin will overshoot again (maybe $2k - $5k) but after that I think it might be the end. Whales will dump, price will plunge at current levels or below, miners will lose incentives and bitcoin will eventually fail..

  Do you believe in such a scenario? Do you believe that another crypto could eventually replace bitcoin or do you think bitcoin will always be the king?

  Could I point you to this topic where @adam has posted something relevant to your question?

  Posted on July 16, 2014 at 3:56 PM
  Last Edited: July 16, 2014 at 3:58 PM
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• Mike

  

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  Location: Chicago, IL

  It's going down because it's a two-sided market. Thank your lucky stars that it is. Any market that goes straight up or straight down is pretty useless.

  It doesn't need a reason, or an explanation. It just is. It could be going down because there's no speculative inflow today but a lot of consumer transactions needing to be cashed out into dollars. Who knows? Doesn't particularly matter at this point, since anybody that claims to know why is really, really pulling your leg.

  Posted on July 16, 2014 at 3:57 PM
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• btc_revel

  

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  Why should it stop at 2k-5k? Yes at this value the next CYCLE might end, and the start of dipping for some months again, but no apparent reason why it should be the end. As long as things evolve like they do now, there is no worry. Market capitalization is still to small to stop at 5k$/BTC.

  Minining centralization seems to be a problem that might be here for a couple of months to a few years, but for the long run it seems to be solvable (mainly because in decentralized way the heat produced by ASICS can be used at home for heating water for shower, ... so it just takes time for such new bitcoinHomeWaterHeatMiner and such products to be developed). => mining centralization needs to be addressed (SW changes that make centralization hard like 2Phase- ProofOfWork as well as products like MiningWater heaters), but things looks like this will be solved

  Posted on July 16, 2014 at 4:11 PM
  Last Edited: July 16, 2014 at 4:12 PM
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• crux

  

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  Location: Australia

  @btcrevel Why should it stop at 2k-5k? Yes at this value the next CYCLE might end, and the start of dipping for some months again, but no apparent reason why it should be the end. As long as things evolve like they do now, there is no worry. Market capitalization is still to small to stop at 5k$/BTC.

  Minining centralization seems to be a problem that might be here for a couple of months to a few years, but for the long run it seems to be solvable (mainly because in decentralized way the heat produced by ASICS can be used at home for heating water for shower, ... so it just takes time for such new bitcoinHomeWaterHeatMiner and such products to be developed). => mining centralization needs to be addressed (SW changes that make centralization hard like 2Phase- ProofOfWork as well as products like MiningWater heaters), but things looks like this will be solved

  I love the idea of mining water heaters etc... is anyone aware of any actual developments in this area?

  Posted on July 16, 2014 at 4:17 PM
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• PTheD

  

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  Yeah, I'm digging the idea of the bitcoin mining water heater, but I suspect nothing like that will be widely commercially available unless and until Bitcoin is one of the world's must used currencies.

  Posted on July 16, 2014 at 4:31 PM
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• Halo

  

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  There's still uncertainty with regulators that could influence the price in the shirt term. We're also waiting on those regulators to say something so that institutional investors can dive in without worrying that they are participating in an unregulated market.

  Posted on July 16, 2014 at 5:10 PM
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• AdiaAir

  

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  Location: Tanasqui, Eastern Woodland, Turtle Island

  every time the price goes down, all i hear is "bitcoins are on sale!"

  Posted on July 16, 2014 at 5:33 PM
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• Rob

  

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  While I can't answer you question, my feeling is that institutional buyers plus anything resembling a Bitcoin ETF will be a driving force for Bitcoin prices in the not-too-distant future. I was just thinking how great it would be to hold some Bitcoin in my retirement account with an ETF (especially knowing I could buy and maybe even sell at times w/o worry ingabout taxable events). I wouldn't worry about short-term price trends (unless you're a trader). I think that many things are lining up for Bitcoin, and serious gains are due soon. That's my read.

  Posted on July 16, 2014 at 5:42 PM
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