back to article Bitcoin price soars amid technical troubles for exchanges

The price of Bitcoin (BTC) continued to soar on Thursday, creating chaos among those trying to buy and sell the cryptocurrency currency due to service trouble at several exchanges. In the past 24 hours, Bitcoin surged from around $12,700 up beyond $16,500, a new high, before retreating to around $15,500 by mid-morning Pacific …

  1. cdegroot

    Nothing new...

    "PwC said it has begun accepting Bitcoin as payment for its advisory services"

    Well... given that BTC is mostly useful for crooks, that figures...

    (yeah, by the time I hit post I'm sure I'm not the only one to make that bad joke)

    1. Pen-y-gors Silver badge

      Re: Nothing new...

      Not a bad joke, comes into the 'sad but true' category.

      +1

  2. Mark 85 Silver badge

    At some point, the Bitcoin bubble will obviously explode. I wonder what kind of economic meltdown will follow along with where all the "stolen" ones ended up.

    1. HatHatHatHatHat

      Only meltdown will be the winkelwii - crying conspiracy.. again...

  3. sjsmoto

    I admit I'm confused about this Bitcoin thing. It looks like a decentralized stock to me. Who wants to get paid with a stock that can reduce or crash at any time? I'd rather get paid in real money.

    1. Anonymous Coward
      Anonymous Coward

      "I'd rather get paid in real money."

      That worked out well for Greece a few years back yeh?

    2. Gob Smacked
      Alert

      @sjsmoto: I am already into Bitcoin since 2009, but only invested in 2013. As I already pulled my investment out 4-fold 2 months ago (halving my wallets), I now see the remains climbing another 15-fold after 2 months and strongly consider to give notice on my invoices that these may be discounted 20% if paid in Bitcoin. Most customers probably won't choose to do so, but doubling the money in a few weeks on the rest may well be worth it...

      1. Doctor Syntax Silver badge

        @Gob Smacked

        The joke icon is over there >

        1. Gob Smacked
          Thumb Up

          Sorry Syntax. It's no joke... :)

  4. quattroprorocked

    Today I went looking to see if I could buy a retail PUT on bitcoin. Sadly I can't. Def would have been worth a punt.

    1. katrinab Silver badge

      There are a couple of places looking at that, the problem is that because of the time it takes to transact in bitcoin, extreme counterparty risk, and the risk of theft, there is no way to effectively lay off the trade.

      1. Anonymous Coward
        Anonymous Coward

        "extreme counterparty risk"

        So obviously there's an opening for a new financial product - Bitcoin Default Swaps.

        1. MyffyW Silver badge

          Short

          If I had a spare couple of quid (some hope at this time of year) I would definitely short BitCoin.

          The key, as ever, is timing - or knowing quite when the whole shebang will come crashing down. End of 2018 is my best guess, there's still a few irrational expectations to be piled onto this Christmas turkey.

          1. Doctor Syntax Silver badge

            Re: Short

            "End of 2018 is my best guess"

            Nearer end of 2017 would be mine.

    2. Anonymous Coward
      Anonymous Coward

      If your looking for Options on BTC, I think the Volatility used to price them might be just turn out to be a little bit extreme, which then means they will be priced astronomically high.

  5. Ken Moorhouse Silver badge

    New concept for subscription services...

    Here's my first and final instalment. (All future instalments can be derived by keeping my payment in Bitcoin currency).

    ---

    This charade will continue until there are some well-publicised instances of people unable to convert to traditional currency, and everyone tries to head for the exit in desperate panic. Due to the time overhead involved in interfacing with the underlying blockchain, meltdown is not far away.

    1. I ain't Spartacus Gold badge
      Happy

      Re: New concept for subscription services...

      Ken Moorhouse,

      Good ideal. But Douglas Adams beat you to it...

      All you have to do is deposit one penny in a savings account in your own era, and when you arrive at the End of Time the operation of compund interest means that the fabulous cost of your meal has been paid for.

      This, many claim, is not merely impossible but clearly insane, which is why the advertising executives of the star system of Bastablon came up with this slogan: "If you've done six impossible things this morning, why not round it off with breakfast at Milliways, the Restaurant at the End of the Universe?"

  6. stucs201

    Can I buy Tulips with Bitcoin?

    https://en.wikipedia.org/wiki/Tulip_mania

    1. Anonymous Coward
      Anonymous Coward

      Re: Can I buy Tulips with Bitcoin?

      Yes! In fact, the rise in bitcoin has made me wealthy enough to buy several million tulip bulbs, should I so desire! And if you'd got in early enough, rather than pointing and laughing and saying 'lol it's a bubble!' as the price passed $2 then $10 then $100 then $500 then $1000 then $5000 then $10000 you could too!

      1. veti Silver badge

        Re: Can I buy Tulips with Bitcoin?

        Where, specifically, can you buy tulips with Btc?

        Because my local garden centre certainly doesn't accept them.

        1. Gob Smacked

          Re: Can I buy Tulips with Bitcoin?

          Just to name 1: https://www.duivenvoorden.nl/

          There's a growing list with Bitcoin-friendly retailers in our country (in Dutch): http://www.bitcoinspot.nl/waar-kan-je-in-nederland-met-bitcoins-betalen/zoo-frontpage.html

      2. Charlie Clark Silver badge

        Re: Can I buy Tulips with Bitcoin?

        And if you'd got in early enough…

        As is true for all pyramid schemes. I was given 0.005 BTC earlier this year and have just cashed out: money for nothing always requires an idiot on the other side of the transaction.

        1. MyffyW Silver badge

          Re: Can I buy Tulips with Bitcoin?

          Let us raise a glass to Charles Ponzi (March 3, 1882 – January 18, 1949).

          1. Mage Silver badge

            Re: Charles Ponzi

            Famous, but not at all the first:

            We learnt about the South Sea Bubble at school:

            …peaking in 1720 before collapsing to little above its original flotation price; the economic bubble became known as the South Sea Bubble. The Bubble Act 1720, which forbade the creation of joint-stock companies without royal charter, was promoted by the South Sea company itself before its collapse.

            Also

            Little Dorrit (1855 - 1857) identifies such schemes.

            The Way We Live Now (1875) identifies such schemes.

            So obviously much older. It wouldn't surprise me if the Ancient Romans did it 2000 years ago.

            Gold coins from about 500BC (or earlier) became Electrum. The proportion of silver (and sometimes copper) was gradually increased. Pure gold is too soft for a coin anyway. The idea of gold as a standard survived in west till 20th C. Modern Fiat Currency using paper money was established in the 11th C. in China. It's really only a problem if the Government gets corrupt and stupid, because printing too much is self defeating (Hungary & Germany in the past, South America and Zimbabwe today).

            Bitcoin seems designed to aid money laundering and pyramid selling. The mechanism to create coins is in the private control of rich people that can afford the mining computers and have cheap electricity.

            Little Dorrit is a novel by Charles Dickens, originally published in serial form between 1855 and 1857. It satirises the shortcomings of both government and society, including the institution of debtors' prisons, where debtors were imprisoned, unable to work, until they repaid their debts. The prison in this case is the Marshalsea, where Dickens's own father had been imprisoned. Dickens is also critical of the lack of a social safety net, the treatment and safety of industrial workers, as well the bureaucracy of the British Treasury, in the form of his fictional "Circumlocution Office".

            The Way We Live Now is a satirical novel by Anthony Trollope, published in London in 1875 after first appearing in serialised form. It is one of the last significant Victorian novels to have been published in monthly parts.

            Comprising 100 chapters, The Way We Live Now was Trollope's longest novel, and is particularly rich in sub-plot. It was inspired by the financial scandals of the early 1870s; Trollope had just returned to England from abroad, and was appalled by the greed and dishonesty those scandals exposed. This novel was his rebuke. It dramatised how such greed and dishonesty pervaded the commercial, political, moral, and intellectual life of that era.

          2. Sam Haine

            Re: Can I buy Tulips with Bitcoin?

            The impressive thing about Bitcoin is that it's both a Ponzi and a pyramid scheme.

        2. DuncanLarge Silver badge

          Re: Can I buy Tulips with Bitcoin?

          "money for nothing always requires an idiot on the other side of the transaction."

          Same with buying Oranges on the stock market. You just need someone who likes Oranges.

          Hope the world dont suddenly decide to hate Oranges. Maybe they will prefer the green ones.

    2. handleoclast

      Re: Can I buy Tulips with Bitcoin?

      Probably the best thing you can do.

      It is highly unlikely there will ever be another tulip bubble but at least tulip bulbs have some intrinsic value (you can plant them and grow tulips to make your garden look pretty) whereas bitcoin do not (if the bitcoin bubble bursts you'll delete your wallet to reclaim disc space).

      Tulip bulbs also have another useful property. One bulb is enough to kill you.* So after you lose a fortune in a tulip bubble you can eat a couple of bulbs to end your despair.

      *There are conflicting reports about this. One claims that only the centre of the bulb is really dangerous. Which is why I recommend eating a couple of bulbs to be sure.**

      **Severe abdominal pain may occur beforehand.

    3. DuncanLarge Silver badge

      Re: Can I buy Tulips with Bitcoin?

      Bit of a silly comparison seeing as you can keep making tulips whereas you cant make move than 21 million bitcoin.

      Unless you bought all the tulips then exterminated all tulip seeds on the planet. That might just work.

    4. not_my_real_name

      Re: Can I buy Tulips with Bitcoin?

      Oh the old media tulip bubble nonsense bounded around by ignorants kicking themselves they didn't get in earlier. Do some research.

      1. Dave Bell

        Re: Can I buy Tulips with Bitcoin?

        Charles Mackay: Extraordinary Popular Delusions and the Madness of Crowds

        Tulips, the South Sea Bubble, and a lot more. But the accounts are poor-quality history.

        When the legend becomes fact... print the legend.

  7. Anonymous Coward
    Anonymous Coward

    Unicorn poop

    Buy now, or be priced out forever!

  8. Anonymous Coward
    Anonymous Coward

    I get the impression

    that amongst the exchanges there are crooks who will take your money in exchange for Bitcoins that will never be delivered (or vice versa).

  9. Anonymous Coward
    Anonymous Coward

    Beware of geeks bearing gifts.

  10. annodomini2
    Mushroom

    A fool and his money are soon parted...

    Currently the worlds biggest Ponzi scheme

    1. Brewster's Angle Grinder Silver badge

      Re: A fool and his money are soon parted...

      Who wouldn't invest if they knew for certain it would rise 15x in 2018 and not burst till 2019? I just don't understand these things well enough to know when the crash will come. But I've said that for several years. If I understood people's appetites better, I could have made a killing.

      1. Doctor Syntax Silver badge

        Re: A fool and his money are soon parted...

        " I just don't understand these things well enough to know when the crash will come."

        Neither does anybody else.

        1. Brewster's Angle Grinder Silver badge

          Re: A fool and his money are soon parted...

          "Neither does anybody else."

          I think I could have better understood the psychology of the fools investors and geeks. The continual hype should have given me a clue. Instead of smirking knowingly at the swelling, pus-filled zit, I could have taken some of their cash.

          However if it carries on at 10x per annum then in three years people who'd've cashed out with millions today will be cashing out with billions. In six, they'll be trillionaires. Does that sound sustainable? Based on what Steam were saying, it's no longer usable as currency either. So on practical grounds, it would seem to be close to apex. But it could easily have another year of high-rate growth.

          Although the questions I'm really interested in, are, "If Bitcoin crashes, will investors run away from all cryptocurrencies and everybody suffer or will they move to the one that 'fixes' the problems?" And of course, "How much can I afford to lose?"

          1. Anonymous Coward
            Anonymous Coward

            Re: A fool and his money are soon parted...

            Its the banks buying up bitcoin - hence the price increase over the past year or two. Eventually they will crash bitcoin by selling it off by the wheelbarrow load. Once bit coin has bitten the dust they can carry on business as usual safe in the knowledge that they have destroyed this threat to their business model.

            Cryptocurrencies are definitely a disruptive technology in finance circles. Best to destroy it rather than try and compete and lose out on major fees.

      2. Mage Silver badge

        Re: A fool and his money are soon parted...

        That's why all successful (for the early adopters) Ponzi schemes work. Anglo Irish Bank. Quinn was a sucker! Though he had been a serial speculator making bad choices after getting money from the Gravel pit and later for a while from the Insurance.

        Usually a secret cartel of early adopters trigger the crash as they get out.

      3. katrinab Silver badge

        Re: A fool and his money are soon parted...

        Will anyone sell me a put option for Bitcoin, strike price $225,000 dated 31st December 2018?

        Probably not, which tells you all you need to know.

      4. d3vy Silver badge

        Re: A fool and his money are soon parted...

        "Who wouldn't invest if they knew for certain it would rise 15x in 2018 and not burst till 2019? I just don't understand these things well enough to know when the crash will come. But I've said that for several years. If I understood people's appetites better, I could have made a killing."

        Exactly - hindsight is a bitch!

        If I'd known how much it would grow (bubble or not) back when I first heard about them (2010 I think) I could have sunk a few hundred in and paid off my mortgage a few times over by now...

        As with all gambling, knowing when to get out and stay ahead is key!

  11. Aaiieeee

    14,400 BTC?

    Crumbs, someone has made a killing.

    About 4 years ago a buddy and I lamented that fact we had missed the bitcoin boat. Oops!

    I am wondering who is buying these up at current prices because they must feel there is still some further price increase to be had. Who knows, the sky is the limit I suppose.

    I'll focus on paying down the mortgage for now and when its done I can blow the extra cash on risky ventures.

    1. handleoclast

      Re: 14,400 BTC?

      I am wondering who is buying these up at current prices because they must feel there is still some further price increase to be had.

      Like all currency manipulation and stock exchange transactions, it's a bet placed with incomplete knowledge. And, like all bets, gambling fever can take hold (the stock market pretty much runs on it). Like all the people who bet on the favourite in a horse race. they reason that it's the favourite because people know something. In actual fact it's the favourite because random disparities in betting shortened the relative odds enough that people who have no idea how to evaluate form decided to bet on it because other people already had.

      It's also subject to that form of manipulation known as "pumping." Economists have learned a tiny amount about negative feedback and labelled it the "invisible hand." If they'd learned a little more about negative feedback they'd have encountered Routh's Stability Criterion and realized just one of the reasons that a free market economy doesn't scale well. God knows if they'll ever learn about Z-transforms and figure out why microtrading is inherently dangerous if you don't understand control theory. Anyway, Routh's Stability Criterion explains why oscillations occur and why pumping can happen.*

      *Greatly simplified explanation. I've forgotten 99.9% of the control theory I studied, and still know more about it than any economist.

    2. GeneralCustardpie

      Re: 14,400 BTC?

      Paying off your debts early and investing in non risky venture would help you more..

      Better off than 90% of the population at that stage.

  12. Pen-y-gors Silver badge

    My only worry

    Is that some of my pension funds may have decided to buy in to BTC.

  13. Anonymous Coward
    Anonymous Coward

    My current plan with bitcoin is every time my fraction of a BTC is worth enough to buy a new graphics card, I'll cash out, but make sure I leave a tiny fraction.

    Then a few years later, my 0.00001BTC is worth £500 again and I can cash out leaving 0.00000001BTC.

    Considering I bought 1BTC for ~£70, and I've so far bought about £700 worth of stuff with it, I'm feeling smug. This is how investment works right?

    1. Anonymous Coward
      Anonymous Coward

      "My current plan with bitcoin is every time my fraction of a BTC is worth enough to buy a new graphics card, I'll cash out, but make sure I leave a tiny fraction.

      Then a few years later, my 0.00001BTC is worth £500 again and I can cash out leaving 0.00000001BTC.

      Considering I bought 1BTC for ~£70, and I've so far bought about £700 worth of stuff with it, I'm feeling smug. This is how investment works right?"

      Same here, though on a smaller scale than you. I bought 0.1BTC for ~£40 in 2014. So far I've bought almost £400 of kit in the last 2 months, and I've still got around 6x my original stake left.

      Bitcoin Math: £40 - £370 = £300

  14. Mage Silver badge
    Coat

    Not surprising

    It's a ponzi scheme using virtual tulips, which unlike real ones are designed to have a fixed final number.

    I'm not sure when the early birds are cashing out and burning all those that bought in much later. Eventual value could be zero to $100.

    A speculation vehicle that also has a transaction time that scales badly as more people do transactions is not a useful currency for ordinary people and honest retailers.

    1. lorisarvendu

      Re: Not surprising

      I'm not sure when the early birds are cashing out and burning all those that bought in much later..."

      That supposed lump sum of 14,400 BTC that was cashed out yesterday at $15400. That equals over $200 million. How? What exchange could provide that much cash? This is where I think things might go wrong. Once the value has inflated beyond the fiscal capacity of any one organisation to trade, what happens then? Actually while writing that I realised what they'd do - continue dealing in fractions of BTC, but have a slowly-lowering ceiling of the highest amount they'll trade in.

      1. foxyshadis

        Re: Not surprising

        Someone traded 14,400 bitcoin for... something. No one knows why, for what, for how much, or with whom. There's no way to know what they got in return, but the transactions were immediately "mixed" (laundered) so that might explain a few things. Someone was willing to pay the ludicrously high BTC transaction fees thousands of times to make that money untraceable.

        1. LOL123

          Re: Not surprising

          Much of this is going into what are called ICOs AIUI. The big transactions are not cash, the small ones are. Thus most volume is for inter-crypto currency conversions. This is why the transaction goes through even when fiat exchanges are down.

          I think money laundering also plays a huge role. I do think this is a bubble but then I also think fiat currency and QE are bubbles too so I don't know enough to draw the line.

          If it ever becomes a real economic currency it will absolutely skyrocket but then regulators will stop it and it will die. I can't see how crypto currency can help society anyway.

  15. Version 1.0 Silver badge

    If it's a bubble, someone blowing really hard

    It's easy to say it's a bubble when you don't know anything but the predictions earlier this year of it hitting $20k by next year are starting to look prescient. The thing is, if it were a bubble then you'd see the price going up without any serious support behind it ... but look at the hash rate on some of the larger mining pools - it's going through the roof. The hash rate is based on people investing in the hardware that supports bitcoin ...

    1. Ken Moorhouse Silver badge

      Re: If it's a bubble, someone blowing really hard

      According to the Wikipedia article linked to earlier, Tulip Mania was disrupted by bubonic plague in a trading exchange. The traded good suddenly became illiquid because of this.

      Name any run on a bank. How did it effectively kick-off? When people tried to withdraw funds they had in their account and were told "not today". The currency had effectively become illiquid by that action.

      Ponzi schemes end when there are not enough people coming on-board, putting money into the kitty to repay earlier investors.

      If Bitcoin conversion into traditional currency were to take a long time to effect, or situations like a Denial of Service were to occur, then people would start to wonder whether their money were safe. With no government willing to act to repay investors/ speculators if Bitcoin defaulted, this is the scenario I envisage:-

      So let's say a Bitcoin transaction takes longer than you anticipate to complete. Would you complain on Twitter? With Twitter and fake news fuelling the fire, a slight delay could turn into a positive feedback frenzy, and everyone will want out.

    2. Mage Silver badge

      Re: If it's a bubble, someone blowing really hard

      "It's easy to say it's a bubble when you don't know anything"

      It's also easy to point out that it's a bubble when you do know. The ONLY thing not known is when it will burst.

      There is no production or earnings or real changes in other currencies to support the current price.

      The transaction time is non-linear and high. It's not scaleable to be used for regular frequent transactions by a reasonable number of people.

      The only "problem" Bitcoin and other Cryptocurrencies solve is anonymity.

      It's purely a speculation vehicle. The massive change in price actually proves this.

      I'd not argue that it can't reach $20K, that would make it clearer to idiots that it's a bubble.

      People buying now KNOW it can't last but are gambling that they can get out with a profit. That is characteristic of a bubble.

      Also when it's too expensive to "mine" or there are no more to mine?

      1. Version 1.0 Silver badge

        Re: If it's a bubble, someone blowing really hard

        You can disagree with me all you like, I'm banking $800 every two weeks at the moment from my miners - Christmas is paid for already.

    3. GeneralCustardpie

      Re: If it's a bubble, someone blowing really hard

      "The thing is, if it were a bubble then you'd see the price going up without any serious support behind it ... but look at the hash rate on some of the larger mining pools - it's going through the roof. The hash rate is based on people investing in the hardware that supports bitcoin .."

      The hardware used to mine crypto currencies has no bearing on the actual "value" of the coin.

      The "value" of the coin dictates the hardware people are willing to use to mine the coin, low price - low hashrate equipment due to the power costs.

      Value of the coin is dictated on the exchanges based on the same principle of stock markets - what someone is willing to pay.

  16. Anonymous Coward
    Anonymous Coward

    Welcome to hotel California.

    Funny thing is, all these exchanges are great at taking your money ( with an inner circle of miners) selling your their precious comidity (or have you believe it is) but once you have them, you can’t find another sucker to take them from you... had my wallet full of coins, only successfully bought a couple of smaller things online and that is it... to me it’s a scam, I mined my coins but never been able to cash out like everyone talks about, and it’s the recurring theme in the main forums an tweeter feeds... it’s a scam, prices can only go up, hope that new blood comes in with their hard earned cash and subdue the IDIOTS that did before with the homie of making it big! Whatcha the news lately, where is the headline on new era millionaires from BTC? Righ, why is that... don’t be blind!

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