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by captainarab 4591 days ago
Looking at the volume/quantity of BTC trades, its pretty clear that this is a demand driven price increase.

Given all of the new investors, how many of them will stay and how severely will demand be impacted with the next seriously negative market event?
2 comments
josu 4591 days ago
I'm not sure that the volume is reflecting an increase in demand, at least not a tenfold increase in demand in just a couple of months.

The increment in volume can be the consequence of increased daytrading activity. Once the price started shooting a lot of volatility was introduced in the system, which allowed daytrading. Many arbitrage opportunities also opened up, which probably moved the volume up as well.

Yes, it seems like bitcoin is catching up some speed, but I don't think that this sudden spike in price is demand driven.

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wmf 4591 days ago
Given that demand started from near zero in China, tenfold growth after legalization of Bitcoin doesn't surprise me at all. The movement in the BTC-USD market looks like arbitrage catching up to the Chinese activity.
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yapcguy 4591 days ago
The Chinese are gambling.

In Hong Kong, they gamble more money on horse racing in a single day, than the UK does in a whole year.

In Macau, single card draw is popular, for an instant adrenaline rush, nobody wants to sit around a poker table all day to win what you can win in a few minutes.

Bitcoin is no different.

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300bps 4591 days ago
Given all of the new investors

How many people buying bitcoins are investors and how many people are just trying to buy something with a transaction that can't be traced back to them? That's a big draw to Bitcoin right now.

To investors, the price you pay matters. To people just trying to buy goods and services with it, it doesn't matter if Bitcoin is at $50, $100, $2000 or $20000.

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bytefactory 4591 days ago
It will, if the timeframes for these fluctuations are rapid enough. Imagine converting $1000 of USD you've converted this morning, and by tomorrow when you actually go in to place the order, the price has dropped to $800. You've lost $200 worth of purchasing power overnight!
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