Category Archives: Bitcoin

This article aims to explain the chain of events that happened and going to happen in bitcoin space. Let me start with few basics so that for the benefit of non tech savvy long term investors. Though some of the terms mentioned below are technical, it is highly desirable for long term investors to understand to make their conviction about bitcoin more stronger.

Bitcoin transaction basics A bitcoin transaction tells the bitcoin blockchain network that the owner of the bitcoin has authorized the transfer of bitcoin to another owner. The new owner can now spend these bitcoins by creating another transaction that authorizes transfer to another owner, and so on, in a chain of ownership. So in nutshell bitcoin transactions are nothing but creating a chain of ownership as the value of bitcoin is moved from address to address.

Exponential growth of bitcoin transactions If we look at the 2 year graph on the number of transactions on bitcoin we would get a better understanding. In 2010, the number of transactions per block was below 50. In 2015, the number of transactions registered in a block was in a range of 650 to 800 transactions. Till then it has grown exponentially and in May 21, 2017, the number of transactions in a block reached an all time high of 2218.

SegWit-An Idea by Dr. Pieter Wuille Every transaction in bitcoin network contains an input address from where the value is coming, an output address to where the value is going and a digital signature to verify the authenticity of the transaction. This digital signature associated with each transaction is taking 65% of the space in a given transaction. Another problem by associating digital signature with transaction data is that the signature can be tampered to change the transaction id and later claim for refund. Dr. Pieter Wuille suggested solution to this problem by segregating the digital signature from the transactions data.

What segwit does? Segregated Witness is the process by which the space in each block is "indirectly" increased by removing signature data from Bitcoin transactions. When blocks are made smaller, this frees up the capacity to add more transactions to the chain. SegWit enabled code ignores the data attached to a signature by striping off the signature from within the input and moving it to a structure towards the end of a transaction. This would increase the 1 MB limit for block sizes to nearly 4 MB, in which 3MB data is exclusively for signature part. Once the solution is implemented every block can accommodate more than 3 times of transactions compared to existing blocks

Alternative for segwit When the segwit idea of segregating signature from transaction data floated around another theory came into picture. The idea as to increase the standard block size from 1MB to 2MB or more without segregating the witness or signature.

Segwit2Mb- The combined solution Segwit2Mb is the project that aims to resolve the above conflict between different political positions among miners and developers regarding segwit activation vs an increase of the on-chain blockchain space through a standard block size increase. Segwit2Mb combines segwit as it is today in Bitcoin version 0.14 with a 2MB block size hard-fork activated ONLY if segwit activates (95% of miners has to agree with the proposal). The hard-fork will happen at a future date once the segwit is activated.

NewYork Agreement In May 2017, developers and miners together joined and reached an agreement at Bitcoin Scaling Agreement at Consensus 2017, there after called as NewYork Agreement. As an outcome, they unanimously agreed to immediately support below two parallel upgrades to the bitcoin protocol, which will be deployed simultaneously and based on the original Segwit2Mb proposal:

Activate Segregated Witness at an 80% threshold, signalling at bit 4 Activate a 2 MB hard fork within six months

As mentioned above, the consensus percentage required for Segwit was reduced from 95% to 80% in the New York agreement. This mandatory activation of segwit deployment comes under Bitcoin Improvement Proposal 148 (BIP 148)

What can happen to Bitcoin during this process When segwit happens, it does nothing to Bitcoin as a coin. It will remain as it is because it is bacically a user activated soft fork or UASF, without any split. When standard block size increase, the coin will split into two, one running with existing 1MB block size and the new one forked out with 2MB block size. This is planned to happen after 6 months of segwit activation.

Sounds great right? But the trick lies in the first part. To understand this, we should understand what happens during segwit activation. miners have to signal that they are ready of segwit. If the total hash rate of miners who agree to segwit reaches majority, then the nodes following the original chain will reorganize and begin to follow the segwit activated UASF chain.

The newly segwit activated BIP148 nodes will begin to orphan Bitcoin blocks not signaling Bit 1 (1 means agreeing with segwit) at its UASF forking point. In such an event, there is a chance that a significant number of financial transaction records will disappear from nodes that rejected segwit activation. Mining community calls this as "wipe out"

A contingency plan against UASF (BIP148)- A hard fork by prominent mining community Bitmain as front runner, majority of the mining community have the opinion as the UASF chain presents a risk of the original chain (the chain which rejects segwit) being wiped out. If there is no contingency plan, all transactions that occurs on the original chain after the UASF forking point will face the risk of being wiped out. According to them this has disastrous consequences for the entire Bitcoin ecosystem. They maintain the stand that UASF is an attack against users and enterprises who disagree with activating SegWit right now without a block size increase.

UASF is an attack against users and enterprises who disagree with activating SegWit right now without a block size increase, which is a very important clause in the Hong Kong agreement made by the global Bitcoin community in February, 2016.-bitmain

To protect their interest, they plan for a User Activated Hard Fork, or UAHF. They will do the hard fork at 12 hours and 20 mins later than UASF to maintain the original segwit not active chain. This hard forked block will accept block of which the size is less than 8MB and miners will soft-limit the block size to less than 2MB.There will be a soft fork rule added into the protocol to limit the sigops (signature part) per transaction within 20K.

BTC 148 & BTC Legacy If this two events happens, here would be two types of Bitcoin tokens, "BTC 148" for coins on the soft forked chain, and "BTC Legacy" for coins on the chain that did not activate segwit. As an investor we don't need to worry as each bitcoin would effectively be copied to both chains. If you hold bitcoin right now, you will hold both "148 BTC" and "Legacy BTC" after the split.

"In the event of a hard fork of the Bitcoin protocol, it is likely that Coinbase will temporarily suspend the deposit and withdrawal of bitcoin from the platform pending our assessment of the technical risks posed by any fork, such as the possibility of replay attacks, network instability, or other factors. Customers should take note that they will not be able to withdraw bitcoin from or deposit bitcoin to Coinbase for a period of up to 24 hours or more following the fork. In the event of a hard fork of the Bitcoin protocol, Coinbase may suspend the ability to buy or sell on our platform during this time."

- Coinbase

Advise for long term investors 2 year wait for such an event is going to end by August 1st. Better keep calm and don't trade from July 31st till August 3rd.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Make Or Break August 1st Event Is Coming For Bitcoin Investors - Seeking Alpha

Rich Ross, technical analyst at Evercore ISI, is getting bearish on the whole market, but not too bearish, predicting a pullback of 3 percent on the S&P 500 and 5 percent on the NASDAQ-100.

The call is based partly on complacency, partly on the time of year, and partly on what he sees are disturbing trends in other asset classes:

"While global equity trends remain strong and prices near record highs; volatility is at the lows; the put/call hit its lowest level of the year; and crude, the dollar, yields and inflation expectations continue to collapse as we enter a period of thinner trade, heightened volatility and typically weaker equity returns," wrote the analyst.

What's most shocking in his new report is the analysis about the sector Ross believes will lead the downturn.

The analyst notes an eerie similarity between trading on the main Philadelphia Semiconductor Sector index (known as "the SOX") and Bitcoin, and indeed the charts do show a remarkable similarity this year, rising modestly from mid-January to mid-March, and taking off in mid-April.

"I reiterate my sell call on Semi's and continue to see a test of 1,000 on the SOX (-8 percent) as the group continues to display the textbook signs of a reversal in trend and a technical symmetry with Bitcoin, which is down -9% overnight and poised for another -17% to 2,044," Ross wrote.

SOX index (black line) vs. Bitcoin (bar chart)

Source: Evercore ISI

He's not completely negative on the whole market. He has an aggressive call to buy biotech and sell semiconductors against them.

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Chart analyst sees a troubling similarity between the rise of chip stocks and bitcoin - CNBC

Mt. Gox was one of the earliest and most public downfalls of the Bitcoin era. In early 2014, Mt. Gox stood atop the field of Bitcoin exchanges as the largest, until it declared bankruptcy following a devastating theft or disappearance. The exchange lost 850,000 Bitcoins with a value of about $450 million in February of 2014, alongside an additional $27 million in cash. 200,000 of those Bitcoins were eventually found, but that leaves 650,000 Bitcoins which have mysteriously disappeared. In the time since, many analysts, former Mt. Gox investors, and others have speculated as to where the missing currency is. This is particularly important as Bitcoin's price has soared in recent months: the missing Bitcoins could be worth as much as $2 billion at this point.

According to reporting by Cyberscoop, the investigator working on behalf of Mt. Gox's creditors, Chainalysis, "definitely" knows the location of the missing coins. This comes via congressional testimony made by the company's co-founder. This information emerged in the midst of a June 8 hearing by the House Financial Services Subcommittee on Terrorism and Illicit finance. The hearing centered on the national security implications involved in cryptocurrencies. Witnesses in the hearing were drawn from Chainalysis and Elliptic, both firms that have run investigations into cryptocurrency security. When Rep. Warren Davidson, R-Ohio, inquired about the reason the missing Bitcoins couldn't be traced considering that the transactions were tied to the Blockchain. "I was particularly struck by your opening remarks that we can detect the activity," he said. "It seems that if we have this ability...then we should be able to find the missing Mt. Gox coins. Why can't we?"

According to Jonathan Levin, co-founder of Chainalysis, "we actually did find those...the destination of those coins is definitely known." Davidson did not follow up on the location of the coins and Levin did not share that or other information about where the coins currently are, who has them, and how that will impact the ongoing cases involving Mt. Gox.

According to Jerry Brito, the executive director of Coin Center, "just because you know where they are may not mean you can get them back." Mark Karpeles, the CEO of Mt. Gox who was briefly jailed in 2015, has stated that "many popular rumors about Mt. Gox about the stolen Bitcoins not actually existing or being stolen by me are absolutely false."

It's possible that the hearing involved a miscommunication. Investigators have long known many of the specific transactions in which the coins were stolen. That does not necessarily mean that the location of the coins is currently available or that they are recoverable, however.

Read more:
Where's the Missing Mt. Gox Bitcoin, Now Worth $2 Billion? - Investopedia

A gloomy Monday ushers Bitcoin in with a downward start to the week as prices fell 4.8% to hit a low of global average low of $2,459.72.

In a downturn that began late Sunday evening, bitcoin prices fell below $2,500 for the first time in over a week. On Bitstamp, bitcoin price hit a low of $2,432, reminding investors of the ongoing volatility with cryptocurrencies less than a fortnight of hitting an all-time high of $3,000.

At press time, figures from CoinmarketCap shows bitcoin price trading at just under $2,550, losing 4.69% on the day. Data shows a significant withdrawal from investors in US markets, followed by Asian and European trading markets.

The United States leads the global trading markets with over a third of the trading volume over a 24-hour period, followed by China, Japan and Korea. The three Asian markets are all seeing trading premiums, with the Korean market currently fielding a significant 15% premium in its spread over US-based markets. Bitcoin is currently valued above $2,900 in a country whose authorities are unable to agree on a uniform path toward regulating its local bitcoin industry despite a pro-FinTech and digital currency-friendly agenda set by the Korean government.

Meanwhile, bitcoin isnt the only currency to see a fall among the wider crypto-market at the start of the final week of June. Ethereum has seen bigger losses leading into Monday, trading under $300 per Ether as gloomy Monday awaits an upbeat turn to hit the green.

For a real-time bitcoin price chart, click here.

Featured image from Shutterstock.

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Newsflash: Bitcoin Price Hits a 10-Day Low - CryptoCoinsNews

The teenagers story has captivated America, delighting people with its mix of childhood ambition, entrepreneurial skills and hard work. Mr Finman has been celebrated on news channels, and lauded in the tech community.For his story is little short of remarkable.

The tale began in 2011, when he was 12, and his grandmother gave him $1,000.

Mr Finman, whose parents Paul and Lorna met at Stanford University in the 1980s, when Paul was getting his PhD in electrical engineering and Lorna was getting hers in physics, took the cash and invested it in Bitcoin, following a tip from his brother Scott.

The Finman siblings, three brothers, admit to being fiendishly competitive. Erik describes his family as being the "Elon Musk version of the Kardashians" both his older brothers work in tech and engineering,and the youngest Finman was frustrated by school.

Read more from the original source:
Idaho teenager becomes millionaire by investing $1000 gift in Bitcoin - and wins bet with his parents - Telegraph.co.uk

You've seen all the headlines about bitcoin and other cryptocurrencies rising in value. Maybe you want to get in on the game. But how do you even start? We'll show you.

Before you do this, though, you should note that bitcoin isn't universally accepted like regular currency. My colleague Seema Mody published a great video recently where she tried to live a week on the currency, and it wasn't easy. You can use bitcoin online and at some retailers, but for the most part you're still better off just paying with cash or a credit/debit card.

You should also be aware that bitcoin is more like a speculative investment than a regular currency, and can fluctuate wildly in value. Although the overall trend has been up in recent months, but crashes of 20 percent or more in a few days are historically not uncommon.

Still interested? Here's how to get started:

Excerpt from:
How to buy Bitcoin in seconds from your smartphone - CNBC

Financial markets are frothier than a millennial's 3-D latte. Investors are scrambling to throw money at Argentina, Vice Media and George Clooney's tequila. Only the crypto-currency craze seems to give us comfort there are worse bubbles out there.

One bitcoin is now worth

$2,677

The latest warning against digital currencies comes from Aberdeen Asset Management's top venture capitalist, Peter Denious. He blames a feeding frenzy of speculation for the explosion in prices and new coins.

"A lot of lessons will be learned and a lot of money will be lost, before a lot of money can be made," he told Bloomberg News. "It's a gold-rush mentality."

Bitcoin Boom

Crypto-currency craze is unsettling people but shows little sign of going into reverse

Source: Bloomberg data for Bitcoin Tracker, an open-end Exchange Traded Note incorporated in Sweden.

Denious is right to say that the market is speculative and unsustainable. Despite recent price wobbles, Bitcoin has almost tripled year-to-date, to $2,677. Its closest rival, Ether, is now worth more than 40 times its end-2016 level of $8.

This isn't because people are using crypto-currencies to buy homes or cars, or because regulators suddenly like them. It's seen as a way to make money.

Another Bubble?

BofA sees S&P 500's market cap relative to nominal GDP hitting all-time highs

Source: Bloomberg

It's hard, though, to separate the crypto craze from worries about regulated public markets and the real economy after a decade of ultra-cheap central-bank cash.

Everything's Fine

Volatility keeps getting crushed

Source: Bloomberg

Talk of a bubble permeates every aspect of today's financial markets. Bank of America research offered up several signs of "Wall Street excess" on Friday:

Bitcoin wasn't mentioned once. That makes it harder for the mud thrown at crypto-currencies to stick. Even Fidelity's CEO and John McAfee are mining bitcoins in this market.

The mind-boggling returns of crypto-currencies also reflect a desire to escape public market bubbles rather than just emulate them.

If bonds are the old world's safe haven, Bitcoin is the millennial generation's apocalypse insurance. Crypto-currencies are marketed as a direct expression of opposition to central-bank and government policy, far more so than gold.

Just as low yields push wealthy investors to take bigger risks -- like buying Argentinian debt -- some people see Bitcoin as an escape from financial repression and instability.

That's why Venezuela, where demand for digital coins is soaring amid triple-digit inflation, currency devaluation and political crisis, has one of the highest potentials for bitcoin adoption in the world, according to the London School of Economics. The other top country is -- you guessed it -- Argentina. Monetary experiments beget technological ones.

This doesn't mean that there are purely rational explanations for the actual price of crypto-currencies today, tomorrow or yesterday. If the bubble bursts, investors will have to lower their expectations as to what Bitcoin and its ilk can actually achieve without rampant speculation and illicit activity.

But the more worrying scenario is that political unease about central bankers and wealth inequality will help to funnel more money into crypto-currencies.

Societe Generale's Albert Edwards reckons citizens are close to turning on "unelected and virtually unaccountable central bankers" after years of economic crisis and stagnation.

Bitcoin's computer scientists don't deserve to be seen as a better alternative. But if the path out of the financial crisis takes a sudden turn for the worse, it may well be too late.

Both bubbles seem too closely connected for comfort.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story: Lionel Laurent in London at llaurent2@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net

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When the Bitcoin Bubble Bursts - Bloomberg

Younger, tech-savvy people are also more likely to play the digital currency markets and the high risk involved, Sunnarborg said. He estimates that about two-thirds of investors in cryptocurrencies are under age 40.

That same age category is less likely to invest in the stock market. Just one-third of millennials, or adults currently aged 21 to 35, said they owned a stock in a Bankrate study last July. In contrast, 51 percent of Gen Xers, or those age 36 to 51, said they owned a stock, and 48 percent of baby boomers, ages 52 to 70, according to the survey of 1,000 American adults conducted for Bankrate by Princeton Survey Research Associates International.

"The next generation is suffering from the same thing that the Gen Xers suffered in the dot-com bust," Winer said. "They're playing all kind of markets that they know nothing about."

He was referring to the speculative trading that ended in the stock market's plunge in 2000.

Traders and market strategists also worry that a "fear of missing out trade" has helped send U.S. stocks deep into record territory the S&P 500 has posted 24 record closes this year and is up 9 percent over that time.

The difference is this time, typical measures of overexuberance may not apply to stocks.

Bank of America Merrill Lynch's June global fund manager survey found that while a record 44 percent of managers say stocks are overvalued, their cash holdings have actually moved up to 5 percent, higher than the 10-year average of 4.5 percent. There's "no irrational exuberance" in contrast with the 1999 bubble, the note said.

However, sluggish global growth and easy central bank policy could limit investment returns, while people remain wary about stock markets after the financial crisis.

"I do believe that in a market with few attractive alternatives, speculation tends to become rampant," said Daniel Alpert, a founding managing partner at Westwood Capital. "And it almost doesn't matter what people choose to speculate in, as long as they believe there is a fool greater than they out there somewhere."

Originally posted here:
Bitcoin speculators are the new day traders - CNBC

I continually get news feeds streaming across my computer telling me how other countries are jumping on board with Bitcoin. But, I read in American financial sites that say to stay away from Bitcoin. The fact is, as a medium of exchange, Bitcoin has tremendous value and ability. As an investment class, Bitcoin continues to move higher, latest pauses on the road to $3k. Bitcoin, as an asset class is heading much higher based upon supply and demand. Articles are being printed showing that Bitcoin could eventually print $1 million dollars. While I can see Bitcoin $1 million dollars, I am going to focus on the crypto-currency's move into from four to five digits for now; that is far more easily accessible.

It is very easy for Americans to dismiss Bitcoin. By, and large, Americans think in only one type of currency; The U.S. Dollar. So, when I read articles on major financial website trashing Bitcoin, I have no problem trashing the articles; the disconnect with Bitcoin is more because of a lack of understanding. A perfect example of a country that is not only embracing Bitcoin is Japan. Japanese are embracing Bitcoin at a very rapid pace. Because of this, demand is pushing higher and higher, and so is price. I see this as being continuous. I see Bitcoin pushing past $3k and, in fact, eventually hitting $10,000.00 per coin with an eventual price target of $1 million for Bitcoin. This is the framework of why that is going to happen.

Whenever I sit down with anyone who asks me about Bitcoin, I always show anyone the daily chart from just the past year alone - below. I then tell them they should consider Bitcoin as an alternative and explain the reasons why. I go into the details about limited supply and no central bank as well as what is happening in the economies around the world. Again, Americans have a tough time with this simply because they cannot think outside of the U.S. Dollar box. Most Americans have never even traveled outside of the country; only 8% of Americans traveled outside of the United States in 2016.

Bitcoin is being embraced in Japan at an incredible pace. I have read several articles over the past two weeks alone where Japanese hotels, cash systems and other purveyors are adding Bitcoin into their economy. And, yet, in America, financial websites are warning to stay away from Bitcoin. I took this as a lack of education, if anything.

In Japan, the government has legalized Bitcoin - along with other countries. At the same time, the Bank of Japan is in the process of desperately trying to dilute their currency to create any kind of inflation possible. It is largely not working.

Here is a look at the central bank's "printing press" in action: As stated, their goal is to stimulate the Japanese economy and keep inflation at target, normal levels. They are not succeeding so far. Inflation at 0.4% on a year-over-year basis is not even worth bringing up; It is negligible. My bigger fear is that mountain of printing that the Bank has done.

In the meantime, savvy Japanese investors are scooping up Bitcoin at a rapid pace. Whereas Japanese Bitcoin exchanges were not even really a factor, since the first week of April when the government legalized Bitcoin, the Japanese exchanges are now neck-and-neck with America exchanges. This is just one of many countries where Bitcoin is not just a curiosity but is becoming a way of life and is being integrated into the economy at a rapid pace with 100s of thousands of pay stations and ATMs appearing.

Americans simply do not get Bitcoin and they may very well regret that later. There is a great deal of potential with Bitcoin as an alternative to banking; some 56 million Americans do not even have a bank account. Bitcoin, just like cash, does not have the extensive paperwork criteria like a bank account has. With some 56 million Americans not even having a bank account this is a significant opportunity.

Unlike the charts above showing the Japanese central bank attempting to dilute its currency, Bitcoin has not central bank. Instead, Bitcoin will only ever have 21,000,000 million coins. Because of that, the price of Bitcoin is going to continue to be pushed higher. In fact, unlike fiat currency, Bitcoin appreciates in value. The purchasing power of any fiat currency is always being eroded by a central bank, whereas Bitcoin's potential to continue to move higher. And, although this cartoon is a bit tongue-in-cheek, it is also very accurate: Compared to today, if you had invested $100 in Bitcoin in 2009, you would be worth about $75 million today. And, yet, there are people who trash the idea of Bitcoin simply because they do not understand the currency and what it does.

At the beginning of April, Bitcoin was trading at $900.00. It is now just above $2,650.00 and looks set to test the $3,000.00 level for the third time. That is a simple multiple of 3.5x in two months. If that happens again, even if it takes another 6 months to happen, or even 6 years, Bitcoin will rise to nearly $10,000. That is an impressive gain unmatched by other "stores of value" or asset classes. Whether the currency crosses the $3k level this time, I am not certain. But, I am certain it will push past eventually. It is a matter of when, and not if, given the limited supply and the potential widespread demand.

Bitcoin's limited quantity of coins is set. But, there are 7 billion potential users of the currency. The fundamentals continue to support Bitcoin moving higher and higher as more and more access is available. And, since this currency's track record is that it moves higher and higher, its appeal over fiat currency is gar greater.

I can very easily see a day when Bitcoin pushes past $10,000.00 per coin. And, I can see a day when there is another order of magnitude to the coin's value. Some savvy investors even see $500,000.00 per coin.

Bitcoin works because of the agreement that there is a price for it and its exchangeability for goods and services, or conversion into fiat currency. And, as more and more countries ensure Bitcoin is able to work unhinged, the demands for the currency will continue to move higher. That will push up price. It is an added value to the coin's appeal.

Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in COIN over the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Embracing Bitcoin - Seeking Alpha

Amid what appears to be widespread fatigue among traditional investors, excitement is booming in the wild, wild west of cybercurrencies right now.

Over on Reddit, one forum dweller said they were ready to drop $20,000 into bitcoin BTCUSD, -0.02% after doing some research and concluding the only way was up for the crypto cash. It beats $20k sitting in a safe-deposit box, the poster said.

Only invest what you are willing to lose, was one response.

For those who are willing, Rupert Hargreaves, blogging for ValueWalk, offers up a less volatile way to bet on cryptocurrencies over just buying bitcoin or ethereum -- though theres still plenty of risk involved. He says theres big money being made on cybercurrencies... and where theres an opportunity, there are hedge funds.

Hargreaves took a deep dive into the Crypto-Currency Fund Index from Eurekahedge. The data firm uses the index to track the performance of five actively managed hedge funds with holdings in bitcoin, ethereum and other digital cash.

His findings? The Eurekahedge index not only beat traditional hedge funds, it even blew bitcoin itself out of the water.

Between June 2013 and April this year, the index shows eye-popping cumulative returns of 2,152.32%, versus 1,408.11% for the Bitcoin Price Index. Looked at annually, thats a return of 125.35%, compared with 102.96%.

It should be noted that while less volatile than a straight play on bitcoin or another cryptocurrency, the level of volatility for the index itself is off the chart, Hargreaves notes in his blog post.

In its report on performance, Eurekahedge said that over a period of 14 months between December 2013 and January 2015, the Eurekahedge Crypto-Currency Fund Index lost almost 73% of its value from its 2013 high. In contrast, the Bitcoin Price Index lost almost 81% of its value, according to Hargreaves.

Whether were on the edge of a South Sea Bubble or greatness for the cybercurrency faithful, bitcoin and its pals have been bringing the drama.

Popular rival ethereum suffered a flash crash Wednesday, plunging from more than $317 to briefly trade as low as 10 cents in a flash cash on the GDAX exchange before rebounding. In a post, GDAX Vice President Adam White said a multimillion-dollar market sell order was placed on GDAXs ETH-USD [ethereum-U.S. dollar] order book, which resulted in orders being filled from $317.81 to $224.48for a slippage of 29.4%. That, in turn, began a cascade of around 800 stop-loss orders and margin-funding liquidations, which sent the price temporarily as low as a dime, he explained.

Just a day in the life of a brave new world.

Check out: How big is bitcoin, really? This chart puts it all in perspective

Originally posted here:
How to bet on bitcoin, without the crazy volatility? Here's one idea - MarketWatch