Category Archives: Bitcoin

Bitcoin Posts

Start-ups Take Two

Welcome to the future, again.

b2fMaybe it’s serendipity, things seem to be coming together for technical innovation these days. Maybe we’re experiencing the promise. Everywhere you look, literally, efficiency is being injected into our daily lives. Our PC and the internet in our pockets, in our cars, and at The Gap.

For those of us that lived through pets.com, boo.com, flooz.com, Napster, and the play by-play demise of these astronomically high valued companies on fuckedcompany.com, the ongoing optimism around  Twitter, Facebook, Bitcoin, Snapchat, and a myriad of others has taken me a bit by surprise. At the time (and for me personally) it was the tsunami of freshly minted marketing graduates descending on NYC that signaled the beginning of the end. The party was filling up with the uninvited. Time to cash out. Bye. France? Ok, why not. For those handing out the cash it was the start-up earnings that never came to the party. Time to apologize to our investors and move on.

This weeks Economist has a good piece on the whole start-up environment, it looks at funding, management styles, even the technology, which has evolved into something akin to a theoretical plug-and-play, or start-ups in a box. This time might be different they say, because the tools are available to create our craziest idea for next to nothing. The release cycle has turned into overnight – nothing ever leaves beta. In fact the cost of moving an idea into a fad like Snapchat takes place in the real world. That real world isn’t just Google or an internet site, it’s your phone, your car, your home, your entertainment and even your currency.

Andreesen’s op-ed piece in the New York Times, screaming Bitcoin is the future, reminds me of the excitement around mobile in 1999. Yes mobile. People forget that mobile was also all the rage even 15 years ago, very smart investors with vision and insight lost millions. They had to wait for the iPhone and the Apple’s app store to kick things off. The mobile promise has finally arrived,  open-source software is saving millions of dollars in development costs and today’s web 2.0 geeks are all enthusiastic about Bitcoin. And Marc Andreesen is probably right about virtual currencies,  but how’s his timing? Bitcoin is playing in a Keynesian sandbox full of politicians, central banks and federal governments. Napster pissed off A&M music, and lost. With Napster you could point the finger at three humans, Shawn Fanning, John Fanning and Sean Parker. There’s only the consumer to take to court with Bitcoin, and in it’s case, who will pay the lobbyists? Eventually the end-user is the only possible target as the Silk Road founder Ross Ulbricht can attest. The real question for Bitcoin believers is: will politicians and federal governments treat Bitcoin as financial terrorism? And who’s coming to the party?

*Update:  I just stumbled on Jamie Dimon’s comment  that Bitcoin is a terrible store of value… (here)

 

Another Year (Tchin)

priorite-a-droiteAre you already tired of top 10 lists and reviews; the best, worst, top, bottom, favorite, saddest, ugliest, or even funniest? The people we lost, the music, the films, and viral videos all get pulled off a virtual shelf then pulled from a a virtual box. In truth these lists are stored in a relational database and prepped for release in November. You never know – the top 10 most viewed YouTube videos might need to be recycled for 15.

Of course predictions will be arriving any day. Here’s mine: in 2014 Google will  start adjusting the “Lists of Top” I prefer, automatically. The top 150 wing-suit videos, 45 cat jokes and the 5 most effective Federal Reserve programs. They’ll appear on my android phone without my asking. Relational databases are smart but Google is much smarter.

Lists of absurdities still catch my attention. I admit. (Thank you FTAlphaville) It’s harder to define absurd and as far as I know, you can’t measure absurd in hits, votes or dollars. Absurd appears only in hindsight.

Here are a few of my favorite dubious absurdities:

  • Buying a Tesla with Bitcoins.
  • My telephone asking me if it should record my commute and share it with my friends on Google+. (Anyone that knows my routine will appreciate this just a little bit more.)
  • Nicorette prices fluctuating with the price of cigarettes.
  • Debt, QE and its positive impact on ‘growth’ forever.
  • Herbalife pyramids

When you live, work and eat in France, absurdity often passes into the realm of the surreal.

My trading year left a lot to be desired, it was frankly absurd. Absurdities abound and they deserve attention (with or without a relational database) and a few lists of their own.

Hello?

Bitcoin Parabolic

It’s hard for me to resist the Bitcoin story. A few months ago I calculated that mining Bitcoins would cost more than the electricity needed to run the mining computer (here).

Today that’s no longer the case. Look at this 5 day chart.

Bitcoin Surges

What should we make of this?

It’s starting to feel like 1999 – just different.

  • The S&P (and most indexes ) only climb
  • IPO Excitement – see TWTR
  • High School Kids Trade Forex and CFD’s
  • QE +++
  • Housing Bubble (This time is different)

Bitcoin is what makes this all extra amusing. The press has grown tired of the story. Why? I have no idea. I guess I’ll turn on the miner tonight…

Bitcoin Crashing

Time For Another Bitcoin Post – Down 40% in the last 2 hours

Bubble, no bubble? The markets are in rally mode and Bitcoin is tanking. I’m sure there’s no link, but still… MtGox is suffering under the weight and the exchange is having growing pains.

Bitcoin Crashing

So what’s a Bitcoiner to do? They just learned a few lessons, regular traders have been learning for decades.

  • What goes up goes down.
  • Weakness in the exchange creates a crisis of confidence.
  • Valuation is hard work.
  • Backstops limit volatility.

Good luck bitcoiner, cupcakes just got cheaper.

 

S&P Futures Chart

SPY S&P Futures – Just Part of the Churn?

S&P Futures ChartWatching the schizophrenic twitter kids, you’d think we’re falling off a cliff today. Maybe today’s the day, but it’s been the same for about 2 weeks now. Risk-on, Risk-off – day in, day out. The momentum looks extra convincing today, or does it? The S&P futures chart is unique in my trading memory. It looks to have doubled-up in volatility, yet look at the VIX, we’re at 13, and holding lows, hardly panic. Option players are counting on the Fed’s steady bond buying. Even Gold is playing along with its consisitent downtrend. No worries, right?

My humble opinion is that the VIX is undervalued here, the 10 year bond has been churning as well, but easing upward. In fact, maybe Bitcoin has just taken over from the VIX as a more appropriate fear index! Parabolic…

If the VIX is undervalued, check out some long straddle’s here, the only caveat is that if this churn continues you’ll get burned, adjust quickly…

btcguild stats

Bitcoin – Now Everyone Has An Opinion

cpu

Talking media heads frustrate me because they regurgitate information they don’t understand. They’re like bad salesmen, but with oversized influence.

I’ve been playing with Bitcoin now, just trying to understand all the fuss. I remember the early internet and the first Mozilla browser, the technology was captivating and the idea simple enough. There are some similarities here. HTML (the internet) wasn’t a threat  at the time, for example, to small bookstores.

If I’m going to criticize or advocate this thing, I’d like to understand how it works. So I installed my wallet and a miner.

When early HTML was making the rounds you played with it, came up with crafty uses for ‘refresh’, animating an image or loading other unique data. This miner I installed works with a server and a bunch of other miners to ‘discover’ Bitcoins, then the proceeds are distributed amongst the miners. Simple enough, creative enough… I get it.

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cool avatar

Bitcoin Virtuality – Who Owns My Avatar?

cool avatarVirtual objects, virtual pets, virtual lives have been common gaming currency since the inception of MUDs and MMORPGs (massively multi player online role-playing games). Virtual property has been around for even longer. But, who owns my avatar? In 1999 Linden Lab’s were on to something, when Second Life recognised a gamer’s intellectual property. They even invented Linden Dollars. Warcraft in 2004, Flyff, and dozens of other games have created virtual economies by exchanging virtual goods in the context of a ‘game’.

Avatar chasers, lawyers, the tax man and gambling regulators have been observing these economies for over 10 years, yet rest well behind the curve. And the secondary market for virtual objects within the context of these games has been largely ignored. If you can’t transfer your objects to other players for a fee, it seems you’re safe from big brother, but that’s no fun. Where are my bragging rights? On the other hand if you start selling what you earned, things start to look more like commerce/gambling. Still the secondary markets for virtual game currency is alive and well. Do a search for World of Warcraft Gold. It looks like I can get 10000G for about $10 in 5-15 minutes (I’m not sure why the time element is important). The site I’m looking at even as live 24/24 help in 4 languages.

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