Price manipulation and zooming out logarithmic style

in #price7 years ago

I remember some time ago reading a comment along the lines of "if you guys thought the bitcoin prices have been getting manipulated in the past - just wait until the Wall Street guys get on top of it". It didn't make much sense at a time to me, someone who hasn't been active with trading or investing pre-blockchain, but seeing as how futures are now available for Bitcoin and Ethereum it is starting to get a lot more clear.

Having been into the blockchain space for some time now, I've witnessed a lot of price swings, usually they seemed quite random, some coins would go down while others up. It seems as of late it has been following this new pattern where most of them mimic the price of Bitcoin which has continued to be as volatile as ever.

To this day I still haven't looked into the stock market or other investing opportunities than crypto because I was lucky enough to get stuck and addicted on blockchain technology and the currencies that came to life through that. I consider it lucky because I know how few people were as active and interested in it back in the day, that has changed a lot now but the matter of the fact is that a lot more people had heard about it around the same time but they just didn't stick around. Hence why I consider myself lucky, for some reason I happened to have more time on my hands during that period to "waste" (as many friends and people close to me called it) into the rising blockchain awareness. If for some reason I had gotten uninterested, a few trades had gone wrong too often or something else had come along I am sure I wouldn't have continued being so obsessed about it in the lengths that it made many of my friends annoyed of me since I couldn't stop talking about it with them.

Something kept bringing me back to it though, something that felt real and valuable for maybe one of the first times in my life. I admit when the altcoins started popping up I did get a bit insecure of what it was I had gotten myself into, especially currencies like Dogecoin or other copies that were popping up, but there I was abusing my GPU to the max to turn electricity and wear and tear into "digital tokens". My gaming friends got annoyed at me when I'd skip playing because I was mining and getting a lot of Dogecoins early on, they thought I had literally gone nuts probably more often than they jokingly said it. Even though I tried my best back then to get them interested and see it the same way I do, I didn't have much luck and to be honest I couldn't even explain to them as well back then as I can now since I didn't completely get it myself either.

One thing I believe that caused me to subliminally understand the technology, what gave it value and what ensured that it would be unstoppable in the future was something similar I had encountered in the past, the early days of the internet. I was only ten years old at the time when things like Torrents and p2p sharing were getting popular, even though I didn't understand the technicals back then I was aware of how difficult it was to stop it. No matter the negative feedback they got about the main use of them being to copy things illegally, it didn't mean that it was the only thing it could be used for. I remember the time when p2p sharing was being used for other things as well, legal things such as downloading games faster because other people also downloading them would share what they already had downloaded to another person. The fact that after all the warnings, taking down piracy mass uploaders and finding them and wanting to shut it all down I realized that they can't. No one can, unless they'd shut down the internet. It was too late for that though, the internet had already become so big and a necessity for many things that shutting it down for something like content piracy was ridiculous. This is also why I believe blockchain tech with Bitcoin came out at a perfect time. Even those who saw it as a big threat to their centralized monetary systems and middlemen competition would not be able to stop it much in the same way as torrenting.

That's what got me to continue researching the tech and all the new currencies that came to life after Bitcoin, I knew that it was here to stay and change the world like nothing else had changed it before. Re-inventing the internet of money and the monetary systems.

Of course that still didn't get many of my friends interested, no matter how I tried to explain it to them. Some did listen though and trusted my judgement enough to invest some on their own or risk their GPU from overheating to mine some coins. Many of them have already seen huge amount of profits through it and many of them have just like me skipped everything else and gotten more into the cryptocurrency space.

What I want to get to with this story is that there are a lot of enemies that don't want this technology to succeed. Many who don't see things the way others do, who don't understand that we are entering a new era where manual labor is being overthrown because bots will be able to pretty much do anything much better than humans can and much cheaper. Jobs are already getting cut in many different sections and the unemployment rate is rising whether we like it or not. They are also realizing that they can't stop this technology. They can postpone it, threaten people not to touch it and manipulate it through news or markets but in the end they will realize that this technology is unstoppable and the more they fight against it the more it will hurt them in the end that they didn't get along with it.

As we saw recently with the Facebook scandal and Cambridge Analytica allegedly being the reason to one of Americas biggest scandals with the presidency being stolen, manipulation of news and stealing data to easier target people's thoughts and decisions is a very powerful tool. Unfortunately this is something that will happen time and time again in the cryptocurrency space too, even more so here considering every action can benefit some people who are holding a certain asset that can grow in value because of their manipulation or manipulation news of competitors for their own gain.

It might even be that most of the important people in the world have already understood the power of blockchain and that they are now manipulating the price to get the early adopters to sell so they can gather a big amount of coins that can't be inflated.

The important thing to remember here is that this technology has been invented, it exists now, it works and it can't be stopped. It is open-source, can get upgraded (forked) and is competing versus every sector that has been operating in the past with unfair cuts and costs.

I understand that people are easily manipulated by news, what other people think and say, but its good to remind them of what is important with this technology and how it has performed so far. They often get sensitive about daily/weekly/monthly movements but don't zoom out enough times to see the reality of things.

I noticed the other day that coinmarketcap has included a logarithmic scale on its charts, even though the site does not account for the price of Bitcoin since the beginning, it does show its movements since the site has been up. I found out that blockchain.info has some charts from beginning of 2009 when Bitcoin was still worthless and they also had a logarithmic scale that I wanted to show you the difference it can change in your perception of the price movements.

Here is the Linear Scale

Here is the Logarithmic Scale

Linear Scale of all currencies since 2013

Logarithmic Scale of all currencies since 2013

It's kind of hard to imagine that there could come another spike in price, say bitcoin going past 100-500k and making the recent chart look almost like a straight line like the past movements look now, but it has happened time and time again with Bitcoin and other currencies with potential that it wouldn't surprise me to see it happen again soon. It all depends on adoption and how fast the rest of the world will realize the value of this new type of money and will want to opt out of their other holdings. It's only a matter of time.

Remember that with a finite amount of tokens and only a low number of people trading them daily, people will go out of their way to try and get you to sell your holdings. The manipulations and fake news may have only just begun but I'm hoping the new web, something like the Steem platform will help deter it in the near future.

Even if you are one of those that believes its all just a big bubble that will burst sooner or later, do what I suggested some of my non-believer friends to do. Place some money you can afford to lose into it and forget about it for a few years, hodling has been one of the most profitable things for many in this space, even those who have no idea what the technology is.

Thanks for reading!


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The logarithmic scale really makes you see the market from a different perspective. Blockchain and cryptocurrency technologies are here to change the world, keep in mind that technology adoption trough human history has always been slow and painful.

So far there has been a lot of FUD and naysayers but let me tell you, i believe this is only the beginning, blockchain tech is still in its infancy and stiff people will always be against advancement.

Since the start of human history, naysayers to new technologies have been there trying to stop progress, probably since the wheel was invented lol, why do i need this wheel when i can walk with my two feet? Why do i need a car when i have my trusty horse? why do i need electricity when i have a candle? why do i need a phone when i can send a letter? why do i need the internet when i can use my phone to contact people? lol the naysayers will always be there, so we have to learn to live with it and help spread the awareness of the technology and if possible help improve it :-D

I totally agree! I am extremely excited about the future of Blockchain and Crypto. I totally fell in love with it <3

Heya Acid...

I know you know stuff, as an early adopter you dominate this space much more than I do... I'm a one year old coiner...

Now, what I want to ask you is what new tokens (founded this year or the last) do you think have the brightest future?

Would love to know your opinion on this... I've been asking around knowledgeable folks such as yourself to see if I get some common pointers.

I've actually been thinking of getting back to posting about altcoin news and new ICO's I believe have potential for some time now, this recent dip might be a good time to get started.

It will obviously all be personal opinions but I haven't been doing all that bad in the past "Alt-News" I used to post and recommend some projects if you wanna google them and check them out.

Hopefully I'll have the time and energy to get back to it soon, wouldn't mind helping followers earn some money so they can increase their SP from trading/investing and thanking me by continuing to upvote my posts. :)

Definitely do it sometime soon, man. When SBD gets back up a bit and I can afford to spend some money into crypto, I'd find it pretty handy to have some suggestions from someone whose opinion I value. I put a little bit of money into Storj a few months back when SBD's were still somewhat high after you recommended that and a few other cryptos, been hodling that since :)

Go EOS Max.

But dont Go Full money. Altough i like the team, and the Idea, remember that at this moment its only promisses.

But there is potential on those promisses.

To take a chapter out of @taskmaster4450 playbook the Banksters are doing everything to feed the FUD through their media controlled companies.

Funny how you talked about Torrent and P2P as I was thinking of Napster and how record companies tried to stop it and it eventually led to the creation of technoly and services like Spotify and apple music that we enjoy today.

They can't stop the technology being developed and will be adopted to the mainstream.

Place some money you can afford to lose into it and forget about it for a few years, hodling has been one of the most profitable things for many in this space, even those who have no idea what the technology is.

sage advice there.

My response to this is like the response I gave earlier today on your post about self driving cars. Cryptos have come and they are going to stay, there's nothing that can be done about it. There will be more fight and dips than this but at the end crypto will make it out victorious. I will never make the mistake I made earlier in my crypto experience where I sold my bitcoin in late December 2016, now I have made up my mind to hold till all I have left is the will to say Kodl

As funny as it may sound, I was just going through a web page today and noticed something really striking..

Here's a look

IMG-20180322-WA0005.jpg

And then I laughed.
The charts are looking a bit similar tho.

So if we say its been manipulated, I might want to agree to an extent as well as disagree to another extent too.

They can postpone it, threaten people not to touch it and manipulate it through news or markets but in the end they will realize that this technology is unstoppable and the more they fight against it the more it will hurt them in the end that they didn't get along with it.

I agree with you 100% on this.

They can't stop it, but "it's coming" is inevitable hence its manipulation.

My friend @acidyo, I love this analysis. Would have loved to share my thoughts on all of the points you have raised tho, but then, we are both on the same page. So I'll just say "Bravo my friend"

No necessarely.

The thing is, only btc, ETH and LTC (bch maybe?)are widely traded against usd.

All other coins are traded against BTC, so changes on BTC/usd are heavily reflected on COIN/usd.

Well that's been true for a long time, the alts basically follow BTC to the T

logvslinear.gif

As you can see from the charts above, an increase in price from $10 to $15 is the same as an increase from $20 to $25 on the linear chart, because both scenarios represent an increase of $5. However, a logarithmic price scale will show the vertical distance between $10 and $15 to be different than the $5 distance between $20 to $25. The reason for this is that a change of $5 when the price is at $10 represents a 50% increase, while a move from $20 to $25 is a 25% increase. Since a 50% increase is more significant than 25%, chartists will use a larger distance between the prices to clearly show the magnitude of the changes.

It's kind of hard to imagine that there could come another spike in price, say bitcoin going past 100-500k and making the recent chart look almost like a straight line like the past movements look now

I don't know about 500k but i do believe that at some point it will reach 100k.Bitcoin will become a measure of wealth in the following years.Such as gold

I regret my negativity with Bitcoin (the only one I knew of before). I was telling myself that time that it is too much to invest in and I worry of losing my money. Only to be slap later on. All the "If only.." thoughts drive me crazy. If only I take a leap of faith..

there are a lot of enemies that don't want this technology to succeed.

As bad as the FUD already is, I expect it to get much worse. Crypto can be used by terrorists and crap like that.

But decentralization is too powerful. Early adopters (like anyone currently using the Steem blockchain) may end up very well off.

I'm surprised how crazy volatile bitcoin is that log charts are often better for long term analysis