maged thanks for this,

I somehow think there is much difference from now and back then.

Price can go down I suppose, but the world economy awareness is just picking up.

shortly after bitcoin's 2011 crash the media really stopped reporting on it.

This time we dropped 80% or so and media is still covering it.

I honestly think this is the beginning of media attention phase.

The public hasn't woken up to it yet.

Just my take.

This time it's different. 

I don't disagree, if you look at the larger picture. If you're planning to be invested in bitcoin for 5-10 years, now is a pretty good time to buy. Hell, anything under $10,000/BTC is a good time to buy, at that scale. An argument could even be made for $100,000/BTC.

But that's not the scale I'm talking about here. I'm talking about the daily to weekly scale. In that scale, we've clearly peaked in media attention. If you don't believe me, just look at Google trends! Does the fact that you could have made that same argument in 2011 invalidate the fact that a bubble occurred on the daily and weekly scale?

If you're strictly investing long-term, you should really ignore this board in your forum preferences, because all that matters there are the fundamentals. As long as you watch that, you shouldn't even look at the price, since that will only spark your emotions and cause you to deviate from your plan.

I keep thinking the same thing, but then I remember that people constantly said your last sentence almost exactly, but about $10 instead of $100 back in 2011. So, I don't know what to think.

I think there is a fundamental difference: at 2011 there were way too many with weak hands holding way too much, for which they got at a way too cheap price, at this moment they are mostly out.

And we should not forget, a billion dollars market is quite a bit more difficult to manipulate than a million-dollars market, anyone remember the pandemonium that was Nov 2011(Bitcoinica, etc)?

Tend to agree with Maged. Unless we get lots of fresh money quickly and can decimate the Bitcoins from the order book causing a positive feedback loop, we are in for a bleeding.

An important factor during times of historical bitcoin scarcity in the markets (BTC on MtGox's book at the peak has been decimated to an unbelievable 30k, and it is still low with barely 130k): Miners still have unbelievable profit margins, and most probably most choose and chose not to sell most of their profits and speculate instead. As the profit margins go down due to difficulty increase and price decrease, they are forced to sell their Bitcoins to cover their running costs, providing the market with a larger share of the 3600 daily Bitcoins. They will also begin to sell their accumulated coins to take profits if sentiment worsens. Now speculators not only have to compete with other speculators, but miners, and a negative feedback loop can emerge. People find themselves having vastly underestimated both the available and the newly added supply.

The time to buy Bitcoins could be when difficulty begins to deflate again. Admittedly, that could happen much further up if another media hype starts, but the chances in my eyes are relatively small.

Further factors making me more bearish in the mid term: Bitcoin exchanges are being eliminated and MtGox is returning to its monopoly status from years ago. Bitcoin still extremely centralized through mining pools (2 people conspiring can do a 51% attack, and actually have done so during the coin fork), block size limit hindering growth (see SatoshiDice), altcoin popularity rising (LTC soon to be added to MtGox; Ripple emerging as possible alternative). Oh, and of course that there are no popular actually used (ie, by lots of people with lots of volume) economic applications I know of besides SatoshiDice and Silk Road. There is still no Bitcoin economy.

PS: Talking on a scale of weeks/months here, of course. Short term I guess I am mildly bullish.

Part of what sparked the last bubble in 2011 was the mining race to arms war.

Right now we haven't even bit off a tip of the ice-berg of how much ASIC hardware can and will come online thus reducing daily mining rewards for miners thus making bitcoins much more difficult to obtain through mining.

You have failed to read my post. I was talking about how a larger share of newly generated coins is provided to the market as profit margins go down and its effect on the behaviour of dormant supply.

Also, Bitcoin Days Destroyed is a usless metric that is easily manipulated.

great post

all the bulls in denial here make me want to push that sell button

this is not true... bitcoin is finding its niches in many small places, just planting seeds -- no flowers yet, but soon

i can also tell you from first hand experience that seals with clubs (bitcoin poker) saw a massive influx of new users over the course of the last 6 months.

i think you're underestimating the amount of media coverage we received... bitcoin was all over reddit, tumblr, etc, in a big way. these kinds of things have a gradual effect.

in other words, i think the bitcoin userbase is expanding at an unprecendented rate, even still, though said figure may have taken a hit after the crash.