Another Wild Spike In Bitcoin Cash On Coinbase Addition + Atomic Swap - This Is Why You Keep Optimistic Limit Orders Active
As previously noted on my blog, there are a number of positive pieces of news coming for Bitcoin Cash - and in this case, I don't mean the fees for transferring Bitcoin.
Aside from the addition to Coinbase, a successful atomic swap for Komodo has also been performed with Bitcoin Cash:
Bitcoin Cash also has "Full Bitpay Support + Bitcoin.com Debit Card + Blockinfo Wallet + SBI Group Partnership" on the way. We'll if any of this matters to the market. Ironically, Atomic Swaps could end up being a negative for Bitcoin Cash as they will make the legacy Bitcoin chain more usable.
This fast doubling/tripling phenomenon that Bitcoin Cash displays, before hard pullbacks each time, presents the perfect example case for why keeping optimistic limit buy and sell orders at exchanges is often well worth the risk of leaving trading funds on exchanges.
Here's a look at how Bitcoin Cash looked a few days ago:
Note the previous November spike that should have warned us this might happen again. Hypothetical places to set limit buys and sells are pointed out on the chart, admittedly in hindsight. However, even optimistic targets are often well-exceeded in such a volatile market. In this example, I caught a sell closer to .385, and a rebuy at closer to .175-.2. There was money left on the table, but no way to know it and it was still an excellent trade.
Correctly done, you will actually layer your buys and sells around a central numbers. Say .4 BTC is your optimistic sell. Put limit sells up ranging from .375-.425, or a wider range if you feel comfortable, with an average of roughly .4 BTC. This way, you will not miss out on a run just because a price missed your single buy/sell by a few dollars/satoshi.
Here's what we saw last night:
Earlier that day, Bitcoin cash was as low as .1 BTC. Had you set an optimistic sell at a doubling, or even tripling, you would have hit. Provided you follow the rule of never leaving your limit orders on a round number. For example, don't sell at "10,000" - that's too obvious. Layer sells in from $9800-9990.
For the record, a tripling is usually too greedy. I recommend going for 175% or less (2.75 times), which in this case, would have served you well.
Hopefully, with this information, the next time you see this happen you'll have FOLO instead of FOMO (Fear Of Lamboi'ing Out.)
If you have any additions or errata for this post, please let me know! I will see that they are voted to the top of the comments, and will make the appropriate edits (if possible).
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Sources: Coinbase, GDAX, CoinMarkCap, r/BTC
Copyright: Bittrex, Bitcoin.com, ArsTechnica.com
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I totally agree with what you have to say here. It's amazing just to grasp the huge "creation" of wealth happening as we transition to a new form of value.
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I regret selling my BCH in august now! I still don't support it, but I never thought these forks would be so succesful.
As usual, it turns out the only way to win is to just HODL. I swear..every single trade I make... at some point it turns out I should've just hodled instead.
edit: I don't think I will be buying back into BCH though. I'd rather get a real, decent alt instead.
Well, I have been saying Bitcoin Cash is the real deal for some time. The way you say "support it" makes it sound like it's a political candidate. You're too emotionally invested in your trades/holds.
"I'd rather get a real, decent alt instead."
Sorry to be blunt but, this tells me you probably don't know much about Bitcoin Cash.
Have you personally read the entire Bitcoin whitepaper?
Bitcoin Cash appears to be the only real Bitcoin in existence today. Bitcoin was never meant to be restricted to 1MB blocks, or have $20 fees. The white paper makes this explicit.
Let's take a trip into the "way-back" machine. And by way-back, I mean, 14 months:
The funny thing is the very vendor mentioned in that image, Steam, now no longer accepts Bitcoin precisely because they sell items from $1-$60 and they can't use a payment format with $20 fees.
Bitcoin Cash is Bitcoin. The market doesn't know it yet.
PS - This doesn't mean Bitcoin is going down. It may become digital gold. I'm not hating on Bitcoin. But it's no longer Bitcoin.
Here's a simple artist's rendition of why:
PPS - Also, to be clear, I'm not saying it's a good time to buy into BCH, or sell. It is, however, a good time to trade, and it's volatile, so if you put in a low limit buy, you may get a bargain on a small piece to hodl.
Oh, yeah, maybe I wasn't clear. I don't really care which Bitcoin is the real Bitcoin.. I think they're both not the best cryptocurrencies. I think we're headed to a future where you can pay with whatever crypto you're holding, no matter if it's BTC, BCH or STEEM or ETH. So whichever is the real Bitcoin doesn't matter. Bitcoin (either one) only matters now, and will continue to matter as the biggest PoW coin or atleast one of them will.
Somehow I suspect (a feeling) that in the long run, PoW will survive and indeed be viewed in a more positive light than today. But using BTC for payments? Nope, not without significant upgrades. Using BCH for payments? Cheaper sure, but less trust in the longterm reliability of the network due to centralization risks. Some people will trust it enough to use it, and it will probably be safe (you'd have to be an idiot to kill your own goose with the golden eggs), and others will prefer to store it in BTC as 'store of value' and infrequently move it due to costs.
But even though I am a big crypto-enthusiast, I've learned to stay critical and I would still rather place (most of) my bets on crypto's that have a clear-cut value proposition other than 'it is money'. I know that we're all falling big time for the belief in crypto, and yes, fiat money is only belief too. But in the long run, if you have the choice between Crypto A which is 'like fiat' and Crypto B which has a clear value proposition... Well, it kind of ties back to our other discussion right now in the other post regarding fundamentals. A clear value proposition will be the fundamentals that keep it afloat when the belief in 'money like fiat' starts wavering, I believe.
So, that's why I said I'd rather put my money in a good alt than BCH. I feel like ETH is perhaps a less explosive bet, but a more safer bet. Even better is something like OMG, where there is a profit-sharing mechanism built into the token. It doesn't hinge on belief (=potential bubble) but is more akin to traditional investments.
Hm.. I think this discussion is inspiring a new topic for one of my next posts.
Edit: by the way, I think they should unify both Bitcoin communities. Let BTC be digital gold, or a digital 'savings account', and let BCH take care of payments. That's essentially what both communities seem to want anyway. Atomic Swap between the two, integrate the whole damn thing together and there shall be peace on earth
"That's essentially what both communities seem to want anyway."
Unfortunately, this is absolutely what the
snakesdevelopers of Bitcoin core want, who have publicly admitted they have restricted network speeds by preventing upgrades to increase fees to force users onto their "second layer, NOT decentralized" solutions like Lightning.The more I think about it though, the more I am starting to understand why indeed 2nd layer solutions are necessary in crypto. It was explained by a recent video of Boxmining where he interviews the Trinity developer (which is Lighting/Raiden, but for NEO). There they talk about the thousands of transactions per second that are required for running games, for each individual player, and how no scaling solution for the main chain can ever be enough to accommodate that many transactions. Of course this is more of an ETH/NEO discussion than a BTC one as BTC is purely a currency and not a platform as such. But it did make me view these second layer solutions in a different light.
As for the Bitcoin transaction fees, it turns out that Coinbase might in fact be the reason why fees are so high: they are spamming the mempool with individual transactions. Coinbase is taking measures now, one of which is finally implementing Segwit. It's going to be interesting to see how the fees develop once they do.
Also, the Lightning Network has arrived, sort of. It makes the fees practically zero, or will over time. I'm still undecided on the implications this has for decentralization and trust. I think you remain 100% in control of your own funds, and the only possible risk might be during a transaction, but otherwise everything should still be Bitcoin-secure. I could live with that, for the time being.
Actually, I just did some more thinking on this... and thinking about your remark about taking the emotions out of it. But in that case, why even bother with BTC/BCH at all? With the uncertainty of whichever is the 'true bitcoin', it seems like there is an added 50% risk involved in investing in either of them, that has to do a lot with emotional belief?
I'm feeling better and better with being diversified in many projects! Less uncertainty, they're all great
" But in that case, why even bother with BTC/BCH at all?"
This is a great question, and sometimes we can't see the answer even though it's sitting right in front of us.
We are all extremely early adopters. Most people have still, at best, heard only of Bitcoin in the crypto sphere. If we buy what we know to be the best coins on fundamentals this early, we are going to miss the price pumps as dumb money flows into the sector (See: BTC, Eth, LTC, Ripple, etc...this year).
BTC will be first, for now, as that's how money comes in.
Remember, if you're posting on a crypto-website about crypto...you need to drink a lot of lead paint before you're operating at the Wall Street level, which just recently pumped a nothing stock to 7.1b because they started "block-chain" to their press releases.
You're absolutely right.. but those lead paint drinking people obviously know nothing about crypto and wouldn't know the difference between BTC and BCH either. They just look at the one that's priced the highest as being 'the' Bitcoin, I believe.
So for now, those lead paint drinking people still only care for BTC and probably don't even know BCH exists and if they do it's only to get in, and get out quickly for a quick profit. They don't really add much to the ecosystem except volatility.
Bitcoin is king for now because it has the name and the appeal (moreso than BCH) but I think pretty soon 'crypto' is going to replace 'bitcoin' as the buzzword of choice. Once we're no longer talking about Bitcoin but rather Crypto then I'm not sure either Bitcoin will survive into the future. Neither of them scales enough, and when it comes down to wether I want money that is just money, or money that pays me for holding it, I'm going with the latter. Once people start thinking with their wallets instead of their hearts, I think eventually sentiment will change towards these crypto's more. I mean, why not? All things being equal, one giving 8% dividend while the other does not.. I know what I'd choose.
I do agree that playing the 'dumb money' game can be more profitable than being 'too early smart money'. I tend to be too early.. I'm there even before smart money shows up it seems (usually this means I lose out on other opportunities big time) but I still feel it is a more safer bet than gambling on what the herd is going to do. If the project is good, I know that smart money will show up eventually, and I may get a 10x instead of a 50% gain.
Like, dumb money made BTC skyrocket and my BTC value in my portfolio sucked big time. There's something to be said for chasing the rises, sure, I could have benefitted maybe. But instead I patiently waited for my turn to rise, and now I am in a pretty good shape again in terms of BTC value in my portfolio. There really is more to HODL than just meme power.
edit: Also this discussion makes me think I should look into RaiBlocks again. I just wish I could withdraw less than 100. It's an interesting project.. if anything is going to function as peer-to-peer cash I believe it is going to be projects like that and IOTA. I'm starting to believe more and more that blockchain may not be suitable for instant micro payments.
@pandorasbox You still have a chance :)
It's never too late...(for now). [30 Rock fans?]
In moments like that when BTC is low again and BitCoin Cash rises should I wait smiling or I need to buy some low crypto... Is there some golden rule for that?
When in doubt, it's hard to go wrong taking 50% of your profits and holding the rest. What you buy from there is a totally separate decision.
I think Bitcoin Cash will be somewhere but probably can't over power Bitcoin because many people even the new ones no Bitcoin and mostly have no idea about other cryptocurrencies. Anyway the people can determine what is good for them on market.
That's binary, black-or-white thinking. Usually wrong.
Bitcoin may become digital gold, while Bitcoin Cash is for more routine transactions. That's the only way this fee structure and valuation makes sense.
True @lexiconical I now make full sense of the matter. They are definitely wanted to be clinical
"clinical"
I'm afraid I lost you here, but this may simply be a translation/language barrier.
Great analysis and prediction buddy. I had sold my BTC long ago upon receipt and converted to bitcoin. Post that bitcoin had a phenomenal rise so i feel i havent missed out.
Regards Nainaz
#thealliance
" BTC long ago upon receipt and converted to bitcoin"
BTC is Bitcoin....?
"that bitcoin had a phenomenal rise"
You would have been better off keeping the Bitcoin cash. It's up over 10x since the bottom of the fork.
Which is what I've been saying for months, but nobody listens to me.
Glad to have you back in form @lexiconical and happy that I just found some BCH laying around...good times!! :D
Upvoted for teaching me not to play so stupid in poker last night
I think I sucked out on you at least once.
I think you mighta hit a set against my queens or something haha, looking forward to a revenge game someday ;) Also, love your posts man, I was following you before that and I was like I remember this guy haha see you around
Ah, yes, always a good rule not to get too attached to an overpair early in the tourney. Too cheap to see the flop, too many good hands.
Note: This may not have happened in our case. I sucked out in the later stages a couple times.
@lexiconical great post! I cannot believe the new trending word FOMO 🤣 love it!!!!
Luckily I won’t be FOMOing. Best wishes to you
It's tough to resist that FOMO. It's a part of human nature!
Nice post
also check out my post about bitcoin cash
https://steemit.com/bitcoincash/@darkreunion/coinbase-halts-bitcoin-cash-transactions
I was preparing to scold you for naked post promotion with a cut and paste comment...
But I can't help but notice this isn't even your post you linked.
You got a 5.50% upvote from @postpromoter courtesy of @lexiconical!