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37 sats \ 20 replies \ @Scoresby 19h \ parent \ on: Fama: Bitcoin is Dead (Promarket/Capitalisn't) econ
Right, but this is what gets me: supply and demand is really just demand then -- either not demanding as much as you once did (supply) or demanding more than you once did (demand).
Imagine airdropping some forkcoin onto Darth. Before and after the airdrop, Darth has zero demand for the forkcoin, but the supply changed, because he's immediately going to buy some bitcoin with it (or beer, but bitcoin is better for this conversation).
Whatever bitcoin he bought was the cheapest currently available on the market, so the exchange rate of bitcoin to forkcoin is now lower, because the supply (willingness to part with) of forkcoin increased.
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Did the willingness to part with bitcoin also increase during this trade?
If no, then how does the act of Darth offering forkcoin for sale increase supply? (Isn't it rather the airdrop that increased supply?)
If yes, then why shouldn't the exchange rate of forkcoin to bitcoin also go lower because someone also was willing to part with bitcoin in the trade? (Obviously, they can't both decrease in this example).
Finally, I move that all future conversations about bitcoin should use @DarthCoin as the example.
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I don't understand why am I involved in this useless discussion.
Why am I related with a forkcoin?
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I don't see this as a pointless argument. My goal is to determine whether bitcoiners are able to exert more influence on the outcome of a fork via selling their fork coins than if they were to simply yell and scream about how evil the fork coin is.
It is a very widely held belief among bitcoiners that in the event of a fork all the hodlers will awake from their slumber and crash the side of the fork they don't like by selling their fork coins.
James O'Bierne made exactly this argument recently.
I think bitcoiners are deluding themselves in this belief.
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I will bring here a must read post by Mircea Popescu
http://trilema.com/2015/if-you-go-on-a-bitcoin-fork-irrespective-which-scammer-proposes-it-you-will-lose-your-bitcoins/
and this one too, is quite funny
https://bitcointalk.org/index.php?topic=1960821.0
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I do not see anymore those real bitcoiners from 2010-2017...
People nowadays are such pussies and shitcoiners that a fork will be viewed and welcomed only as a new opportunity to make more fiat crap.
Not every bitcoiner knows that power of holding the real coin. Just look how many UTXOs are still from pre-2017 fork...
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I didn't tag you, because I figured you would have weighed in if you cared about the discussion, but I chose you as my example of someone who has no interest (zero demand) in forked bitcoin.
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Ah so you were talking about a possible fork of bitcoin or what?
I've said many times on SN: I would be happy to see a new fork and I will do the same as I did in 2017, dumping all the new fork-coins for more BTC.
Forks are not something people should be scared. It help to dilute all the opportunists and shitcoiners and make the Bitcoin holder stronger.
Unfortunately not every bitcoiner have big and steel balls...
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I like using Darth here, because we know his demand for Forkcoin is zero. Therefor, there is no corresponding increase in Forkcoin demand.
It's better to imagine this as something like an inheritance, rather than airdrop, so that the total stock remains unchanged. All that's happening is the willingness to exchange those Forkcoins increased.
The demand for Forkcoin is unchanged, because nothing changed amongst the holders of bitcoin: no one in this example became more willing to buy.
What's happening is that Darth is taking what was an unrealized offer. The offer was unrealized precisely because no one was as willing to part with their Forkcoin as Darth is. On the other end of the exchange is someone who was unwilling to part with their bitcoin for any of the available Forkcoin offers. It's only because Darth is offering more that the exchange happens.
Hopefully, that illustrates why an increased willingness to part with a fork coin will in fact lower it's price.
If not, I'll try to write up a whole parable and throw in some supply/demand schedules.
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It's only because Darth is offering more that the exchange happens.
If Darth's offer to sell forkcoins on the cheap represents an increased willingness to sell forkcoin, so does the fork coin enthusiast's acceptance of the offer represent an increased willingness to sell bitcoin. He wouldn't have sold his bitcoin unless Darth showed up.
At some point, the unrealized offer creator decided they wanted to hold forkcoin more than bitcoin. This was a change in the willingness to sell bitcoin. I don't see why it should be excluded from our analysis.
an increased willingness to part with a fork coin will in fact lower it's price.
Following this logic, if both coins have an increased willingness to sell, both coins will have lower prices ... which is illogical.
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so does the fork coin enthusiast's acceptance of the offer represent an increased willingness to sell bitcoin.
No, that stayed the same in this example. They had a reservation price for their bitcoin and were waiting for someone to be willing to pay it. It's excluded from this analysis because it isn't what's changing in this example.
What you're right about is that there's no way to tell, a priori, which coin is being "dumped". That's an assessment we make after the fact, once we've seen how the prices move.
The symmetry that you're highlighting isn't the relevant one, though. Yes, there is someone on each side of these trades, but the terms of the trades are changing with the sentiments about either coin.
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Well, I appreciate your patience in explaining your viewpoint here.
I still disagree that the symmetry isn't relevant.
The forkcoiner made a choice at some point that they would be willing to trade btc for forkcoin.
If Darth's decision to sell fork coin represents a change in willingness to sell fork coin, so too does the forkcoiner's decision represent a change in willingness to sell bitcoin (even if it was made long before Darth's).
And further, if you argue that it is this change in the willingness to sell fork coin causes the price of fork coin to go down, the same logic means that the forkcoiner's change in willingness to sell bitcoin causes the price of bitcoin to go down.
Excluding it from the analysis doesn't make sense to me. Darth's trade relies on the existence of this reservation price. Pretending that the same rules don't apply to it as apply to Darth's trade is not logical.