[jasonwen]

I discussed the things that happened specifically on November 14th in my Quora answer: https://www.quora.com/Why-did-the-price-of-Bitcoin-plummet-d...

It's very very likely because of the Bitcoin Cash fork. It has become a pissing contest between Roger Ver (Bitcoin ABC) and Craig Wright (Bitcoin SV). While Craig trolls and threatens the Bitcoin ABC side by "bleeding them dry" in a hash war.

Jihan Wu, founder of Bitmain quoted: “I have no intention to start a hash war with Craig, because if I do, by relocating hash power from BTC mining to BCH mining - BTC price will dump below yearly support; it may even breach $5,000. But since Craig is relentless, I am all in to fight till death!

The war is related to Bitcoin as the price of Bitcoin tanks because in a hashing war, both sides are likely to rent hash from the Bitcoin mining pool. This is being settled in Bitcoin, sold on the market to cover electricity, and thus suppressing the price of Bitcoin.

Since Craig is trolling around, threatening a price of $1,000 per Bitcoin in a full out hash war, people are selling before it gets even more ugly.

Another downside which reinforces the price suppression is for Proof-of-Work systems (where miners are rewarded based on their computing power), there's an unfortunate feedback loop in price drops. As said by Colin, founder of Nano currency, Low price -> low mining rewards -> turn off some miners to lower cost -> lower hash rate -> longer transaction confirmation -> lower price.

More details can be found in my Quora answer about this.

[wpietri]

I think it's fascinating that this is 100% different than what Bitcoin was sold as.

The theory of Bitcoin was basically "money without people". You wouldn't have to worry about governments and politics; value would be sent and stored in pure pieces of math. Mere governments couldn't possibly do as well as the glorious algorithms wisely fixed in advance by, etc, etc.

But if you're right, Bitcoin has way more politics than a third-world kleptocracy. And it clearly lacks the institutions and formal procedures used to shape those kinds of political currents into useful effects on the currency and the economy.

[petre]

There's no money without people. Money needs people's confidence to work as an exchange vehicle or value store. Jasonwen's theory seems correct if the facts are looked at as a collapse in confidence. If this is true, we shpuld also see capital flight to other cryptocurrencies.

[natmaka]

The problem here is not Bitcoin per se, it is the current state of the real world, where anyone can "buy" and "sell" Bitcoin for legal tender.

Bitcoin, in a world where it is the sole currency, has the benefits you quoted.

[latchkey]

There is differences between the white paper and the implementation. There is also another elephant in the room... whales who have enough money (thanks to crypto currencies) to influence things.

[nnain]

It seems to me that the price is dropping due to large players selling off their coins, not because of some hash-war. AFAIK, mining Bitcoins is barely profitable anymore and wouldn't cause such wild jumps (even if this is true).