Bitcoin: Satoshi Dice
If you’ve been thinking about investing in bitcoin, but haven’t jumped in yet, it looks like the time is ripe as value hit a one-month low today. The ripple chart you see here is the aftermath of a huge buy-up by speculators, followed by panic sell-off when one of the largest exchanges in China suspended trading. Even though that exchange recently resumed, and despite massive positive feedback in the USA, bitcoin has basically remained stable for weeks at $800. As you can see from the chart, the best time to buy has been when the stock dips below $800, where it sits right now at Coinbase, my personal favorite site. Coinbase is a “hosted wallet” not technically an exchange, although you can buy and sell bitcoin and request a paper wallet at any time.
Over half the activity on Bitcoin happens at Satoshi Dice, a gambling site that is not available inside the USA. Much of the rest goes to other bitcoin gambling sites. Most bitcoin activity happens in China. Speculators are holding around 90% of the coins, although how many of those are now officially “lost” is unknown. Even though Americans have invested millions into the system, we represent a piddling of the market, and that actually makes sense, because the dollar is stable compared with many other currencies around the world. Bitcoin presents a possible safety net for those living in countries threatened with imminent currency collapse.
Of course, the million dollar question is how low will bitcoin go before it resumes an upward tic? That is difficult to estimate, but my instincts tell me it is a good time to buy.