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You would probably have to sell off in small batches, because I think some/most of the cryptocurrency exchanges place limits on how much you can sell/convert back into cash at a time?
Some stocks are like that with low average volumes of trading. Larger selling always have a significant impact on price.
Some stocks are like that with low average volumes of trading. Larger selling always have a significant impact on price.
I couldn't even imagine a single person (let's throw out a ridiculous number) trying to sell $1 Billion worth of bitcoin all at once and trying to deposit that into a savings/checking account!
Can you even have $1 Billion in a bank account?
(You'll probably be that bank's favorite customer)
You would probably have to sell off in small batches, because I think some/most of the cryptocurrency exchanges place limits on how much you can sell/convert back into cash at a time?
You can have those limits raised by providing more KYC documents. Also by the time you get to the point where you have big money like that your limits are likely higher anyway. As far as selling as long as the order book has buyers you can sell as much as you want, the only limits would be on how much cash you can withdrawl at a given time but you could exit your Bitcoin position essentially all at once.
worth nothing until you can find someone to buy it from you
Go over to GDAX and look at the order book, that's not really an issue. Also LocalBitcoins is full of people willing to pay 20% over spot for Bitcoin. Finding buyers for Bitcoin isn't an issue at this time.
I couldn't even imagine a single person (let's throw out a ridiculous number) trying to sell $1 Billion worth of bitcoin all at once and trying to deposit that into a savings/checking account!
Can you even have $1 Billion in a bank account?
(You'll probably be that bank's favorite customer)
Even selling $1 Million worth bitcoins may trigger something -- people will think, is this the time to cash in on something totally worthless, created by hackers? That'd start a panic selling. Bitcoin is valuable in trading because people think they are valuable. In reality, it does not even exist. Where is "the coin"?
When you owe someone a specific amount of money, say $20, and you send them $20, that's what they get. It doesn't change. But if you want to send someone $20 using BTC, you send them what the value is at that moment in whatever coin you choose. It could easily change lower or higher by the time they get it. Then it will continue to change as long as they hold the coin because the value of the coin is whatever people trading it think it's worth.
That would be like handing someone a share of stock they could cash in--in that the value of that share would change until they sold it and got their money from it.
For that reason it makes transactions using something other than an actual currency, wonky, because the value is not stable.
Even selling $1 Million worth bitcoins may trigger something -- people will think, is this the time to cash in on something totally worthless, created by hackers? That'd start a panic selling. Bitcoin is valuable in trading because people think they are valuable. In reality, it does not even exist. Where is "the coin"?
1 Million worth of Bitcoin is nothing compared to the volume. You'd need a really big whale to move the market significantly and even then it drops a little and most people see a buying opportunity as opposed to a panic sell
When you owe someone a specific amount of money, say $20, and you send them $20, that's what they get. It doesn't change. But if you want to send someone $20 using BTC, you send them what the value is at that moment in whatever coin you choose. It could easily change lower or higher by the time they get it. Then it will continue to change as long as they hold the coin because the value of the coin is whatever people trading it think it's worth.
That would be like handing someone a share of stock they could cash in--in that the value of that share would change until they sold it and got their money from it.
For that reason it makes transactions using something other than an actual currency, wonky, because the value is not stable.
This is true but that's why companies like Coinbase, BitPay and others instantly convert it so your getting the USD value immediately.
That said an interesting side note overstock.com converts 90% to cash and keeps 10% Bitcoin, up until recently they were keeping 50% in Bitcoin despite price changes and it worked out pretty well for them. Take a look at their stock price as well.
My son has a friend who made $ 400,000 this year in Bitcoin. Since he sold out, his holdings would have been worth $ 1,000,000. It's killing him.
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