Well, Well Well! So, the bitcoin “bubble” (oh sure, like there is one) could be “popped” by a couple sellers exacerbating the slow transaction speed and causing massive exit congestion. Hmmmm, maybe. The $500M Dragon ICO has been pushed back a couple weeks because of extreme congestion on the Bitcoin and Ethereum Networks. Certainly a possibility as we have seen similar action in equity markets (1987, Flash Crash, etc). BUT, here’s the counter; a bubble, how silly. And why would anyone want to sell their bitcoin holdings if it is going UP (price to be named later). Oh yeah, that’s sarcastic humor folks (by the way, I am a bitcoin bull……….so we probably are close to a top).
- “Bitcoin is becoming increasingly illiquid.
- As more people buy bitcoin, the network becomes congested and transaction times get longer.
- Transaction fees are getting higher, too.
- This will be a real problem if the price crashes and everyone tries to get out at the same time.
This chart shows a seven-day average of the total number of minutes it takes to confirm a bitcoin transaction, since May 2016.
Like the price of bitcoin itself, transaction time has been rising as the months go by. Right now, it takes four and a half hours to confirm a bitcoin trade, on average.
Blockchain Luxembourg SARL
If you are holding bitcoin and worried that the price – which cleared $17,000 last week — is a bubble, then bitcoin transaction times should really start to scare you.
The price of bitcoin is shifting up and down by hundreds or thousands of dollars each day. No one knows what the price will be one hour from now — but we know it will be very, very different.
And the schedule for the world’s largest initial coin offering, the $500 million Dragon casino offering, has been pushed back two weeks.
“Due to the extreme congestion on both the Bitcoin and Ethereum Networks, ICO investors or contributors have faced significant challenges when transferring their Bitcoin and Ethereum to participate in the Dragon Pre-ICO,” it said in a press release.
The transaction time is built into the system, as each transaction must be confirmed by six bitcoin miners. There is a finite number of them, and the more transactions they have to confirm, the longer it takes as their network bandwidth fills.
Worse, they charge for transactions and prioritize transactions based on price. Those who pay more get processed first…”
Full Story at BusinessInsider