Logarithmic (non-linear) regression - Bitcoin estimated value

4 messages BitcoinTalk Trolololo October 22, 2014 — October 23, 2014

Trolololo October 22, 2014 17:47 UTC Permalink · Commentary

In this OP I will always post the last updated chart:

Update 2017-01-03:

Donations: bitcoin:1Fe6B3Zo4HxaCD8ybi9A8zBRH2wKpciUxe

Calculate today’s trendline value HERE (http://www.wolframalpha.com/input/?i=10%5E(2.66167155005961++*+ln((number+of+days+since+2009+Jan+09)%2Fdays)+-+17.9183761889864))

Trolololo October 22, 2014 17:49 UTC Permalink · Commentary

Chart with data until 2014-10-14:

Log-scale chart dated 14-10-2014, v1.1: Bitcoin's daily weighted price in green from 2010 to 2014 under a red curve labeled "Logarithmic (non linear) Regression, R² = 0.9886, y = 2.9065Ln(x) - 19.493," with dated markers where the curve reaches $1 (06-04-2011), $10, $100, $1,000 (24-04-2015), $10,000 (22-11-2017) and $100,000 (16-07-2021), and a donation QR code

Donations: 19AYtA4xFM7izR7BAXKr9TLJkrAJsvcfFm

If we “flatten” the red logarithmic line, we get the spread between the price and the estimated value:

Chart titled "Spread": the percentage gap between price and the regression line from 2010 to 2014, peaking at +1678% in 2011 and +506% in 2013 and ending at -42%

Donations: 1BgnScfDU5QvKUGCqKKsDm62YxKzh5sjCn

This is how the 2011 and 2013 (1) bubbles look like in linear price axis:

Linear-scale chart of the daily weighted price from 2010 to early 2013 with the red regression curve, showing the 2011 and first 2013 spikes above the curve

Donations: 1EbbkBkTDZ667bUxHNHtxhAysFEAWVgWB4

And this is how the 2011 and 2013 (1&2) bubbles look like in linear price axis:

Linear-scale chart of the daily weighted price from 2010 to 2014 with the red regression curve, showing the late-2013 spike above $1,100 and the price falling back near the curve in 2014

Donations: 196xJM7c4jjhHkUp7CnrKG2joXPe57uNRF

Calculate today’s trendline price HERE (http://www.wolframalpha.com/input/?i=10%5E%282.9065++*+ln%28%28number+of+days+since+2009+Jan+09%29%2Fdays%29+-+19.493%29)

Projected:

     1.000  24-04-2015
    10.000  22-11-2017
   100.000  16-07-2021
 1.000.000  06-09-2026

Trolololo October 23, 2014 00:33 UTC Permalink · Commentary

Quote from: chriswilmer on October 23, 2014, 12:14:23 AM

What price do you get in 2075? In my opinion the “equilibrium” price of Bitcoin is one of the easier numbers to make rational arguments about (thermodynamics is always on sounder footing than kinetics, etc.). For example, if you get $1 trillion per BTC in 2075, I would say the model is problematic, however well fitted. If you get something in the $1-10 million range, then you’re probably in the ballpark. (these models assume a certain optimism about adoption already)

By year 2075 I will be dead.

The curve will always grow, but slowlier and slowlier as time goes by. Just like the Bitcoin emission curve. This logarithmic regression is way better than the linear regression. But it’s just a model, not a crystal ball.

The curve will flatten or steepen depending on the future price fluctuations, but not much. I will recalculate the regression from time to time. Maybe monthly, or once every three or four months.

I made the chart for myself, and I later thought that it would be worth sharing it with you all.

Trolololo October 23, 2014 08:12 UTC Permalink · Commentary

Added to the OP: Calculate today’s trendline price HERE (http://www.wolframalpha.com/input/?i=10%5E%282.9065++*+ln%28%28number+of+days+since+2009+Jan+09%29%2Fdays%29+-+19.493%29)