# The awkward mathematics of booms and bubbles

When short and long aren't opposites.

One of the most common responses in the many, many comments to my pieces on Bitcoin over the last couple of weeks has been to ask me why, if I'm so sure it's a bubble, I don't short it.

The simplest answer is that journalism isn't a career which leaves a huge amount of money left over after the bills are paid with which to gamble, and that I'm not entirely sure it's ethical anyway. There's also the fact that the two main Bitcoin meta-exchanges aren't particularly liquid, which leaves me doubtful that I'd get the best value for money on any shorting contract,

Then there's the problem that being pretty certain the bubble is going to pop doesn't leave me any surer about when it's going to pop – something which most methods of shorting require you to know.

Shorting usually involves borrowing the thing you want to short for a fixed amount of time, selling it straight away, and then buying it back just before your loan is up. Ideally, the commodity has dropped in value, and so you make a profit by you pocketing the difference.

In a normal commodity, going short and going long – buying the commodity to sell at a higher price – are roughly symmetrical. If a share in Apple goes up \$1, the people who are long make a dollar a share; if it goes down, the people who are short do.

But that symmetry breaks down when you're dealing with a commodity on the sort of parabolic trend that Bitcoin is shooting along now.

If I spend £100 on Bitcoin, then the most I can lose is £100. Conversely, if the trend continues, I could have £1000 in a month. And the maximum possible payoff is basically uncapped. Suppose I'm catastrophically wrong, and Bitcoin becomes the world currency by the end of the year – anyone who'd bought in to it, even at today's inflated prices, would be a millionaire.

But what if I short it, by borrowing £100 of Bitcoin? Well, then the most I can earn is £100, if the price drops to zero. But the amount I could lose is potentially uncapped, for the exact same reasons that make buying in to it so appealing.

That lack of symmetry – which is an innate feature of, well, maths – serves only to goose the bubble higher and higher. And at the other side, when the down swing comes, it will be vicious; with no shorters ready to step in and buy the coins of people trying to cash out, the volatility will have nothing dampening it.

So that's why I'm keeping my money where it is. But don't think I'm not pretty damn confident when I say that if I had any extra, it still wouldn't be in Bitcoin.

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty
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# Space suicide: the sad but noble death of the Cassini probe

It’s not surprising that scientists and space geeks around the world will bid it adieu with a heavy heart.

Since April 2016, a Twitter bot called @CassiniNoooo has been tweeting out “Nooooo” followed by random numbers of “O”s. The last tweet sent by the bot is just “I......”.

The account has been paying a light-hearted tribute to one of the most important important scientific projects of recent times, and one which is soon to come to an end.

Launched in 1997, Cassini-Huygens is a plutonium-powered probe that has been circling Saturn since 2004. Providing teams of scientists with unparalleled images of Saturn and its moons, it has allowed experts to examine the composition of solar bodies one billion miles away.

But on 15 September, Cassini will begin its final mission, referred to by Nasa scientists as its "Grand Finale". It will shed its modules and sensors as it heads towards a final fiery death in Saturn's gaseous atmosphere.

When news of Cassini's impending end was announced in April, scientists, casual space fans, engineers, teachers and other assorted stargazers expressed sadness about the craft’s suicide mission. Many are expected to tune in to watch the live stream of the probe's final moments on Nasa’s dedicated webpage

Cassini has provided some of the most intriguing discoveries about our solar system. It discovered a saltwater ocean under the icy surface of one of Saturn’s moons, Enceladus, by "tasting" molecules – a finding that could, in theory, support alien life. It also took photographs of Titan, a moon bigger than Mercury, which enabled scientists on earth to discover liquid on its surface – only the second body in the universe to have free-standing liquid after our own planet.

In a way, Cassini's discoveries signed its own death warrant. Potentially life-supporting pristine environments must not be contaminated by Earth-originating microbes and, left to its own devices, Cassini could collide with one of the moons it discovered so much about.

Faithful until its last moment, Cassini will be diving in and out of the space between Saturn and its rings as it reaches the end of its final orbit, a feat never achieved before, transmitting completely novel data that would be too risky to gather unless it was already destined for immolation.

Cassini's contribution to science, laid out in this oddly moving webpage from Nasa, not only allowed us a deeper understanding of our solar system, but also helped us picture other kinds of worlds. It's a service that has been recognised well beyond academics or professional scientists. One six-year-old is even throwing Cassini a goodbye party, with a themed cake and games – because, he said, it was the “only spacecraft he ever knew”. Others have tweeted out music composed for Cassini, and comics depicting their versions of its final moments.

It has not been easy for the scientists who had to approve the decision to kill Cassini. In a press conference on 4 April, roughly three weeks before Cassini started its final orbit, Linda Spilker, a planetary scientist at Nasa's Jet Propulsion Laboratory, admitted that it was hard to say goodbye to their “plucky, capable little spacecraft”. Some even referred the probe as their child.

On Earth, we get to think of these robotic explorers like astro-ambassadors, not least because so much of the current discussion around space monitoring centres on how information collected will enable life in space for humans. Now one of those ambassadors is about to make its final visit to a foreign planet, long before its creators will get to make their own introductions.