Bitcoin Forum

The more expensive BTC is, the less useful it becomes. A LTC long position is ultimately a BTC long position, hoping BTC outprices itself as an efficient medium of exchange (for amounts under $100). In that scenario, LTC would really shine.

So, there's always going to be that kind of price ceiling with BTC. ... It doesn't stop PM traders, though. Almost all the talked-about metals have been priced so high, they're no longer cost-effective in industrial use, so I guess there's no reason Bitcoin can't have the same fate, where it's just a token the rich agree is worth $x for large transactions, and there'll always be that floor where NORPs would be able to cost-effectively use Bitcoins as a medium of exchange again.

(I like how this sub-forum now color-codes based on poster's outlook!)

The more expensive BTC is, the less useful it becomes.

I disagree. The price of Bitcoin has nothing to do with its use as a money transmitting vehicle. If I wanted to send $1ooo to a relative and Bitcoin was going for one million per Bitcoin then I would only need to purchase .001 Bitcoin to send it to them but if Bitcoin was only worth $100 each then I would need to purchase 10 Bitcoin. Either way they get their $1000 and at the same cost to me.

The price of Bitcoin only affects the traders and the savers

thank you! there are a lot of smart people on here and there are a lot of smart people who have too much pride and just wan to be right. there way of thinking or no way.

I agree with this. The concept of a buy bitcoin at one end - transfer - cash out at the other end. Is really one of the most amazing things about bitcoin.

You'd need to purchase .001BTC keeping in mind the likely fee to transmit (if BTC is successful) would be at least 50% of that, or $500. At best, you could probably get an exchange willing to do internal exchanges (which'd be nothing more than internally assigning numbers, not actually trading Bitcoins), but then you still have wire and exchange fees, so why bother even using BTC as an intermediary in that case? Fees ("bid-to-transmit") are practically nothing right now because it's heavily subsidized by block rewards. Soon enough, the block reward will decrease to 12.5BTC, and fee/reward parity might be consistently achieved before then if Bitcoin continues growing its user base. Within a decade, the block reward will equal 6.25BTC.

Bitcoin is currently able to get around a lot of the bandwidth/storage costs of including microtransactions by shifting it all on people who run full nodes, but there's a reason light clients and web clients are seen everywhere in the community. Running a full node is practically impossible for anyone with capped data bandwidth, and difficult for anyone with an uncapped ISP option lesser than DSL. Bitcoin's on an exponential growth trend greater than Moore's Law and subject to explosion if it should become mainstream, while the only solutions are really only to either decrease number of full nodes by increasing the amount of transactions/second (increasing the burden to run a full node, while each full node dropping off only compounds burden on those still running), or to accept the current t/s rate and allow the free market to increase fees. Once the subsidy drops off, large fees will likely be mandatory, and full nodes (if users can find one unburdened enough to connect to) may be primarily run by mining pools which won't even bother to relay microtransactions.

Bitcoin has a rough road ahead of itself before it can sustain a dramatically higher price (rather, the higher volume of transactions which'd sustain it), and we don't even fully know what kinds of changes the rules and software will need to keep Bitcoin chugging along, but I doubt the days of <$.10 minimum bids for a quickly-included transaction will be here for even another year (whether that's because of an increase in number of transactions, or increase in price, or the likely combination of the two). Bitcoin simply isn't built for microtransactions, and that'll become more apparent as it continues to grow.

http://cdn.memegenerator.co/instances/400x/38199461.jpg

Sums it up quite nicely.

Not true at all sir. If BTC were a million, the fees would obviously drop appropriately. Remember that the fees is NOT determined to be a fixed % but rather market driven (like almost everything else with BTC). Miners would be happy to take an equivalent of say $1 in fees per transaction irrespective of how many BTC it represents. Bitcoin will always have a lower cost of transmission than fiat just by virtue of how it is setup.

With a more flexible blocksize, which may come eventually, you would be right.  However, with blocks currently capped at 1MB, we can not sustain more than 7 transactions per second.  This will limit the supply of block space in such a high valuation environment, thus driving up fees.

this thread = more evidence we are headed toward $50

This. Fees are flexible, and will adjust.
The only reason fees exist is to make sure people will keep on mining when diff becomes insane / all the initial coins have been mined away.

or he wants us to think that ..
or ...

:)

the first 2 posts on this thread are so WTF it hurts.

if i had to send $1000 to a relative, i'd use LTC, not btc.   by time they cash out their btc, they would probably only be worth $900 or less.  ltc only loses small percent

I'm not sure where some people are paying these exorbitant fees to transfer funds.

At my local exchange (Virtex), deposit and withdrawal fees are negligible. All my deposits regardless of amount, have cost me a flat fee of $3 to cover the bank's anonymous cash deposit fee, and taken less than a couple of hours.

Withdrawal fees are similarly low-priced but may take a couple of banking days. The only real expense is the exchange trade fee (to buy back CAD), which starts at 2.5% and decreases with volume.

Yes, 2.5% is high compared to MtGox but by avoiding additional transfer expenses, it is relatively cheap.

This is why I use Virtex as a portal for fiat and use MtGox strictly for daytrading. International transfers of BTC are still free and quick.

Virtex lowered their fees considerably last week. They now start at 1.5%.

Very great news!

Virtex stock went up 30% after they announced the fee cut.

Wow. Thanks for the news. I'm up in the bush at my country place and spend less time than usual online, mostly to watch the Jays games and check the BTC market, mostly around MtGox closing (hence my daily candles).

The only company shares I have ever owned are Virtex shares which I bought in April when the bubble burst and Virtex shares seemed vastly undervalued, considering that they make money whether the price is rising or falling.

I have avoided the stock market like the plague since I worked for a TSE member exchange back in the 1960s and learned what a tawdry, dirty little business it was.

My purchase of Virtex shares wasn't an investment like the bitcoins in my cold storage wallet. It was more of a philosophical statement. Still, it's nice they've more than doubled since then.

Edit: P.S. Thanks for the heads up on the new fees. I'll have to cancel and re-place my $150 sell order to get the new rate.

Did I say daytrading? More like monthtrading. Last sell was $165, last buy was $97. Quibbling over a few satoshis is just too much fuss.  :D

All the people who spurned the chance to buy at $65 waiting for it to drop into the 50s (for the 3rd time since the peak), will be kicking themselves senseless when it ramps back into the hundreds, permanently.

That is besides the point, but since you mention it: the trend since around April 23rd has not changed. We are experiencing lower highs and lower lows. If the trend continues we may well see the 50s in August.

http://bitcoincharts.com/charts/chart.png?width=939.76666&m=mtgoxUSD&SubmitButton=Draw&r=120&i=&c=1&s=2013-04-23&e=2013-07-15&Prev=&Next=&t=S&b=&a1=&m1=10&a2=&m2=25&x=0&i1=&i2=&i3=&i4=&v=1&cv=0&ps=0&l=0&p=0&

Cap should be at least remain over 1 billion
http://blockchain.info/charts/market-cap

Wow, you analysis is really deep. And the colors and such really make it insightful indeed.