Bitcoin Forum

At some point in time I guess it will become either one thing or the other. It cannot stay both at the same time. Can it? Is it a healthy usage method to have it as both?

so far in the past 10 years bitcoin has been volatile and also been a payment method. in fact during each volatility cycle when price is at its peak and the volatility is the most, the number of payments increases to its own ATH setting up a record on each cycle. for example last year when the volatility reached its max by the end of 2017 (price rise of ~100% in 1 month) there were the most number of payments taking place.

That's not very likely

Since it is a vicious circle of sorts. Using Bitcoin as a payment device or value transfer vehicle means real value, while increasing real value leads to less volatility. On the other hand, speculation boosts volatility and prevents mass adoption for Bitcoin's use in these fields. As speculative value comes before real value (it just happened so for whatever reason), it prevents adoption but without adoption there is no way real value is going to increase. Thus you get locked into this vicious circle

It definitely can stay both at the same time. It's just that with huge volatility present, the people who are going to use it for payments is just going to be a minority; pretty much like the current state of bitcoin right now whereas pretty much only the people in the bitcoin/cryptocurrency community are willing to pay using bitcoin. With time(probably a lot of time), bitcoin should attain stability as more regulations come in along with market liquidity. This is one of the things that are just a matter of 'when'; then bitcoin can be used and owned widely for both store-of-value and for daily payments(assuming bitcoin is very noob-friendly at that time).

You use fiat in your daily life and invest fiat at bank deposits. Replace fiat with bitcoin and you have your answer.

Bitcoin was initially started as a p2p electronic currency system but later adopted as a method of investment. That's unfortunate but true at the same time!

I agree with what you say,and actually if I understand correctly, you are saying that it can technically stay the same, but not gonna work as well for both. Which is exactly my point. These 2 factors are counterproductive to each other. The more volatile, the less people will use it for daily payments. Because that means they are either loosing a lot of money money, or should hold it because they are earning money.
So I'm not sure if I got your idea correctly, but I think we agree on the fact that once it becomes stable, then it can become a standard payment method.
With all the user friendliness included for non-tech users.

If Bitcoin follows the course of most mass adopted technologies, its usage and price will plateau after it becomes ubiquitous. At that point, it will hopefully be much less volatile than today. I'm sure it'll always be somewhat volatile, but it might act more like gold or silver once it has a more established and liquid market.

Merchants, wholesalers, service providers, etc. definitely like currency stability. Commodities like this aren't the most stable, so they're not ideal for being a medium of exchange, but they might still be useful nonetheless. It largely depends on whether consumers and other market actors want to transact in bitcoins or not.

If the fiat money system ever collapses, I think we'll see a big uptick in the use of commodity money including Bitcoin.

There are many people who already make money using it. Volatility makes someone lose money while others make money. We have to work hard to be on the right side here.

Bitcoin is not a commodity money, by any means

Further, it is not clear what fiat money system you refer to. There is no unified fiat money system in the world as there are many mostly independent ones (Euro, Swiss franc, British pound, etc). And it is unlikely (if not to say impossible) that they are going to collapse all at once. If by that you actually mean the US dollar, it remains to be seen whether its downfall (should it ever come about) will do any good for Bitcoin. It will likely cause gold to surge, not Bitcoin (relative to other fiat monies, e.g. Euro)

Why not? Here's how the term is commonly used:


The US court system and CFTC view Bitcoin as a commodity: Virtual currencies are commodities, US judge rules (https://www.cnbc.com/2018/03/07/cryptocurrencies-like-bitcoin-are-commodities-us-judge-rules.html)

So, it seems like a reasonable enough position (https://www.forbes.com/pictures/efei45mhdf/think-of-bitcoin-as-a-commodity-not-a-currency/#459f91751664).


https://www.investopedia.com/terms/f/fiatmoney.asp

I'm mainly talking about a general move away from fiat currencies and back to other forms of money should the USD ever collapse.


That depends on Bitcoin's position within the "commodity money" and "store of value" niches. You're assuming that over the coming years, Bitcoin won't take a bite out of gold's market.

If bitcoin actually reaches mass adoption, then eventually the price of bitcoin will stay stable. Like you said, it can't really stay both at the same time, then normal people will wonder "hey? why did my 1$ turn into 50 cents? "
That would be pretty bad for a currency you are trying to use daily. I remember when Steam used to accept bitcoin for payment and now they don't because of volatility.

Bitcoin is not a commodity money

Just because a US judge declares it so doesn't turn Bitcoin into one. I remember as another US judge allegedly ruled gravity no longer valid (that's just an urban legend so bear with me). Did it stop gravity from exerting its force? Not in the least, obviously. And if I'm not mistaken, Bitcoin was declared commodity exclusively for the purpose of regulating its trading by the CFTC and taxing it accordingly (just like any money can be traded and used as a commodity). That has nothing to do with commodity money as this term is understood by economics (i.e. money in the form of tangible goods like gold, cattle, etc)

currencies can be pretty volatile too, but that doesn't change the fact that they can and are being used as a payment methods. for example you can take a look at a couple of countries that had their economy go down the tubes and their currency plummet hard. that is a high volatility for those "fiat" currencies but they are still currencies.
you could have shorted them and make a fortune but that also didn't change the fact that they are currencies!

Yeah, for 10 years, bitcoin has been doing the same and has done the job quite well, so I guess it'll continue to do the same thing and perform as a payment system and an asset as there are third-party services willing to do real-time conversion of BTC to fiat for merchants. As long as currencies carry value on them, they can be used as a payment system and as an investment as well. Fiat are also subjected to changes, albeit not as volatile as bitcoin and crypto.

In fact, bitcoin is in real a currency and not a investment method. But currently it is more used as an investment method and not as a currency. This is indeed not good for bitcoin itself it if is not used as a currency. Due to do much fluctuation in the btc prices, it is very unattractive to use it as a payment currency. For traders, it is best as they use it as investment opportunity and trade with it.

It is spliting between the two right now, many people discuss in which category does Bitcoin fall into. I consider it both, because more than a half of users use it as an investment and the rest use it as a currency for spending. I personally use it as a currency and endorse that side of Bitcoin more because it is made to be a currency.

I do not think so. BTC can be used as a method of payment in some places today, but I do not agree with how accurate it is to belong to everything. At least people can evaluate the value of an asset by calculating BTC's price with USD. And think this is a very expensive thing (e.g. plane). If you were owner of the plane company, would you risk it? Surely, NO!

That's a good question. Of course, they can be partially both with the vast majority using it for one of those things. Nowadays, bitcoin can be used for payments, but is mainly used as an investment. In the long run, however, I think that the payment method needs stability, because otherwise nobody would bother to take the risks or convert everything to fiat on weekly basis, you know. The best thing would be if bitcoin stabilized pretty much forever on a reasonable price (at least the ATH one) with regular 10-15% price fluctuations. This would be something merchants could live with and traders could profit from.

It can and has been, however... forms of payments [money] should be relatively stable as a medium of exchange.

Nothing wrong about the simultaneous usage, Bitcoin was mainly created for P2P electronic cash system, but the volatility the cryptocurrency markets have given make people see an opportunity to use it as an investment(for some to get rich quick). But if somehow in the future when Bitcoin volatility decrease it doesn't mean people stopping it for investment.

But this is exactly what has been happening over the past 10 years?

What the question really is I think is how much volatility is hindering adoption. Bitcoin as a payment method will work regardless of its value, since the network is completely distributed. Even if prices drop to close to 0 one day, as long as the network which bitcoin runs on stays the same, there won't be any issues with bitcoin being a form of payment. For example, merchants accepting bitcoin in a period of volatility can still do so, through hedging their exchange rate risks with a third party or by themselves.

I do think that speculation will lead to somewhat decreased actual consumer use, but at the end of the day, will not completely stop consumers adopting it. And as I expect bitcoin volatility to continue to drop in the future like it has, it's not a particularly big problem.

i think you need to check out all the places that accept bitcoin before making "assumptions" like this here. there are some airlines that are actually accepting bitcoin payments. you see it is not about how big or small the payment amount is in USD, it is about whether someone is willing to accept bitcoin or not. there are many huge sales taking place using bitcoin, even real estate deals worth millions.

Volatility is not really dropping

Though I certainly see why you think it is. You basically look at the prices and see that they haven't been moving much as of recent. So it definitely looks like daily volatility declined a lot, and technically that would be a correct conclusion. But this is not enough, and when you start looking at longer timeframes, e.g. a few months, you will notice that volatility simply moved there. The price doesn't move much on a day by day basis, that's true, but when it moves finally, its movement makes up for all this lack of daily price action. And with a vengeance at that

This is one of the main questions that we have been trying to answer for a long time, because the fate of Bitcoin actually depends on it. Here we have a contradiction: Bitcoin will always have high price volatility, if it remains decentralized. But he cannot lose his decentralization, otherwise it will be another Bitcoin that we don’t need. Apparently, Bitcoin will have to combine high price volatility and use as a means of payment. In this case, as a means of payment, it will be used primarily by individuals, business structures are unlikely to use it widely with such volatility.

It is not about merchants at all

Merchants will be willing to accept anything provided there is a demand for such payments and the means of payment doesn't lose too much value in the process. In fact, in countries with high inflation rates (though not like in Zimbabwe, of course), merchants are still accepting local currency despite it being continually devalued by the government. So it is more about regulation (i.e. allowing Bitcoin to be used as a means of payment) and actual desire of holders to spend their coins

And this leads us to an interesting conclusion. If we assume that merchants are not a limiting factor in Bitcoin adoption, we should necessarily expect Bitcoin to be accepted in areas where there is possible interest of Bitcoin holders in paying with coins. And reality seems to support this view as the fields you mention (airlines, luxury business, real estate) are likely to attract big holders who are willing to pay with their bitcoins, and as a result, we see a lot of adoption going on there

I think the point is that bitcoin is a payment method but it's just that people have chosen to use it more as an investment. I am guessing this is likely because they have seen the price escalate very quickly. Equally, there is nothing to stop bitcoin being both and actually I think it does happen. People do use it as a store of wealth/ an investment but sometimes use it as a method of payment - it's never been static.

Definitely no because it can make huge problems for both parties during a transaction and low volatility and more stability is significant for a good currency and that is why major currencies like Dollar, GBP,EURO and other often used to do international transactions because there stability is well maintained by central governments and banks so the risk during payments are very minimum and negligible so bitcoin can never be a volatile too and a good payment method at the same time

This is just my opinion of what you wrote.  ;)
I am not talking about airlines, I am talking about the companies that produce airplanes. Let us assume that you have worked for many years and have a big company with the money you have accumulated and price of products you produce is one million dollars. Would you exchange for a money you do not know what will be tomorrow?

Yes, there are people who can invest millions into cryptocurrency today, but do not think them like us. e.g. Our risk can be 20k, but theirs can be a million or more.

so the simple answer is YES. and it is not really new and has been happening for so long already for bitcoin. and up until now, bitcoin is one of the major cryptocurrencies that has been used by many establishments as their payment method. they really have to deal with volatility issue, and it's up to the payer and payee to tackle such risk.

Beeing a volatile investment tool and payment method are very different situations from each other and nothing can be in the opposite situations at the same time. Volatile nature of bitcoin makes it a good invesment tool for people who would like to take risk but it also limit the use of bitcoin as a payment tool.

It has been serving as a volatile investment along with the access to payment. Being volatile is good for trading, but with marketplace if is hard for them to use as a payment source. This can be taken into effective usage by the acceptance between the buyer and seller. Large number of such trades were happening around with some trusted escrow services.

It will be hard to serve both, the volatility is not good as the payment, it will make the customers become confuse and the sellers also hard to determine the price, the volatility one of the reason why stores didn't want to adopt crypto payment, if the volatility swing is not too big then maybe the store owner could tolerate, but for now the swing is too big and too wild

Name: epiphanyblockchain
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Date Registered: March 12, 2018, 10:36:14 AM
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You created this thread and never answered, but you made 6 post after creating this thread. I wonder why create threads if will not answer  in that thread that create?

Well i agree though probably there will be a transition when times comes that btc becomes more stable. Of course that's not going to happen now since at this stage, it's volatility serves investors better. We're not yet at that point.

In principle, the high price volatility of Bitcoin and using it as a means of payment are not very compatible. This is one of the reasons because of which Bitcoin and another decentralized cryptocurrency are not so quickly legalized by the states.
Given the conservatism in the development of Bitcoin, its primarily low scalability, most likely it will be used mainly for very large transactions, which contributes to its very high price.

In case with cryptocurrencies volatility usually goes along with trade volume. For example if your coin have about 1000$ of daily trade volume then if someone sells hit 100$ worth of tokens then he will probably dump the market, what could be way harder if the trade volume was about 100000$.
It can be an investment tool even now. Like gold or fiat currencies but it is still lacking mass adoption to become useful for payments.

In my own opinion, the volatility of bitcoin will come to an end in time and will become a full payment method and this will occur when it is fully adopted all across the globe. Bitcoin cannot stay in between, a time will come when the world will fully accept it and then this rapid rise and fall in price will end as bitcoin price will become stable, maybe it will be regulated then.

I don't think it's possible that bitcoin will be used for both investments and payments since these two things don't work well together. Think about a store who at the end of the day have collected 1 bitcoin for example. Next day in the morning when they want to exchange that bitcoin into dollars to buy more merchandise or even if they use bitcoin for that the value of that bitcoin could have dropped over the night with 10% so their income also dropped with 10%.

Bitcoins can surely be both simultaneously. Bitcoins are a volatile investment tool with a unstable price as well as bitcoins are been used as a payment method in various payment gateways where bitcoins are been used as a mean of payment. Bitcoins are multi-beneficial with a lot of other benefits which makes them totally different from the fiat currencies. Usage of bitcoin should be maximized even more so that the demand is raised back.

course yes  . infact we are already doing that and ever since bitcoin discovered on the year 2009 , it is already being use for both purposes   .  its only upt to the user if what he prefer on his bitcoins  but im aware that lots of people are now using thier bitcoin as a form of investment tool because they think that its too valueable to be wasted on some items or on some services online   . better if they can hodl it so that they can earn more income in the latter stages  .

I wonder that, too. OP was a bit late with regards to his questions. It can be both an investment and already use it as a payment method nowadays. Are you on doubt about using both? Or maybe he is confused about that. Even though it is volatile , we are taking the risk and still use bitcoin as a payment.

Why I will think that bitcoin can be used for both investment and payment is that these roles are already in the domain of bitcoin. For investment, I don't think the volatility will stop and so it will always play the role as a tool to investment and to measure personal riches (personal because it is private, only who you disclose what coin and quantity you have will know)
For payment, it optional fiat especially for very huge financial dealings.

Yeah,you can use both bitcoin is very suitable to be used for transactions and used to trade cryptocurrency more, with prices that are not stable, you will also earn a profit from the highly volatile price bitcoin

There is no other way out. Bitcoin will remain with high price volatility. To others he cannot yet be by nature. What it will be at the same time means of payment, time will tell. It is most likely that it will be used for expensive goods and services. If its functionality does not fundamentally change for the better, then it will be ineffective for small purchases.

At the moment, Bitcoin is a volatile investment tool and payment method at same time as so many people use it to pay for goods and services in different parts of the world  while some others just wait for price to drop so they buy some quantity which the hodl and sell whenever price pumps up. But time will come when there is a full adoption as every country will fully use it for transactions making the price stable, then Bitcoin volatility will be reduced.

I think we have provided proof and answers right? not all crypto users are investors, many users use crypto for their payment
platforms. and many of us have done that paying bills, gambling and many others

I think it can be and here in the Philippines we could use Bitcoin as payment option for our Bills and other things.
But we also consider crypto as an investment tool so we are the proof that it could be both at the same time.

Bitcoin as with most other currencies, can be used as a currency and also as a investment option. Forex trading in currencies has long been done with other currencies, so I cannot see why Bitcoin can not play both those roles at once.  ::)

Bitcoin will just be a better currency and a more favorable investment tool, because traders just love the volatility and the possibility for massive returns with Bitcoin as a trading investment.  8)

As time goes by and mainstream adoption takes place, Bitcoin will even become less volatile and a better currency.  :P

It can be both. Bitcoin created to be a currency and payment method but different amount of supply between bitcoin and fiat (particularly USD and its forever inflation) forced bitcoin to be an investment.
Bitcoin price don't need to be stable to become payment method because it actually is. it just need two sides who agreed to transact using bitcoin.

we need to stop seeing bitcoin as a commodity. maybe your 0.1 bitcoin price is down and you think you lost some money but actually you still have your 0.1 bitcoin. it just because you still think your fiat as default money. (yeah i just realized it)
In fact bitcoin "price" is just an exchange rate from one currency to another

What about if the Bitcoin's value stays stable (let's say $5,000 with some ups/down of ~$150 which will still be volatile but wouldn't be considered a lot.) Similar to how gold is considered.

So I would think that yes Bitcoin can be an investment, a safe haven like gold is, maybe a reason why people call Bitcoin the digital gold. And it can slo be a payment method, again, like when gold was the only currency.

Fiat currencies are also volatile but that doesn't prevent anyone from using it.

Of course, even though bitcoin is pretty much a volatile currency, it could be a great payment method for all of us. It's because whatever the price of bitcoin is, there is an accumulate conversion of it on our own fiat. For example, the current price of btc is 4000 usd and you need to buy a dish from a restaurant. The price of the dish is 20 usd. On 4000 usd of bitcoin, you should determine the value of 20 usd from 4000 usd bitcoin. It could be .005 btc.

Bitcoin can be both but it is mostly used as an investment tool for both short/long-term investment plans. Some individuals (like me) use a portion of my bitcoins and convert them to cash to purchase services/products. Unfortunately, there are only limited things that you can purchase with bitcoins and mostly the transaction fees are high. This dilemma makes bitcoin as not the preferable option to use with in paying products or services.


I doubt that its price would be stabilized since its decentralized nature depends its price from the law of demand and supply. From that instance, it will lose its nature and become a centralized unit, which is the antithesis of what bitcoin is all about.

Bitcoin is a very volatile investment which is used as a payment method. Bitcoin was created as a payment tool that is cheaper than conventional transactions of banks. Being the first cryptocurrency makes it more valuable as an investment than a payment tool as there are a lot of new coins that are better than it in terms of scalability, lower transaction fees, and speed.

If you consider bitcoin could survive only by being used as an investment then I suggest thinking again about this. In order for it to be used as an investment it had to offer some kind of value to the world so that people have demand over it and the price increases. But how could bitcoin add any value to people if it is not used as a payment method?

Yeah, i also believe so because it'll be very difficult for Bitcoin to remain in both features. A worldwide accepted currency can't be highly volatile else it'll affect trades. Nevertheless i believe also that Bitcoin will gain some stability but it'll be at a higher price. If it would've died, it would already. Bitcoin gas tested many extreme forms of rejections by economists, governments, etc but it has shown enormous resilience. With that, i believe Bitcoin shall have a very impressive price in the future and at that time, we'll get te stability we need to make it appreciated by all as a currency.

Bitcoin is an excellent investment tool. In fact, it can be used as part of a diversified cryptoasset portfolio to help investors secure their finances for the long term. Many investors are already pouring their 401ks and IRAs into dependable assets such as precious metals, real estate and yes, Bitcoin.

I would recommend checking out how a cryptocurrency ira (https://www.smartbitcoininvestments.com/) works in order to educate yourself on the benefits of holding them as an investment vehicle.

volatility has been bitcoin's feature since the beginning and if it can be a payment method, haven't you heard? more and more stores and other markets are accepting bitcoin as payment? there are even retail stores here in my place that are accepting not just bitcoin but also other major cryptocurrencies. It is just a matter of choice for merchants, whether they will take risk and trust bitcoin in spite of its volatility or never at all.

And do you know why everyone is using it?

Because everyone is forced to use it, as simple as it gets. People and businesses alike have to pay taxes in the local legal tender, and unlike the former who pay these taxes maybe once a year the latter pay them constantly (read, they have to price their goods and services in the local currency). Further, the government pays government employees and requires payment for the services it itself provides in this currency as well. All in all, if we take into account all the channels through which the use of fiat is forced on the general public, there is no way you can avoid using it (till the advent of cryptocurrencies at least)

As an aside, in cases of runaway inflation people as well as businesses do in fact stop using a heavily depreciating currency but that's an extreme case when a money token (say, the Zimbabwean dollar or Venezuelan bolivar) stops representing money as such and turns into useless and worthless trash

https://s45.radikal.ru/i109/1612/f8/64f848b33903.gif

Put simply, all paper will burn

You can still make it worth by saving some of your bitcoin as investment against price flutuation.
When price goes up the price you bought take advantage and sell it again so you profit from sell - bought price.
Therefore yeah surely can be volatile investment tool and payment method as the same time.

There are examples out there. Gold bars and coins can be used as an investment asset, and at the same time they have been used as currency (especially during the middle ages). If gold can be used in this way, then why can't Bitcoin or any other crypto?

What you have mentioned is agreeable in one way, but the same isn't a volatile investment tool. Gold bars and coins have a physical state and a very long years of history. This is how they gained importance as an investment, and bitcoin is truly a volatile investment in comparison to gold bars and coins.

I think there are some place or country that has it already both.
They are using it for payment at the same time other people use it for investment .
There are already so many places that we could use our Bitcoin for payment method but the question here is are you willing to pay with your Bitcoin ?

Bitcoin is known to fluctuate, so many are afraid to have it. Despite its fluctuating nature is the process towards long-term price stability. So that bitcoin investment is considered very feasible because it provides big profits.
When bitcoin is created, people will consider it not a global digital currency because based on their analysis, people will be afraid of unstable prices. It turns out that everything is not right because now bitcoin has become a digital currency that is used globally, and more and more users.

Switzerland is the first country that comes into my mind, so possibly, it's doable.

Right now? I'm not willing to pay with my bitcoin, lol, the price is really going up, would rather hold it as a investment. But there are a lot of bitcoin supporters, no matter what the price, is using it as mode of payment though.

Of course, it can.
 It can always be paired to something stable. If not the dollar, we could create a stable currency/unit of measurement that is slightly affected by the economic factors of the most stable economy or product of the world.


The inventor included the deflation for good reasons.
Before you can safely take away the deflation, there are several other things that need to be adjusted as well. Example: the  21 million supply limits has to be adjusted.

yeah actually there are many places that accept payment with bitcoin even though it's fluctuating though. they will not pay attention to fluctuations as long as the payment system they make does not harm them. and actually the question is with you, do you want to use it to pay?

I think it depends on the two parties making transaction. If the receiving party would gladly accept btc as payment, knowing well that it has a very volatile nature, then why not. They could be btc investors themselves.

While Bitcoin remains very volatile in price by its nature and method of payment at the same time. And in the near future, nothing seems to change. Bitcoin is volatile because its decentralized nature obliges it. Stable in price, it looks like it will never. On the other hand, it was created in this way and at the same time was conceived precisely as a means of payment. Therefore, it still has to combine the volatile price nature and be both an investment instrument and a means of payment. By the way, even a regular currency fulfills this dual role, but the price volatility in them is not so vividly expressed.

Just think about the currency in Venezuela and you will understand that volatility has nothing to do with payment options.

Their currency is much more volatile than most of crypto coins and it's still being used.

This is difficult to ascertain. What is clear is that Bitcoin is now used as an investment medium that provides opportunities to gain profits. In addition, the system and function of the currency are also owned by Bitcoin. We try to use all the benefits that exist in Bitcoin and I think it's worth making Bitcoin a good financial system.

In no case I would call that volatility

It is correctly called depreciation up to a point where a money token (be it the Zimbabwean dollar or Venezuelan bolivar, or whatever) stops being money. Volatility means change in value, most definitely in both directions. This assumes there is some value but when a money token loses that value altogether, it has nothing to do with volatility. And for the majority of fiat money existing in today's world it is strictly a one-way ticket, i.e. these monies can only depreciate over time. As I'm inclined to think, we can't actually call such depreciation volatility

Currently there's no problem using it for both since most of the products and service being paid for in bitcoins have their value priced in fiat. That means the amount paid is adjusted anyway.

If we intend for bitcoin to be the successor to fiat though, then it'll have to be less volatile as it is now.


Sadly yes.

Of course it can, but to be a credible payment method it needs to become much less volatile overtime.

I have a very bad feeling about its price for near future. Stoch RSI (daily & weekly) are very high, RSI daily as well.
There are a lot of "bullish video" on youtube, everyone seems to have $5700 or more as the target.
Short/long chart have never been that low since a long time.
In my opinion, we're going to see a big crash in a few days or week.

When bitcoin will be used more like a payments method then bitcoin will be less volatile
Bitcoin need more merchants adoption to be more in use
However best performing asset in the world always will be volatile
Gold is stable but can't bring bring that kind of profit nothing can