Latest posts of: wogaut

"This might be the end of the correction".

Although I like to agree with this statement, as I have come to the same conclusion following the trend over the past months, and I have a lot of confidence in Bitcoin's stability at the current point, your statement sounds amazingly like taken from the "Famous last words" section...

Bitcoin needs to beef up the underlying economy, i.e. the volume for trades of goods and services using Bitcoin as means of exchange to become a stable currency. Hoarding coins and speculating on them leads to dynamics of a commodity market (and I am comparing Bitcoin itself to the commodity being traded); hence we see "corrections" that would be called a crash when applying metrics and known fluctuations of a currency.
As the value of a currency is also driven by supply and demand, where the supply is the money supply itself, demand is both created by speculators on exchanges and also the volume of the economy supported by the currency (goods and services to be paid using it as means of exchange).

We are moving in the right direction, but we are not there yet, so I would be more cautious calling the "end of the correction".

Again, if you like to see a stable currency, you need to encourage a market for it, which means using it as a means of exchange for goods and services and keep the bitcoins in circulation. Only if bitcoins eventually close the loop and return at the same rate to the person spending them, there will be a stable currency. On the other hand people that just seek speculation and those hoarding them (ref. "my precious") disrupt that circle, making it harder to pay with bitcoins for the ones actually spending them (because they don't return at the same rate).

Note: I am aware I am posting this on the speculation board (but the title of the thread was just too tempting), so as a sheep among wolves I don't expect much applause.

Someone earlier made the suggestion that bitcoin may be dead if the price stabilizes as speculators won't make any money. First, I'd reduce this to short-term speculation, second, as I said that demand for a currency is given not just by speculators but the supporting underlying economy, a price stabilization and reduction in short-term speculation might signal a shift from "commodity status" to currency (means of exchange, as lower fluctuations make it more trustworthy in business transactions), which could be a good thing for those of us supporting it as a new alternative currency.

W.