Bitcoin will never again be priced over $300.

[Transidium]

The only real value still built in is that of the electricity and hardware costs.

As global mining operations continue to consolidate, mining efficiency increases. This trend is predictable and irreversible. Therefore that intrinsic "cost of creation" declines at a rate that's also predictable.

Any speculative value that's currently built in is also fated to decline as trading efficiency increases and arbitrage opportunity disappears -- not to mention that the classic early-stage hype bubble has come and gone.

Finally, any commerce/transactional-discount value that's currently built in will decrease as the user marketplace approaches ubiquity and merchant competition dilutes potential margin plays.

... I look forward to intelligent, reasoned arguments for how Bitcoin will again find a value north of $300.

Ben

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[BlindMayorBitcorn]

The only real value still built in is that of the electricity and hardware costs.

As global mining operations continue to consolidate, mining efficiency increases. This trend is predictable and irreversible. Therefore that intrinsic "cost of creation" declines at a rate that's also predictable.

Any speculative value that's currently built in is also fated to decline as trading efficiency increases and arbitrage opportunity disappears -- not to mention that the classic early-stage hype bubble has come and gone.

Finally, any commerce/transactional-discount value that's currently built in will decrease as the user marketplace approaches ubiquity and merchant competition dilutes potential margin plays.

... I look forward to intelligent, reasoned arguments for how Bitcoin will again find a value north of $300.

Ben

Same.

BMB

[tokeweed]

[coinableS]

There's a really simple explanation. The cost per coin could easily head north of $300 again when demand out weighs the supply. If there is enough adoption 21 million coins is not enough to go around. Also the currency velocity is a dull argument, bitcoin's only purpose is not for transactions but also a store of wealth and possibly even a reserve currency one day. We are still in a high inflationary area of the new bitcoins per day, but needless to say this drastically decreases over time. It's a digital asset that cannot be faked. If 21 million people were interested in bitcoin the price would easily head north of 4 figures.  There's a lot more to the bitcoin price than just mining costs.  

[Beliathon]

... I look forward to intelligent, reasoned arguments for how Bitcoin will again find a value north of $300.

Never is a long time.  The US dollar is an empire-backed currency, Bitcoin is a distributed ledger protocol on the internet. Which of these do you think has the longer lifespan?  

Historically speaking empires have lifespans measured in single digit centuries.

[Transidium]

If there is enough adoption 21 million coins is not enough to go around. ... If 21 million people were interested in bitcoin the price would easily head north of 4 figures.

I strongly disagree, for this simple fact: one satoshi carries exactly the same transactional capability and benefit to consumers/merchants as does one full Bitcoin.
People need to get over the mindset of $1/BTC1, i.e., value being assigned in integer increments.

The current Bitcoin protocol provides for a maximum of 21M BTC x 100M sat = 2.1 QUADRILLION units of fungible supply.

Ben

[j5d]

Send bitcoin to a blackhole wallet no one can access. Now there is less bitcoin in existence. More demand. Price skyrockets.

[Transidium]

Send bitcoin to a blackhole wallet no one can access. Now there is less bitcoin in existence. More demand. Price skyrockets.

The rate at which wallets become inaccessible + the rate at which people intentionally burn BTC, cumulatively weighs as only a tiny fraction of a percent in the Bitcoin value equation.
And no, that rate won't 'spiral exponentially over time' or other nonsense.

Try again.

Ben

[mercistheman]

Thanks for interpreting the impact of every current and future startup... whew, and I was gonna buy more of that shit.

[Transidium]

... I look forward to intelligent, reasoned arguments for how Bitcoin will again find a value north of $300.

Never is a long time.  The US dollar is an empire-backed currency, Bitcoin is a distributed ledger protocol on the internet. Which of these do you think has the longer lifespan?  

Historically speaking empires have lifespans measured in single digit centuries.

Fine, I'll narrow the scope of my statement:

"Bitcoin will never again be priced over $300, for so long as the United States Dollar and/or the Euro and/or the Chinese Yuan exist as the world's de facto reserve currencies."

Better?

Ben

[Transidium]

Thanks for interpreting the impact of every current and future startup... whew, and I was gonna buy more of that shit.

This isn't a cogent argument, it's sarcastic fluff.
Please return when you can back up your bullish position with a strong rationale.

Ben

[coinableS]

If there is enough adoption 21 million coins is not enough to go around. ... If 21 million people were interested in bitcoin the price would easily head north of 4 figures.

I strongly disagree, for this simple fact: one satoshi carries exactly the same transactional capability and benefit to consumers/merchants as does one full Bitcoin.
People need to get over the mindset of $1/BTC1, i.e., value being assigned in integer increments.

The current Bitcoin protocol provides for a maximum of 21M BTC x 100M sat = 2.1 QUADRILLION units of fungible supply.

Ben

You're completely ignoring that it requires 100,000,000 satoshi to make up a full bitcoin all of which are limited. If you are ready to "get over the mindset" I will happily trade you 1 satoshi for your one bitcoin right now. I mean it's just a value being assigned by integer increments, right?

[mercistheman]

Alright put your money where your mouth is... escrow 5 coins... 5 years

[Transidium]

You're completely ignoring that it requires 100,000,000 satoshi to make up a full bitcoin all of which are limited. If you are ready to "get over the mindset" I will happily trade you 1 satoshi for your one bitcoin right now. I mean it's just a value being assigned by integer increments, right?

I'm not saying that 1 sat = 1 BTC. I'm saying that 1 sat has the same blockchain/transactional capability as 1 BTC.
This is where the "If 21M people want BTC, we hit the utility ceiling!" argument falls apart.

Are you saying that the potential exists for transactional demand to surpass a supply of 2.1 quadrillion fungible units, when the primary argument for Bitcoin centers around its functional value over otherwise perfectly usable dollars?

Ben

[jonald_fyookball]

$300 is completely arbitrary.  It certainly can go higher or lower.  Price is based on supply and demand...period.

[Transidium]

$300 is completely arbitrary.  It certainly can go higher or lower.  Price is based on supply and demand...period.

You're right, $300 is an arbitrary figure. That figure represents my degree of confidence in the strength of my argument.
If I thought Bitcoin had a bigger "value envelope", I'd have said $400 or $500...

You saying that "supply and demand determines the value of things" is not a valid counter-argument.
Please try again.

Ben

[coinableS]

You're completely ignoring that it requires 100,000,000 satoshi to make up a full bitcoin all of which are limited. If you are ready to "get over the mindset" I will happily trade you 1 satoshi for your one bitcoin right now. I mean it's just a value being assigned by integer increments, right?

I'm not saying that 1 sat = 1 BTC. I'm saying that 1 sat has the same blockchain/transactional capability as 1 BTC.
This is where the "If 21M people want BTC, we hit the utility ceiling!" argument falls apart.

Are you saying that the potential exists for transactional demand to surpass a supply of 2.1 quadrillion fungible units, when the primary argument for Bitcoin centers around its functional value over otherwise perfectly usable dollars?

Ben

The argument does not fall apart. If there is incredible demand and I can only get my hands on 0.001 bitcoin, I can not assign a value to it and send it to a recipient. The value is set elsewhere. If one bitcoin is worth $2 and I need to send $4 to someone then I have to come up with 2 bitcoins, period. I can not send them 0.001 and tell them to treat it as if it's worth more.  You asked for an intelligent discussion then you refuse to acknowledge simple supply and demand rules that have been proven again and again.
I can admit I don't know the future. The price could go to $0 or to $100,000 in 10 years. Stating that the price will never cross (X) is short sighted and foolish.

[Transidium]

Likewise, I could be proven wrong.
Personally I am 100% confident that Bitcoin will never again be priced over $300.
But like anybody who makes a reasoned prediction, there are no guarantees, only degrees of confidence.

Ben

[futureofbitcoin]

The only real value still built in is that of the electricity and hardware costs.

What's the "real value" of a movie? The cost of making the movie?

Your argument seems to imply that a movie would never make any more (or less) than the cost of producing the movie. This is obviously not true.

Just because electricity and hardware costs were involved in producing bitcoins, doesn't mean bitcoins will retain that value, just as putting money to produce a movie doesn't guarantee people will pay to watch it.

Similarly, just as movies might have make more value than was put in when producing it, bitcoin could do the same.

Perhaps at some point in the future, there will be a paradigm shift and people will really value decentralization. At that time, a decentralized cryptocurrency (or a number of them) will be used as the main currencies of trade. Then the cryptocurrencies must have value equivalent of a few trillions of USD current value.

Perhaps bitcoin will gain some sort of collector's value in the future. Or become the main currency used in black markets, which again, would give it extra value.

What you said may sound logical to you, but really it's quite flawed. It may be that bitcoin never goes over $300 USD again. But there are any number of scenarios in which it would go past $300.

[Transidium]

I find no entertainment value in owning or using Bitcoin, certainly not enough to account for any meaningful percentage of its value.

I am willing to pay towards the profit of a movie (its value to its creators exceeding its cost) because I find personal value in consuming it.

Apart from the (highly unlikely) "Bitcoin as a collectors item" thing, I don't see a realistic parallel in your argument...

Ben