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February 13, 2013, 07:12:15 AM |
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The world fiat monetary base (M0) which is cash and cash equivalents is in the region of $10 trillion. Think of cash as payments which are the end-point extinguishing a transaction. (If you pay on credit card then you just open up a new transaction, a debt, as the purchase is made, so credit money is not M0).
If Bitcoin grew to supersede nearly all fiat (which is feasible given its huge inherent advantages), and this takes place when about 15 million BTC have been created, then the maximum price for a bitcoin would be in the region of $700,000 each in 2013 dollars.
Considering that a currency war is hotting up then there may be a lot of printing in the next few years, so perhaps $1 million per BTC is a round number to keep in mind.
This is not considering the impact of the FRB system likely disappearing, and a huge percentage of the $1000 trillion world derivatives markets, which would have a hard time existing in a stable monetary base system. The benefits are, according to Austrian economics, very little in the way of booms and busts.
I believe a significant amount of speculation is recognition that there is a possibility this may all happen.
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