The universe doesn't want any one money. Even with gold, there was also silver. And there are many, many other stores of value, such as famous paintings and other artwork, real estate and so on.
Of course it does. The reason why we had silver to complement gold was because of physical issues pertaining to divisibility, transportation and weight. Those do not exist in the digital world.
There is no silver to BTC.
I wouldn't be so sure that a few big governments wouldn't agree on banning bitcoin. For the moment bitcoin has legal problems in Russia and in China to a certain extend. The day the US government also jumps in, I don't see how bitcoin can become a universal currency rapidly.
It is too late for the US government to jump it. Bitcoin is now an industry in the US and they will face a colossal fuck up if they even attempt to squash it for what would be very anti-constitutional reasons.
Because, after all, as long as there is no general *merchant* adoption, the only gateway to "buying stuff" with bitcoin are exchanges between fiat and bitcoin. This is why I think that the first adoption has to be merchant adoption.
But it has to be more than that: merchant adoption has to be such that the price is quoted in bitcoin, and is not just the "latest conversion of the price in fiat according to the rate at a given exchange".
This is backwards thinking. First it becomes a store-of-value, then a means-of-exchange and ultimately a unit of account.
I don't think many people would, at the moment. I wouldn't. I might change my mind if I could buy most of the stuff directly quoted in bitcoin. If I could buy a car in bitcoin (and not as "a conversion from $ into bitcoin"). At that point, I would start to trust bitcoin as a store of value. I think many people would. Maybe I'm wrong here, but I wouldn't think right now, or in the coming years, that many people with a lot of money would put it into bitcoin as a store of value.
I think you're wrong. The features I have noted above demonstrate why it is so. Bitcoin is an infinitely better store of value than fiat. It has qualities that are too attractive for even the commoners to ignore. And as I've said above, it makes to sense to suggest Bitcoin would be used as a unit of account until it is adopted as a store of value.
The devil is in the details: it is in the assumption of "stable". Stable in the sense of buying power. That can only be taken seriously if a lot of important stuff can be bought directly quoted in bitcoin, I would think.
In several developing countries, you're probably right, and I think that developing countries are probably the potentially biggest attraction pool of bitcoin usage, because their fiat is not very reliable. But the main currencies, like Euro or $$, I don't think people would bet on bitcoin in the coming years as "safer".
Why not? It shields your wealth from inflation and keep it out of the hands of banks and mobsters. Buying power? Someone has informed you already but it is worth repeating that Bitcoin can buy any of the top major world currencies at extremely favorable exchange rates.
Would you prefer holding inflationary fiat that loses buying power or Bitcoin that grows it with time?
Your point is useless if you choose to ignore the speculative aspect. This is simply a dishonest way to argue against reality.
I do consider the speculative aspect, but the speculative big growth expectation has to be based upon something else than "more growth", because that is exactly what drives a Ponzi. There needs to be something else.
Now, I was given a clear answer: bitcoin is going to be the unique and universal money and value store.
Ok, but I do buy that only at very low probability in the foreseeable future, and I would think, most people with money, too.
I do not suggest that Bitcoin would become the one an only store of value but yes I do envision it become the unique money. Of course the probability is very low but the mere fact that it exists is what is responsible for that potential "to the moon" growth and therefore will continue to attract investors.
That makes me smile a bit. *Fiat* is forced upon you because you have to pay your taxes in fiat. As long as a government decides that you have to pay your taxes in fiat, and as long as taxes make up a serious fraction of the economy, bitcoin *can't* take over the whole of payments. Because fiat will be in high demand to be able to pay taxes with !
Of course, the day that you are allowed to pay your taxes in bitcoin, your hypothesis has come true. I don't see that happening for a long, long time. I would think that most people would think that too.
Simple : hold Bitcoins and cash out the necessary amount of fiat when it is time to pay your taxes. All the upsides of Bitcoin without the downsides of fiat.
At this point I am not so sure the government is gonna be interested in its own worthless fiat though... which is why they'll probably be happy to get paid in BTC
Once you are on the moon, the "to the moon" argument won't work anymore, right.
Now, I understand your stance here: you say that "to the moon" is a justified expectation as long as not everything monetary isn't done in bitcoin, and once everything is done in bitcoin, the discussion is over.
My point is that that scenario is highly unrealistic in the coming several decades, and if no "moon" is realised earlier, I think many will LEAVE bitcoin if there is no widespread merchant adoption.
You are severely underestimating the power of network effect and technology adoption. It is not a slow, linear growth. It is exponential and once we go vertical (following the typical technology adoption s-curve) then it is hyper-exponential.
If your scenario is realized 100 years from now, I'm honestly not interested, and I don't think many people would be interested. I'll be dead, my children will probably be dead, and I don't care further along the road. I don't think many people would buy into bitcoin if they had to wait for 100 years for "full moon".
And if your scenario is realized much earlier, I would be surprised. I don't think that 10 or 20 years from now, this will be the case. I wonder how many people would want to hold serious money into bitcoin waiting for more than 20 years "for full moon".
We don't have to wait for full moon. If Bitcoin continues its growth trend then WHO would not want to hold their wealth in Bitcoin, hell you are almost guaranteed a 10x increase in buying power EVERY YEAR. Another thing you are severely underestimating is human greed.
Just wait until we get to the next bubble and it will all become clear.
So we have to consider something less ambitious, but more realistic as a "fundamental". This is what I'm after. What will be the expected market share of bitcoin, say, in 20 or 30 years ? Because that gives a *realistic* idea of the price of bitcoin to expect.
And the realistic answer to that is either 0,01%-1% or 95-100%. There is no in between.
I have to disappoint you, but the current price doesn't indicate that. In order to have an idea what price expectations to hold realistically, you need also to have a realistic view on fundamentals in a few decades. And that's what I wanted to discuss. Now, you made your point, you think "full moon" is realistic. In that case, indeed, the real price should be tens of millions of $ per coin. Fact is, it isn't for the moment, which means that most market players don't think so. Now, of course, the main reason to be in a market is that one thinks one is smarter than the market - me too.
In order for a high price, say, $100 000, - to be sustainable, this would mean that enough people need to believe "full moon" with enough money. I don't think that moment is there yet.
Not there yet but just around the corner.
I would like to believe them, but unfortunately, I don't. I do think there is a place for bitcoin, but a much more modest one than you describe here (even though deep inside I wish you were right). In my opinion, the scenario you describe is at least a century away. It would be great if not, but I can't believe it.
Again, you severely understimate the hyperexponential growth of technologies and the overwhelming power of something that combines the network effect of a protocol (think the internet) and money.
http://nakamotoinstitute.org/mempool/why-bitcoin-will-continue-to-grow/
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