Bitcoin should be at $13,500 ?

[johnyj]

QE3's 2.8 billion new USD per day vs 3600 new bitcoin per day, $778K per coin, at 1% acceptance, $7.8K per coin

People tends to forget how much new USD were created daily, out of nothing

[superduh]

It's alright guys, naphto is attempting to use his head

[semaforo]

  And do you think in a country where monthly income per capita is around $300 dollars, and then one family starts getting a payment from a family member working in Sweden for $550 a month through BTC exchanges instead of the $510 a month they were getting with Western Union, do you really think their neighbors are just going to ignore this and keep using Western Union?

How the hell would bitcoins be able to reduce those fees?
If you want to buy btc with kroners, you have to convert kroner to usd first (or euros), and then convert usd (or euros) into bitcoins.
You will get charged:
(1) by your bank for converting kroners.
(2) by mtgox for converting usd.



But, if you find a reliable way to convert kroner => btc and btc => usd, maybe you can save money.
But at which price? Too much of a hassle compared with the easiest way: international wire.


So, yes, it could save money, but not likely to be used by most of the world population.

    Compare fees to double digit inflation in many countries, and how are 1% exchange fees more expensive than WU fees of up to 20% for comparable speed. The cheapest Western Union fees are 5%, and it takes several days. This is to places where banking institutions are not widely distributed. I am guessing it is hard to imagine life like this in Denmark.

    I understand there is a gap here, because bitcoin adoption is mainly happening in post-industrial societies. There are barriers. Once the dam starts to crack, what starts as a trickle will soon start to grow.

    Take this example- in the Congo-Kinshasa, dollars are the defacto currency, with the Congolese franc being totally mismanaged. Small purchases like vegetables, coffee, or time in an internet cafe are paid with francs, but cars, real estate, diamonds, oil, and so forth, is all dollar based transactions.
    The dollars role as de facto world currency is the only reason that the Fed can print dollars with impunity without inflation skyrocketing. It's because hundreds of millions of people believe they have value, and this trust is being horrendously abused right now.

   So in the Congo, where all big purchases are made with dollars, someone can buy 50 BTC for $5,550 right now from their job in a fish processing plant in Alaska to Kinshasa. The purchase takes 4 days, and costs a 1% exchange fee of $55.50. They are sent in 30 minutes to Kinshasa, where someone can change the BTC back into dollars for another 1% fee. Okay, it cost over a hundred dollars to send the money, plus fluctuations could have resulted in a loss or gain of another couple of hundred dollars.

    If you compare this to a bank wire transfer fee, which are usually $35 to $75 for the same amount, the BTC-USD exchange rate entirely determines whether or not it was more efficient.

Both:

1) Recognition of its value in countries with high inflation and use for major purchases
2) More efficient exchanges

   could make BTC a better option than wire transfer. Also the scarcity of banking services or capital controls in some countries also add cost barriers that make BTC, especially mobile BTC transfers more cost effective.

   I don't expect people who haven't spent time in Africa to understand this, but take my word for it- this could become an international currency see:

http://en.wikipedia.org/wiki/List_of_countries_and_territories_by_inflation_rate

   This idea will not be stopped.

      

[chiropteran]

Some website said they accept bitcoin, like that "DigiDeals" in Australia. When you want to pay online, guess what:

Credit or Debit Card (2% processing fee)
  
PayPal (2% processing fee)
  
Bank Transfer
  
Bitcoin (5% processing fee)

It seems like you are taking a singular example and assuming all business everywhere forever will follow the same fee schedule.  Don't you realize how absurd of an assumption that is?

Here is a singular example that blows your whole theory out of the water: http://www.slysoft.com/en/

ZOMG!  10% discount for using bitcoin, in comparison credit cards have an 11.1% increased "fee".  Your silly 5% fee at DigiDeals doesn't seem like such a big deal anymore.

[BitcoinAshley]

it has lots of great properties — negligible transaction fees (...)

Bullshit.
My credit card is free of charge for me (as a customer), I don't give a shit if the merchant have to pay an American company for providing this service. But I know, and I care, that everywhere in the country I can use it, without paying any fee. Bitcoins fees are way too high.

Nope. You are incredibly, retardedly, wrong. CC fees are priced into the goods/services you receive, as they are contractually prevented from adding a charge for CC billing in most cases. So the lower the tx fee for ANY service, the lower the overhead. If you think you're not affected by a recipient tx fee vs. a sender tx fee, you're wrong

Merchants are allowed to charge less for cash but not more for CC. Most don't do this. Gas stations are a notable exception. For the most that don't, it's equivalent to everyone paying a little more to cover CC cost. For those that do, it's equiv. to getting a discount for cash payments. Just like I give my customers discounts for BTC payments as it's less trips to the bank for me, less hassle, and no fees (I don't use BitPay.)

The article does not into account the whole picture

+ the main argument should not be based on stupid assumption like "the bitcoin market should represent xxxx in the future", but "how much an average human being is willing to pay for 1 bitcoin?".


Considering a 10 % chance of loosing it all, does anyone will be willing to spend 13.5 k usd for that? Not even close...

Ok, so here naphto really reveals his stupidity as he obviously does not understand decimal points. Go back to highschool dude! 

Why a "bitcoin" and not a "megabitcoin" or a "kilobitcoin" or a "minibitcoin?" Why "they wouldn't spend 13.5k for that" and not "they wouldn't spend 13.5k for a kilobitcoin" or "they wouldn't spend 10k for a yodabitcoin" like wtf for real? That's like the most noob mistake you could possibly make. Fungibility. Lrn2monetarytheory.

[Coinseeker]

As was posted in another thread, Bitcoin will never be able to survive as an international currency.  Store of value maybe, but not a currency.

In 2011 Visa maxed out at 11,000 transactions per second.  Two years later, 2013, Bitcoin can only handle 5-7 transactions per second.  So no, Bitcoin won't be helping Africa or any other nation.  It can't even match the number of Visa transactions, let alone trying to surpass King Dollar.

[notme]

it has lots of great properties — negligible transaction fees (...)

Bullshit.
My credit card is free of charge for me (as a customer), I don't give a shit if the merchant have to pay an American company for providing this service. But I know, and I care, that everywhere in the country I can use it, without paying any fee. Bitcoins fees are way too high.

Nope. You are incredibly, retardedly, wrong. CC fees are priced into the goods/services you receive, as they are contractually prevented from adding a charge for CC billing in most cases. So the lower the tx fee for ANY service, the lower the overhead. If you think you're not affected by a recipient tx fee vs. a sender tx fee, you're wrong

Merchants are allowed to charge less for cash but not more for CC. Most don't do this. Gas stations are a notable exception. For the most that don't, it's equivalent to everyone paying a little more to cover CC cost. For those that do, it's equiv. to getting a discount for cash payments. Just like I give my customers discounts for BTC payments as it's less trips to the bank for me, less hassle, and no fees (I don't use BitPay.)

Exactly.  2-5% CC fees are a cost of doing business for merchants that accept them.  When conducting transactions has a cost, it doesn't matter who pays them because the one paying always factors it into their pricing.  If they are socialist (or contractually obligated to act as if they were) they may spread the cost across all customers, but the cost is still part of the price.  BTW, if you want a real world example, check out bitcoinstore.com.  Their huge product database is still a little tough to sort through, but it is getting better.  More importantly, by only accepting bitcoin, they are able to offer better prices on most electronics than any other site on the web.  Not only do they save CC processing fees, but they avoid the extra costs incurred in dealing with cases of fraud or attempted fraud.

[ElectricMucus]

The error in this calculator is that it presents the percentage of "store of value" and "black market" to unrealistic values.

If you enter more realistic values like 0.01% in there you come to more realistic values.

[notme]

The error in this calculator is that it presents the percentage of "store of value" and "black market" to unrealistic values.

If you enter more realistic values like 0.01% in there you come to more realistic values.

I disagree frequently with your comments, but this one is spot on, although store of value may be a bit higher than 0.01%.  (That said, I at least can respect your logic skills, we just have different experiences).

[bitzox]

It's alright guys, naphto is attempting to use his head

FTFY

[yvv]

The cheapest Western Union fees are 5%, and it takes several days.

BS. Currently, WU is much faster, cheaper, safer and more convenient than bitcoins.

Sending bitcoins from address to address is easy, but getting bitcoins and converting them back to fiat is pain in the ass (at least in USA).

[semaforo]

As was posted in another thread, Bitcoin will never be able to survive as an international currency.  Store of value maybe, but not a currency.

In 2011 Visa maxed out at 11,000 transactions per second.  Two years later, 2013, Bitcoin can only handle 5-7 transactions per second.  So no, Bitcoin won't be helping Africa or any other nation.  It can't even match the number of Visa transactions, let alone trying to surpass King Dollar.

   A couple of years ago Western Union averaged less than 540,000 transaction per day.

http://www.chacha.com/question/how-many-transactions-does-western-union-make-in-one-day-worldwide

If there are any technical limits (from data types or whatever), they can be eliminated in the same way that MAX_BLOCK_SIZE can be increased.

Storage is the main issue, I think: an attacker could create huge blocks that every full network node has to store forever. With just 1 BTC you can create a block of 15+ GB by splitting it into 100,000,000 "nanocoins".

In the future most people will run Bitcoin in a "simple" mode that doesn't require downloading full blocks or transactions. At that point MAX_BLOCK_SIZE can be increased a lot.

https://bitcointalk.org/index.php?topic=1314.20


    As I understand it, 1 MB blocks allows for 7 transactions a second. 15 GB would be 15,000 times that or 105,000 tps. That's enough for the volume of bitcoin trade to exceed the volume of visa, moneygram, and western union combined.

     The post above was 3 years ago. I am not so sharp on the technical aspect. Does this mean that if block size was increased to handle more volume that DoS attacks would become more viable? Perhaps someone can give me a link to an old discussion about this. Maybe there will be dedicated servers that can confirm transactions by searching only relevant data to a specific transfer rather than the whole block? Anyone care to school me?

[semaforo]

The cheapest Western Union fees are 5%, and it takes several days.

BS. Currently, WU is much faster, cheaper, safer and more convenient than bitcoins.

Sending bitcoins from address to address is easy, but getting bitcoins and converting them back to fiat is pain in the ass (at least in USA).

   Have you tried using WU? I've had many problems with WU transfers, often because of complicated security protocols. For example, in Colombia I once had to have a transfer resent in a friends name because the bank had a requirement that only Colombian citizens can receive transfers. If you honestly think WU is better than bitcoin, read this story:

http://www.thebeijinger.com/forum/2008/05/11/Western-Union-fees

   I have had similar experiences- the fees are high and they skim even more off with exchange rates considerably worse than bank exchange rates. They also require a slough of documentation which all has associated costs.


   Imagine bitcoin infrastructure is more developed, say two years from now. I could have had the transfer sent in BTC, simply got on to localbitcoins.com or a comparable service, and exchanged the BTC with a 1% or less transaction fee. The main cost is in the exchanges, but this is true of any forex transaction. Right now I am transferring money from the US to Germany via BTC. This costs me 1% deposit on one side, and 1% withdrawal on the other. For 5000 dollars this is 100 dollar fee- a wire transfer would be cheaper, but since I don't have a bank account in Germany (the bulk of people receiving remittances also do not have bank accounts) it is cheaper for me to sell the bitcoins via local bitcoins, where I can charge a 1% premium which translates the fee to effectively 0. This means my only cost is the time of finding a buyer on localbitcoins. Since I am not in a hurry and have moral reasons for not wanting to support corrupt governments and their currencies, this is great for me. The efficiency will increase in direct relation to the number of people using bitcoin.

     Surely, not as efficient as a wire transfer, but there is also no risk that a government in a financial crisis will seize or freeze my funds. Also, a wire transfer takes 3-5 days for funds to become available, sometimes even longer, and with larger amounts the time value of that money which goes to the bank, plus the fees, become a considerable sum. Also, many people receiving remittances don't have bank accounts or the ability to get one, being in rural areas and needing to care for their animals just to survive. Many of them don't have the id cards necessary to deal with banks. But with a smartphone with a BTC wallet, they can receive transfers from anywhere in the world almost instantly. They could then trade their BTC a little at a time for local fiat to meet expenses, thereby protecting themselves from the inflation rampant in many countries. When bitcoin catches on, they will also be able to trade directly with BTC, insha'Allah, eliminating the main obstacle in the network- the exchange on the ground in the recipient countries.
        
       There were people who said a man could never set foot on the moon. There are still people who say that humans never have walked on the moon. Keep up the critical thought, it will keep us rising.
      

  

[yvv]

  Have you tried using WU?

I use it every month, never had an issue. Fees used to be high in the past, but now they are quite acceptable.

I seriously considered using bitcoins or other e-money for sending money to my relatives in Ukraine, but this adds nothing but complexity.

[bitzox]

Its a market in its nascent stages, complexity is to be expected. Do you think WU was easy when they were still using the pony express? Give it 24 months once regulatory issues have been resolved competition will increase, complexity and costs will decrease and WU will be left in the dust.

[jubalix]

Bitcoins are coming down, and the clones (alt coins) will go up.

There is no limited supply of 'bitcoins' and all it takes is copy and paste, and can create lots of coins.

the blockchain stores the value, the bitcoin blockchain has the most agreed value,

I think you are confusing the software engine with the database

[AliceWonder]

Its a market in its nascent stages, complexity is to be expected. Do you think WU was easy when they were still using the pony express? Give it 24 months once regulatory issues have been resolved competition will increase, complexity and costs will decrease and WU will be left in the dust.

WU could adapt and adjust, using bitcoin as their means of transfer.

[Luckybit]

The article does not into account the whole picture


+ the main argument should not be based on stupid assumption like "the bitcoin market should represent xxxx in the future", but "how much an average human being is willing to pay for 1 bitcoin?".


Considering a 10 % chance of loosing it all, does anyone will be willing to spend 13.5 k usd for that? Not even close...

They will be buying mBTC.

[Luckybit]

I think this will happen in 100 years.

There wont be a such thing as work in 100 years. Robots will have all the jobs.

[Luckybit]

The article does not into account the whole picture


+ the main argument should not be based on stupid assumption like "the bitcoin market should represent xxxx in the future", but "how much an average human being is willing to pay for 1 bitcoin?".


Considering a 10 % chance of loosing it all, does anyone will be willing to spend 13.5 k usd for that? Not even close...

You're assuming people are going to want an entire bitcoin.. what's wrong with a satoshi

That's about human psychology.
Why the top was about 250 usd a few weeks ago? Because 250 is 1/4 of one thousand usd. That's why ... People understood that it was overestimated. It could have been 500 or 1 000 as well.

You can find 1 guy stupid enough to pay 1 000 usd for 1 btc, but not enough people to maintain the price that high.
Bitcoin was not designed to be used for anything else that it is now:
- wannabe-traders-willing-to-make-money
- negligible trades (for drugs, geeks, or money laundering)

What will happen is miners will start pricing in mBTC and selling Bitcoin in mBTC.
Not much else would have to change. People will pay $1000 for 1BTC btw. I know I would. But the way I would do it is I would set aside a % of my income or paycheck to purchase Bitcoin no matter how much or how little it ends up being at the time.