A question about the general economics of BTC.

[hotcakepan]

I think this goes in this thread. Basically, I'm kinda new at Bitcoin mining, but I know enough to get around. However, a question about the economy.

"What does a buyer of bitcoins use them for in the real world?" I know, for example, that the person may be investing for later. What about if a person was selling physical goods for Bitcoins, like a boat. The person who sold the boat has received the Bitcoins, but what is he/she going to do with them? If the received BTC were to be sold on a converter like Mt Gox, what would the person buying the Bitcoins for real money use the Bitcoins for?

I'm kinda confused.

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[xxjs]

I think this goes in this thread. Basically, I'm kinda new at Bitcoin mining, but I know enough to get around. However, a question about the economy.

"What does a buyer of bitcoins use them for in the real world?" I know, for example, that the person may be investing for later. What about if a person was selling physical goods for Bitcoins, like a boat. The person who sold the boat has received the Bitcoins, but what is he/she going to do with them? If the received BTC were to be sold on a converter like Mt Gox, what would the person buying the Bitcoins for real money use the Bitcoins for?

I'm kinda confused.

You have to look further into the future, to a situation where lots of people are bitcoin users. You will be able to both earn and spend bitcoins, and the exchanges are only necessary for trade between users and non-users.

[johnyj]

If one large online merchant like Amazon accept bitcoin, then issentially you could buy anything use bitcoin, never need to convert back to fiat again. That day is not so far

And the reason you use bitcoin instead of USD: When you don't spend them, their value will be on the rise, so your purchase power is always higher every year

[dwdoc]

"what would the person buying the Bitcoins for real money use the Bitcoins for?"

Bitcoin is real money.  It can be exchanged for goods and services just like fiat (government issued money). Check out this forum's marketplace or Bitmit to see cool stuff you can buy only with Bitcoin. Does that mean fiat is not "real money?"

[countryfree]

Think of bitcoin as a foreign currency. If you sell your boat to a Japanese guy, he will pay you with Yens. Then, you have the choice. You can convert them to U.S. dollars, or spend them in the few shops which accepts Japanese Yens in your area, or you can spend them at mail order retailers that accept Yens.

[jgalt]

Bitcoins are similar to fiat currency in that they can be used to purchase goods and services, store value, invest, etc.

If you're looking for a couple of examples:

http://www.buybitcoinswiki.com/what-can-i-buy-with-bitcoin/

[Fugger]

I believe that what has been said in the previous posts is one of the ultimate goals of Bitcoin. That it is eventually used as a currency to purchase goods and services. That's where one of the real advantages of Bitcoin is, it's a superior means of payment which does not lose value only because a central bank decides to print more of it.

[firefop]

personally I buy beer and pizza with mine.

[Rygon]

I use bitcoins to buy pizza, and stuff from Amazon/Lowes via Gyft. With a lot of merchants signed up with Bitpay, there's more and more places to spend coins. However, I think the weighted majority of these merchants are taking fiat cash, and the coins are sold on the exchanges. This puts more downward pressure on the price because we can only rely on those same people buying back their coins from the exchanges, or more people getting into Bitcoin. Until more merchants actually keep the Bitcoins they take in, and pay their employees and invoinces in Bitcoin, I think the price will actually go down at first, as acceptance grows among merchants.

[BitCoiner2012]

I think this goes in this thread. Basically, I'm kinda new at Bitcoin mining, but I know enough to get around. However, a question about the economy.

"What does a buyer of bitcoins use them for in the real world?" I know, for example, that the person may be investing for later. What about if a person was selling physical goods for Bitcoins, like a boat. The person who sold the boat has received the Bitcoins, but what is he/she going to do with them? If the received BTC were to be sold on a converter like Mt Gox, what would the person buying the Bitcoins for real money use the Bitcoins for?

I'm kinda confused.

The goal would be that since someone is offering a boat > BTC , someone is further willing to offer the receiver some physical good, or something he elsewise desires, for those BTC he received. What's the lesson? We are the hurdle to adoption. I love BTC for investment and speculation - but I realize it can't be as great of a tool for either of those without being what it's supposed to be first, a way to transmit some pretty important information, a store of meaning so to speak, vs other objects.

In other words, I advocate and do purchase items from people with BTC, and always offer to accept BTC, even if it isn't something I expect to get a response from - it lets them know I do accept it. Someone accepts it.. something to think about in the back of your mind, if you understand.

I use bitcoins to buy pizza, and stuff from Amazon/Lowes via Gyft. With a lot of merchants signed up with Bitpay, there's more and more places to spend coins. However, I think the weighted majority of these merchants are taking fiat cash, and the coins are sold on the exchanges. This puts more downward pressure on the price because we can only rely on those same people buying back their coins from the exchanges, or more people getting into Bitcoin. Until more merchants actually keep the Bitcoins they take in, and pay their employees and invoinces in Bitcoin, I think the price will actually go down at first, as acceptance grows among merchants.

This is relevant to what I'm saying completely.

[bitfromit]

"what would the person buying the Bitcoins for real money use the Bitcoins for?"

Too many to list and growing uncontrollably... try :

https://www.bitcoinstore.com/ item for item much cheaper than elsewhere due to very low overheads of BTC.

https://en.bitcoin.it/wiki/Trade will give you an idea of the types now looking at implementing bitcoin as a payment sys.

And as already mentioned in this thread: Gyft (http://www.gyft.com/bitcoin.html)