Why bitcoin will appreciate forever

[greBit]

I was wondering if there actually is a good source to 'measure' Bitcoin popularity and to figure out at what kind of rate new users are coming in approximately?
Have not yet seen any figures that I would trust.

Determining such a number is not yet so easy, limiting us to work with very few options. Even with the help of statistics, its accuracy is still something which we need to figure out from every individual. The best way to know how many people are using bitcoins is having at he mass survey, or ask them personally about a vote-down, etc. So what is your final choice anyway?

A mass survey would be good, but I eye methodical problems, because there are differences in adoption per country, line of business (IT), social rong, and political (the statists are eagerly uninterested). Even asking everyone, could pose problems, since there would be communication problems.

So do you think there is any way right now or maybe in future to know how many people currently use bitcoin? Knowing their value and their possession or even their identity is not the motive, finding out the true number of users is the only motive. I was thinking of a poll which collaborates with wallet providing websites but I don't think anybody will care to fill, and we can't force users. Also, who knows they might put false data too.

I think the price reveals the combination of number of users and their eagerness to hold. Maybe that is the number you want to predict, so that doesn't work.

Maybe there is a technology advancement in bitcoins which lets the market know how many individuals are actively using bitcoins, on a regular basis. If we try calculating it by the price of bitcoin, we will never know the answer. If we know the total amount of bitcoins till now, then we might narrow down perspectives but it would still be a long and horrifying task  and possibly leave unverified answers.

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[qiwoman2]

I think Bitcoin might start appreciating more once it can no longer be mined, or the buyers per mined coins increases..so as more and more people invest in bitcoin and less and less coins are being mined then we may see another big trending upwards. I don't know but that's how my little logical brain would put it. Just my 2 bits.. 

[Xxmodded]

Nothing lasts forever and many are waiting for BTC to take off again.

[johnyj]

[...]
Yes, USD has dropped 99% of its value since 100 years ago, but the USD supply has increased much more than 1000 times,
[...]

(I had to crop the quote, I wanted to address only this point)

I have no idea if your numbers are correct, but if they are:

We know that the consequence of increasing the money quantity has effect on prices, more money means higher prices, but there is a delay. When money is printed and are still in the basement of the central bank, and it is unknown to the public, there is no price rise, but when the money is distributed, it will rise prices, first on the products that are bought by the state, then the products that are bought by the vendors to the state and so on, until they are evenly spread out, which can take ten years or more.

So when he money quantity have risen 1000 times, but prices only 100 times (your numbers), the prices may rise in the future, eventually up to 1000 times, or 10 times more than today, don't you think? How long time will it take, will it be quicker? Money printing is still going on, not?

http://www.tradingeconomics.com/united-states/money-supply-m2
You can google some numbers for US money supply. M2 is around 16 billion at 1913, and at 2013 it is around 12 trillion, so close to 1000 times increase, but if USD only becomes 1/100 of its initial value, that means for each 10x more money created, price level only increase by 1x.

The reason is: Although the money supply increases, the demand for money for trading goods/services also increased, so the goods and services production and consumption increased by about 10x. In one century, the industry output increased by 10x, banks printed 1000x more money and devalued those money by 100x in the process

Since the change in M2 and price level is just several percent each year, I don't think you will see a significant Cantillon effect any time. That's the rule that inflation should never increase by more than 5-10% per year, so that average people will ignore that change. However, the increase in base money supply becomes too dramatic since 2008, so what will happen now is uncertain

But my guess is, as long as those money are in the hands of banks, they can control the money in circulation, thus create inflation or deflation at will. Those rules in economy books are only a small subset of the giant central bank game, they can make things works like those books described, but they can also change it at will. At central bank's level, it is all about market manipulation, but they do it with certain risk

[americanpegasus]

A better coin is possible, better privacy and microtransactions, otherwise just as good as bitcoin. An altcoin that good could take good slice of the market, but I have not seen such altcoin yet, and hopefully I shall be able to see it coming in time before the mob sees it.

 
 
When you wrote this, we didn't have such a coin.  Now we do. 
 
Monero is destined to be the global private ledger to bitcoin's public ledger: 
 

[Erdogan]

[...]
Yes, USD has dropped 99% of its value since 100 years ago, but the USD supply has increased much more than 1000 times,
[...]

(I had to crop the quote, I wanted to address only this point)

I have no idea if your numbers are correct, but if they are:

We know that the consequence of increasing the money quantity has effect on prices, more money means higher prices, but there is a delay. When money is printed and are still in the basement of the central bank, and it is unknown to the public, there is no price rise, but when the money is distributed, it will rise prices, first on the products that are bought by the state, then the products that are bought by the vendors to the state and so on, until they are evenly spread out, which can take ten years or more.

So when he money quantity have risen 1000 times, but prices only 100 times (your numbers), the prices may rise in the future, eventually up to 1000 times, or 10 times more than today, don't you think? How long time will it take, will it be quicker? Money printing is still going on, not?

http://www.tradingeconomics.com/united-states/money-supply-m2
You can google some numbers for US money supply. M2 is around 16 billion at 1913, and at 2013 it is around 12 trillion, so close to 1000 times increase, but if USD only becomes 1/100 of its initial value, that means for each 10x more money created, price level only increase by 1x.

The reason is: Although the money supply increases, the demand for money for trading goods/services also increased, so the goods and services production and consumption increased by about 10x. In one century, the industry output increased by 10x, banks printed 1000x more money and devalued those money by 100x in the process

Since the change in M2 and price level is just several percent each year, I don't think you will see a significant Cantillon effect any time. That's the rule that inflation should never increase by more than 5-10% per year, so that average people will ignore that change. However, the increase in base money supply becomes too dramatic since 2008, so what will happen now is uncertain

But my guess is, as long as those money are in the hands of banks, they can control the money in circulation, thus create inflation or deflation at will. Those rules in economy books are only a small subset of the giant central bank game, they can make things works like those books described, but they can also change it at will. At central bank's level, it is all about market manipulation, but they do it with certain risk

Well I think the demand to hold, not the demand to trade, is the source of the money value, so the danger of price inflation is high. But there is also the debt money, which can contract.

[johnyj]

Well I think the demand to hold, not the demand to trade, is the source of the money value, so the danger of price inflation is high. But there is also the debt money, which can contract.

True, both holding and transaction will have the same effect on money supply: Make some amount of money occupied from other's access. But holding have a much larger effect. You must spend $2000 every month to make those money occupied, while you only need to hold them to make them disappear from circulation for a long time. Normal people seldom spend $10K every month, but having a saving of $10K is not so difficult

But following this path, you will see that banks printed 1000x more money, where 90% of those are being hold in long term storage, and the rest 100x USD depreciated 100 times, so that the economy does not grow at all. Maybe this is the truth, because the time for anyone is always the same, and most of the people born with nothing and die with nothing, what they did during their life time is irrelevant

[BillyBobZorton]

A better coin is possible, better privacy and microtransactions, otherwise just as good as bitcoin. An altcoin that good could take good slice of the market, but I have not seen such altcoin yet, and hopefully I shall be able to see it coming in time before the mob sees it.

 
 
When you wrote this, we didn't have such a coin.  Now we do. 
 
Monero is destined to be the global private ledger to bitcoin's public ledger: 
 

Monero will always remain an underground currency. Now this doesn't mean it cannot be a big success, underground economies are huge specially in poorer countries where people simply cannot afford paying taxes. The problem is unless you get paid in Monero directly it stops being as anonymous.

[americanpegasus]

That's the same problem with any currency; we can't help that other currencies aren't anonymous.   Ideally a Monero economy will eventually emerge so that people *do* get paid in Monero and spend it too. 
  
And financial privacy is not "underground".   Bitcoin is inherently flawed as a currency.    
  
Consider this: if the original bitcoin had truly private transactions built in, by way of cryptographic ring signatures...  Would anyone ever consider it an upgrade to remove that feature?  
  
Of course not.

[ummina]

well.. as we know... if we get many BTC we can get money too....
as much as we can. and we can be billion people if we get more than 5000BTC..
everyone who not want to get money with make some post,,, and maybe some half of around people want to leave their job to focus in bitcoin..
caus if we really seriousely here, we can get much money more than but absolutely is an subjektif with we are effort. more than we work more than we get btc and more han we get the money.... so thats is my opinion wy bitcoin will appreciate forever.

[johnyj]

The problem I see with altcoins is that they all cause inflation in cryptocurrency world, thus people lacks long term incentive to hold them: If today I start to inject part of my capital towards Monero, then those added Moneros will dilute the value of bitcoin, and what will happen to my monero's value if tomorrow there are even better coin Monexo, Moneyo, Monezo, etc... So it is better we just upgrade the bitcoin protocol to include the best features of Monero if they really are appreciated by most of the community members, and refuse any monetary inflation in crypto currency world

[alva5763]

Why do you want bitcoin to keep appreciating as it will cost more to purchase them?

[johnyj]

Why do you want bitcoin to keep appreciating as it will cost more to purchase them?

You never hold something that has a long term depreciating future as a store of value (like fiat money). If it is always appreciating long term wise, then you can buy it any time and be assured your savings are safe in future

[mrhelpful]

Taking everything that I know, it`ll appreciate forever due to the hard code.

Also the fact it serves multiple areas so it has more chances to appreciate more then one direction. Some people see it as a priceless money transmitter like I do and can see it used by the poorest countries to do commerce.

Others also see it as "commodity" aspect and that this will traded as some form of foreign debt as well.

[Amph]

Why do you want bitcoin to keep appreciating as it will cost more to purchase them?

you can simply buy less, which will have the same value as the same amount you are willing to buy now, the ratio will always be the same if you want, unless something stupid and unrealistic happens, like for example 1 satoshi = $1k...

[techgeek]

That's the same problem with any currency; we can't help that other currencies aren't anonymous.   Ideally a Monero economy will eventually emerge so that people *do* get paid in Monero and spend it too.  
  
And financial privacy is not "underground".   Bitcoin is inherently flawed as a currency.    
  
Consider this: if the original bitcoin had truly private transactions built in, by way of cryptographic ring signatures...  Would anyone ever consider it an upgrade to remove that feature?  
  
Of course not.

Bitcoin is not a private currency true, but it should be looked as a money transmitter.

The blockchain is a public ledger obviously, but you can do services like bitmixer or any other mixing services that removes all those transactions to harder to follow making "underground" becoming a financial privacy.

[lissandra]

well.. as we know... if we get many BTC we can get money too....
as much as we can. and we can be billion people if we get more than 5000BTC..
everyone who not want to get money with make some post,,, and maybe some half of around people want to leave their job to focus in bitcoin..
caus if we really seriousely here, we can get much money more than but absolutely is an subjektif with we are effort. more than we work more than we get btc and more han we get the money.... so thats is my opinion wy bitcoin will appreciate forever.

umm, so youre saying the existing people who hold bitcoin, go buy an extra coin?

this is what day traders do, if they make profit in trades and buy back in cheap. But, as for the focus part of leaving their jobs most are relied on paying the bills with fiat form so focusing on bitcoin entirely must mean that person is financially already secure.

bitcoin is to volatile to leave a job for it.

[americanpegasus]

The problem I see with altcoins is that they all cause inflation in cryptocurrency world, thus people lacks long term incentive to hold them: If today I start to inject part of my capital towards Monero, then those added Moneros will dilute the value of bitcoin, and what will happen to my monero's value if tomorrow there are even better coin Monexo, Moneyo, Monezo, etc... So it is better we just upgrade the bitcoin protocol to include the best features of Monero if they really are appreciated by most of the community members, and refuse any monetary inflation in crypto currency world

You have a good point, that minor features should not restart a block-chain. 
 
However the improvements to Monero make it a fundamentally different instrument that bitcoin.  It would be impossible to transfer bitcoin over to the standards that Monero uses for cryptography because the entire point of those standards is privacy and anonymity.  Every Monero has had those guarantees of privacy since inception whereas bitcoins have not. 
 
Now, I'm not saying that bitcoin needs to be replaced, in fact, we need a public and a private ledger.  Both serve an important role. 
 
But the old adage of, "just incorporate that technology into bitcoin" doesn't apply here.  In the future, I will agree with you: just incorporate that technology into Bitcoin/Monero where applicable, but sometimes radically different concepts require a new blockchain.

[johnyj]

The problem I see with altcoins is that they all cause inflation in cryptocurrency world, thus people lacks long term incentive to hold them: If today I start to inject part of my capital towards Monero, then those added Moneros will dilute the value of bitcoin, and what will happen to my monero's value if tomorrow there are even better coin Monexo, Moneyo, Monezo, etc... So it is better we just upgrade the bitcoin protocol to include the best features of Monero if they really are appreciated by most of the community members, and refuse any monetary inflation in crypto currency world

You have a good point, that minor features should not restart a block-chain. 
 
However the improvements to Monero make it a fundamentally different instrument that bitcoin.  It would be impossible to transfer bitcoin over to the standards that Monero uses for cryptography because the entire point of those standards is privacy and anonymity.  Every Monero has had those guarantees of privacy since inception whereas bitcoins have not. 
 
Now, I'm not saying that bitcoin needs to be replaced, in fact, we need a public and a private ledger.  Both serve an important role. 
 
But the old adage of, "just incorporate that technology into bitcoin" doesn't apply here.  In the future, I will agree with you: just incorporate that technology into Bitcoin/Monero where applicable, but sometimes radically different concepts require a new blockchain.

What if something better than Monero pops up? Should people constantly change to a new currency because of new feature and introduce more inflation every a few years?

The biggest advantage for bitcoin over fiat currency is its inflation resistance, and that's the fundamental support for its value. The consensus among cryptocurrency users is: Select one currency with limited supply and keep building its infrastructure and user base, you will get many anti-inflation benefits in the long run. However, if every a few years we introduce a new currency with new features and start to rebuild the infrastructure and rebuild the value and community from ground up, you can guess who will be participating this kind of cycle

Finance is about long term perspective, that's the reason bitcoin worth almost nothing in the first 2 years, you need time to prove a concept's value. If Monero can reach bitcoin's status after another 5 years, maybe people will start to take it seriously

[americanpegasus]

What if something better than Monero pops up? Should people constantly change to a new currency because of new feature and introduce more inflation every a few years?

The biggest advantage for bitcoin over fiat currency is its inflation resistance, and that's the fundamental support for its value. The consensus among cryptocurrency users is: Select one currency with limited supply and keep building its infrastructure and user base, you will get many anti-inflation benefits in the long run. However, if every a few years we introduce a new currency with new features and start to rebuild the infrastructure and rebuild the value and community from ground up, you can guess who will be participating this kind of cycle

Finance is about long term perspective, that's the reason bitcoin worth almost nothing in the first 2 years, you need time to prove a concept's value. If Monero can reach bitcoin's status after another 5 years, maybe people will start to take it seriously

 
 
Now that we have a public blockchain and a private blockchain, you would be hard pressed to find something as fundamental to upgrade.  Someone suggested a blockchain that was capable of zero-second confirmations but I have yet to see one like that so far. 
 
Your argument is to just keep building off of bitcoin, but you are missing the bigger point: it is unsuitable as a global currency.  Blockchain analysis is only going to get more and more sophisticated as we go forward and the idea of everyone being able to see everyone else's transactions is absurd on a global scale.  Privacy is essential, and not privacy that depends on a centralized source: true privacy. 
 
Very rarely have we ever had "one" of anything; there has always been competition, especially with money involved.  Multiple blockchains are an inevitability.  The key is to ensure they have drastically different features and aren't just a clone (which is why I think litecoin has no future).