The believe that because of Bitcoin limited supply the price will rise is a myth

[franky1]

Obviously if there won't be any demand at all, it won't be Worth any money at all..

if its too expensive to trade. and has no merchant usage.. then its demand dies.
check out all the crap coins that cant buy a loaf of bread(random example) in the real world. but all have 21mill coin cap

scarcity is meaningless without utility/function.
emphasis check out all the crap coins with 21mill coincap

dont rely on scarcity as bitcoin saviour of value. otherwise your willing to say kill off utility/function because scarcity will push bitcoin up. reality is it wont. scarcity is meaningless without function/utility

scarcity is about supply.. function/utility drives demand. supply does not drive demand

[Dava.Dina]

I do not think the Bitcoin price hike could be a myth because it has shown the world that it can reach its price farther than we thought in the final quarter of 2017 that reaches over $ 20K USD.

And I can not predict how much Bitcoin will be needed in a day, month, or decade, we can only be sure that its scarcity will be a major factor in determining its value.

I believe that bitcoin will continue to potentially grow in the coming years to provide more profit for investors.

[Ranly123]

Let's suppose that for some reason the supply of potato drastically decreases all around the world. Does that mean that people will pay 10.000 dollars for a potato or give up their cars just to get a potato? Of course not. This is because the utility of consuming a potato - the want-satisfying power of a potato is much smaller than that of a car or of 10.000 dollars worth of goods or services. In other words, from the mere fact that the supply of something is limited it does not follow that the price will soar.

In comparison to a potato, Bitcoin is not even a physical tangible good that can be used for satisfying human wants or needs, and its only utility is that it functions as a medium of exchange. So, just because Bitcoin supply is limited, that does not mean its price will rise. People will NOT pay enormous amounts of money just to have a medium of exchange function, especially if this function is equally available whether the price of Bitcoin is 1 cent or 7.000 dollars, and if this function can be realized with various alternative cryptos or fiat money.

This is a basic law of supply and demand in the economics. Of course, prices will vary in accordance to the circulating supplies in the market.

[hatshepsut93]

Let's suppose that for some reason the supply of potato drastically decreases all around the world. Does that mean that people will pay 10.000 dollars for a potato or give up their cars just to get a potato? Of course not. This is because the utility of consuming a potato - the want-satisfying power of a potato is much smaller than that of a car or of 10.000 dollars worth of goods or services. In other words, from the mere fact that the supply of something is limited it does not follow that the price will soar.

If potatoes suddenly became extremely scarce, their prices would skyrocket because they would become luxury food similar to truffles. Scarsity itself doesn't create value, but it amplifies the value of something that already has some utility.

In comparison to a potato, Bitcoin is not even a physical tangible good that can be used for satisfying human wants or needs, and its only utility is that it functions as a medium of exchange. So, just because Bitcoin supply is limited, that does not mean its price will rise. People will NOT pay enormous amounts of money just to have a medium of exchange function, especially if this function is equally available whether the price of Bitcoin is 1 cent or 7.000 dollars, and if this function can be realized with various alternative cryptos or fiat money.

You're mixing up different things here. If we're talking about medium of exchange, then the costs of using it are a combination of network fees, exchange fees and price fluctuations and in some cases it can already be lower than traditional payment methods.

[emuLOADs_temp]

Obviously if there won't be any demand at all, it won't be Worth any money at all..

if its too expensive to trade. and has no merchant usage.. then its demand dies.
check out all the crap coins that cant buy a loaf of bread(random example) in the real world. but all have 21mill coin cap

scarcity is meaningless without utility/function.
emphasis check out all the crap coins with 21mill coincap

dont rely on scarcity as bitcoin saviour of value. otherwise your willing to say kill off utility/function because scarcity will push bitcoin up. reality is it wont. scarcity is meaningless without function/utility

scarcity is about supply.. function/utility drives demand. supply does not drive demand

bloody hell is reading comprehension no longer a thing?

[pawel7777]

...
I am not claiming that a potato will not be worth as much as the highest bidder is willing to pay for it. I am instead claiming that the price of a potato will always return to value determined by its utility.

Just like the gold's value returned to the utility-only value? Just like Chateau d'Yquem ($50k/bottle) is now worth same as any other wine sold at supermarket? Just like you can now buy white truffles at $1/kg?

Price is determined by supply and demand. Scarcity is a factor that drives the price up - whether you want to accept it or not. Utility itself won't automatically create monetary value, for the same reason you won't pay for air, even know it has huge utility - it keeps you alive.

The prices of the goods you mentioned didn't rise 200,000,000 percent from their utility value, while the Bitcoin's prices did. Regarding scarcity, it is true that scarcity is a factor that drives the price up, but the utility provided by bitcoin is not scarce, since people can create an infinite number of digital currencies that will serve as means of exchange. If 21 million grains of sand are put into a box and a limitation is set that this is the maximum number of grains that can be put into the box, this artificial constraint won't make these grains scarce or valuable. This is because people can create their own boxes, fill them with sand and set their own quantitative limitations. Why would people pay 10,000 dollars for a grain of sand in your box if they can make their own boxes with sand in them? Likewise, why would people pay 10,000 dollars for numerical values in your digital box if they can design their own digital boxes with numerical values in them? You people live in a fantasy world. When you wake up, it will be too late.

I've been on this forum long enough to know not to engage in incoherent rants. Clarify your position. Are you arguing that scarcity doesn't affect the price or that Bitcoin is not really scarce?

[dothebeats]

Everyone knows that. Even if the supply of a certain commodity/stock is so finite, as long as no one wants it, or a large number of people don't really care, there wouldn't be any value to such. You must have unlocked the logic behind supply and demand then, because a limited supply alone wouldn't permit insanely high prices, you need other things to meddle with it.

So yeah, the law of supply and demand isn't a myth at all, but rather a simple logic.

[hot_ads]

Any finite number of things, in the end it will have a reasonable price. So BTC will definitely have a reasonable price in the end.

[Bitcoinnumberone]

good job, you've discovered elasitcity of demand. now go study some more to realize why your conclusions are not neccesarely very insightful or likely.

Bitcoin is not a good in the sense potatoes are, that's one place where you can start.

This iA true. If the demand is high,what will hapoen is that the price of a prodict will rise as well. Since the demand is high, and a lot of people will also be interested in bitcoin.This is a great oppoeftuniy

[bitChipper]

Supply will stay the same, demand will effect the price. Demand of bitcoin has grown over the years so price has risen.

To only think of it as a medium of exchange I think is somewhat narrow minded.

border-less
store of value similar to gold

Those two alone I think will yield ever increasing demand.

[lampukoe lumo]

I do not believe that a limited supply of bitcoin will make bitcoin rising is a myth, otherwise I strongly believe if the total supply of bitcoin is limited and bitcoin enthusiasts so much the price of bitoin aoan keeps going up. Everyone knows that. Even if the supply of a particular commodity / supply is very limited, as long as nobody wants it, bitcoin will not cost a bit, but if bitcoin is a lot of people who bother bitcoin then bitcoin prices will continue to rise.

[JL421]

No one actually knows what is going to happen in the future weather it's a myth or not bitcoin is really a good innovation to the world and i can disagree of it being any sort of bubble , till now most coins price is compared with it's supply bitcoin has surely been an exception but you never really know what the future holds

[ashley_49]

you shout research more my friend, i am not only saying you, it is for all of us, if we do research deeply and then post here it will be very helpful for all of us.

[Rozita]

You shouldn't compare bitcoin with a potato.
If a potato price reaches 10000 dollar, I won't buy potato any more. And note that a potato will never reach 10000 dollar. Because there will be no demand at very lower prices.
You should compare bitcoin with something else like a house. You need a house and you have to pay for it. If a house becomes very expensive, then you will buy a smaller house.

Big house = bitcoin
The smallest house = Satoshi

[Doge dealer]

it does make a lot of sense that an item in limited quantity will of course appreciate in price should the demand for that item increase . what will drive the demand is the benefits that bitcoins provide at this moment in time
1. its the most dominant and is the major crypto,
2. it is decentralized and basically somewhat untraceable
3. most trusted crypto at this point in time
these three features is what will maintain the demand and cause the prices to rise ,these three features are very important to people especially persons who engage in multi million dollar transactions daily.

[earnetheasy]

What you tried to sayings pure economics. But the problem is, Potato is a commodity that reduce our hunger. It has many supplements. Whereas, Bitcoin is not a commodity but a medium of exchange. It doesn’t work like any goods. Besides, I think balance between Demand and supply of Bitcoin will not drastically be hampered. Just my thought.

[19spawnfeed]

What you tried to sayings pure economics. But the problem is, Potato is a commodity that reduce our hunger. It has many supplements. Whereas, Bitcoin is not a commodity but a medium of exchange. It doesn’t work like any goods. Besides, I think balance between Demand and supply of Bitcoin will not drastically be hampered. Just my thought.

The bitcoin price will base on Supply and demand and this are the two most fundamental concepts in modern economics, and they have a dramatic impact on one another. If demand outstrips supply, then prices of bitcoin tend to rise. However, if supply is greater than demand, prices tend to drop. This is true in every deregulated market, and is essential for understanding the increase in Bitcoin’s price. The higher the demand for bitcoin, the higher prices will be.

[-Sinner-]

What about gold? Why the price is so high? It is a metal after all.. Why some painting were sold for millions? They are just painting after all.. Why bitcoin should grow? It is just an unique currency owned by anyone after all..
Ps. Many btc were lost also

[guybrushthreepwood]

...
I am not claiming that a potato will not be worth as much as the highest bidder is willing to pay for it. I am instead claiming that the price of a potato will always return to value determined by its utility.

Just like the gold's value returned to the utility-only value? Just like Chateau d'Yquem ($50k/bottle) is now worth same as any other wine sold at supermarket? Just like you can now buy white truffles at $1/kg?

Price is determined by supply and demand. Scarcity is a factor that drives the price up - whether you want to accept it or not. Utility itself won't automatically create monetary value, for the same reason you won't pay for air, even know it has huge utility - it keeps you alive.

The prices of the goods you mentioned didn't rise 200,000,000 percent from their utility value, while the Bitcoin's prices did. Regarding scarcity, it is true that scarcity is a factor that drives the price up, but the utility provided by bitcoin is not scarce, since people can create an infinite number of digital currencies that will serve as means of exchange. If 21 million grains of sand are put into a box and a limitation is set that this is the maximum number of grains that can be put into the box, this artificial constraint won't make these grains scarce or valuable. This is because people can create their own boxes, fill them with sand and set their own quantitative limitations. Why would people pay 10,000 dollars for a grain of sand in your box if they can make their own boxes with sand in them? Likewise, why would people pay 10,000 dollars for numerical values in your digital box if they can design their own digital boxes with numerical values in them? You people live in a fantasy world. When you wake up, it will be too late.

If your logic is true then why are people using bitcoin at all? Many people do create crapcoins but they're largely worthless or or worth very little. Why would people use gold when they can use silver? Why use silver when you can use bronze? Why use bronze when you can use aluminum? Why use aluminum when you can use clay? Why use clay when you can use something else you just made up? Why buy stocks in Berkshire Hathaway when you can buy stocks by the thousands in a brand new startup? Why is the Mona Lisa worth something when an exact copy painted by somebody else is worthless or worth very little? Why do people value some art more than others? Why does anything have value? It has value because people place value upon it just like anything else.

[peter1]

If there is a limit to the value of things, its value should be unlimited. It's good for long-term investment.