volatility, can it really be overcome?

[JohnBlack]

Every cryptocurrency has an intrinsic volatility at this moment as every chart out there clearly shows.

As you all know this can affect their widespread adoption in online retail in a negative way (it's a bit hard to pay suppliers next month if your income halved in value yesterday imho), my question is, what solution can there be?

State currencies remain stable thanks to a regulated environment, do you think there is any other solution, different from a state regulated context, to this pivotal problem?

I don't believe that any currency will just go on and "stabilize itself" as long as speculators and traders exist..

are crypto destined to be commodities?

[Ibian]

Just a matter of wider adoption. Until then, it's perfectly suitable to be a store of value. Better than gold as long as you can handle proper safety measures.

[JohnBlack]

Just a matter of wider adoption. Until then, it's perfectly suitable to be a store of value. Better than gold as long as you can handle proper safety measures.

how could wider adoption stabilize the price automatically?

[Ibian]

Think about what volatility is. It's people buying and selling. The less hands it's spread over, the more any one person can swing the market. The more people use it the less each individual person can do.

That's also why we need to spend bitcoin. The more we use it the more hands it gets spread over the wider adoption the more it's worth. Effectively, spending bitcoin increases the value of our remaining reserves.

[JohnBlack]

I see what you are saying, is there any proof this (=automatic stabilization without state intervention) has actually taken place for a free traded currency until now?

[Anon136]

a better question is "does it matter?". price your goods in ounces of gold and use bitcoin to move value not store it. to make an analogy, bitcoin should be your checking account, not your savings account.

[JohnBlack]

a better question is "does it matter?". price your goods in ounces of gold and use bitcoin to move value not store it. to make an analogy, bitcoin should be your checking account, not your savings account.

So stores should price their goods in gold and you should use bitcoin to pay them?

What should store owners do next though? Run to buy gold with your bitcoins in order to use gold as their savings account?

That doesn't sound very practical for the average business owner I'd say...

[Peter R]

I see what you are saying, is there any proof this (=automatic stabilization without state intervention) has actually taken place for a free traded currency until now?

Price levels in England were quite stable for 2 centuries on various gold/silver standards.  Check out the table here: http://safalra.com/other/historical-uk-inflation-price-conversion/.  Notice that the yearly change in the price levels between 1750 and 1900 have equal + and - signs, but after the turn of the century the price level changes are almost entirely +?  This represents the transition from hard money (gold and silver) to fiat currencies. 

[JohnBlack]

I see what you are saying, is there any proof this (=automatic stabilization without state intervention) has actually taken place for a free traded currency until now?

Price levels in England were quite stable for 2 centuries on various gold/silver standards.  Check out the table here: http://safalra.com/other/historical-uk-inflation-price-conversion/.  Notice that the yearly change in the price levels between 1750 and 1900 have equal + and - signs, but after the turn of the century the price level changes are almost entirely +?  This represents the transition from hard money (gold and silver) to fiat currencies. 

So England used silver or gold itself as a currency those days, not a currency "pegged" to silver/gold?

[BitchicksHusband]

I see what you are saying, is there any proof this (=automatic stabilization without state intervention) has actually taken place for a free traded currency until now?

It's logic.  If there are 1000 people in bitcoin and someone takes out $1 million, the price drops by $1000 per user.  If there are 1 million users, it drops by $1.  If there are 1 billion users, nobody even notices.

[Peter R]

I see what you are saying, is there any proof this (=automatic stabilization without state intervention) has actually taken place for a free traded currency until now?

Price levels in England were quite stable for 2 centuries on various gold/silver standards.  Check out the table here: http://safalra.com/other/historical-uk-inflation-price-conversion/.  Notice that the yearly change in the price levels between 1750 and 1900 have equal + and - signs, but after the turn of the century the price level changes are almost entirely +?  This represents the transition from hard money (gold and silver) to fiat currencies.  

So England used silver or gold itself as a currency those days, not a currency "pegged" to silver/gold?

The name "pound sterling" came from the fact that 240 "sterlings" were minted from a pound of silver.  So, yes, silver coins circulated amongst the people, as well as bank notes.  There is a line in Oliver Twist where the rich old man gives the kid a 5 pound note to run an errand, and the other old man is sure he's going to run away with it.  That's because that five pound note was redeemable for 5 pounds of silver (5 pounds of silver is a lot of money today, but a 5 pound note won't buy you a decent lunch in London today).  

The history is long and complex but fascinating to read up on.  There were times when the supply of silver coins became diminished so the mint would issue "tokens" to fill the void.  But it wasn't until the early 20th century that the idea of hard currency was abandoned once and for all, and gold and silver stopped circulating with banknotes.