Bitcoin Forum
December 06, 2022, 01:06:53 PM *
News: Latest Bitcoin Core release: 23.0 [Torrent]
 
   Home   Help Search Login Register More  
Pages: [1] 2 3 4 »  All
  Print  
Author Topic: Bitcoin Will Not Be a Medium of Exchange  (Read 513 times)
dnprock (OP)
Member
**
Offline Offline

Activity: 324
Merit: 17

Bitflate developer


View Profile WWW
November 25, 2019, 12:34:42 AM
Last edit: November 25, 2019, 06:00:38 AM by dnprock
 #1

Original Post: https://bitflate.org/post/2019/11/24/bitcoin-will-not-be-a-medium-of-exchange.html

Bitcoin is "good" money. It’s too good that "bad" money will crowd it out of circulation.

Bitcoin is digital gold. It’s the number one Store of Value in cryptocurrency. But it doesn’t do much for us besides Store of Value. Some Bitcoin supporters argue HODL is a use case. More use cases will come. There is a narrative: Store of Value first, then Medium of Exchange. In this narrative, it’ll take time for Bitcoin to gain widespread adoption. Once it reaches critical mass, possibly hundreds of trillions of dollars, people will then use it as a currency. This narrative is convenient and used to justify Bitcoin ever rising price.

Nobody knows exactly when Bitcoin will reach critical mass. I agree with Store of Value use case. But I don’t agree that Bitcoin will have other use cases. Bitcoin is currently worth more than 100 billion dollars. We see few indications that it is being used as a currency outside of crypto world. Bitcoin is a valuable commodity. It will not be used as a medium of exchange.

Gresham’s law: bad money drives out good money

This principle states that more valuable commodity (good money) will gradually disappear from circulation. It will be replaced by less valuable commodity (bad money). For example, if people are currently using silver coins as money, the government decides to switch to copper coins. Government decrees that both coins have same value. In this situation, people will hold on to silver coins and use copper coins. They will spend the bad money (copper coin) and keep the good money (silver coin).

Bitcoin supporters tout it as the good money, the "goodest" money. Hyperbitcoinization will eliminate all bad money. It is misleading to label money as good and bad. Any form of currency has some use if it is in circulation. Fiat money makes the good/bad distinction fuzzy. These bad currencies are in circulation because they are just easier to circulate. The good, sound, and hard money is simply harder to circulate.

We should classify money as the desirable (good) money and the less desirable (bad) money. There is a spectrum between desirable and not desirable. In this spectrum, Bitcoin is highly desirable, gold is desirable, USD is desirable, Euro is next, Venezuela bolivar is not desirable. Gresham’s law continues to apply to the spectrum. The less desirable money will drive out the highly desirable money.

Bitcoin world domination does not reduce price volatility

Bitcoin needs to reach critical mass for world domination. This is a future outcome that Bitcoin supporters often pitch. In this future, Bitcoin price will become less volatile. It will be suitable as a medium of exchange. This argument derives from micro view of Bitcoin economics. If Bitcoin market cap is hundreds of trillions of dollars, a few hundred billions exchange will not affect price. The flaw of the argument is it assumes Bitcoin is micro and local. Bitcoin is permissionless and global. It is accessible by everyone.

Bitcoin supply is fixed. But its demand is unpredictable. Humans are fallible. We may go into wars and induce recession. We may achieve productivity breakthrough and grow fast. The future is unpredictable. Another factor is high fee. When Bitcoin no longer gives out block reward, miners will need to raise fee. When a transaction has high fee, bitcoin owner will need to have substantial gain to justify high fee. Otherwise, he/she will do better by HODLing. Bitcoin price will continue to be volatile.

Bitcoin will not be a medium of exchange because of price volatility.

"Bad" money always exists to prevent "good" Bitcoin circulation

Bitcoin is decentralized money. It exists because many of us believe it has value. It is unlikely that everyone on planet Earth will unify into one single belief. There will always be other kinds of money. These money won’t be as desirable as Bitcoin. Therefore, people will put them in circulation and keep their bitcoins.

Bitcoin will be a Store of Value. We will use other "bad" money as currency.

Bitflate is a cryptocurrency with constant inflation of 7% per year.
1670332013
Hero Member
*
Offline Offline

Posts: 1670332013

View Profile Personal Message (Offline)

Ignore
1670332013
Reply with quote  #2

1670332013
Report to moderator
1670332013
Hero Member
*
Offline Offline

Posts: 1670332013

View Profile Personal Message (Offline)

Ignore
1670332013
Reply with quote  #2

1670332013
Report to moderator
1670332013
Hero Member
*
Offline Offline

Posts: 1670332013

View Profile Personal Message (Offline)

Ignore
1670332013
Reply with quote  #2

1670332013
Report to moderator
Bitcoin mining is now a specialized and very risky industry, just like gold mining. Amateur miners are unlikely to make much money, and may even lose money. Bitcoin is much more than just mining, though!
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction.
1670332013
Hero Member
*
Offline Offline

Posts: 1670332013

View Profile Personal Message (Offline)

Ignore
1670332013
Reply with quote  #2

1670332013
Report to moderator
poornamelessme
Hero Member
*****
Offline Offline

Activity: 1204
Merit: 509


View Profile
November 25, 2019, 05:56:59 AM
 #2



Bitcoin world domination does not reduce price volatility


To me, that is the biggest flaw with the idea of ever using btc as an everyday currency. And I see no real solution ever presenting itself.

As a store of value, digital gold, sure, btc could work. But as a replacement for fiat, not really, outside of 3rd world nations with hyperinflation. And even there, BTC probably isn't the ideal crypto to use in place of fiat.

For a crypto to catch on as a medium of exchange, first off it needs to be stable. Then it needs to charge less fees than credit cards do, and be just as fast. And consumers will need to be able to use this crypto seamlessly, as easy as other forms of payment, and ideally it'd have to be cheaper to use from a consumer standpoint than a credit card which typically offers 1-5% back. So.... umm... currently no cryptos really qualify, and btc certainly doesn't.
dnprock (OP)
Member
**
Offline Offline

Activity: 324
Merit: 17

Bitflate developer


View Profile WWW
November 25, 2019, 06:09:56 AM
 #3



Bitcoin world domination does not reduce price volatility


To me, that is the biggest flaw with the idea of ever using btc as an everyday currency. And I see no real solution ever presenting itself.

As a store of value, digital gold, sure, btc could work. But as a replacement for fiat, not really, outside of 3rd world nations with hyperinflation. And even there, BTC probably isn't the ideal crypto to use in place of fiat.

For a crypto to catch on as a medium of exchange, first off it needs to be stable. Then it needs to charge less fees than credit cards do, and be just as fast. And consumers will need to be able to use this crypto seamlessly, as easy as other forms of payment, and ideally it'd have to be cheaper to use from a consumer standpoint than a credit card which typically offers 1-5% back. So.... umm... currently no cryptos really qualify, and btc certainly doesn't.

I'm working on Bitflate, a crypto with constant inflation. I think inflation will make price stable and Bitflate token more suitable for transaction. We intentionally make a crypto less "good" so it'll circulate. Inflation discourages HODL behavior so people will put Bitflate token to use. It's an experiment. I'm not sure it'll be able to match fiat efficiency. But it has a chance to address the transaction use case.
Patrix_1
Member
**
Offline Offline

Activity: 364
Merit: 10


View Profile
November 25, 2019, 06:37:38 PM
 #4

BTC dominance is far too high and I hardly doubt that an altcoin will replace BTC one day. I prefer to use altcoins, but the majority of investors still believes in Bitcoin and sells all their altcoins to get some extra BTC.
diazepam666
Hero Member
*****
Offline Offline

Activity: 1162
Merit: 516


1BTC Welcome Bonus


View Profile
November 25, 2019, 06:48:28 PM
 #5

BTC dominance is far too high and I hardly doubt that an altcoin will replace BTC one day. I prefer to use altcoins, but the majority of investors still believes in Bitcoin and sells all their altcoins to get some extra BTC.

Not even a single percent we have opportunity to pull down the Bitcoin.
FB investors and traders mostly looking to invest on Bitcoin and then ethereum after all this only you will find investment on the various altcoins.
Mobile me your going to convert kryptos to fiat cash that time only we will feel Bitcoin is far far enough.

.
.
        ▄▄▄▄▄▄▄
       ████████     ▄█▄▄
       ▀█▀▀▀▀▀▀█▀   ▄██████
         ▀▀▀▀▀▀    ███████▀
 ▄▄███▄▄          ███████▀
█████████▄        █████▀
███████████▄       ▀▀▀▀
▀████████████▄
 ▀████████████▄
  ▀████████████▄
    ▀███████████
      ▀████████▀
        ▀▀████▀
        ▄▄▄▄▄▄▄
       ████████     ▄█▄▄
       ▀█▀▀▀▀▀▀█▀   ▄██████
         ▀▀▀▀▀▀    ███████▀
 ▄▄███▄▄          ███████▀
█████████▄        █████▀
███████████▄       ▀▀▀▀
▀████████████▄
 ▀████████████▄
  ▀████████████▄
    ▀███████████
      ▀████████▀
        ▀▀████▀
.
..Learn More..
Pearls Before Swine
Sr. Member
****
Offline Offline

Activity: 1148
Merit: 306



View Profile
November 25, 2019, 07:20:47 PM
 #6

As a store of value, digital gold, sure, btc could work. But as a replacement for fiat, not really, outside of 3rd world nations with hyperinflation.
Bitcoin would be a very bad replacement for fiat in its current state with long confirmation times especially.  You just can't have that situation when you're in line somewhere trying to pay for something, nor would people want to pay network fees, especially high ones when the network is congested.

There are other coins that would serve this purpose so much better.  Just take a look at how venezuelans are using dash as a currency, and apparently it's working for them down there.  I just watched a youtube video about it, and it was amazing.

Bitcoin works as 'digital gold' I guess, tho I wouldn't describe it as that myself. 
poornamelessme
Hero Member
*****
Offline Offline

Activity: 1204
Merit: 509


View Profile
November 25, 2019, 07:23:37 PM
 #7



Bitcoin world domination does not reduce price volatility


To me, that is the biggest flaw with the idea of ever using btc as an everyday currency. And I see no real solution ever presenting itself.

As a store of value, digital gold, sure, btc could work. But as a replacement for fiat, not really, outside of 3rd world nations with hyperinflation. And even there, BTC probably isn't the ideal crypto to use in place of fiat.

For a crypto to catch on as a medium of exchange, first off it needs to be stable. Then it needs to charge less fees than credit cards do, and be just as fast. And consumers will need to be able to use this crypto seamlessly, as easy as other forms of payment, and ideally it'd have to be cheaper to use from a consumer standpoint than a credit card which typically offers 1-5% back. So.... umm... currently no cryptos really qualify, and btc certainly doesn't.

I'm working on Bitflate, a crypto with constant inflation. I think inflation will make price stable and Bitflate token more suitable for transaction. We intentionally make a crypto less "good" so it'll circulate. Inflation discourages HODL behavior so people will put Bitflate token to use. It's an experiment. I'm not sure it'll be able to match fiat efficiency. But it has a chance to address the transaction use case.

The problem with testing that sort of experiment is the coin would need to catch on with the public to even know if it worked or not. And no offense, but it's not like the general public will equate bitflate with btc.

For a coin to be stable, there is a simple (and not so great) solution -- centralization. It'd have to be a stablecoin, backed either by a company or assets.
jacafbiz
Hero Member
*****
Offline Offline

Activity: 1778
Merit: 523


Fun Fast Fair


View Profile
November 25, 2019, 07:44:41 PM
 #8

This argument could be valid in future if Bitcoin failed to gain market share and people just decided to use it for store of value, another thing to look at is the lighting network, the success of lighting network is going to determine if BTC is going to be use for medium of exchange because the  transaction fees that people complained about that is high is going to be reduced significantly

▄▄▄███████▄▄▄
▄▄█████████████████▄▄
▄██▀▀     ▀▀█▀▀     ▀▀██▄
███▀   ▄▄▄  ▐▌    ▄    ▀███
████   ▐███▌ █   ▐███▌   ████
█████▄   ▀▀▀  ▐▌▄▄▄▀▀▀▄▄ ▄█████
█████▀▀▄▄   ▄▄▄▀▄       ▀▀█████
████    ▄███▄   ▀▄▄███▄    ████
███    █████    ██████    ███
██▄    ▀▀▀    █  ▀▀▀    ▄██
▀█▄▄       ▄█▄       ▄▄█▀
▀▀█████████████████▀▀
▀▀▀███████▀▀▀
██
██
██
██
██
██
██
██

██

██

██

██

██
Providing Efficient Payment
Solutions for Bookmakers
██
██
██
██
██
██
██
██

██

██

██

██

██
█████████████████████████████
█████████████████████████████
█████████████████████████████
██████▀█████████▀▀▀▀█▀███████
██████▌ ▀▀████▀       ▄██████
██████▀              ▐███████
███████▄             ████████
███████▄           ▄█████████
██████▀▀▀       ▄▄███████████
████████▄▄▄▄▄▄███████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
████████████████████▀▀▀██████
██████████████▀▀▀  ▄  ▐██████
████████▀▀▀    ▄▄▀▀   ███████
██████▄▄▄  ▄▄█▀▀     ▐███████
██████████▌▐▀        ████████
███████████▄ ▄█▄▄   ▐████████
███████████████████▄█████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████▀     ██████████
█████████████   ▄▄▄██████████
██████████▀▀▀   ▀▀▀██████████
██████████         ██████████
█████████████   █████████████
█████████████   █████████████
█████████████   █████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
██████▀  ▀███████████████████
██████▄  ▄███████████████████
██████▀▀▀▀██▀▀▀▀█▀▀▀▀▀███████
██████    ██     ▄▄    ██████
██████    ██    ███    ██████
██████    ██    ███    ██████
██████    ██    ███    ██████
█████████████████████████████
█████████████████████████████
█████████████████████████████

██████    ██
██
██
██
██
██
██
██
██
██
██████████
       ▄▄▄██▄▄▄
    ▄███████████▄
    █████████████▄
   ███████████████
▄█████████████████▄
▀▀▀▀█████████████▀██
    ▀█████████████▄
    ▄▀█████████████▄
   █▀ ▀▀▀██████████▌
▐███    ▄█████████▀▀
 ▀▀     ▄█████▀▀
       ███▀▀
      ██▀

██████
██
██
██
██
██
██
██
██
██
██████
electronicash
Legendary
*
Offline Offline

Activity: 2562
Merit: 1033



View Profile
November 25, 2019, 08:04:46 PM
 #9

This argument could be valid in future if Bitcoin failed to gain market share and people just decided to use it for store of value, another thing to look at is the lighting network, the success of lighting network is going to determine if BTC is going to be use for medium of exchange because the  transaction fees that people complained about that is high is going to be reduced significantly

eventually this LN will be used in more wallets that we may not even need to create channel anymore but simply send to any address since by default all are using LN. BTC is meant to be spent, to buy products on stores that is why we do have QR codes for it. right now we can send fees already, its not just going to be SOV, it all depend to how you will use it.

▄▀▀▀▀▀▀▀▀▀▀▀▀▀▀▀▀▀▀▀▀▄
█  █                 █
█  ▄      ███        █
█ ▀ ▀ ███  ███       █
█      ██▄▄███      █
█     ██████████    █
█    ███████████   █
█    ████▌  █
█    ▀████████   █
█      ▀▀██▀▀ ▄ ▄ █
█                 ▀  █
█                 █  █
▀▄▄▄▄▄▄▄▄▄▄▄▄▄▄▄▄▄▄▄▄▀
.HUNNYPL♤Y.█▀▀▀











▀▀▀▀
  ▄▄    ▄██▄  ▄██▄  ▄██▄
▄▄██▄▄   ██████████████     
▀▀██▀▀    ▀██████████▀     ██ 
  ▀▀       ▀████████▀    ██████
           ▄▄▄▄▄▄▄▄▄▄      ██
 ██      ██████████████
       ███████▀▀ ▀▀██████
      ███████ ██ ██ ██████ 
     █████████▄▄ ▀▀████████
     ████████ ██ ██ ███████
      ████████▄▄ ▄▄███████
        ▀██████████████▀
           ▀▀▀▀▀▀▀▀▀▀

UP
TO
.180%.D E P O S I T
B O N U S

        ██▄
         ▀▀▀██▄
     ▄▄▄▄▄▄▄▄██▄▄▄▄▄▄▄
  ▄█████████████████████▄
 █████████████████████████
███████████████████████████
███████████████████████████
███████████████████████████
███████████████████████████
 █████████████████████████
  ▀▀███████████████████▀▀
>< UP TO 28% CASHBACK
EXCLUSIVE PROMOTIONS
LEVELS & REWARDS
▀▀▀█











▀▀▀▀
.PLAY NOW.
dnprock (OP)
Member
**
Offline Offline

Activity: 324
Merit: 17

Bitflate developer


View Profile WWW
November 25, 2019, 08:10:44 PM
 #10

This argument could be valid in future if Bitcoin failed to gain market share and people just decided to use it for store of value, another thing to look at is the lighting network, the success of lighting network is going to determine if BTC is going to be use for medium of exchange because the  transaction fees that people complained about that is high is going to be reduced significantly

eventually this LN will be used in more wallets that we may not even need to create channel anymore but simply send to any address since by default all are using LN. BTC is meant to be spent, to buy products on stores that is why we do have QR codes for it. right now we can send fees already, its not just going to be SOV, it all depend to how you will use it.

You should examine my last point: "Bad" money always exists to prevent "good" Bitcoin circulation.

If Bitcoin is a Store of Value, it's desirable, people won't put it in circulation.
Altcoins enthusiast
Member
**
Offline Offline

Activity: 491
Merit: 17


View Profile
November 25, 2019, 08:23:06 PM
 #11

This argument could be valid in future if Bitcoin failed to gain market share and people just decided to use it for store of value, another thing to look at is the lighting network, the success of lighting network is going to determine if BTC is going to be use for medium of exchange because the  transaction fees that people complained about that is high is going to be reduced significantly

eventually this LN will be used in more wallets that we may not even need to create channel anymore but simply send to any address since by default all are using LN. BTC is meant to be spent, to buy products on stores that is why we do have QR codes for it. right now we can send fees already, its not just going to be SOV, it all depend to how you will use it.

You should examine my last point: "Bad" money always exists to prevent "good" Bitcoin circulation.

If Bitcoin is a Store of Value, it's desirable, people won't put it in circulation.
I strongly believe that we did not understand were we are heading to in technology and it is those that are able to see into the future that might tell us if bitcoin is going to be a store of value or medium of exchange for Goods and services. I think what is in the mind of bitcoin's developers is taking out third-party from transactions and that bitcoin is doing extremely well, the remaining features are in the womb of time.
dnprock (OP)
Member
**
Offline Offline

Activity: 324
Merit: 17

Bitflate developer


View Profile WWW
November 25, 2019, 09:40:10 PM
 #12

This argument could be valid in future if Bitcoin failed to gain market share and people just decided to use it for store of value, another thing to look at is the lighting network, the success of lighting network is going to determine if BTC is going to be use for medium of exchange because the  transaction fees that people complained about that is high is going to be reduced significantly

Even in the world domination scenario, Bitcoin won't be a medium of exchange. The key is here:

The Bitcoin supply is fixed. But its demand is unpredictable.

Bitcoin will always be desirable because of its fixed supply. Other "bad" money will take it out of circulation.
poornamelessme
Hero Member
*****
Offline Offline

Activity: 1204
Merit: 509


View Profile
November 25, 2019, 09:55:54 PM
 #13

This argument could be valid in future if Bitcoin failed to gain market share and people just decided to use it for store of value, another thing to look at is the lighting network, the success of lighting network is going to determine if BTC is going to be use for medium of exchange because the  transaction fees that people complained about that is high is going to be reduced significantly

Lightning network just solves one problem though (or two, if we count fees + speed of transaction). It doesn't help much with volatility however. Who wants to buy a TV for 1K today, when a month from now that same amount of BTC could be worth 2-5K? Nobody will use BTC as a medium of exchange... they would hold it for speculation.

An exception could be in 3rd world countries where their own fiat fluctuates more than BTC does. I suppose it could catch on as a medium of exchange there with the LN. But other cryptos are probably better suited to that task than BTC is, at least currently.

shinratensei_
Legendary
*
Offline Offline

Activity: 2576
Merit: 1018


Fun Fast Fair


View Profile
November 25, 2019, 10:26:53 PM
 #14

This argument could be valid in future if Bitcoin failed to gain market share and people just decided to use it for store of value, another thing to look at is the lighting network, the success of lighting network is going to determine if BTC is going to be use for medium of exchange because the  transaction fees that people complained about that is high is going to be reduced significantly

eventually this LN will be used in more wallets that we may not even need to create channel anymore but simply send to any address since by default all are using LN. BTC is meant to be spent, to buy products on stores that is why we do have QR codes for it. right now we can send fees already, its not just going to be SOV, it all depend to how you will use it.

You should examine my last point: "Bad" money always exists to prevent "good" Bitcoin circulation.

If Bitcoin is a Store of Value, it's desirable, people won't put it in circulation.
People won't until they will face an urgent situation when their bad money if not enough to cover all and they will start to put bitcoin that what you have called good cash in circulation. In the urgent situation, people will not care what kind of the stuff as long as it can be converted as money and they will sell it.

Your last points seem not to be a valid point caused by people are seeing something worth based on what condition they have faced it.
When you have considered bitcoin as a store of value, and it's meant if you see bitcoin as a commodity and not a currency. All of your points are conditional.

▄▄▄███████▄▄▄
▄▄█████████████████▄▄
▄██▀▀     ▀▀█▀▀     ▀▀██▄
███▀   ▄▄▄  ▐▌    ▄    ▀███
████   ▐███▌ █   ▐███▌   ████
█████▄   ▀▀▀  ▐▌▄▄▄▀▀▀▄▄ ▄█████
█████▀▀▄▄   ▄▄▄▀▄       ▀▀█████
████    ▄███▄   ▀▄▄███▄    ████
███    █████    ██████    ███
██▄    ▀▀▀    █  ▀▀▀    ▄██
▀█▄▄       ▄█▄       ▄▄█▀
▀▀█████████████████▀▀
▀▀▀███████▀▀▀
██
██
██
██
██
██
██
██

██

██

██

██

██
Providing Efficient Payment
Solutions for Bookmakers
██
██
██
██
██
██
██
██

██

██

██

██

██
█████████████████████████████
█████████████████████████████
█████████████████████████████
██████▀█████████▀▀▀▀█▀███████
██████▌ ▀▀████▀       ▄██████
██████▀              ▐███████
███████▄             ████████
███████▄           ▄█████████
██████▀▀▀       ▄▄███████████
████████▄▄▄▄▄▄███████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
████████████████████▀▀▀██████
██████████████▀▀▀  ▄  ▐██████
████████▀▀▀    ▄▄▀▀   ███████
██████▄▄▄  ▄▄█▀▀     ▐███████
██████████▌▐▀        ████████
███████████▄ ▄█▄▄   ▐████████
███████████████████▄█████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████▀     ██████████
█████████████   ▄▄▄██████████
██████████▀▀▀   ▀▀▀██████████
██████████         ██████████
█████████████   █████████████
█████████████   █████████████
█████████████   █████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
██████▀  ▀███████████████████
██████▄  ▄███████████████████
██████▀▀▀▀██▀▀▀▀█▀▀▀▀▀███████
██████    ██     ▄▄    ██████
██████    ██    ███    ██████
██████    ██    ███    ██████
██████    ██    ███    ██████
█████████████████████████████
█████████████████████████████
█████████████████████████████

██████    ██
██
██
██
██
██
██
██
██
██
██████████
       ▄▄▄██▄▄▄
    ▄███████████▄
    █████████████▄
   ███████████████
▄█████████████████▄
▀▀▀▀█████████████▀██
    ▀█████████████▄
    ▄▀█████████████▄
   █▀ ▀▀▀██████████▌
▐███    ▄█████████▀▀
 ▀▀     ▄█████▀▀
       ███▀▀
      ██▀

██████
██
██
██
██
██
██
██
██
██
██████
tenakha
Hero Member
*****
Offline Offline

Activity: 1442
Merit: 508



View Profile
November 25, 2019, 10:35:06 PM
Last edit: November 25, 2019, 10:58:11 PM by tenakha
 #15

Bitcoin world domination does not reduce price volatility

Bitcoin needs to reach critical mass for world domination. This is a future outcome that Bitcoin supporters often pitch. In this future, Bitcoin price will become less volatile. It will be suitable as a medium of exchange. This argument derives from micro view of Bitcoin economics. If Bitcoin market cap is hundreds of trillions of dollars, a few hundred billions exchange will not affect price. The flaw of the argument is it assumes Bitcoin is micro and local. Bitcoin is permissionless and global. It is accessible by everyone.
Dominance is not an asset that protects the price volatility. They are the governments that maintain the volatility of today's paper money. Actually, the lack of access to the BTC may cause trouble, but with some regulations it will be possible to counter it. I recently read about the arrest of several people who wanted to move the price of the AUD. And they were the governments that opposed it. So there is nothing special about the other moneys, they seem more appropriate because there are governments protecting them.

Bitcoin supply is fixed. But its demand is unpredictable.
Another reason for the acceptance of BTC is that it is limited. Unlimited paper money causes inflation and uncertain movements of governments. Therefore, a limited and traceable system causes to more positive results. Imagine you can see how much money governments have, how much money they send to whom. Would not that be better for all of us?

Besides, we do not have to use BTC as a 1BTC. It may be limited to 21 million, but lets calculate it as 0.0000000001.
huu78
Sr. Member
****
Offline Offline

Activity: 924
Merit: 252



View Profile
November 25, 2019, 10:36:26 PM
 #16

Bitcoin is one pioneer of cryptocurrency that can know and know many people. The games in the online offer make it more fun and we have. Bitcoin prices dropped it was reasonable. Because every year must have slots and there will be down posted there.

█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
████▀▀ ▄▄▄ ▀▀████▀ ▄▄▄▄ ▀████
███▀ ███████▄ ██ ▄██████▄ ███
███ ████▀▀▀▀▀  ▀█████████████
███▄ ███████▀ █▄ ▀██████▀▀███
████▄ ▀▀▀▀▀ ▄████▄ ▀▀▀▀ ▄████
█████████████████████████████
█████████████████████████████
█████████████████████████████
█████████████████████████████
GoMeat.  300+ STORES ALREADY ONBOARD
 THE FIRST PROJECT OF ITS KIND

ONLY 160K TOKENS REMAINING
████
██
██
██
██
██
██
██
██
██
██
██
████
████
██
██
██
██
██
██
██
██
██
██
██
████
████████████████████████████
████████████████████████████
████████████████████████████
█████████████████▀▀  ███████
█████████████▀▀      ███████
█████████▀▀   ▄▄     ███████
█████▀▀    ▄█▀▀     ████████
█████████ █▀        ████████
█████████ █ ▄███▄   ████████
██████████████████▄▄████████
████████████████████████████
████████████████████████████
████████████████████████████
setialovers
Member
**
Offline Offline

Activity: 812
Merit: 11


View Profile
November 26, 2019, 12:22:29 AM
 #17

This argument could be valid in future if Bitcoin failed to gain market share and people just decided to use it for store of value, another thing to look at is the lighting network, the success of lighting network is going to determine if BTC is going to be use for medium of exchange because the  transaction fees that people complained about that is high is going to be reduced significantly

Lightning network just solves one problem though (or two, if we count fees + speed of transaction). It doesn't help much with volatility however. Who wants to buy a TV for 1K today, when a month from now that same amount of BTC could be worth 2-5K? Nobody will use BTC as a medium of exchange... they would hold it for speculation.

An exception could be in 3rd world countries where their own fiat fluctuates more than BTC does. I suppose it could catch on as a medium of exchange there with the LN. But other cryptos are probably better suited to that task than BTC is, at least currently.



In my opinion, it takes a long time for Bitcoin to become a medium of exchange because of many factors that are obstacles. Until now, not everyone understands what bitcoin is and how it functions or they know about cryptocurrency. Maybe Bitcoin will become more practical if used as a digital asset, as an alternative investment or safe haven other than gold
Text
Hero Member
*****
Offline Offline

Activity: 1974
Merit: 565


View Profile
November 26, 2019, 12:44:45 AM
 #18

Yeah, it can't be for now because of its volatility but I think it will never cause we still prioritize the fiat money as number one. Bitcoin has a separate use-case and different space so it is only exchangeable in an online market. Past HODLers already changed, they realize that it is not only its use case, but it should also be circulating and spendable.

leowonderful
Legendary
*
Offline Offline

Activity: 1624
Merit: 1129


Bitcoin FTW!


View Profile
November 26, 2019, 01:33:51 AM
 #19

While I like the concept of LN and its current technological implementation is decent, the majority of merchants accepting Bitcoin payments still do not accept LN payments from my experience (though there are a number that I use), and most transactions still take place on the mainnet for both purchases and regular transactions between wallets. Also seems like adoption of LN's mostly stagnated or is starting shrink by a bit too, from this chart that I've taken from txstats.com (click for link) that looks at both the sum of the value of all open channels and the sum of their values. The good news is that we're still way above where these values were a year ago, but it seems like things have slowed down somewhat.
zeze18
Sr. Member
****
Offline Offline

Activity: 938
Merit: 256


View Profile
November 26, 2019, 02:31:37 AM
 #20

Bitcoin is one pioneer of cryptocurrency that can know and know many people. The games in the online offer make it more fun and we have. Bitcoin prices dropped it was reasonable. Because every year must have slots and there will be down posted there.

It almost every december or end of the year bitcoin price will be bleeding because of many people cash out their bitcoin to spend for holiday or something like that. It's usual thing happened in crypto. And the price will recover at Q1 of next year. So, for new investors investing on december is always the best decission to make
Pages: [1] 2 3 4 »  All
  Print  
 
Jump to:  

Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!