If there are increasingly more Bitcoin hodlers, even those purely holding for profit, there likely will be more merchants that will take that as an opportunity.
Assuming volatility continue to fall but as long as Fiat exist
Many would still prefer using Fiat for payment since Bitcoin is deflationary.
We are talking about merchants here, right? In that case, what you have written is false. It is a theoretical economic argument, and while it is true in theory, in practice it shows the exact opposite. Merchants do not care at all whether the thing they are accepting is inflationary or deflationary. They primarily care about getting paying customers and minimizing negative impacts on their direct profit margin which would come for example in the form of credit card fees. Inflationary or deflationary effects are more long-term, and it is unlikely that an average merchant would keep Bitcoin for long periods of time in order to expose themselves to the risk of it. If you were by any chance talking about the customer side, it is incorrect as well. I know plenty of people who use it and then buy it back as to not reduce their strash, and frankly I have seen this practice mentioned countless time on the internet too. Who would not want to use Bitcoin and especially after it has appreciated significantly since you purchased it?
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Like I said the narrative being pushed is that Bitcoin is Gold not a currency.
And who is pushing this narrative? Those who have the most power and the most BTC in their possession. If we consider that most people in the world blindly follow those who have political power and who are extremely wealthy, then how can we expect anything to change in terms of how the average person perceives BTC?
Bitcoin has both features of gold and currency but it neither, that is the correct way to describe it.
What we also lack is general interest in BTC, and I think that from 2009 to today we have at best about 5% of people in the world who are involved in BTC in any way, and on the other hand, millions of BTC have been bought by people who see them as something completely different than currency.
This is not an issue with Bitcoin, this is an issue with the wider society. Most of the society are distracted and manipulated in all sorts of ways. Think about something more immediate, urgent and tangible: physical health. How many people in % are overweight? How many in % are regularly doing exercise in the minimum amounts prescribed? There you have your answer. Bitcoin can't fix society, it is not meant to fix society. Everyone will come to BTC at the price that they deserve, that is how it has always been.
Oh I agreed on falling volatility just that volatility can never be eliminated even Gold and Fiat have some level of volatility.
I agree that Bitcoin will probably never fall to the volatility level of major fiat currencies like the US dollar (even if even the USD fell about 15% vs. the EUR in the last years).
It can't and it shouldn't, that would be a bad thing. Those currencies and markets are extremely controlled and manipulated, that is why the volatility can be so low.
My point is for Bitcoin adoption it would be positive to reach a lower volatility to be really usable at least for saving by everyday people who cannot afford to lose 50% in a capitulation crash nor to buy just into the moment of maximum FOMO and then lose 50% too because that price level was unsustainable.
Gold volatility (which has ramped up in the last year) or an "average fiat currency" like the BRL (which tends to go up and down but has a higher volatility than the USD and the EUR) would be the goalpost to reach.
It needs time to mature, and users need patience to let it mature. In each cycle we are overcoming some hurdles and making progress in various terms.
For example, if a merchant has 10% less cost in total in BTC considering credit/debit card fees, chargeback fraud, clearing time and on the other side resting volatility cost, then he may be able to offer 20% discounts on selected articles for BTC payers just to attract this crowd and reduce the total cost. And if they do promotions anyway, for example because their storage is full, they may go much lower for BTC payers than for fiat payers.
The volatility cost is still to high for this to work, probably, at least to that extent (and thus most BTC-accepting merchants will use Bitcoin payment processors with only slightly lower fees than credit cards). But if volatility reached around half the current value, it may be possible to generate such a dynamic.
Actually you can already find this at certain places by only by merchants who are hard core Bitcoin supporters. I don't really expect to see this with average merchants, even in the future when the volatility cost goes down. One must remember that generally people don't think about what is the best thing to do (aside from perhaps a superficial overview), they just do things. Often these things are directly harmful to them and their business.
