Medium of exchange or Strategic reserve for Bitcoin.

[X-ray]

If you're seeing from the perspective of bitcoin maxi, 1 bitcoin is 1 bitcoin and if we don't depend on fiat system too much, the volatility doesn't exist.

USD looks stable only because you don't pay attention to inflation. Overtime, unlike bitcoin where the volatility is bidirectional, it could go up or down. Dollar is rather 1 dimensional, it go down on the long term.

Bitcoin is a good medium of exchange and people need to pay less attention to the value in USD.

[Lida93]

Debates on this topic has shown that both price stability and consistent price rise can't be simultaneously achieved with such a volatile asset as bitcoin. So if we gonna have it as more of a means of exchange then we shouldn't be expecting a price rise anymore than we have, that means we will be experiencing a gradual price declining than an upside in value of bitcoin as it is with fiat. But serving as reserve where many buyers are accumulating in storage and not selling, pushing price more to the upside, diminishing any iota of  stability.
_{It's really confusing to put it straight out in words  for easy understanding}

[dzungmobile]

Debates on this topic has shown that both price stability and consistent price rise can't be simultaneously achieved with such a volatile asset as bitcoin. So if we gonna have it as more of a means of exchange then we shouldn't be expecting a price rise anymore than we have, that means we will be experiencing a gradual price declining than an upside in value of bitcoin as it is with fiat. But serving as reserve where many buyers are accumulating in storage and not selling, pushing price more to the upside, diminishing any iota of  stability.

The market has different phases with low or high volatility and it's not exception with the Bitcoin market so when people understand about the market cycle well, they will feel less panic by having better preparation from knowledge to psychology and action in this market.

Assuming that if people are ready to trade Bitcoin, they already accept its market volatility so with such people, they have no big problems of using bitcoin as a medium of exchange. I meant, not all people are like this, but most people are like this, and it comes from a fact that most traders lose money in market without complaints about market volatility.

It's a little bit difference in perspective of business companies but with time, Bitcoin market volatility will shrink smaller, and it will become a smaller barrier for business accepting bitcoin.

[FinneysTrueVision]

Bitcoin is not that volatile on a day to day basis, but the fact that it can occasionally have significant drawdowns over short periods has almost certainly hurt its adoption as a medium of exchange. Speculative investment and store of value are by far more popular use cases. You can argue that its not a great store of value either as we have seen during bear markets, but there are still some people who will prefer to hold Bitcoin over fiat currency despite those price swings.

[ThemePen]

Bitcoin is not that volatile on a day to day basis, but the fact that it can occasionally have significant drawdowns over short periods has almost certainly hurt its adoption as a medium of exchange. Speculative investment and store of value are by far more popular use cases. You can argue that its not a great store of value either as we have seen during bear markets, but there are still some people who will prefer to hold Bitcoin over fiat currency despite those price swings.

I think that Bitcoin does not necessarily have to be stable currency to be huge success at moment. Major function of it is to serve as censorship resistant store of value outside of traditional monetary banking. Network is still safe and decentralized even in bear market and fiat can never provide this. I think in future, with market becoming more mature, and total market cap increasing, volatility will naturally become less, so it becomes more useful for day to day use.

[suzanne5223]

Yes, I believe the strategic Bitcoin reserve will likely have an impact that will support an increase in Bitcoin prices over time and also reinforce BTC's role as a store of value. But the effects depend on implementation rules and regulations for the strategic reserve, purchases, and longterm holding. However, we shouldn't rely on the governments statement because of their political games.

[Livingleged]

Bitcoin is a good medium of exchange and people need to pay less attention to the value in USD.

Yes sure bitcoin is a good medium of exchange Which can actually be use to pay for goods and services, or even transfer services through the means of p2p without intermediaries. But the question is how many of us actually use it to pay for good? How many store are always available to take bitcoin on exchange for their good? Unless those bridges are gaped. Bitcoin is always valued in $, you cant say people should pay less attention to its value in $. However, bitcoin is generally considered as store of value than just being use for day to day transactions. And if that’s the case it corresponding value in dollars should be a matter of concern as spending bitcoin alone is sometimes challenging. That’s why most people keep storing it and pay for services with USD or their fiat currency.

[Aanuoluwatofunmi]

Bitcoin has a multi-faucet application used and this has been increasing it demands on all sides, there is a lot that has been contributed to the bitcoin network upon the introduction of the spot bitcoin ETF, but only been a few years to understand the figurative aspect of how they differentiate between investing in Bitcoin and any other institutional assets like the spot bitcoin ETF.

[DiMarxist]

Bitcoin can work as a strategy reserve were wealth can be stored and preserved this is the reason why most people see bitcoin as a store of value were individuals can save their money against the effects of inflation, there by making Bitcoin a good preserver of wealth moving into the future. Bitcoin can also work as a medium of exchange because Bitcoin were originally designed to work as a p2p payment methods when it was been introduced so do whether you say that the value of Bitcoin may not be too high working as a payment medium it doesn't make any difference Bitcoin can work as both.

[AmoreJaz]

Bitcoin can work as a strategy reserve were wealth can be stored and preserved this is the reason why most people see bitcoin as a store of value were individuals can save their money against the effects of inflation, there by making Bitcoin a good preserver of wealth moving into the future. Bitcoin can also work as a medium of exchange because Bitcoin were originally designed to work as a p2p payment methods when it was been introduced so do whether you say that the value of Bitcoin may not be too high working as a payment medium it doesn't make any difference Bitcoin can work as both.

The high volatility of btc makes it very attractive to investors. And with such promise of gaining profits by storing for certain period of time, people are storing it for investments. And when you talk about investments, the value is increasing thru time.

[d5000]

If you're seeing from the perspective of bitcoin maxi, 1 bitcoin is 1 bitcoin and if we don't depend on fiat system too much, the volatility doesn't exist.

The problem is that you can't disconnect that easily from the fiat value.

Let's take a place like El Salvador's Bitcoin Beach, with many businesses accepting Bitcoin. I'm sure they will charge you more BTC for a hamburger on a day where Bitcoin is at $60,000 than at a day where it is at $80,000, even if they can sometimes pay some employees and perhaps even wholesale providers in BTC.

We could imagine something more extreme of course, let's say some kind of Bitcoin island where all businesses without exceptions accept Bitcoin. They could perhaps charge "static" Bitcoin prices for each other. But as soon as a good they sell has at least some component which needs to be purchased from abroad, it becomes much more difficult.

Neverless I'd be very interested in such experiments. Another idea could be non-material goods with static BTC prices.

For example an artist selling music could attempt to charge static Bitcoin prices, which would lead to them accumulating BTC in bear markets. But in peak bull market / ATH territory their sales would be much lower, that's the problem here, and thus I don't think an artist could sustain that idea for much.

[Abiky]

I was going through the thread about Bitcoin strategic reserve and it got me thinking.
Strategic reserve would increase the price and make Bitcoin more like a store of value
But adopting into a medium of exchange would mean the price wouldn't shoot again and become relatively stable
Because I can't really picture a medium of exchange that's quite volatile.

I understand scalability constraint, so it's more of an hypothetical situation to compare
Which would push the price higher and which would keep true to what Bitcoin was created for.

Sigh Now I don't even know what I'm talking about anymore 


In summary how would stability that I believe a accepted medium of exchange should have
Align with a decentralized asset?
Would stability always be hypothetical and scarcity drive price?
Or we have what money should be
One that don't fall with time but stay relatively consistent and keep up with price changes.


Sigh wtf am I even saying, will likely lock when I'm sober and awake.

Why not both? Bitcoin can be both a medium of exchange and a store of value. Just like Gold. It's just that most people are using it as a store of value. Almost nobody wants to use it as a currency. For obvious reasons. Because Bitcoin is volatile with limited transaction capacity. It was designed with a fixed supply, raising the odds of higher prices in the long term.

You can see why many governments around the world are considering making strategic Bitcoin reserves of their own. I believe BTC's status as a gold alternative will remain unchanged forever. We just need to deal with it.

[arwin100]

If you're seeing from the perspective of bitcoin maxi, 1 bitcoin is 1 bitcoin and if we don't depend on fiat system too much, the volatility doesn't exist.

The problem is that you can't disconnect that easily from the fiat value.

Let's take a place like El Salvador's Bitcoin Beach, with many businesses accepting Bitcoin. I'm sure they will charge you more BTC for a hamburger on a day where Bitcoin is at $60,000 than at a day where it is at $80,000, even if they can sometimes pay some employees and perhaps even wholesale providers in BTC.

We could imagine something more extreme of course, let's say some kind of Bitcoin island where all businesses without exceptions accept Bitcoin. They could perhaps charge "static" Bitcoin prices for each other. But as soon as a good they sell has at least some component which needs to be purchased from abroad, it becomes much more difficult.

Neverless I'd be very interested in such experiments. Another idea could be non-material goods with static BTC prices.

For example an artist selling music could attempt to charge static Bitcoin prices, which would lead to them accumulating BTC in bear markets. But in peak bull market / ATH territory their sales would be much lower, that's the problem here, and thus I don't think an artist could sustain that idea for much.

Trying to completely disconnect their usage on fiat is so though, since there are lots of services and also good which really on the pricing happened internationally. Also even on those place like the Bitcoin beach, those local businesses adjust the price on BTC and base the value of goods also service in dollars. Those Bitcoin payment only on island can possibly work locally, but if theirs import goods are been involve in the business the fiat will enter on the discussion.

Those experiments  they made for accepting BTC is really interesting, but the real challenge is on how long they can sustain it, because there's a chance that their they get affected if there's sudden changes will happen like bullish and bearish market situation.

[Cryptomultiplier]

I was going through the thread about Bitcoin strategic reserve and it got me thinking.
Strategic reserve would increase the price and make Bitcoin more like a store of value
But adopting into a medium of exchange would mean the price wouldn't shoot again and become relatively stable
Because I can't really picture a medium of exchange that's quite volatile.

I understand scalability constraint, so it's more of an hypothetical situation to compare
Which would push the price higher and which would keep true to what Bitcoin was created for.

Sigh Now I don't even know what I'm talking about anymore 


In summary how would stability that I believe a accepted medium of exchange should have
Align with a decentralized asset?
Would stability always be hypothetical and scarcity drive price?
Or we have what money should be
One that don't fall with time but stay relatively consistent and keep up with price changes.


Sigh wtf am I even saying, will likely lock when I'm sober and awake.

Why not both? Bitcoin can be both a medium of exchange and a store of value. Just like Gold. It's just that most people are using it as a store of value. Almost nobody wants to use it as a currency. For obvious reasons. Because Bitcoin is volatile with limited transaction capacity. It was designed with a fixed supply, raising the odds of higher prices in the long term.

You can see why many governments around the world are considering making strategic Bitcoin reserves of their own. I believe BTC's status as a gold alternative will remain unchanged forever. We just need to deal with it.

I would like us to remember the stages that Bitcoin has gone through to where it is today and that is talking about how it was first a collectible and then now a store of value.
The next stage which is already unfolding is where Bitcoin becomes more of a medium of exchange, where we have its price high enough and volatility low enough for everyday transactions and payments.

One thing is made clear though and that is that, Bitcoin can't become a medium of exchange without accomplishment of the current state it is now in as a store of value making it digital gold.

[SilverCryptoBullet]

I would like us to remember the stages that Bitcoin has gone through to where it is today and that is talking about how it was first a collectible and then now a store of value.
The next stage which is already unfolding is where Bitcoin becomes more of a medium of exchange, where we have its price high enough and volatility low enough for everyday transactions and payments.

One thing is made clear though and that is that, Bitcoin can't become a medium of exchange without accomplishment of the current state it is now in as a store of value making it digital gold.

From 2009 to 2026, it's a long time and like a one-third or one-fourth of a person lifespan already, whilst with a new project, very first years are most sensitive, vulnerable for failure and death. Fortunately Bitcoin has gone through many challenges very well so that it has been strong now in 2026 and will aim at bigger adoption in coming years.

Reading Bitcoin history book can help reviewing this progress and learn more about Bitcoin.

[BlackHatCoiner]

Would stability always be hypothetical and scarcity drive price?

Isn't stability always hypothetical and scarcity always drives the price in everything in a free market? The US dollar seems stable when you compare it for short time periods with goods and services that grow in supply at around the same rate, but it is absolutely not stable in purchasing power overtime.

Bitcoin as medium of exchange wouldn't render it stable. Deflation has existed in the past when people used gold as money, and it had been fantastic. It is only the monetary downgrade of the 20th century that psyop-ed the public through Keynesian jargon into believing that monetary inflation is good.

[Furball808]

Isn’t the similarity between being a medium of exchange and strategic reserve is the need for stability? Which right now bitcoin doesn’t really have but its stability is now a lot better compared to before so there’s a possibility of becoming more stable in the future.

At this point, there’s still a balance between bitcoin being used as a medium of exchange and speculative asset. Bitcoin is still being juggled by these purposes and many others.

[d5000]

the real challenge is on how long they can sustain it, because there's a chance that their they get affected if there's sudden changes will happen like bullish and bearish market situation.

Imagine you sell a virtual good you have created yourself for BTC (i.e. there's no fixed cost you have to pay to someone), like a video game, app or music, and then a sudden crash occurs.

If you're bold, you can maintain the price stable in BTC. Let's say measured in USD the price reduces from $100 to $60 due to the crash. Its likely that this sudden "discount" could attract a lot of customers who would otherwise never have bought your product. And even in USD, your income would then be much higher than in "normal" phases where everybody has to pay the value of $100.

So these sudden crashes can be a blessing for some merchants if they are bold enough. They even can speculate with the Bitcoin they receive, perhaps it was only a dip and the price recovers, and then they have benefitted twice (by increasing sales volume and by getting precious BTC for relatively cheap).

[Satofan44]

Because I can't really picture a medium of exchange that's quite volatile.

You need to drop this shit, this is usually the incorrect nonsense that is being repeated here by shitposters -- you are better than that. Most of the currencies in the world are fairly volatile, and most are more volatile than Bitcoin. The USD has even had a quite volatile last 12 months. Therefore, yes you can absolutely use a fairly volatile currency as a medium of exchange.

I understand scalability constraint, so it's more of an hypothetical situation to compare

Bitcoin on Lightning has solved the scalability issue. The whole world could operate using the Lightning Network without issues. Sure, what we can't do is that everyone does self-custody and uses self-custodial Lightning wallets -- but that is irrelevant because we will never live in a world where that is going to be needed. The majority of users will choose to use it under a custodial model, and that is their right -- to choose the wrong option if they want to.

In summary how would stability that I believe a accepted medium of exchange should have
Align with a decentralized asset?
Would stability always be hypothetical and scarcity drive price?
Or we have what money should be
One that don't fall with time but stay relatively consistent and keep up with price changes.

Nothing is able to be completely stable in a free market in the world that we live in, fueled by emotions, nonsense, misinformation and hype. If the price of something is under control, that is a big red flag. Therefore, I do not see any path towards price stability with either approach. What is only possible is what is already happening, a slow and steady reduction in volatility which will eventually reach its limit.

Sigh wtf am I even saying, will likely lock when I'm sober and awake.

Now I get what is going on here. Did you miss this @d5000?  

[Ambatman]

USD looks stable only because you don't pay attention to inflation. Overtime, unlike bitcoin where the volatility is bidirectional, it could go up or down. Dollar is rather 1 dimensional, it go down on the long term.

well I'm aware of Fiat's volatility hence why I said relative.
Bitcoin been measured in Fiat sure doesn't help his case.

Why not both? Bitcoin can be both a medium of exchange and a store of value. Just like Gold. It's just that most people are using it as a store of value.

to be sincere now that you mentioned it
I can't really tell what the question I was asking about was.
Ooh yeah just checked the title I think that's the only thing that understandable
Which would have a faster impact on Bitcoin price
As a strategic reserve or medium of exchange.

Bitcoin as medium of exchange wouldn't render it stable. Deflation has existed in the past when people used gold as money, and it had been fantastic. It is only the monetary downgrade of the 20th century that psyop-ed the public through Keynesian jargon into believing that monetary inflation is good.

Alright let's a paint a scenario
If Bitcoin was the standard we have deflation
A month that really keeps to the store of value concept but with unit of measurement it would seem unchanging
Except when compared to the cost of goods in the market
But currently we have Fiat which many use as a standard of measurement
Thus why Bitcoin looks more volatile Because a Bitcoin can be $70K today and $75K tomorrow
But Fiat would always look like a dollar today is same tomorrow because many don't focus on the real cost.

Most of the currencies in the world are fairly volatile, and most are more volatile than Bitcoin. The USD has even had a quite volatile last 12 months. Therefore, yes you can absolutely use a fairly volatile currency as a medium of exchange.

Yeah my country's currency is an example of such volatility
But it's not noticeable since like I stated before in majority perception the currency nominal value remains unchanged
The Iran currency even imitated how shitcoins work.
My question was supposed to be what would have a bigger impact on price
Medium of exchange or store of value
When Gold was the money the price didn't really go up like we see today since prices were measured in Gold
It showed in the prices of goods
But it started looking like it's quite volatile when it became of store of value.

Now I get what is going on here.

Lol the brain was in overdrive.