How high a of a market cap would bitcoin need to have to be 'stable'?

[Tzupy]

Bitcoin price was relatively stable during 2012, because of high supply and concentrated trading at MtGox.
Now with lower supply (and more hoarding) and market fragmentation, it's much easier to pump bitcoin.

[BitchicksHusband]

Or at least different market caps for different levels of stability.

What is your estimate for +-1% variation and +-3% variation. Or what do you think is the most realistic +-% range that we'll see?

Gold is what, 9 trillion? And it's still often volatile. I'm guessing this is purely due to speculation.

Do you consider gold stable?

[InwardContour]

Would it take governments deciding to hold bitcoin in their reserves for bitcoin's market cap to reach these heights or not? Or is private capital sufficient to get bitcoin to the 100 billion, 500 billion or 2 trillion dollar market caps mentioned?

When some country buys another currency for reserves, yes that strengthens the foreign currency.

The only reason to have reserves, is to manipulate (also called stabilize) a local fiat currency. If the fiat currency in question were allowed to float, reserves would not be necessary.

If a country has a trade surplus and nothing to spend the excess currency that is pouring into the country then it will have foreign currency reserves.

That is not enough, the foreign money has to somehow get into the pockets of the government.

Most governments charge some kind of tariff when goods are imported, these can be paid for with foreign currency. Governments also often have some kind of ownership stake in various industries. 

[Este Nuno]

Or at least different market caps for different levels of stability.

What is your estimate for +-1% variation and +-3% variation. Or what do you think is the most realistic +-% range that we'll see?

Gold is what, 9 trillion? And it's still often volatile. I'm guessing this is purely due to speculation.

Do you consider gold stable?

Not really. But it's a lot more stable than bitcoin and and if bitcoin were ever to become as volatile as gold I would consider that a big step forward.

[Harley997]

Or at least different market caps for different levels of stability.

What is your estimate for +-1% variation and +-3% variation. Or what do you think is the most realistic +-% range that we'll see?

Gold is what, 9 trillion? And it's still often volatile. I'm guessing this is purely due to speculation.

Do you consider gold stable?

Gold is a commodity and commodity's do not generally have stable prices, that is why there are futures markets for commoditys - so buyers and sellers can hedge their prices 

[ShakyhandsBTCer]

Given how mining work for bitcoin, I do not think the price will stable.

It has to keep going up so miners can have "profit" in either profit or transaction fee.

Well, it can still go up and be relatively stable as well.

Generally speaking if something is rising in price at a rapid rate it will not be considered stable.

[freedomno1]

Well when you consider it from a small percentage movement instead of a cash value then one can consider it more or less stable.

[InwardContour]

Or at least different market caps for different levels of stability.

What is your estimate for +-1% variation and +-3% variation. Or what do you think is the most realistic +-% range that we'll see?

Gold is what, 9 trillion? And it's still often volatile. I'm guessing this is purely due to speculation.

Do you consider gold stable?

Not really. But it's a lot more stable than bitcoin and and if bitcoin were ever to become as volatile as gold I would consider that a big step forward.

Gold is still more stable then a lot of 3rd world currencies. Over the long term bitcoin could potentially supplement currencies in the "3rd world" allowing it to reach it's true potential 

[Este Nuno]

Given how mining work for bitcoin, I do not think the price will stable.

It has to keep going up so miners can have "profit" in either profit or transaction fee.

Well, it can still go up and be relatively stable as well.

Generally speaking if something is rising in price at a rapid rate it will not be considered stable.

Well it could be rising in price relative to the USD but still stable relative to gold and oil. I.e. the USD is going down instead of bitcoin going up.

[InwardContour]

Given how mining work for bitcoin, I do not think the price will stable.

It has to keep going up so miners can have "profit" in either profit or transaction fee.

Well, it can still go up and be relatively stable as well.

Generally speaking if something is rising in price at a rapid rate it will not be considered stable.

Well it could be rising in price relative to the USD but still stable relative to gold and oil. I.e. the USD is going down instead of bitcoin going up.

This would be unusual. The US dollar is a very stable currency and for all intensive purposes will not fall at the rate needed to make bitcoin go up substantially

[Este Nuno]

Given how mining work for bitcoin, I do not think the price will stable.

It has to keep going up so miners can have "profit" in either profit or transaction fee.

Well, it can still go up and be relatively stable as well.

Generally speaking if something is rising in price at a rapid rate it will not be considered stable.

Well it could be rising in price relative to the USD but still stable relative to gold and oil. I.e. the USD is going down instead of bitcoin going up.

This would be unusual. The US dollar is a very stable currency and for all intensive purposes will not fall at the rate needed to make bitcoin go up substantially

Yeah, I don't think that it is likely at all. I was just commenting on a hypothetical where the price could be rising and still be considered stable.

[ShakyhandsBTCer]

Given how mining work for bitcoin, I do not think the price will stable.

It has to keep going up so miners can have "profit" in either profit or transaction fee.

Well, it can still go up and be relatively stable as well.

Generally speaking if something is rising in price at a rapid rate it will not be considered stable.

Well it could be rising in price relative to the USD but still stable relative to gold and oil. I.e. the USD is going down instead of bitcoin going up.

The Dollar is simply too stable for this to be a possibility. A change of 1% in the value of the dollar is considered to be extreme. It is unusual for bitcoin to not trade in a range of at least 5% in any given day.

[aminorex]

This would be unusual. The US dollar is a very stable currency and for all intensive purposes will not fall at the rate needed to make bitcoin go up substantially

I LOLed.

[aminorex]

The Dollar is simply too stable for this to be a possibility. A change of 1% in the value of the dollar is considered to be extreme. It is unusual for bitcoin to not trade in a range of at least 5% in any given day.

You just don't get it, do you?  The only reason the dollar appears to be stable is that all other major currencies are pegged to it after a fashion:  When the fed wants to devalue, they coordinate with other central banks, thus avoiding competitive devaluations.  Moreover the major relative moves are very trendy and take much longer than days.

[tinof]

This would be unusual. The US dollar is a very stable currency and for all intensive purposes will not fall at the rate needed to make bitcoin go up substantially

Dollar is not stable. Look at commodity chart for the last 10 years.

[Keyara]

Given how mining work for bitcoin, I do not think the price will stable.

It has to keep going up so miners can have "profit" in either profit or transaction fee.

Well, it can still go up and be relatively stable as well.

Generally speaking if something is rising in price at a rapid rate it will not be considered stable.

And small event such as the FBI auction cause price to go up over 10% should let people know how volatile the price is.

[Swordsoffreedom]

This would be unusual. The US dollar is a very stable currency and for all intensive purposes will not fall at the rate needed to make bitcoin go up substantially

Dollar is not stable. Look at commodity chart for the last 10 years.

This the dollar has been on a deflationary streak for a long time in terms of purchasing power as well



With reservations for the wealthy elite lol. Real Income Changes
http://realfactbias.blogspot.ca/2012/02/no-dollar-did-not-really-lose-95-of-its.html

[devphp]

I would say, +-10% yearly and even quarterly fluctuations is stable enough, doesn't have to be 1-3% to call it stable. Currencies on Forex can fluctuate 10% and people are ok with that even though they have immense support from Central banks to give them some pegging.

Besides, if real (not published in stats) yearly inflation of world fiat currencies is 5-10% on average, having 10% fluctuations in Bitcoin is as good as it gets. With that in mind, I would say, it's already reached that point where it can be called stable.

Now that artificial Mt.Gox liquidity is gone, the market has reached more fair valuations, and buyers seem to be in match with sellers recently. If Bitcoin price changes on average 1%/month against USD when calculated at the end of the year, that is stable and good enough for all practical purposes.

[DannyElfman]

Given how mining work for bitcoin, I do not think the price will stable.

It has to keep going up so miners can have "profit" in either profit or transaction fee.

Well, it can still go up and be relatively stable as well.

Generally speaking if something is rising in price at a rapid rate it will not be considered stable.

And small event such as the FBI auction cause price to go up over 10% should let people know how volatile the price is.

A 10% change in the market price of bitcoin is not very big by bitcoin standards. It has seen price swings of 50% or more in both directions in one day.

[Gargulan]

Given how mining work for bitcoin, I do not think the price will stable.

It has to keep going up so miners can have "profit" in either profit or transaction fee.

Well, it can still go up and be relatively stable as well.

Generally speaking if something is rising in price at a rapid rate it will not be considered stable.

And small event such as the FBI auction cause price to go up over 10% should let people know how volatile the price is.

A 10% change in the market price of bitcoin is not very big by bitcoin standards. It has seen price swings of 50% or more in both directions in one day.

A good reason why is it not a good payment system. Hard to set consumer protection policy if the price can change this much.