Maybe you missed the fact that money in the bank are no longer trusted and can be confiscated for any reason by whatever government or entity?
Bitcoin is vulnerable too. A dedicated effort by collaborating governments could destroy or severely damage Bitcoin, by e.g. blocking the protocol, seizing powerful hashing equipment, downing exchange websites, performing a 51% attack, and so on. This notion that Bitcoin is some robust, untamperable currency system is simply incorrect.
Or just make things uncomfortable for the people changing coins for other currencies.
It's sort of interesting how the liquid dollar market for bitcoins makes it impossible to judge whether someone accepting bitcoins as payment trusts it much.
How could the bitcoin exchange rate reverse its trend and start falling? Do you have any scenarios in mind?
US government declares it an illegal currency, and if you accept bitcoins at your business you will be investigated. Game over.
They would have to define it to ban it. Bitcoin would just evolve to no longer fit the ban. There are already dozens of other cryptocurrencies brooding- just waiting for a scenario where Bitcoin is pushed out to make more room for them.
A ban on bitcoin will work about as well as a ban on piracy.
You need to adjust the price just like you need to ajust prices for any currency. It's just that the value of 1 bitcoin changes faster than other currencies, as it's now being adopted at a quick rate.
A new domain name has been 10 USD from Namecheap for the last decade. A new domain name in BTC however, has varied between 1 BTC and 0.1 BTC in just the past two months. BTC as a proxy for USD is still useful IMO, it gives us a way to avoid Paypal and other online processors. But for it to be a USD replacement, it needs to first settle down and stabilize.
"settle down and stabilize."
Depends how you look at it. From BTC point of view it is the USD that's highly unstable and dropping in value... It's all relative.
$450k of electronics were purchased at bitcoinstore.com in march alone
Got a source for that?
There was ticker on their site that must of reset this morning. They say need to get $850k per quarter in order to keep re-seller account and the low prices. They are selling 0% margin in order to promote bitcoin and get the competition, newegg and amazon to accept it as well.
They didn't make the goal but were not open the whole quarter so they may still be able to continue. I'll see if they post news or press release about it
If I see a currency rising in value faster than Gold itself, I'm going to want to get in on the value. Fact is, if I had "invested" in 100 BTC only 5 months ago when it was hovering around USD$10, that would have cost me about $1000. And now it would be worth $10000. There are not that many investments that have that kind of return in such a short time. You'd have to be dumb to believe that people aren't doing exactl…
Well - I was making the point that not being used as a currency of exchange does not hurt it's chances at serving as a store of value. In fact, volatility isn't necessarily bad either if you are using it to store wealth only and you take the long view. What would hurt its ability as a store of value would be a sustained and systemic trend downward in value (i.e. inflation). Short of complete collapse of the currency…
Not a world that can sustain 100% growth month-over-month :)
If I see a currency rising in value faster than Gold itself, I'm going to want to get in on the value. Fact is, if I had "invested" in 100 BTC only 5 months ago when it was hovering around USD$10, that would have cost me about $1000. And now it would be worth $10000. There are not that many investments that have that kind of return in such a short time. You'd have to be dumb to believe that people aren't doing exactl…
If I see a currency rising in value faster than Gold itself, I'm going to want to get in on the value. Fact is, if I had "invested" in 100 BTC only 5 months ago when it was hovering around USD$10, that would have cost me about $1000. And now it would be worth $10000. There are not that many investments that have that kind of return in such a short time. You'd have to be dumb to believe that people aren't doing exactl…
What's a good way to short bitcoin?
If you really want to - Borrow $x bit coins - sell $x bit coins - wait for price to drop - buy back $x bit coins - return $x bit coins to lender.
I'm not a bitcoin fanboy - but I see this sentiment around a lot and I'm not sure I agree with it. The claim is that the value of a currency is supposed to also be somehow related to its utility in acquiring goods and services. And if this isn't the case - then people will go off it. When was the last time someone acquired a good or service with an ounce of gold? Perhaps we shouldn't consider gold a currency? Well I'…
If I see a currency rising in value faster than Gold itself, I'm going to want to get in on the value. Fact is, if I had "invested" in 100 BTC only 5 months ago when it was hovering around USD$10, that would have cost me about $1000. And now it would be worth $10000. There are not that many investments that have that kind of return in such a short time. You'd have to be dumb to believe that people aren't doing exactl…
This is not rational thinking. Simply because something has gone up in the past does not mean it will continue to. The returns for the past 5 months have been insane, but that doesnt mean it was a good investment 5 months ago because thats based entirely on results oriented thinking. In a casino, if a roulette wheel hit black 10 times in a row, somebody letting it ride on black the whole way would have made a fortune, but that doesnt mean it would have been a good bet, it means the people making those bets got lucky. It also doesnt affect the chance of the wheel hitting red or black on the next spin, so it doesnt tell us anything about the future.
Gold is a commodity; same with bitcoins. Not that there's anything wrong with that, but it isn't the same thing as a currency. Gold was only ever a currency when it was stamped by the issuing authority.
As a commodity, gold always had an intrinsic value separate from its value as a currency. So if the authority stamping the coin disappeared, I could always melt down the gold and sell it as a simple commodity. In the case of bitcoins, they do not have a utility outside of their use as a medium of value exchange. You can't really melt them down and use them to make jewelry, build cables or any of the myriad other uses…
Is gold's intrinsic value anywhere near what it's currently trading at?
edit: I think I mean it's "use value". The value of gold if it were not used a store of value.
I worry that as Bitcoin's value rises, people are buying in not to use it as payment for services or goods, but simply as an investment vehicle. In principle, there's nothing wrong with this; currency trading is common and well-explored. The problem is that the value of a currency is supposed to also be somehow related to its utility in acquiring goods and services. When it is rarely used to that effect, people may r…
Demurrage (cost to hold currency) could help hoarding. However, at some point, people will start spending them too. There's a fork of Bitcoin which actually has this built in. I imagine we could see an interesting future with cryptocurrencies, where people are essentially betting/investing on the stability of the framework/algorithm and demand on it. Multiple ones could exist, and you're hoping for the best return, o…
Oh, I was going to write about Freicoin. It seems like an incredibly fascinating concept and I'd really like to see an online economy emerge around it. Do you use it?