Coinbase Is Now Selling Over $1M USD Of Bitcoin Per Month

Post by Judson » Sat, Feb 09, 2013, 12:54 AM UTC

conroe64 wrote: post #116

Symmetry wrote: post #110

Earlier quoted context omitted.

Well, in general the price level of bitcoins, how much individual bitcoins are worth compared to other goods, is going to end up being governed by MV = PQ Where M is the quantity of bitcoins, V is how fast they criculate, P is the price things in bitcoins, and Q is the size of the economy that bitcoins are used for. Since the bitcoin design prevents M from increasing that much, and since V tends to fluctuate a lot bu…

I think you need to include speculators in your equation. If S is the number of bitcoins being horded, we would get (M - S)V = PQ. Since the perception seems to be shifting where more and more people believe that Q is going to continue to increase, S becomes larger (and in extreme cases, a bubble).

Post by jzwinck » Sat, Feb 09, 2013, 1:03 AM UTC

sliverstorm wrote: post #114

Dylan16807 wrote: post #70

Earlier quoted context omitted.

Do you really think the price would change very much if the miner payout was raised or dropped by a factor of ten? Over half the bitcoins have already been mined; expecting the price to be based on the trickle of new ones is unrealistic.

It may change eventually, and the exchange rate does fluctuate dramatically sometimes, but it has been shown in the past that the market value of bitcoins tends to stabilize around the electricity cost of mining.

Post by anigbrowl » Sat, Feb 09, 2013, 2:00 AM UTC

Jd wrote: post #22

unix-dude wrote: post #18

I think bitcoin is an extremely interesting concept, and the economics around it are equally interesting. I bought a tiny amount when the prices were around the $11 mark, and its insane to think of the price-shift. I made a couple bucks off the price shift, but now I'm honestly thinking that the price will fall back down. Despite serving the needs of many SR/SatoshiDice people, I dont think they're quite at the point…

The problem with all fiat currencies is they have no inherent value; it is all in the eye of the beholder. So what is an "appropriate" price is quite difficult to determine. Most currencies are driven by being effective monopolies wherever they are issued, so the market price remains somewhat stable. Even so, many professional economists have opined that the exchange rates even between major currencies are way too vo…

Post by tedunangst » Sat, Feb 09, 2013, 2:54 AM UTC

pixie_ wrote: post #107

nullc wrote: post #103

Earlier quoted context omitted.

You're making the mistake of consulting a medium writable by throngs of InternetLibertarians™. :P There is nothing inherent in the economic concept of a fiat currency of government. What is a law or a government in any case? Bitcoin is created by rules. The rules are embedded in a program instead of a law-book. The governed users opt in by using the software rather than by living in some geography. The rules are enfo…

Bitcoin is created by rules of mathematics and mined by problem solving. Gold is creating by mining and refining and governed by the rules of physics.. What does any of this have to do with the definition of fiat? It's already defined, lookup the latin - 'it shall be'

Post by obi-nine » Sat, Feb 09, 2013, 3:30 AM UTC

pixie_ wrote: post #46

nas wrote: post #39

Earlier quoted context omitted.

Or poker ( https://sealswithclubs.eu/ ). If you snoop around on the twoplustwo poker forms you will see there is some interest and decent reviews of the site. I imagine for someone that gambles regularly, it's easier for them to leave their bankroll in bitcoin rather than continuously exchanging it back to USD or whatever. I'm no economist but this is how I see a fiat currency like bitcoin deriving value. Even if no…

As noted above, Bitcoin is not fiat currency. It can't be created on demand by any person or government.