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Bitcoin exchange rate reached $100 USD per BTC

bitcoincharts.com

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Re: Bitcoin exchange rate reached $100 USD per BTC

#71

Post by incision »

spartango wrote: post #28

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…

>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.

I'd say it has been that way for a long time. When I dabbled in the community 2 years ago it was already brimming with speculators. Early adopting evangelists looking to legitimize their hoards and speculators who'd have been gambling on leveraged ETFs or FX if not BTC.

Re: Bitcoin exchange rate reached $100 USD per BTC

#72

Post by acabal »

I added a Bitcoin purchase option to Scribophile to test the waters. But I'm interested in a Bitcoin economy, not a USD cash alternative--the situation where a Bitcoin has its own value, not a value dependent on a different currency. For that reason, I decided to fix the price of an upgrade to 2 BTC, not peg it to the dollar like most other sites do.

Unfortunately it seems like that's just not going to work at this point. I set the price at 2 BTC when the exchange rate was $35--like two weeks ago or so. That meant the BTC membership price was about in line with the USD price. But in a few weeks, the value of a Bitcoin has tripled. Since most people using BTC ultimately want to convert it to dollars, this insane instability makes BTC impossible to use for anyone interested in a pure BTC economy. Too bad.

Re: Bitcoin exchange rate reached $100 USD per BTC

#75

Post by tibbon »

spartango wrote: post #28

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, or greatest stability.

What would be REALLY interesting is if essentially one of these ends up seeming a better 'idea' than US currency (the de-facto currency now)

Re: Bitcoin exchange rate reached $100 USD per BTC

#77

Post by hilko »

acabal wrote: post #72

I added a Bitcoin purchase option to Scribophile to test the waters. But I'm interested in a Bitcoin economy, not a USD cash alternative--the situation where a Bitcoin has its own value, not a value dependent on a different currency. For that reason, I decided to fix the price of an upgrade to 2 BTC, not peg it to the dollar like most other sites do. Unfortunately it seems like that's just not going to work at this p…

wouldn't it be possible to link the BTC price to the going rate at MtGox, so that it always translates to around $35?

Re: Bitcoin exchange rate reached $100 USD per BTC

#78

Post by jwallaceparker »

spartango wrote: post #28

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…

"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 reconsider their investment in the currency."

Gold and silver stand in opposition to this statement.

You can't buy groceries with gold or silver coins, but they're a fantastic store of value and time-tested investment.

Furthermore, according to Gresham's Law, people keep "good money" (i.e. money that holds its value) out of the marketplace and spend their "bad money" (i.e. fiat) acquiring goods and services.

Re: Bitcoin exchange rate reached $100 USD per BTC

#79

Post by xhrpost »

Everyone keeps saying that a crash is around the corner and the current price is unsustainable, been hearing it since $40/BTC, maybe earlier. I don't completely disagree, the question I keep pondering though is, if there is a big sustained crash coming, is it from $100 to $30, or $900 to $300?
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