Topic: Am I misunderstanding this or? - page 5. (Read 7714 times)

I both horde and spend bitcoins...
I keep a 'savings account' of them, and spend maybe 20% of it infrequently.

Very true.  As a further note to the parent, who asked who would sell their gold now, well, lots of people would.  If everyone just sits there with their gold and thinks 'no point in selling, it'll only head upwards' that will only cause a bubble that inevitably pops.  The price can only rise so much before the early buyers think 'wow, great profit, time to sell'.  Remember that you only have a profit when you sell a commodity/share/etc.  Until then it's just a paper profit.

I sold some gold last year as I was applying for a mortgage and needed cash.  The gold had risen in value considerably since I bought it so it was a good investment.  Right now, a year later, gold's price is lower than where I sold it in my local currency.  Seeing as the mortgage costs over 6% (hint: I'm not in the USA), my gold would have had to rise 6%pa every year from last year to make sense keeping it instead of cashing out.

If bitcoins are so valuable to you that you won't spend them near the market rate on stuff you want then you should buy more coins until they aren't so precious to you. If you never reach the point where you'd rather have a dollar or a thing than a bit more coin I'll be very surprised. But if you do, then you should just start working harder or smarter to get more coin. Working harder/smarter just -might- involve using your only asset (now some bitcoins) to get some other thing to improve your bitcoin getting ability.

Short answer: People actually want lots of things and balance them as they like.

Every time someone buys gold, someone else sells it.  So there are as many ounces of golds sold as there are ounces of gold bought.

So when tomorrow comes and 1 BTC only has the same (or slightly higher buying power) what then? To characterize all users as thinking the value is going to go up 100% daily is kinda silly.  Some users likely will never sell any of their coins or use them to buy anything.  However they aren't the only users.

Even if someone is hoarding for some future payday they all have a point they would cash out otherwise what is the point in hoarding to begin with.

Say hoarder Joe bought 1M BTC @ $0.01 ea.  Today they are worth ~$5.  He lives in an apt w/ his mom has almost no possession, no non-coin wealth, and yet has $5M in value in coins.  Do you think the utility of having his own place, car, life might be worth more than the future appreciation on his $5M?  Say hoarder Joe says "sell @ $5ea (a mere 50,000% gain no way suckers)".  In 10 years Bitcoin is worth $100 ea.  hoarder Joe has a net worth aproaching a quarter billion.  Is he going to sell/use/trade them?  By your logic no because they might keep going up.  In 30 years Bitcoin is worth $2000 ea so trader Joe now has $2B tied up in digital coins.  Does he sell?  Hell no.  He collects welfare and food stamps, but there is no reason to leave any future profits on the table.  In 85 years Bitcoin is worth $1M ea.  hoarder Joe finally did it he became the worlds first trillionaire (in dollars and likely the only remaining Bitcoin millionaire).  Er no he actually died 3 years prior and was buried in an unmarked pauper's grave because he wasn't going to be a sucker and sell out as a "mere billionaire".

Money is an abstraction.  It is an accounting system for what really matters: wealth.  If you never exchange it for any tangible wealth (goods & services) then it really doesn't make any sense to acquire it in the first place does it?  The idea that someone will hold and never ever ever trade/exchange/sell those coins doesn't even make common sense.

I'm trying to suss why you see this as such a problem though.

I don't know the numbers but let's say in the past month, 8 million of the 9 million BTCs issued didn't move, and were not used in any commerce.  Only 1 million BTC were.  But bitcoin being sent electronically with settlement within minutes (e.g., 1 or 2 confirmations) and divisible to a tiny fraction of a penny worth of money, that economy can function no different with 1 million BTC than with 9 million BTC, right?

So what is the problem with people sitting on those 8 million BTC?

I presume the real problem with this is that the exchange rate could easily plummet with the percent of hoarding being such a significant amount of all the currency issued.  But I want to know if that's the reason you are seeing such a problem with the hoarding by some.

To say it simple.
How many people are selling there gold now?
Not alot I guess, since its a long term investment for the most right?
Why do they not sell there gold? Cause they believe its getting worth more in the near future right?

Doens't Bitcoin have the same thing right now?
Also, lets not forget that alot of people bought high when Bitcoin price was at its peak or above $10 and don't want to sell low.
They can just hoard it and wait till it gets high again some time around 2020.

It's an usefulness in itself. (and why the yelling? getting stressed so easily?)


If you convince other people it's a good store of value, it might. That's not easy at all, though.
By the way, if at least you value your shit sword, then it already has value - to you, at least.


If you can still trade them for currency at least, it can be used as a store of value.
It's true that if there really isn't any function at all to something, then it will not have value.
The only thing I'm trying to say is that this claim that bitcoin needs to be used in commerce (trading it for goods and services) to have value is false. It doesn't need to, although it helps a lot to have such utility.


Because prices change?


Prices are a function of scarcity and demand. A particular usefulness of a scarce resource won't necessarily translate into demand until this usefulness is perceived and desired by people.


Agreed.


That's true for absolutely everything which has value. There's no such a thing as "inherent value".

It's right in the text of mine you just quoted: store of value.


The "clones" haven't managed to convince enough people that they are a good store of value. But, they've convinced a few, that's why they have some value instead of no value at all.


They are not actual clones. An identical clone would be a "fake bitcoin", which is impossible. They are different things, different "coins". The original bitcoins remain scarce, no matter how much equivalent implementations are done.

Not $1,535 per ounce worth of utility it doesn't.


Bitcoin very well could have been that one and only one to sneak through the vulnerable startup phase without being attacked.  There was plenty of computing power that could have messed with bitcoin but that never happened because it wasn't seen as a threat to anyone.

This might be remedied for an alternative chain though where it is centralized but still rewards miners with new currency to attract hashing capacity and to circulate the initial coins, and then switch over to a true decentralized, proof of work method at a certain block.

I am hoarding until Dec 2012 when the price is doubling.

Why use BTC when I can use USD

+1

Because you may want it now.

The same question could apply to any high tech product. Why buy a computer if you know that in two years the same computer will be much cheaper, or with the same amount you'll be able to afford something better? And the answer again is the same: because you want the computer now.

Ok, so there will be some coins hoarded and others spent regardless if the value will go up or not.  What's the problem then?

Being a "medium of exchange" is not the only utility of bitcoin. All "sound moneys" are also useful to store value. And for that, no commerce other than the exchange for other currencies needs to exist.

Because the majority are not really into bitcoins and don't want to undertake any complicated investing proces with bitcoins.
They just bought bitcoins with only one reason. It's gonna get scarce and the value will rise. They see it as a long term investment.
I mean, for example why should I buy a steam game with bitcoins if I maybe can buy 10 steam games with bitcoins within 2 years.
Why spend today if I can spend the half of the ammount for the same thing tommorow?

Why sell your gold today if you know (have a feeling) the value is gonna increase tremendously?

The appreciating value of the currency is not the only factor used when choosing which method to use when making a payment.  The cost savings from using Bitcoin more than offsets the cost to replenish the amount of bitcoins used for spending, thus protecting it from any deflationary spiral.

Described further here:
  - https://bitcointalksearch.org/topic/m.887005

Replace "bitcoin" with "gold" and you might be able to answer that yourself.

Why would the majority of the people that have bitcoins spend them if they know bitcoins are becoming scarce (wich equals to more value) while time passes?
And to get the value of bitcoin raising you need a running economy right?
Doesn't these two things conflict with each other or am I misunderstanding something here?

Thanks for enlighting.

-Grouver-