Topic: An easy way to make bitcoin worth millions of dollars (Read 5714 times)

It's still orders of magnitude faster than credit cards or bank transfers. In fact, it faster than any known system.

Also, decreasing confirmation time like many altcoins do only result in needing more confirmations to achieve the same level of safety.

Note that your transaction can be validated instantly, but confirmation may take several minutes or hours depending on how secure you want it to be.

With credit cards your transaction may be validatd instantly but the actual transfer of money will take weeks or even months. Bank transfers will take days or even weeks. And they are way more expensive too.

For your average transaction, what you as a consumer notice will not be much different with Bitcoin from what you are used to. You can use a phone or a card to pay. Your payment will be instant. The benefits are that you have full control over your own money and do not risk a bank or a government stealing or "confiscating" your money, and that eventually things may be cheaper because stores might pass on their savings to you. And you can easily do transactions in foreign countries. A true world currency.

The benefit to the store is that they can market worldwide, have extremely cheap processing of transactions, get their money almost instantly (as opposed to having to wait for weeks), and probably more, but you get the point.

Bitcoin is designed to be a currency, and it is perfectly suited to be used as currency.

About credit expansion


In today's fiat money system, central bank creating money out of nothing, thus indefinitely raise the value of total money supply. So, is it possible to raise the value of bitcoin money supply indefinitely by a similar practice?

Fiat money's value expands through unlimited supply, but bitcoin have limited supply, so the bitcoin's value can only be expanded through unlimited demand

Where is that unlimited demand comes from?

If bitcoin can be mortgaged and get loan, then it is possible to raise the value indefinitely due to limited supply and unlimited demand (By credit expansion)

Example:

Take $300 million loan to buy 1 million bitcoin, coin price doubled to $600

Mortgage the coins and get $600 million loan, buy another 1 million bitcoins, price rise to $1200

Mortgage the coins and get $1.2 billion loan, buy another 1 million bitcoins, price double again to $2400

Mortgage coins and get $2.4 billion loan, price rise to $4800

etc...

After a while all the coins in existence will be bought out, so the price would rise exponentially to compensate the liquidity problem, that high price give mortgage even more value to finance much larger loans, so the exchange rate will rise even quicker and easily reach 100x in a couple of years

The only question is: Would bitcoin qualify as an asset to get more loans from banks? Or, if I'm holding certain amount of twin's ETF, can that asset be used as collateral to acquire bank loans?

If significant amount of coins are off the exchanges permanently, then bitcoin's value will rise

There are 2 possible causes:
1. People buy bitcoin and hold them as investment
2. People continuously buy bitcoin and through spend or transfer, send them to another exchange and sell

The first one is driven by saving and long term investment, which is most of the bitcoin's demand today. The second one is mainly driven by consumption and international money remittance, this is the part that we can research and improve a lot.

There can also be other area that bitcoin is needed to achieve certain business goal

10K or 1 million per coin it would never be a problem since there are 1 million bits inside a coin. Once price goes that high we will use bits to measure value, not BTC.

People don't care about one pound of gold being worth $16000, or one diamond worth millions, they also don't care about one bitcoin bit worth only $0.00027, looking at the absolute number is meaningless

Sure, no one knows what is gonna happen next month, but very likely you will have hyper deflation with bitcoin, since that is the only thing you can do with it

And because of this we either need to find a steady balance, or even better: when demand outstrips demand and the price goes up because of it. There is no easy way to forcefully do this though other than getting more merchants and users involved which will ;likely be a slow and gradual process.

Or people will simply say "$10000 a coin? Nope. Guess I'll just use my credit card." It's all theoretical and there's no telling what the real outcome will be. You can claim you know what will happen all you want, but the simple fact is you don't.

You missed the most important one:
When people buy and spend bitcoins forever, price goes up
So the net result is up

When you hold 100 coins indefinitely, there will be 100 coins permanently disappear from exchanges, thus reduce the supply and increase the price. When you spend them every 3 hours, there will also be 100 coins permanently disappear from exchanges, same effect. I hope this explanation can make it easier for you to get the picture

Everything could be summed to supply and demand, but we can talk about theories and methods, even tho we dont need to do anything, btc is good enough withing itself to reach glory.

I think this entire thread could be summarized:
When people buy Bitcoins, price goes up.
When people sell Bitcoins, price goes down.
.. and OP's price "speculation" won't work.

Even US can not force China to use USD as currency, if you practice centralized issuance, the usage will be limited by the range of your own reach, like airline miles and super market shopping coupon. Apple could issue its own money to be used at apple shops, but android users won't bother 

And... there's the issue with Bitcoin having been open source. Great idea. But other companies (that have money and power) are able to take the same idea, re-create it with no changes, and capitalize on it. And due to money and power, they can make the world adopt it.

I really hope that people can decide what currency they use, but in current system it is their boss decide what kind of currency they receive as salary, and the boss typically get new money from bank loans, in the form of domestic fiat currency

However there are some countries have a tradition of using multiple currencies due to unstable local currency, bitcoin might get a grip there much faster. In developed countries, the easiest way is to buy bitcoin with fiat money and spend, that does not impact fiat money system, thus will not result too much resistance from governments and banks

If some of the big businesses like Apple still resist to accept Bitcoin is all due ego. It's a stupid ego fight, they want their own thing.. they should learn from Microsoft.

Exactly, people feel unsafe when they see some currency that has nothing backing it. Backing is a means to provide confidence, it is just a promise, never need to have anything behind it, so it is better to have some powerful entity behind it to increase people's trust

Before 1971, you can take your USD to FED and exchange gold, but now it is only backed by government bond: A promise of giving you back same amount of USD plus some interest, many years later. If one day USD becomes useless, then this promise does not mean anything

So in fact all the currency is only backed by the merchants who accept it. If bitcoin have large scale of merchant acceptance, then it is backed as good as fiat money, or even better, due to not possible to be inflated by central banks. And you can see my use case have some real meaning in increasing bitcoin's merchant acceptance: If many people are purchasing and spending bitcoin at every possible place, then soon merchant will all include bitcoin as a payment alternative

My use case just proved that the net result is positive, because some of the coins will be permanently disappear from the market, and that will reduce the supply, even the demand kept the same

If you bought 100 bitcoins and sold it back, you will take a small loss due to commission (suppose that everything else does not change). However, if you bought 200 bitcoins, and use 100 in your daily spending, thus permanently occupied them, you will reduce the coin supply on market by 100 bitcoin, that will raise the exchange rate permanently, so that your other 100 bitcoins can be sold at a profit FOR SURE

You can achieve the same result by putting aside 100 bitcoins and never use them, but then you lose 100 bitcoins, much worse than just spending them

In fact, if you look at fiat money's value, it is mainly decided by transaction demand. If people stop using USD as transaction medium, then there will be trillions of dollar supply on market and its value will plunge to almost zero, the effect is huge

The net result to him will still be a loss. It is a small loss but a loss nevertheless. The one making the profit will be the one sitting out.

This turns into a tricky arena, though. Small businesses wouldn't benefit. Big businesses are harder to sway. It takes money to get big business to make a switch. Such as Apple and Apple Pay.

Merchants follow the money, if we start to use soda cans tommorow as a barter item, they will have to accept it too, or they would go out of business. The people decide what currency too use, the merchants just follow the most popular method of payment.

Let's not forget that there are a benefit for them in this too... if they hoard, the price goes up, and they get more bang for their buck. 

They only need to sell, when the price goes up... Let's say they did this with a yearly gross turnover of  $1 000 000 and they got a average 1% profit on doing this. They would have received $10 000 more for their same money, if they only waited a few days, before they converted back to fiat. 

Eh, hasn't worked that way. Case in point: today someone was asking me about Bitcoin. The amount of misinformation is staggering. His understanding was that bitcoins had values that change depending on when you got them (such that the first bitcoins are worth more than the ones we get today and their value goes down as time goes on). It ended up with a discussion that led to confusion and a "I don't know why anyone would trust something that has nothing backing it" statement.