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Current Bitcoin can't be sustainably much over $400.
Justification: the 1MB block size limit and the fact that the price has pretty much grown hand in hand with the number of transactions per block (in the long time trend). We have free transactions now (for old enough coins). Eventually a minimum transaction fee for ANY transaction will be several dollars, when the block space scarcity really starts to constrict usage. If BTC adoption grows at the current rate, in a couple of years this scenario is going to be real. This will mean, by the way, that the block subsidy will be insignificant far sooner than most people think. At 20,000 tx/block and $1 fee per tx, assuming $400/BTC and current reward level, fees will be two thirds of total miner revenue.
Justification: the 1MB block size limit and the fact that the price has pretty much grown hand in hand with the number of transactions per block (in the long time trend). We have free transactions now (for old enough coins). Eventually a minimum transaction fee for ANY transaction will be several dollars, when the block space scarcity really starts to constrict usage. If BTC adoption grows at the current rate, in a couple of years this scenario is going to be real. This will mean, by the way, that the block subsidy will be insignificant far sooner than most people think. At 20,000 tx/block and $1 fee per tx, assuming $400/BTC and current reward level, fees will be two thirds of total miner revenue.
This gives absolutely no explanation for the $400 figure.
Within the last year the number of transactions per day went from ~40k to ~60k (+50%), in the same time the usd/btc price went from ~6.5usd to ~110usd (+1692%). Stating these two values have "pretty much grown hand in hand" is a lie of epic proportions.
Wild theorizing on my part, take it with a truck load of salt: TX fees will not raise to several usd/tx even if the block size limit was not lifted. The reason is that a majority of all transactions will be relatively small sums and people will simply refuse to pay such high fees. Eventually average small time users would rather drop bitcoin and the network would be left exclusively to the movement of larger sums, this development would rather decrease the number of transactions than increase it.
Again, where does the 400 come from??
I'm also waiting for someone to connect dots here. How exactly does the "transactions-per-time-limit" affect the USDBTC exchange rate?
We haven't been this low since the beginning of June.