Can Bitcoin be a volatile investment tool and payment method at the same time? - page 3.

gabmen

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Quote from: Indrawan77 on March 06, 2019, 06:49:54 AM

It will be hard to serve both, the volatility is not good as the payment, it will make the customers become confuse and the sellers also hard to determine the price, the volatility one of the reason why stores didn't want to adopt crypto payment, if the volatility swing is not too big then maybe the store owner could tolerate, but for now the swing is too big and too wild

Well i agree though probably there will be a transition when times comes that btc becomes more stable. Of course that's not going to happen now since at this stage, it's volatility serves investors better. We're not yet at that point.

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Quote from: epiphanyblockchain on January 23, 2019, 01:17:28 AM

At some point in time I guess it will become either one thing or the other. It cannot stay both at the same time. Can it? Is it a healthy usage method to have it as both?

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You created this thread and never answered, but you made 6 post after creating this thread. I wonder why create threads if will not answer in that thread that create?

Indrawan77

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It will be hard to serve both, the volatility is not good as the payment, it will make the customers become confuse and the sellers also hard to determine the price, the volatility one of the reason why stores didn't want to adopt crypto payment, if the volatility swing is not too big then maybe the store owner could tolerate, but for now the swing is too big and too wild

romero121

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It has been serving as a volatile investment along with the access to payment. Being volatile is good for trading, but with marketplace if is hard for them to use as a payment source. This can be taken into effective usage by the acceptance between the buyer and seller. Large number of such trades were happening around with some trusted escrow services.

Halmater

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Beeing a volatile investment tool and payment method are very different situations from each other and nothing can be in the opposite situations at the same time. Volatile nature of bitcoin makes it a good invesment tool for people who would like to take risk but it also limit the use of bitcoin as a payment tool.

CaVO32

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Quote from: Herbert2020 on January 23, 2019, 03:12:06 AM

so far in the past 10 years bitcoin has been volatile and also been a payment method. in fact during each volatility cycle when price is at its peak and the volatility is the most, the number of payments increases to its own ATH setting up a record on each cycle. for example last year when the volatility reached its max by the end of 2017 (price rise of ~100% in 1 month) there were the most number of payments taking place.

so the simple answer is YES. and it is not really new and has been happening for so long already for bitcoin. and up until now, bitcoin is one of the major cryptocurrencies that has been used by many establishments as their payment method. they really have to deal with volatility issue, and it's up to the payer and payee to tackle such risk.

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Quote from: Herbert2020 on January 27, 2019, 01:56:09 AM

Quote from: tenakha on January 26, 2019, 02:33:09 PM

Quote from: Herbert2020 on January 23, 2019, 03:12:06 AM

so far in the past 10 years bitcoin has been volatile and also been a payment method. in fact during each volatility cycle when price is at its peak and the volatility is the most, the number of payments increases to its own ATH setting up a record on each cycle.

I do not think so. BTC can be used as a method of payment in some places today, but I do not agree with how accurate it is to belong to everything. At least people can evaluate the value of an asset by calculating BTC's price with USD. And think this is a very expensive thing (e.g. plane). If you were owner of the plane company, would you risk it? Surely, NO!

i think you need to check out all the places that accept bitcoin before making "assumptions" like this here. there are some airlines that are actually accepting bitcoin payments. you see it is not about how big or small the payment amount is in USD, it is about whether someone is willing to accept bitcoin or not. there are many huge sales taking place using bitcoin, even real estate deals worth millions.

This is just my opinion of what you wrote. Wink

I am not talking about airlines, I am talking about the companies that produce airplanes. Let us assume that you have worked for many years and have a big company with the money you have accumulated and price of products you produce is one million dollars. Would you exchange for a money you do not know what will be tomorrow?

Yes, there are people who can invest millions into cryptocurrency today, but do not think them like us. e.g. Our risk can be 20k, but theirs can be a million or more.

SIDDHI777

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Definitely no because it can make huge problems for both parties during a transaction and low volatility and more stability is significant for a good currency and that is why major currencies like Dollar, GBP,EURO and other often used to do international transactions because there stability is well maintained by central governments and banks so the risk during payments are very minimum and negligible so bitcoin can never be a volatile too and a good payment method at the same time

marjil

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I think the point is that bitcoin is a payment method but it's just that people have chosen to use it more as an investment. I am guessing this is likely because they have seen the price escalate very quickly. Equally, there is nothing to stop bitcoin being both and actually I think it does happen. People do use it as a store of wealth/ an investment but sometimes use it as a method of payment - it's never been static.

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Quote from: Herbert2020 on January 27, 2019, 01:56:09 AM

Quote from: tenakha on January 26, 2019, 02:33:09 PM

Quote from: Herbert2020 on January 23, 2019, 03:12:06 AM

so far in the past 10 years bitcoin has been volatile and also been a payment method. in fact during each volatility cycle when price is at its peak and the volatility is the most, the number of payments increases to its own ATH setting up a record on each cycle.

I do not think so. BTC can be used as a method of payment in some places today, but I do not agree with how accurate it is to belong to everything. At least people can evaluate the value of an asset by calculating BTC's price with USD. And think this is a very expensive thing (e.g. plane). If you were owner of the plane company, would you risk it? Surely, NO!

i think you need to check out all the places that accept bitcoin before making "assumptions" like this here. there are some airlines that are actually accepting bitcoin payments. you see it is not about how big or small the payment amount is in USD, it is about whether someone is willing to accept bitcoin or not. there are many huge sales taking place using bitcoin, even real estate deals worth millions

It is not about merchants at all

Merchants will be willing to accept anything provided there is a demand for such payments and the means of payment doesn't lose too much value in the process. In fact, in countries with high inflation rates (though not like in Zimbabwe, of course), merchants are still accepting local currency despite it being continually devalued by the government. So it is more about regulation (i.e. allowing Bitcoin to be used as a means of payment) and actual desire of holders to spend their coins

And this leads us to an interesting conclusion. If we assume that merchants are not a limiting factor in Bitcoin adoption, we should necessarily expect Bitcoin to be accepted in areas where there is possible interest of Bitcoin holders in paying with coins. And reality seems to support this view as the fields you mention (airlines, luxury business, real estate) are likely to attract big holders who are willing to pay with their bitcoins, and as a result, we see a lot of adoption going on there

Argoo

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This is one of the main questions that we have been trying to answer for a long time, because the fate of Bitcoin actually depends on it. Here we have a contradiction: Bitcoin will always have high price volatility, if it remains decentralized. But he cannot lose his decentralization, otherwise it will be another Bitcoin that we don’t need. Apparently, Bitcoin will have to combine high price volatility and use as a means of payment. In this case, as a means of payment, it will be used primarily by individuals, business structures are unlikely to use it widely with such volatility.

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Quote from: timerland on January 27, 2019, 01:24:19 AM

I do think that speculation will lead to somewhat decreased actual consumer use, but at the end of the day, will not completely stop consumers adopting it. And as I expect bitcoin volatility to continue to drop in the future like it has, it's not a particularly big problem

Volatility is not really dropping

Though I certainly see why you think it is. You basically look at the prices and see that they haven't been moving much as of recent. So it definitely looks like daily volatility declined a lot, and technically that would be a correct conclusion. But this is not enough, and when you start looking at longer timeframes, e.g. a few months, you will notice that volatility simply moved there. The price doesn't move much on a day by day basis, that's true, but when it moves finally, its movement makes up for all this lack of daily price action. And with a vengeance at that

Herbert2020

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Quote from: tenakha on January 26, 2019, 02:33:09 PM

Quote from: Herbert2020 on January 23, 2019, 03:12:06 AM

so far in the past 10 years bitcoin has been volatile and also been a payment method. in fact during each volatility cycle when price is at its peak and the volatility is the most, the number of payments increases to its own ATH setting up a record on each cycle.

I do not think so. BTC can be used as a method of payment in some places today, but I do not agree with how accurate it is to belong to everything. At least people can evaluate the value of an asset by calculating BTC's price with USD. And think this is a very expensive thing (e.g. plane). If you were owner of the plane company, would you risk it? Surely, NO!

i think you need to check out all the places that accept bitcoin before making "assumptions" like this here. there are some airlines that are actually accepting bitcoin payments. you see it is not about how big or small the payment amount is in USD, it is about whether someone is willing to accept bitcoin or not. there are many huge sales taking place using bitcoin, even real estate deals worth millions.

timerland

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Quote from: epiphanyblockchain on January 23, 2019, 01:17:28 AM

At some point in time I guess it will become either one thing or the other. It cannot stay both at the same time. Can it? Is it a healthy usage method to have it as both?

But this is exactly what has been happening over the past 10 years?

What the question really is I think is how much volatility is hindering adoption. Bitcoin as a payment method will work regardless of its value, since the network is completely distributed. Even if prices drop to close to 0 one day, as long as the network which bitcoin runs on stays the same, there won't be any issues with bitcoin being a form of payment. For example, merchants accepting bitcoin in a period of volatility can still do so, through hedging their exchange rate risks with a third party or by themselves.

I do think that speculation will lead to somewhat decreased actual consumer use, but at the end of the day, will not completely stop consumers adopting it. And as I expect bitcoin volatility to continue to drop in the future like it has, it's not a particularly big problem.

vv181

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Nothing wrong about the simultaneous usage, Bitcoin was mainly created for P2P electronic cash system, but the volatility the cryptocurrency markets have given make people see an opportunity to use it as an investment(for some to get rich quick). But if somehow in the future when Bitcoin volatility decrease it doesn't mean people stopping it for investment.

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Quote from: epiphanyblockchain on January 23, 2019, 01:17:28 AM

At some point in time I guess it will become either one thing or the other. It cannot stay both at the same time. Can it? Is it a healthy usage method to have it as both?

It can and has been, however... forms of payments [money] should be relatively stable as a medium of exchange.

Blocktopian88

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I've read some reports, it said Bitcoin might become another VIX, it's market-oriented. Because Bitcoin inversely correlated with the VIX now, and the correlation is more and more strong. Maybe both, because as volatile investment tool and payment method, belongs to different area.

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Quote from: epiphanyblockchain on January 23, 2019, 01:17:28 AM

At some point in time I guess it will become either one thing or the other. It cannot stay both at the same time. Can it? Is it a healthy usage method to have it as both?

That's a good question. Of course, they can be partially both with the vast majority using it for one of those things. Nowadays, bitcoin can be used for payments, but is mainly used as an investment. In the long run, however, I think that the payment method needs stability, because otherwise nobody would bother to take the risks or convert everything to fiat on weekly basis, you know. The best thing would be if bitcoin stabilized pretty much forever on a reasonable price (at least the ATH one) with regular 10-15% price fluctuations. This would be something merchants could live with and traders could profit from.

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Quote from: epiphanyblockchain on January 23, 2019, 01:17:28 AM

At some point in time I guess it will become either one thing or the other. It cannot stay both at the same time. Can it? Is it a healthy usage method to have it as both?

I think for an investment it will be very risky if the price is too volatile, but it depends on how you respond to it
Then for the payment method, I think this only depends on the payment gateway, which must be realtime to update the price so the rate matches the actual price.
I think these two things can happen together.

tenakha

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Quote from: Herbert2020 on January 23, 2019, 03:12:06 AM

so far in the past 10 years bitcoin has been volatile and also been a payment method. in fact during each volatility cycle when price is at its peak and the volatility is the most, the number of payments increases to its own ATH setting up a record on each cycle.

I do not think so. BTC can be used as a method of payment in some places today, but I do not agree with how accurate it is to belong to everything. At least people can evaluate the value of an asset by calculating BTC's price with USD. And think this is a very expensive thing (e.g. plane). If you were owner of the plane company, would you risk it? Surely, NO!

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