Topic: Can Bitcoin be a volatile investment tool and payment method at the same time? - page 4. (Read 1087 times)
January 26, 2019, 01:33:03 PM
It is spliting between the two right now, many people discuss in which category does Bitcoin fall into. I consider it both, because more than a half of users use it as an investment and the rest use it as a currency for spending. I personally use it as a currency and endorse that side of Bitcoin more because it is made to be a currency.
January 23, 2019, 06:15:41 AM
great idea!
January 26, 2019, 11:23:14 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?
In fact, bitcoin is in real a currency and not a investment method. But currently it is more used as an investment method and not as a currency. This is indeed not good for bitcoin itself it if is not used as a currency. Due to do much fluctuation in the btc prices, it is very unattractive to use it as a payment currency. For traders, it is best as they use it as investment opportunity and trade with it.
January 23, 2019, 08:08:02 AM
Yeah, for 10 years, bitcoin has been doing the same and has done the job quite well, so I guess it'll continue to do the same thing and perform as a payment system and an asset as there are third-party services willing to do real-time conversion of BTC to fiat for merchants. As long as currencies carry value on them, they can be used as a payment system and as an investment as well. Fiat are also subjected to changes, albeit not as volatile as bitcoin and crypto.
January 23, 2019, 07:55:14 AM
currencies can be pretty volatile too, but that doesn't change the fact that they can and are being used as a payment methods. for example you can take a look at a couple of countries that had their economy go down the tubes and their currency plummet hard. that is a high volatility for those "fiat" currencies but they are still currencies.
you could have shorted them and make a fortune but that also didn't change the fact that they are currencies!
you could have shorted them and make a fortune but that also didn't change the fact that they are currencies!
January 23, 2019, 06:06:25 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?
If Bitcoin follows the course of most mass adopted technologies, its usage and price will plateau after it becomes ubiquitous. At that point, it will hopefully be much less volatile than today. I'm sure it'll always be somewhat volatile, but it might act more like gold or silver once it has a more established and liquid market.
Merchants, wholesalers, service providers, etc. definitely like currency stability. Commodities like this aren't the most stable, so they're not ideal for being a medium of exchange, but they might still be useful nonetheless. It largely depends on whether consumers and other market actors want to transact in bitcoins or not.
If the fiat money system ever collapses, I think we'll see a big uptick in the use of commodity money including Bitcoin
Bitcoin is not a commodity money, by any means
Why not? Here's how the term is commonly used:
Quote
Commodity money is money whose value comes from a commodity of which it is made. Commodity money consists of objects that have value in themselves (intrinsic value) as well as value in their use as money.
https://en.wikipedia.org/wiki/Commodity_money
https://en.wikipedia.org/wiki/Commodity_money
The US court system and CFTC view Bitcoin as a commodity: Virtual currencies are commodities, US judge rules
Bitcoin is not a commodity money
Just because a US judge declares it so doesn't turn Bitcoin into one. I remember as another US judge allegedly ruled gravity no longer valid (that's just an urban legend so bear with me). Did it stop gravity from exerting its force? Not in the least, obviously. And if I'm not mistaken, Bitcoin was declared commodity exclusively for the purpose of regulating its trading by the CFTC and taxing it accordingly (just like any money can be traded and used as a commodity). That has nothing to do with commodity money as this term is understood by economics (i.e. money in the form of tangible goods like gold, cattle, etc)
January 23, 2019, 05:35:28 AM
Fiat currencies are also used for payment and trading / investment so I do not see why bitcoin can't be the same. Interesting thought though.
January 23, 2019, 05:59:36 AM
If bitcoin actually reaches mass adoption, then eventually the price of bitcoin will stay stable. Like you said, it can't really stay both at the same time, then normal people will wonder "hey? why did my 1$ turn into 50 cents? "
That would be pretty bad for a currency you are trying to use daily. I remember when Steam used to accept bitcoin for payment and now they don't because of volatility.
That would be pretty bad for a currency you are trying to use daily. I remember when Steam used to accept bitcoin for payment and now they don't because of volatility.
January 23, 2019, 05:26:22 AM
Yes, if we use bitcoin for long-term investment. Because bitcoin will be used by people only when it is more or less stable. If the volatility is too high, people will not use this currency to buy something, it's a fact. It seems to me that in the near future this issue will not be so urgent, because Bitcoin is changing in price precisely. It takes more time to stabilize
January 23, 2019, 05:57:16 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?
If Bitcoin follows the course of most mass adopted technologies, its usage and price will plateau after it becomes ubiquitous. At that point, it will hopefully be much less volatile than today. I'm sure it'll always be somewhat volatile, but it might act more like gold or silver once it has a more established and liquid market.
Merchants, wholesalers, service providers, etc. definitely like currency stability. Commodities like this aren't the most stable, so they're not ideal for being a medium of exchange, but they might still be useful nonetheless. It largely depends on whether consumers and other market actors want to transact in bitcoins or not.
If the fiat money system ever collapses, I think we'll see a big uptick in the use of commodity money including Bitcoin
Bitcoin is not a commodity money, by any means
Why not? Here's how the term is commonly used:
Further, it is not clear what fiat money system you refer to. There is no unified fiat money system in the world as there are many mostly independent ones (Euro, Swiss franc, British pound, etc).
https://www.investopedia.com/terms/f/fiatmoney.asp
If by that you actually mean the US dollar, it remains to be seen whether its downfall (should it ever come about) will do any good for Bitcoin. It will likely cause gold to surge, not Bitcoin (relative to other fiat monies, e.g. Euro)
That depends on Bitcoin's position within the "commodity money" and "store of value" niches. You're assuming that over the coming years, Bitcoin won't take a bite out of gold's market.
January 23, 2019, 05:00:35 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?
If Bitcoin follows the course of most mass adopted technologies, its usage and price will plateau after it becomes ubiquitous. At that point, it will hopefully be much less volatile than today. I'm sure it'll always be somewhat volatile, but it might act more like gold or silver once it has a more established and liquid market.
Merchants, wholesalers, service providers, etc. definitely like currency stability. Commodities like this aren't the most stable, so they're not ideal for being a medium of exchange, but they might still be useful nonetheless. It largely depends on whether consumers and other market actors want to transact in bitcoins or not.
If the fiat money system ever collapses, I think we'll see a big uptick in the use of commodity money including Bitcoin
Bitcoin is not a commodity money, by any means
Further, it is not clear what fiat money system you refer to. There is no unified fiat money system in the world as there are many mostly independent ones (Euro, Swiss franc, British pound, etc). And it is unlikely (if not to say impossible) that they are going to collapse all at once. If by that you actually mean the US dollar, it remains to be seen whether its downfall (should it ever come about) will do any good for Bitcoin. It will likely cause gold to surge, not Bitcoin (relative to other fiat monies, e.g. Euro)
January 23, 2019, 04:59:36 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?
There are many people who already make money using it. Volatility makes someone lose money while others make money. We have to work hard to be on the right side here.
January 23, 2019, 04:38:24 AM
indeed in this case we have to be very careful in choosing a project that we determine we all can not predict whether everything will be as we expect but at least we can continue to monitor the development of the market and always often find info and always think positively.
January 23, 2019, 04:30:49 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?
If Bitcoin follows the course of most mass adopted technologies, its usage and price will plateau after it becomes ubiquitous. At that point, it will hopefully be much less volatile than today. I'm sure it'll always be somewhat volatile, but it might act more like gold or silver once it has a more established and liquid market.
Merchants, wholesalers, service providers, etc. definitely like currency stability. Commodities like this aren't the most stable, so they're not ideal for being a medium of exchange, but they might still be useful nonetheless. It largely depends on whether consumers and other market actors want to transact in bitcoins or not.
If the fiat money system ever collapses, I think we'll see a big uptick in the use of commodity money including Bitcoin.
January 23, 2019, 04:18:46 AM
It definitely can stay both at the same time. It's just that with huge volatility present, the people who are going to use it for payments is just going to be a minority; pretty much like the current state of bitcoin right now whereas pretty much only the people in the bitcoin/cryptocurrency community are willing to pay using bitcoin. With time(probably a lot of time), bitcoin should attain stability as more regulations come in along with market liquidity. This is one of the things that are just a matter of 'when'; then bitcoin can be used and owned widely for both store-of-value and for daily payments(assuming bitcoin is very noob-friendly at that time).
I agree with what you say,and actually if I understand correctly, you are saying that it can technically stay the same, but not gonna work as well for both. Which is exactly my point. These 2 factors are counterproductive to each other. The more volatile, the less people will use it for daily payments. Because that means they are either loosing a lot of money money, or should hold it because they are earning money.
So I'm not sure if I got your idea correctly, but I think we agree on the fact that once it becomes stable, then it can become a standard payment method.
With all the user friendliness included for non-tech users.
January 23, 2019, 04:02:02 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?
You use fiat in your daily life and invest fiat at bank deposits. Replace fiat with bitcoin and you have your answer.
Bitcoin was initially started as a p2p electronic currency system but later adopted as a method of investment. That's unfortunate but true at the same time!
January 23, 2019, 03:53:54 AM
It definitely can stay both at the same time. It's just that with huge volatility present, the people who are going to use it for payments is just going to be a minority; pretty much like the current state of bitcoin right now whereas pretty much only the people in the bitcoin/cryptocurrency community are willing to pay using bitcoin. With time(probably a lot of time), bitcoin should attain stability as more regulations come in along with market liquidity. This is one of the things that are just a matter of 'when'; then bitcoin can be used and owned widely for both store-of-value and for daily payments(assuming bitcoin is very noob-friendly at that time).
January 23, 2019, 03:28:47 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 not very likely
Since it is a vicious circle of sorts. Using Bitcoin as a payment device or value transfer vehicle means real value, while increasing real value leads to less volatility. On the other hand, speculation boosts volatility and prevents mass adoption for Bitcoin's use in these fields. As speculative value comes before real value (it just happened so for whatever reason), it prevents adoption but without adoption there is no way real value is going to increase. Thus you get locked into this vicious circle
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.
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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