watch James d'angelos video on price modeling, it is quite informative.
Basically, high prices are all about displacing the big markets, gold,etc.
merchant adoption, while important, doesn't positively impact
price in the short term, and can even drive it down when coins
are cashed out...
speculative excitement can help price to some degree, there has been
lots of good news lately and the price is up greatly from 2 months
ago,...but don't forget, 3600 new coins get mined daily.
Basically, high prices are all about displacing the big markets, gold,etc.
merchant adoption, while important, doesn't positively impact
price in the short term, and can even drive it down when coins
are cashed out...
speculative excitement can help price to some degree, there has been
lots of good news lately and the price is up greatly from 2 months
ago,...but don't forget, 3600 new coins get mined daily.
All that is good, however, we have to keep in mind too that it's not all about the price of BTC, it's about getting people to use it as it's supposed to be used - as a currency.
A slight dip in the PRICE of BTC is worth the amount of merchants taking it as payment as it gives it more VALUE.
Nice point. There is a distinction between value and exchange rate. As more merchants come into bit coin we will be able to get a truer sense of value by measuring purchasing power of a specific amount of bitcoin.
