Things like bitcoin can not be stable due to pre-scheduled supply rate. Market demand always varies, and since supply can not be adjusted to demand, bitcoin price will always be volatile.
Topic: Is bitcoin too volatile? - page 6. (Read 7980 times)
The fiat money you list, are not stable. Yen lost 30 per cent this year only, relative to dollar. The strong bolivar of Venezula lost even more. Measured in a capital good like iron ore, the dollar gained 100 per cent this year. Measured in a consumption good like a flat, the dollar lost - how much - 10 percent year on year.
Money can not have a stable value. It is market based like all goods. But, unlike some good like an ice cream, where you might consume more when they are cheap, not so with money, it makes no difference if they are cheap or expensive at the moment. They are only for speculation. On the other hand, when you expect them to be cheaper or more expensive in the future, you might seek to acquire either more or less. Anyway, you would like to have a cash balance, just to have freedom to decide later.
When you sell something, including your time, for money, there is no guarantee how much you get back, measured in goods, for that trade. It depends on the value of the goods you seek, and the value of the money. When you buy, you know, not earlier.
Money can not have a stable value. It is market based like all goods. But, unlike some good like an ice cream, where you might consume more when they are cheap, not so with money, it makes no difference if they are cheap or expensive at the moment. They are only for speculation. On the other hand, when you expect them to be cheaper or more expensive in the future, you might seek to acquire either more or less. Anyway, you would like to have a cash balance, just to have freedom to decide later.
When you sell something, including your time, for money, there is no guarantee how much you get back, measured in goods, for that trade. It depends on the value of the goods you seek, and the value of the money. When you buy, you know, not earlier.
bitcoin is now getting stable
I think you might need to refresh your browser, your charts are not updating
We will keep the volatility for atleast a few more years, just use it in your advantage to make profit.
It is a bit a catch-22.
In order for bitcoin to gain stability, it should have strong fundamentals which determine the price, and not much speculation. This can come with very large merchant adoption. If you can buy a lot of stuff with bitcoin, then what you can buy with it will essentially determine its value: that's a monetary fundamental. It is also the reason why fiat is stable in the short term: there is a huge market of things you can buy with it. The "price" of $ and Euro is determined as a function of the stuff you can buy with it, and not as an exchange rate with respect to another currency. If prices would suddenly rise, people would buy less stuff, which would leave merchants with surplusses, and prices would lower again, until they are in agreement with offer and demand.
The problem for the moment with bitcoin is that you can't actually buy a lot of stuff with it, and moreover, that in those cases you can, you are *actually* buying in $ or Euro or whatever, converted to bitcoin. The price is set in fiat, and the bitcoin price is derived from it via an exchange rate. That means that you are actually not buying with a bitcoin price, but a fiat price, and that you are depending on the bitcoin-fiat exchange rate.
As such, the monetary fundamental of bitcoin at this moment is very, very narrow, and cannot support even the current price.
The current price is mainly determined by pure speculation, which is always volatile.
And unfortunately, as long as it is volatile, no merchant is going to price his goods directly in bitcoin.
I think the first stage is to acquire a large, large merchant adoption (even with actual price setting in fiat). From there on, we may hope on a direct price setting in bitcoin. That will give a monetary basis of a price of a bitcoin, and is a real fundamental. But we are a far cry yet from that point.
In order for bitcoin to gain stability, it should have strong fundamentals which determine the price, and not much speculation. This can come with very large merchant adoption. If you can buy a lot of stuff with bitcoin, then what you can buy with it will essentially determine its value: that's a monetary fundamental. It is also the reason why fiat is stable in the short term: there is a huge market of things you can buy with it. The "price" of $ and Euro is determined as a function of the stuff you can buy with it, and not as an exchange rate with respect to another currency. If prices would suddenly rise, people would buy less stuff, which would leave merchants with surplusses, and prices would lower again, until they are in agreement with offer and demand.
The problem for the moment with bitcoin is that you can't actually buy a lot of stuff with it, and moreover, that in those cases you can, you are *actually* buying in $ or Euro or whatever, converted to bitcoin. The price is set in fiat, and the bitcoin price is derived from it via an exchange rate. That means that you are actually not buying with a bitcoin price, but a fiat price, and that you are depending on the bitcoin-fiat exchange rate.
As such, the monetary fundamental of bitcoin at this moment is very, very narrow, and cannot support even the current price.
The current price is mainly determined by pure speculation, which is always volatile.
And unfortunately, as long as it is volatile, no merchant is going to price his goods directly in bitcoin.
I think the first stage is to acquire a large, large merchant adoption (even with actual price setting in fiat). From there on, we may hope on a direct price setting in bitcoin. That will give a monetary basis of a price of a bitcoin, and is a real fundamental. But we are a far cry yet from that point.
bitcoin is now getting stable
less volatility
Nah it's far from stable. It will get more stable tho, but I dont hope for fiat tier stable, but gold tier. less volatility
Quote
Assuming that we want bitcoin to replace the current paper currency
Only 3% of money in the world is printed in paper. Almost all of it exist in electronic accounts only.
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So, does anyone here believe that bitcoin can replace the $?
In gambling, smuggling and money laundering very likely.
People prefer bitcoins because its easy to get, and its faster and just better.
bitcoin is now getting stable
less volatility
less volatility
it's for VICE buys
drugs
casinos
porn
sex
etc
btc needs a nice cheap download site for music, 10 cent downloads
that will get 100 million users worldwide FAST
then btc will be 50K a coin
cha ching
drugs
casinos
porn
sex
etc
btc needs a nice cheap download site for music, 10 cent downloads
that will get 100 million users worldwide FAST
then btc will be 50K a coin
cha ching
I am wondering...
One can trust the dollar, euro, pound, yen or whatever because they are stable.
Meaning that if I can buy a popsicle at a nearby convenience store for 1$ I will probably be able to do so tommorow or next week.
Bitcoin, however, can easily gain or lose 100$ of its value within a single day...
Assuming that we want bitcoin to replace the current paper currency, why should any consumer trust bitcoin?
If no one is regulating it, it can suffer from huge inflation/deflation problems.
The people I know buy bitcoins because they are hoping to make money off of it. I don't personally know of anyone who holds bitcoins for the sole purpose of buying online goods.
So, does anyone here believe that bitcoin can replace the $? If so I would like to hear an explanation to why people will use such a volatile coin.
Thanks!!
One can trust the dollar, euro, pound, yen or whatever because they are stable.
Meaning that if I can buy a popsicle at a nearby convenience store for 1$ I will probably be able to do so tommorow or next week.
Bitcoin, however, can easily gain or lose 100$ of its value within a single day...
Assuming that we want bitcoin to replace the current paper currency, why should any consumer trust bitcoin?
If no one is regulating it, it can suffer from huge inflation/deflation problems.
The people I know buy bitcoins because they are hoping to make money off of it. I don't personally know of anyone who holds bitcoins for the sole purpose of buying online goods.
So, does anyone here believe that bitcoin can replace the $? If so I would like to hear an explanation to why people will use such a volatile coin.
Thanks!!
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