Topic: Is the price of bitcoin important? - page 7. (Read 4149 times)

I think that by that logic, bitcoin has already failed to be what you want it to be. It's a great speculative tool, medium of exchange and for some store of wealth but the most common most use cases are dependent on its FIAT value. The reason so much bitcoin gets traded and transacted as well as mined by so many parties is because it is priced on monetary value through something as widely accepted as FIAT. It's not bad to measure bitcoin's value on money that's more widely accepted, that's what's actually happening in fact. I think that it's good to go by that principle and call bitcoin successful already. Because bitcoin doesn't need to surpass the dollar or even compete with it in order for it to be considered successful, all use is good and as long as it's used in any way it's not failing.

the bitcoin price is a direct result of the limited amount of bitcoin, and for bitcoin to be used on a large scale it needs to be worth much more.

For example, china has a total of $30 trillion in savings. Right now there's about 15 million bitcoin in circulation.

If even 1% of chinese savings were converted to bitcoin, this would mean 1 bitcoin would be worth $2000.

And that's only (a fraction of) the chinese savings, the worlds savings are more like $300 trillion.

So bitcoin has to rise, a lot.

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Well, yes, to me it is obvious that price of Bitcoin is important!

If BTC goes up, you can buy more with it.  If it goes up faster than the price of gold went up slower than BTC's, well then you get more gold!  That matters!

Moves upward may wind up attracting more attention and users to BTC, which also matters.

I agree that the price of bitcoin acts as an incentive to promote participation and, in that regard, the upward  trend in price is attractive.  But, if the price was allowed to reach some form of equilibrium and it was appropriately scaled, will we be left with a system that is fair and equitable?  Or, will we be left with a lopsided system in which a minority controls the bulk of the resource again?  It's a big question, and the direction it takes along the way will ultimately be the deciding factor of whether or not the experiment is a success or failure.  It seems that the price doesn't matter as much as its utility which enables control over personal wealth and productivity.  Bitcoin is so much more valuable than its exchange rate....It could be a path to freedom for many....it just depends on the direction the world allows it to go.

OP has pretty much said everything, but you can find something useful in being constantly paying attention to price... Accumulate more coins

When bitcoin first started, the price was not important at all. However, when people start to use it to replace money, hold it as asset and join mining for profit, price becomes an important factor for the participants to continue with bitcoin.

Ya it matters, attracts attention of media = attention of people = more people using bitcoin = higher price = bitcoin FTW

why whouldn't matter? everything with utility has value so more utility higher price.
if the whole planet start to using bitcoin we would see a big pump.

yes because it draws attention from media, and has enough vapital to actually be useful to put serious money. Further the larger the market cap, the harder it is to manipulate.

Eg lets say it goes to 10T, who has 100B laying around to just throw at BTC, I would posit a lot less actors. The old system even has problems transferring this money

Of course, a stable "price" is desirable in the long run, however, it is unclear to me what a fair stable price would be. It depends on the economy and the speed at which goods/services and money are exchanged.
Consider a hypothetical example just using bitcoin as a payment for manual labor: if all work done by all humans on earth would be paid for in bitcoins, and everybody would get their wage at the end of the month, then the value of one bitcoin must be high enough such that this payment can happen using the "free bitcoins" available to employers.
Simple-minded calculation (may be off by two or three orders of magnitude): there are around 7 billion people, of which maybe half work for money. Average annual hours per worker are between 1400 and 2200, so monthly hours roughly between 120 and 190. Let's assume 150 for the sake of simplicity.
That would be 3,500,000,000 * 150 = 525,000,000,000 hours of work. If the total possible number of bitcoins (about 21,000,000) were used to pay the wages, one bitcoin would need to pay for 25,000 hours of work. Hourly wages differ considerably, of course, I'll just assume 1 Dollar for the sake of simplicity, too. This is quite a bit lower than actual wage in high-end economies, and a bit higher than actual wage in low-end economies.
Under these assumptions, the value of one bitcoin should be at least 25,000$ to be just sufficient as salary for all of earth's workers. Naturally, you'd need to consider that goods need to be bought and that people would hold savings, and that a good chunk of the 21 million bitcoins might be lost and thus not available, so the actual value would be quite a bit higher.
In reality, it is very unlikely that the world wide labor force (or any significant part of it) will ever be paid in bitcoin, let alone the goods on global markets, so I would not bet on such an outcome.

Onkel Paul

I've noticed that there are many people who approach bitcoin as though it were some form of "get rich quick" scheme.  But, in reality, the true value of bitcoin is transmitted through its utility.  As long as an equal day's wage is exchanged for an equal day's productivity, the system will be sustainable.  Yes, early adopters were blessed with the fortunate opportunity to be "in the right place at the right time" but that was only because they were the first to recognize and understand bitcoin's utility and that "blessing" was just a side effect of the larger picture.   

If bitcoin's monetary value increased without bound, then the experiment will fail.  Only when bitcoin can be exchanged with equity (labour hour for labour hour, productivity for productivity) can it be considered a success.  If bitcoin is held as an investment, and bitcoin's price continued to increase at the expense of late adopters, then wealth will centralize as opposed to distribute....

So, when we're pondering the direction we should be guiding bitcoin, should we approach it as an investment opportunity or as a vehicle that opens up freer and fairer access to the global economy and the world's resources?  Is bitcoin a "get rich quick with very little effort" opportunity or is it an opportunity to bring about social and political change by taking back control of our personal productivity?  These are questions we should be asking ourselves....

Thoughts?  Does the price of bitcoin really matter, or is bitcoin's utility where value is realized?