Topic: Not to spread FUD or anything, but here's some food for thought (Read 3533 times)

Sorry. I was a bit confusing. What I meant to say is a fixed and predictable inflation rate. Unlike govts. ability to alter inflation rates. Just think about Zimbabwe's inflation.

My background is libertarian political theory, and what I really really have enjoyed in my 20 months running along beside The Crypto Thing is the fantastic way the 'landscape' has kept changing. No sooner do you hammer out one hesitant Theory of It All than some upheaval puts it on the scrapheap.

Mark (IndiaMikeZulu), Australia

And how, exactly, is Bitcoin "inflation proof", when 3600 new coins are created every day, most of which are dumped onto the market, pushing down the price?

Meanwhile, the hated US dollar is stable and liquid. Indeed, most fiat currencies are stable and liquid (and usable) compared to Bitcoin, which is failing and has reached its twilight years.

The price is crashing because the common folk (the 99% sees Bitcoin as "some rich people thing"). And they see to much of a hassle to enter Bitcoin, just to do what? You buy Bitcoin with your hard earned FIAT money, go through the hassle of getting accepted in a exchange and what not.. then you get your less than half a BTC (this is what the 99% can buy at best case scenareo)... what the fuck you do with it? How does this improve your life in any shape or form? Let's be real for a second. The only people that has gotten beneficied from BTC have been the guys that own BTC since the early days. The life of the 99%'s will be absolutely the same post Bitcoin. THIS is why the price is tanking. Something cannot live forever off whales.
Unless there is an easier way to make BTC besides risking your FIAT wageslave money, this is going to keep going down.

Non tech savy people(majority of the world) selling bitcoin because short term profit isn’t happening any more. These people didn’t believe in the potential of bitcoin in the first place.

Libertarians and the like(much fewer) holding bitcoin because of their beliefs.

Adoption of bitcoin from people who see its value in decentralization and its unregulated nature is growing, but it is very slow and steady. These types of people don’t care(maybe a little) what the price per bitcoin is, they just care about its ability to be decentralized, inflation proof, etc.

The price is going to keep falling until all the sceptics, non believers, and sheeple sell their stash of bitcoin.

I am a strong beliver in bitcoin but I do think the price is going to keep falling for a while but I also believe it will never go to $0.

THIS IS JUST MY OPINION.

Seriouse problem here if true.

I think we're saying the same thing, I simply reduced "real growth" (which is difficult to define) to a simple statement:

If the price of bitcoin has doubled over a year, the influx of fiat needs to increase by 28% to negate the 14%, or:

Influx_of_fiat_today = Influx_of_fiat_{one_year_ago} * (Bitcoin_price_today / Bitcoin_price_{one_year_ago}) * 0.14

(or something--coffee's not kicked in yet)

+1

His thread actually started one of the few worthwhile discussions in the last weeks, imo.

LLook in mirror! troll is you!1! /doommeme

I did read your story, and it is really sad what Banks did to you... but with this attitude you will be losing money again but this time it will be because of Bitcoin...go figure. 

There, fixed that for you.

That's the question amorous cow-herder asked a while ago. The summary of my answer in that thread is:

That question is nearly impossible to answer, because BTC is de facto used as a store of value by some early adopters, but at the same time, their decision to use it as such is motivated by the, ultimately speculative, assumption that BTC will succeed. So, in my opinion, the question what is the purely "non-speculatve value" per coin can't be answered because usage and speculation are not entirely separable.

If the question is, what is the current value purely motivated by transactional usage, then based on my very, very back of the napkin calculation in the thread above, I don't see current commercially motivated transactional volume at much higher than 1 billion USD per year, which together with some conservative assumptions about velocity of money and free float available for transactional usage, leads to a value below $100 per coin.

Btw, I don't think black market usage is still as dominant as it was two years ago maybe, but it probably still makes up a relevant share, together with a portion of BTC denominated online gambling. Very crudely again I'd say gambling + black market add up to less, but not much less than 50% of total commercial TV.

Big fat disclaimer: I'm not saying "that's the fair price for BTC right now".  I'm just saying that this is the result of my calculation which coin price is necessary to support current commercial transactional value that occurs on-blockchain.

What I meant is that if the bitcoin economy as a whole grows by 14%, not user adoption counted in individuals.
The point is that as long as we have real growth of over 14% per year you can neglect the additional coins from miners and price comes down to speculation and usefulness and of course more scarcity if we do grow over 14%


[edit] with all the talks about fake volume on chinese exchanges etc it would be really interesting to know solid facts.
As much as Jorge is trolling he does raise some points when it comes to that. All it takes is one big exchange to "tweak" the charts and the sheep (in this case the traders ) will follow. Looking at the gox fiasko in hindsight really makes me wonder how much trust I should place in the markets. Either way I see miners not as a major driving force for price.

Whatever the direction, things are going to look very different one year from now. Either we'll hover arround 50-200, or at 10-15k. Has anyone calculated the necessary bitcoin price for today's use excluding speculation / store of value (which is mostly black market, I imagine)?

It depends on what you mean by "adoption grows by 14%.

If 14% more people learn about Bitcoin this year, and each one bought just one Satoshi, that doesn't do much.  And simply spending 14% more $ doesn't do much either--BTC price has quadrupled since a year ago, so what's needed is (14 x 4)= 56% more fiat.
Oversimplified, but you get the drift.

This model in which Chinese buy BTC directly from the miners in order to get $ out of China by dumping on foreign exchanges
is not just bearish, but worrisome for the future recovery. Eventually the Chinese authorities will stop it and seller pressure will lessen.

It is fixed as a point of convergence more than 100 years into the future. Which is more than the life time of even the youngest market participants right now. That's 'increasing the monetary base' for all practical considerations of a market participant.

Not indefinitely, of course - which is the "sound money" promise of a Bitcoin future. But  until then, it's inflation all the way.

The monetary base of bitcoin is fixed, only that all coins have not been found yet. They are there, somewhere in the integer space.

I am sorry but in this case Wandererfromthenorth is right. If we consider miners' profitability, and estimate mining cost of one bitcoin to, let's say, 300$, it means that 75% of daily supply must be dumped or miners gets on red.