Check out the historical chart at http://bitcoin.clarkmoody.com/ (put the time frame on D1). Aside from the parabolic run up into the USD 200's, the level of 100 seems to be, for now, a new baseline valuation.
When markets don't know what things are fundamentally worth, they tend to trade around "round numbers." Currently 1BTC = 1 Barrel of oil, approximately.
hmmm interesting...not saying that 1 btc should equate to a barrel of oil, but would like to see the cost of mining one btc compared to the cost of drilling for one barrel of oil. When markets don't know what things are fundamentally worth, they tend to trade around "round numbers." Currently 1BTC = 1 Barrel of oil, approximately.
of course the costs of mining one btc cannot be broken down like that and the costs of producing one barrel of oil cannot actually be determined what with all the government intervention in oil markets...but it would be a good thought experiment nonetheless.
You mean basically seeing which one is more profitable? I've got to think that oil would be, just because while the barrel of oil may be $100 or whatever, the cost once it's been refined has a much higher profit margin.
mmm, I see what you mean. The concept of virtual vs. actual, or the fact that while oil has a true usability (in that it runs vehicles and such) BTC has an inferred value, in that it is only useful for trade.
Hence, huge volatility.
