What Holliday said.
My view is that the more bitcoin is current in the ordinary economy - buying things such as tomatoes and land - the less volatile it shall become.
Topic: volatility, can it really be overcome? - page 2. (Read 4080 times)
Maybe, but not for now. The volatility comes from uncertainty. A much bigger problem are possible statistical third moments (volatility is 2nd derivative of price), i.e. tails, which are not even in the historic data set. It can't be ruled out that bitcoin drops by say 90% in a day.
In the end low volatility would mean that the price increase is limited. There are theoretically possibilities of pegging, but I don't think there is any progress in this direction.
In the end low volatility would mean that the price increase is limited. There are theoretically possibilities of pegging, but I don't think there is any progress in this direction.
If we get more institutional investors, then I think the Bitcoin exchange rates will stabilize. Short selling is causing the volatility. Need to clamp down on it. 
It's hard for people to say with certain that bitcoin won't continue to be heavy speculative. But the general assumption seems to be as the market grows it becomes harder and harder for people to manipulate it and things stabilize.
There's already some solutions/options for merchants who accept bitcoin that reduce the risk of volatility and that area continues to improve. So I'm not too worried about that.
There's already some solutions/options for merchants who accept bitcoin that reduce the risk of volatility and that area continues to improve. So I'm not too worried about that.
Every cryptocurrency has an intrinsic volatility at this moment as every chart out there clearly shows.
As you all know this can affect their widespread adoption in online retail in a negative way (it's a bit hard to pay suppliers next month if your income halved in value yesterday imho), my question is, what solution can there be?
State currencies remain stable thanks to a regulated environment, do you think there is any other solution, different from a state regulated context, to this pivotal problem?
I don't believe that any currency will just go on and "stabilize itself" as long as speculators and traders exist..
are crypto destined to be commodities?
As you all know this can affect their widespread adoption in online retail in a negative way (it's a bit hard to pay suppliers next month if your income halved in value yesterday imho), my question is, what solution can there be?
State currencies remain stable thanks to a regulated environment, do you think there is any other solution, different from a state regulated context, to this pivotal problem?
I don't believe that any currency will just go on and "stabilize itself" as long as speculators and traders exist..
are crypto destined to be commodities?
Volatility is natural with new currencies. Hopefully it'll stabilise in the future, but it's still early days for Bitcoin.
A couple good recent articles on the volatility subject:
http://garzikrants.blogspot.ca/2013/11/solution-to-bitcoin-volatility.html
http://www.washingtonpost.com/blogs/the-switch/wp/2013/12/09/heres-why-volatility-isnt-a-big-problem-for-bitcoin/
http://garzikrants.blogspot.ca/2013/11/solution-to-bitcoin-volatility.html
http://www.washingtonpost.com/blogs/the-switch/wp/2013/12/09/heres-why-volatility-isnt-a-big-problem-for-bitcoin/
I can't open the washingtonpost link but I had a look at Jeff Garzik's article and it's very good.
The idea of creating a currency which reacts to bubbles is interesting but at the same time it cannot be used with PoW hence bitcoin.
I don't understand this "volatility issue" with bitcoin, merchants can use services like bitpay to attract more buyer and cash out to FIAT instantly.
why don't try?
A couple good recent articles on the volatility subject:
http://garzikrants.blogspot.ca/2013/11/solution-to-bitcoin-volatility.html
http://www.washingtonpost.com/blogs/the-switch/wp/2013/12/09/heres-why-volatility-isnt-a-big-problem-for-bitcoin/
http://garzikrants.blogspot.ca/2013/11/solution-to-bitcoin-volatility.html
http://www.washingtonpost.com/blogs/the-switch/wp/2013/12/09/heres-why-volatility-isnt-a-big-problem-for-bitcoin/
The jury is still out on where it all goes; but for now, in every cryptocoin system to date, speculators have vastly outnumbered those who would actually use the instrument as a currency in the long run. Too many look upon cryptocoins merely as platforms for get-rich-quick schemes, and these holders are quite content to turn cryptocurrencies into digital tulips. In theory, volatility should decrease over a long time, but that may be a very long time, and in the meantime, legitimate adopters (who are the very ones who would stabilize the system) are inhibited from entering. A next-generation cryptocurrency might contain code that would respond to bubble conditions by flooding the system with extra units and to crashes by withdrawing units as needed; but no such thing has been created to date. More user-friendly software that the average person can comfortably and conveniently use would help, too. Some progress on that front is being made, but it is still slow.
Every cryptocurrency has an intrinsic volatility at this moment as every chart out there clearly shows.
As you all know this can affect their widespread adoption in online retail in a negative way (it's a bit hard to pay suppliers next month if your income halved in value yesterday imho), my question is, what solution can there be?
State currencies remain stable thanks to a regulated environment, do you think there is any other solution, different from a state regulated context, to this pivotal problem?
I don't believe that any currency will just go on and "stabilize itself" as long as speculators and traders exist..
are crypto destined to be commodities?
As you all know this can affect their widespread adoption in online retail in a negative way (it's a bit hard to pay suppliers next month if your income halved in value yesterday imho), my question is, what solution can there be?
State currencies remain stable thanks to a regulated environment, do you think there is any other solution, different from a state regulated context, to this pivotal problem?
I don't believe that any currency will just go on and "stabilize itself" as long as speculators and traders exist..
are crypto destined to be commodities?
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