what does that mean P= (M * V)/T assuming that the velocity will be much lower and transactions much higher then the price will:
a) stay somehow stable if transactions and adoption are almost equal.
b) rise slowly, with no bubbles whatsoever if the adoption is slightly more than the transactions.
c) can even drop a bit if adoption slow down and current holders start using it as a currency
which confirm the theory above "the use of bitcoin will increase 1000x, therefore the price will rise 1000x, I believe the first part, but I don't think the second part follows necessarily", dont you think ?
First of all, you're doing it wrong.
P is not the exchange rate of the currency - it's the price of
good and services.
With M approximately constant, and with V approximately constant, increasing T means that the cost of good and services priced in Bitcoin will fall, a.k.a the purchasing power of a bitcoin has increased.
Velocity would also depend on the application:
Store of value would have a very small velocity. My coins have essentially zero real velocity (moving between my wallets or to an exchange should not count).
Remittance companies could theoretically churn through the same coins over and over again, yielding a high velocity.
As a currency, I would expect velocity to be similar to any other currency.
I don't think we will have an answer until btc has much wider adoption.
