Topic: What is really backing the price? - page 2. (Read 3148 times)

What's backing any other currency? The dollar is no longer backed by gold, and what was gold backed by anyway?

A currency is only as valuable as the value people place in it ie: Confidence, and also utility. Bitcoin's got a lot of people who are confident in its future, using it to buy / sell things, and trading / investing in it, so there's your price.

But who cares? The source code is open so it doesn't even matter if Satoshi = NSA/CIA/Rothschild/Bilderberger/Zionist/etc. Oh the irony.

where's #5? you missed the US gvt investing and NSA and CIA mainframes mining bitcoin to pay us debt. 

That wasn't the question.  The question was what's backing the price?  Bitcoin is regulated by the protocol so it's regulated too.

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Fiat has government regulating it
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"Regulating"

Fiat has government regulating it

I believe a big proportion of price is just hype or you can say "idea itself".

So same as any other currency.

Just hype and speculation.

Bitcoin is the fastest and cheapest means to do international value transfer.  In a time when governments are restricting people's ability to transact, an uncensorable transfer mechanism is quite valuable, even before it beats the banks on fees and speed.

Is BTC new world order currency?

so lets work on :

3) Business models using BTC

When bitcoin is actually adopted in a significant way, as a store of value, means of transacting etc etc etc.

I guess every economy in the world is backing bitcoin.

I think it's pretty obvious to quite a few experienced traders out there. Like ALL financial assets, its market is "made" by someone. All big holders of any asset type are strongly motivated to do this.... and bitcoin shows no sign of being any different. So the big question is.... what is the market maker's game plan?

1) Black markets

Many people claim the shutdown of SR and the following quick recovery of the price is proving that the black market cannot be very significant in terms of bitcoin demand.

It is indeed a good signal for the public, emotionally detaching bitcoin from illegal things.

In reality, i know the volume of black market activity has not decreased. There are 2 marketplaces which have absorbed vendors and customers from SR.
I guess the shutdown of SR made the black market even bigger.

So, in the eyes of the public the evil side of bitcoin has gone, but the demand for bitcoins for blackmarket activities has definitely not decreased.
We still do not know how much this contributes to the price, do we?



2) The miners

They have invested and they are keen to regain their investment. This is the most solid factor in my opinion.
They have to invest even more over time be able to do that.



3) Business models using BTC

Can anyone estimate the real volume they generate?
I find it hard to estimate how serious this factor really is, as it is very easy to send BTC from one wallet to another thus being able to create any numbers you like and showing them off as your "cashflow"

What I'm trying to say is without some form of control we don't even know how much volume/demand the legal BTC businesses are generating.
Fraud/reporting false numbers seems to be much easier with BTC.


4) The speculators/investors

you know who you are and what you do



So.. we do not know how much the black market contributes.
We also do not know how much the legal businesses contribute. (I guess it's less than the illegal ones do)

I just compiled my thoughts on the topic here. Trying to be curious, not bearish or bullish.

Please share your opinions on what's backing up the price right now.