Topic: Why does acceptance of Bitcoin has to do with the price of Bitcoin? (Read 6283 times)

Maybe because, the higher the demand/acceptance, the higher the price. 

It can have full reserves.

In order for a bank to potentially offer interest on deposits they would need to also lend out depositors' money and run on a fractional reserve system. If I knew how people on this forum feel about sites running on a fractional reserve (and I do), then I would say that this idea would not be taken very well.

While accepting bitcoin people have to convert it to fiats to accept.Say you bought a burger at a food truck for $5 then you are paying the bitcoin equivalent to $5 not really paying bitcoin

Correct, but you have to make sure the bank is good, there will be no bailouts.

Demand can also come from people that want to save in bitcoins, not only from people that want to spend them. Gold isn't valuable because people spend it on goods and services, but because it's considered as a store of value by enough people.



For the moment you can directly invest in some places, like Bitfinex or Dicebitcoin. But we'll have bitcoin banks for sure in the future, and also stock exchanges to facilitate direct investing (well, we already have the Nxt asset exchange).

We need bitcoin banks, to get interest on our bitcoins. 

The main reason why investors and speculators are buying bitcoin is because they are hoping that a lot of consumers will eventually buy it for the purpose of spending it on goods and services. This is ultimately what will be the demand for bitcoin in the long run (if it is to be successful). Bitcoin is not an income generating asset so investors will buy it for no reason other then hoping for price appreciation, however if the only reason anyone buys an asset is because they hope the price will increase then it is nothing more then a bubble.

Yes, it does need an explanation. In fact, in real life there are a multitude of factors that can not only render this declared dependence not so direct but could even make it inverse as we probably see right now. The possible reasons for this have been explained before...

More the people use the bitcoin in their daily life more the value of it increases.That's doesn't need a explanation does it??Literally they are directly proportional to each other.

Price will increase if demand increases more than supply. To make that happen, people has to be interested to buy bitcoin for whatever reason. It may be for privacy, it may be to save in a non inflationary currency, it may be because there are merchants willing to sell their products for a discount with bitcoins... So yes, it's essential that more merchant accept them, but that's just one of the reasons to want to have bitcoins.

The fact that you need to scan your ID at a BTC ATM is due to the fact that there are AML rules in place that need to be followed by ATM operators, as they are likely a MSB. I think that how "cool" something is will have little to do with overall acceptance but rather the ease of use and the economics of using bitcoin will influence people much more.

There's definitely a lot of off-market transactions occurring. Obviously brokers know that buying/selling big blocks would offset the market and create too much volatility. Barry Silbert's Bitcoin Investment Trust and the hedge fund Binary Financial have acknowledged publicly that they do it. I wouldn't be surprised if Pantera Capital and GABI have been making off market trades on behalf of their high end clients like family practices, private equity firms and fund managers. This is the business. The trading on the exchanges are for the kids. Once the money cap is large enough those transactions will occur more regularly on the exchanges.

I believe the price of bitcoin is far behind the product & infrastructure development (e.g. Circle, Bitpay, XAPO, Coinbase, Bitgo, Moneero). Though there is no direct correlation, the increasing hash rate indicates a great of activity. The increasing difficulty level should also play a critical factor too - more prominently when bitcoin approaches halving. The VCs and entrepreneurs are in it for the long haul regardless of the day-to-day price. Personally, I would love to see a rally just to remind people how explosive bitcoin is. The price is a nice feature to increase greater adoption among speculators.

Bottom line: like everyone else, we have to wait and see and allow the market to play itself out. Long term, the bitcoin bulls know this is a once in a generation technology therefore a once in a lifetime investment opportunity. To each his own.

Now I'm very doubtful about this (I mean Bitcoin universal acceptance). Actually, I couldn't say that it is significantly more widely acceptedtoday than it was a year ago. I think one year is enough to come to a (preliminary) conclusion. Also, I think that after the Cyprus financial disaster (first half of 2013) everyone who is connected to finances in some way is aware of the technology, so you won't get away by the argument that it needs more publicity...

We need to fix these god damn pesky ATM machines first. BTC should be cooler to use, none of that ID scan bullshit man.

Wider acceptance would not have an immediate effect, but is expected to result in a price increase in the long term. Of course, no rational person would expect it to go to a million dollars.

The more merchants =  more btc flowing = stronger economy.

People that are saying bitcoin is going to reach a million dollars are not realistic and do not understand economics. Over the long term, the net effect of higher adoption will increase the value of bitcoin as people will buy more bitcoin then they spend causing a net spending effect on the market. Over the short term, more merchants accepting bitcoin for payment will likely have a negative effect on prices because it will likely entice people to sell bitcoin (via buying products) that would not have otherwise sold bitcoin.

As I said before, it is not given. And the dynamics of the Bitcoin exchange rate as of recent confirms that. So all expectations that the wider acceptance would unconditionally bring about the higher value may ultimately turn out a bit exaggerated (let alone hopes for a million dollars per coin)...

the point is that more people using it mean more volume mean a better value