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PR. Nothing else. Who wants to pay with Bitcoin when Bitcoin is skyrocketing like crazy?

ringaroundthetx 9y ago
everyone that pays with bitcoin now that everything is cheaper? yeah it goes counter to all of the anti-deflationary schools of economics, but when have economists ever gotten actual human behavior right?
- thinbeige 9y ago
  Nobody does. And this is the problem with having no inflation. Every economy needs a slight inflation, otherwise people stop consuming, instead save all their money and it gets worse => deflation. Bitcoin equals gold, nobody uses Bitcoin to consume anything. I don't know which human behavior you refer to.
  - DINKDINK 9y ago
    Your argument is: "Why would anyone spend any money if it's worth tomorrow?!" to support a pro-inflation argument The counterargument / parallel reality in an inflationary world is: "Why would anyone accept any money if it's worth less tomorrow?!" The only difference between the two paradigms is that in the later, the currency creators have the power and in the former, the currency owners have the power. It is no coincidence that the financial institution has chosen to be in control of inflation and extract the wealth first, via seignorage, of currency inflation.
    - dmoy 9y ago
      > Why would anyone accept any money if it's worth less tomorrow I mean they sort of don't, in the case of rapid inflation. See e.g. Brazil decades ago, with payment delays abound all over. But that's not what we're talking about for a healthy economy, with a relatively small steady inflation rate. Very different.
  - icebraining 9y ago
    Every economy needs a slight inflation, otherwise people stop consuming, instead save all their money and it gets worse => deflation. That's the claim, where's the evidence?
  - ringaroundthetx 9y ago
    Meanwhile the bitcoin transaction bandwidth is at max capacity and is frequently at max capacity as the price rises. People are transacting, and its not all to exchanges.
wyager 9y ago
That's not how this works at all. The current price of Bitcoin is the market's best prediction of the present value of holding a bitcoin. When you spend $20 worth of bitcoin, you lose an expected $20 worth of utility from holding bitcoin (and, presumably, gain at least $20 of expected subjective utility from whatever you're buying). The past price of Bitcoin has no bearing on a rational actor's willingness to use it as a medium of exchange.
icebraining 9y ago
Why would you pay with dollars when you could buy Bitcoin with those dollars instead?
- dmoy 9y ago
  Two reasons: 1) Because I need to buy things with dollars to a) not starve, freeze, etc. b) not get thrown in jail for tax evasion and 2) because I'm not comfortable with that level of investment risk, and prefer a more diversified approach of mutual funds, bonds, and real estate.
  - icebraining 9y ago
    1) We're talking about paying for ProtonMail. This is implied by the context in both mine and the parent's post. 2) Exactly! And despite not being comfortable with Bitcoin as an investment, you may very well prefer it over the short term as a payment mechanism.
blunte 9y ago
If the value of bitcoin goes up relative to the local currency (CHF, EUR, USD), then when you pay next month, the amount of BTC you'll need to pay will be lower. They are going to charge you whatever amount of bitcoin gives them X CHF per month. If bitcoin doubles in value relative to CHF, then next month you'll probably be asked to pay half as much bitcoin. This is no different than if you were buying service from a foreign company, and that company charged you in their local currency. You would have to pay the current equivalent in your local currency. Sometimes you would pay more than last month, sometimes less.

everyone that pays with bitcoin now that everything is cheaper? yeah it goes counter to all of the anti-deflationary schools of economics, but when have economists ever gotten actual human behavior right?

thinbeige 9y ago
Nobody does. And this is the problem with having no inflation. Every economy needs a slight inflation, otherwise people stop consuming, instead save all their money and it gets worse => deflation. Bitcoin equals gold, nobody uses Bitcoin to consume anything. I don't know which human behavior you refer to.
- DINKDINK 9y ago
  Your argument is: "Why would anyone spend any money if it's worth tomorrow?!" to support a pro-inflation argument The counterargument / parallel reality in an inflationary world is: "Why would anyone accept any money if it's worth less tomorrow?!" The only difference between the two paradigms is that in the later, the currency creators have the power and in the former, the currency owners have the power. It is no coincidence that the financial institution has chosen to be in control of inflation and extract the wealth first, via seignorage, of currency inflation.
  - dmoy 9y ago
    > Why would anyone accept any money if it's worth less tomorrow I mean they sort of don't, in the case of rapid inflation. See e.g. Brazil decades ago, with payment delays abound all over. But that's not what we're talking about for a healthy economy, with a relatively small steady inflation rate. Very different.
- icebraining 9y ago
  Every economy needs a slight inflation, otherwise people stop consuming, instead save all their money and it gets worse => deflation. That's the claim, where's the evidence?
- ringaroundthetx 9y ago
  Meanwhile the bitcoin transaction bandwidth is at max capacity and is frequently at max capacity as the price rises. People are transacting, and its not all to exchanges.

wyager 9y ago

That's not how this works at all. The current price of Bitcoin is the market's best prediction of the present value of holding a bitcoin. When you spend $20 worth of bitcoin, you lose an expected $20 worth of utility from holding bitcoin (and, presumably, gain at least $20 of expected subjective utility from whatever you're buying). The past price of Bitcoin has no bearing on a rational actor's willingness to use it as a medium of exchange.

icebraining 9y ago

Why would you pay with dollars when you could buy Bitcoin with those dollars instead?

dmoy 9y ago
Two reasons: 1) Because I need to buy things with dollars to a) not starve, freeze, etc. b) not get thrown in jail for tax evasion and 2) because I'm not comfortable with that level of investment risk, and prefer a more diversified approach of mutual funds, bonds, and real estate.
- icebraining 9y ago
  1) We're talking about paying for ProtonMail. This is implied by the context in both mine and the parent's post. 2) Exactly! And despite not being comfortable with Bitcoin as an investment, you may very well prefer it over the short term as a payment mechanism.

blunte 9y ago

If the value of bitcoin goes up relative to the local currency (CHF, EUR, USD), then when you pay next month, the amount of BTC you'll need to pay will be lower. They are going to charge you whatever amount of bitcoin gives them X CHF per month. If bitcoin doubles in value relative to CHF, then next month you'll probably be asked to pay half as much bitcoin. This is no different than if you were buying service from a foreign company, and that company charged you in their local currency. You would have to pay the current equivalent in your local currency. Sometimes you would pay more than last month, sometimes less.