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Generally no, it's why one half of the Federal Reserve's mandate is price stability. Wildly fluctuating prices make it very difficult for businesses to plan ex
by SkyMarshal 14y ago
Generally no, it's why one half of the Federal Reserve's mandate is price stability. Wildly fluctuating prices make it very difficult for businesses to plan expenditures - hiring, production levels, R&D, etc., resulting in more conservative spending and investment.
But bitcoin is still new, not fully understood, in limited supply, relatively illiquid (compared to other currencies and financial assets), and coming onto the scene right in the middle of a banking system and sovereign debt crisis unlike anything ever seen and most of its early adopters see it as a hedge against that.
So, volatility is going to be norm for bitcoin's foreseeable future.
- tptacek 14y agoDo you really believe "most of Bitcoin's early adopters" see it as a hedge against monetary crises? I know some fairly successful Bitcoin speculators, and none of them see it as anything other than a way to make a quick buck.
- SkyMarshal 14y agoProbably shouldn't have used 'most', since I haven't done a survey or anything. But from reading the bitcointalk forums the past year, there's a clear contingent of people who believe money should be deflationary and see btc as an option for hedging against possible dollar hyperinflation. Many of them also tend to be gold bugs and sound money types as well, and btc is just another basket for some of their eggs.