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Bitcoins are just a right to participate in a digital crypto economy. They don't have any value in themselves. Its like holding passes to a show in the big thea

Bitcoins are just a right to participate in a digital crypto economy. They don't have any value in themselves. Its like holding passes to a show in the big theater. If the show doesn't start you passes are worthless. If there is any meaningful possibility of a show in the theater, you might get lucky for holding those passes. The main problem is that people who will participate in the show also need to get the passes to actually act out the show but if everyone just keep holding their passes for no good reason, well then there may not be a show. From many bitcoins forums, people are hoping that its USD rate climb to $1000 or even $1 million, which is pretty ridiculous. People who have thousands of bitcoins, can probably keep holding on to them after selling 50% of them. But people who gonna buy it for more than $100 , they gonna panic at a first sign of decline. I suspect its not that far off.

vacri 14y ago
Isn't that the same as a dollar bill?
- 31reasons 14y ago
  Yes, but dollar bill is running a successful show for the last 2 hundred years without any blackouts, while BitCoin need to START the show in the first place. It needs to sort of start a sustainable chain reaction. EDIT: But the bitcoin deflation has introduced so much resistance to this reaction. Each digital wallet is like an atom, there has to be some force to break the atom and keep the chain reaction going, but due to the deflation, each atom is requiring more and more energy to break (spend bitcoins).
wyager 14y ago
>people are hoping that its USD rate climb to $1000 or even $1 million, which is pretty ridiculous. Is it really? Not too long ago, a Bitcoin was worth about $.0007. 130/.0007 = 185714 It's only four more orders of magnitude to get to the $1M range. I don't think it's going to happen, but it's not all that far-fetched.
- colwem 14y ago
  Well right now the entire bitcoin economy is valued at $1.6B so if a bitcoin rises to $1M the bitcoin economy would reach $12.3T . I'm no economist but that seems like it might be an unrealistically huge percentage of the world economy. I really don't think there's enough investable money in the world to get there.
  - wyager 14y ago
    It's true, 12.3T represents a large portion of the world money supply. But not an insurmountably large portion.
  - icebraining 14y ago
    Actually a bit more, since more coins will be mined until then.
    - davidjohnstone 14y ago
      There are about 11 million Bitcoins in existence now[1], so if they were worth one million dollars each, the Bitcoin economy would be worth 11 trillion dollars now. We're already halfway through mining all the Bitcoins that will ever be mined, so that doesn't affect the numbers massively (it'll be a 21 trillion dollar economy). Apparently[2] there are about ten trillion US dollars in existence, and I'm not enough of a Bitcoin believer to expect the Bitcoin economy to approach that amount. 1. http://bitcoinwatch.com/ http://bitcoinwatch.com/ 2. http://money.howstuffworks.com/how-much-money-is-in-the-world.htm http://money.howstuffworks.com/how-much-money-is-in-the-worl...
      - EwanToo 14y ago
        I hadn't really considered the limits of bitcoin prices in this way, it's a great way to explain the "Why not?" about future price rises!
  - genwin 14y ago
    The price of a Bitcoin can rise regardless of investment in it. For example if the US pulled a Cyprus-like move, Bitcoin could triple instantly.
etherael 14y ago
Serious question, why does the price of a single bitcoin matter when they're divisible to 8 decimal places? Beyond a psychological barrier people have thinking about the 1:100 thing, it's really irrelevant if your cup of coffee costs 10 bitcoins or 0.00001 bitcoins, especially if the calculation is made at the time of purchase relative to an underlying stable value like a basket of the largest fiat currencies in circulation or somesuch, or just the boring plain old USD. 1 BTC = 1000000 USD To put it in a less psychologically alarming way is exactly the same as saying 1 Satoshi = 0.01 USD.
- zanny 14y ago
  People have been measuring the value of a BTC by its whole value until now because it was relative to fiat currencies in whole dollars that way. If BTC was ever worth a million USD, they would probably be talking in Satoshis. It isn't any more complicated than thinking of the difference between $1 and 0.01 cent.
- T-hawk 14y ago
  It doesn't matter, mathematically. Psychologically, it absolutely does. Bitcoin running to $150 is way more splashy and headline-grabby than $15. And at Bitcoin's beginning, it looked more respectable in gaining followers when 1 BTC was somewhere near $1 than if it were $0.01 and looking like some penny-stock scam. Same goes for stock prices. Apple and Google have let the shares run to $400 and $700 instead of splitting to a more industry-standard two-digit number. Of coures the per-share price is meaningless in itself, it'd be the same if ten times as many shares existed at one-tenth the price. But it's a lot easier to grab eyeballs with a stock shooting through $400, $500, $600 benchmarks than a pedestrian $50.
adaml_623 14y ago
That is a really good point. Bitcoin "inflation" will stifle the Bitcoin economy. Because if you are holding Bc then prices on everything are dropping. This effect of deflation is why Japanese economy is so broken. And why Governments and central banks will do almost anything to keep inflation going.
- Frozenlock 14y ago
  Tom Woods on sound money: https://www.youtube.com/watch?v=TnS2OtzSTq0&feature=youtu.be&t=28m26s https://www.youtube.com/watch?v=TnS2OtzSTq0&feature=yout...

vacri 14y ago

Isn't that the same as a dollar bill?

31reasons 14y ago
Yes, but dollar bill is running a successful show for the last 2 hundred years without any blackouts, while BitCoin need to START the show in the first place. It needs to sort of start a sustainable chain reaction. EDIT: But the bitcoin deflation has introduced so much resistance to this reaction. Each digital wallet is like an atom, there has to be some force to break the atom and keep the chain reaction going, but due to the deflation, each atom is requiring more and more energy to break (spend bitcoins).

wyager 14y ago

>people are hoping that its USD rate climb to $1000 or even $1 million, which is pretty ridiculous. Is it really? Not too long ago, a Bitcoin was worth about $.0007. 130/.0007 = 185714 It's only four more orders of magnitude to get to the $1M range. I don't think it's going to happen, but it's not all that far-fetched.

colwem 14y ago
Well right now the entire bitcoin economy is valued at $1.6B so if a bitcoin rises to $1M the bitcoin economy would reach $12.3T . I'm no economist but that seems like it might be an unrealistically huge percentage of the world economy. I really don't think there's enough investable money in the world to get there.
- wyager 14y ago
  It's true, 12.3T represents a large portion of the world money supply. But not an insurmountably large portion.
- icebraining 14y ago
  Actually a bit more, since more coins will be mined until then.
  - davidjohnstone 14y ago
    There are about 11 million Bitcoins in existence now[1], so if they were worth one million dollars each, the Bitcoin economy would be worth 11 trillion dollars now. We're already halfway through mining all the Bitcoins that will ever be mined, so that doesn't affect the numbers massively (it'll be a 21 trillion dollar economy). Apparently[2] there are about ten trillion US dollars in existence, and I'm not enough of a Bitcoin believer to expect the Bitcoin economy to approach that amount. 1. http://bitcoinwatch.com/ http://bitcoinwatch.com/ 2. http://money.howstuffworks.com/how-much-money-is-in-the-world.htm http://money.howstuffworks.com/how-much-money-is-in-the-worl...
    - EwanToo 14y ago
      I hadn't really considered the limits of bitcoin prices in this way, it's a great way to explain the "Why not?" about future price rises!
- genwin 14y ago
  The price of a Bitcoin can rise regardless of investment in it. For example if the US pulled a Cyprus-like move, Bitcoin could triple instantly.

etherael 14y ago

Serious question, why does the price of a single bitcoin matter when they're divisible to 8 decimal places? Beyond a psychological barrier people have thinking about the 1:100 thing, it's really irrelevant if your cup of coffee costs 10 bitcoins or 0.00001 bitcoins, especially if the calculation is made at the time of purchase relative to an underlying stable value like a basket of the largest fiat currencies in circulation or somesuch, or just the boring plain old USD. 1 BTC = 1000000 USD To put it in a less psychologically alarming way is exactly the same as saying 1 Satoshi = 0.01 USD.

zanny 14y ago
People have been measuring the value of a BTC by its whole value until now because it was relative to fiat currencies in whole dollars that way. If BTC was ever worth a million USD, they would probably be talking in Satoshis. It isn't any more complicated than thinking of the difference between $1 and 0.01 cent.
T-hawk 14y ago
It doesn't matter, mathematically. Psychologically, it absolutely does. Bitcoin running to $150 is way more splashy and headline-grabby than $15. And at Bitcoin's beginning, it looked more respectable in gaining followers when 1 BTC was somewhere near $1 than if it were $0.01 and looking like some penny-stock scam. Same goes for stock prices. Apple and Google have let the shares run to $400 and $700 instead of splitting to a more industry-standard two-digit number. Of coures the per-share price is meaningless in itself, it'd be the same if ten times as many shares existed at one-tenth the price. But it's a lot easier to grab eyeballs with a stock shooting through $400, $500, $600 benchmarks than a pedestrian $50.

adaml_623 14y ago

That is a really good point. Bitcoin "inflation" will stifle the Bitcoin economy. Because if you are holding Bc then prices on everything are dropping. This effect of deflation is why Japanese economy is so broken. And why Governments and central banks will do almost anything to keep inflation going.

Frozenlock 14y ago
Tom Woods on sound money: https://www.youtube.com/watch?v=TnS2OtzSTq0&feature=youtu.be&t=28m26s https://www.youtube.com/watch?v=TnS2OtzSTq0&feature=yout...