Bitcoin volatility is the result of thin order books. Look at http://bitcoinity.org/markets/bitstamp/USD http://bitcoinity.org/markets/bitstamp/USD: you can mov

Bitcoin volatility is the result of thin order books. Look at http://bitcoinity.org/markets/bitstamp/USD http://bitcoinity.org/markets/bitstamp/USD: you can move the market by 10%+ with "just" a few million dollars. You can't move the market for Euros or Yen with that much money. In a bitcoin success scenario, this will change once bitcoin is no longer the sole domain of currency speculators, but starts seeing actual commerce. Some places where this could start: 1) International remittance. Wire transfers are slow and expensive. Bitcoin could make moving money internationall much easier. See, for example, YC-backed "Buttercoin": http://techcrunch.com/2013/08/20/buttercoin/ http://techcrunch.com/2013/08/20/buttercoin/ 2) Merchant adoption. Credit card fees for online commerce are in the 2-3% + $.35 range. Bitpay currently offers 0% fees, instead charging a flat $30/month: https://bitpay.com/pricing https://bitpay.com/pricing 3) Micropayments: The "+ $.35" part of credit card fees precludes micropayments. Bitcoin could be used for things like pay-per-minute streaming. Once these types of things start adding volume and depth to the exchanges, it will be harder to move the market, and that will add stability. Obviously, this will take a few years.