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BTC better as a commodity, or currency?

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It’s quite clear that bitcoin is great as tool for financial speculation- and hence a valuable commodity profit-seeking traders eager to give up a little security for large gain. Bitcoin has gained an epithet of the best performing currency - and while there is some doubt that it will ever reach the propheted 100k USD-- its performance as of late has been enough to keep people guessing endlessly.

However -- just how does BTC compare to a traditional currency -- and does it have what it takes to be an internationally accepted container of value?
Bitcoin’s success as a commodity is (to some extent) incompatible with its success as a currency.  A commodity's success is relative to its return as measured against the rate of return of a low risk asset. This way, as the price goes up, holders of said commodity benefit.

With currencies it is a stark contrast -- the metrics which are used to measure success are quite different. A currency's widespread acceptance is no good if it cannot buy truly needful things. For example, the success of the dollar as a currency is not measured in how much it trades for against the Euro, but rather what users can buy with it, ie resources - and which markets are trading for it.

While its volatility is certainly a mark against it as a viable global currency, there is one much more barring issue -- the processing power, and subsequent cost in real resources to produce these securities -- and the cost of exchanging them through the blockchain is becoming increasingly expensive. (as seen in the poopy lil graph I found)

if increase in demand for Bitcoins can be correlated with the price then certainly its inverse, that is, the price to send the coins becomes as important.  Will it eventually become the digital gold which is never spent, only hoarded as a commodity by the rich, and the powerful? Ironic that making transactions is the security's most fundamental use of bitcoin, it’s only made more expensive as usage increases, pushing it toward the territory of commodity.

 

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Bitcoin is never going to be a viable currency in my opinion, only as a store of value. Volatile prices, high transaction costs, and long transaction times prevent it from performing as a currency for real world transactions which need to be completed and verified in a matter of seconds not minutes or hours.

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5 minutes ago, echang426 said:

Bitcoin is never going to be a viable currency in my opinion, only as a store of value. Volatile prices, high transaction costs, and long transaction times prevent it from performing as a currency for real world transactions which need to be completed and verified in a matter of seconds not minutes or hours.

I really tend to agree with this.  Unless someone comes up with a way to make the transaction fees low and fixed, or close to it (and I am not sure how this would happen), I do not see how it could be adopted as a viable currency.  I'm not going to pay $3-5 for a transaction to buy a gallon of milk and then stand in the market for an hour or more until the transaction confirms.

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On 8/22/2019 at 6:24 AM, BLXN said:

It’s quite clear that bitcoin is great as tool for financial speculation- and hence a valuable commodity profit-seeking traders eager to give up a little security for large gain. Bitcoin has gained an epithet of the best performing currency - and while there is some doubt that it will ever reach the propheted 100k USD-- its performance as of late has been enough to keep people guessing endlessly.

However -- just how does BTC compare to a traditional currency -- and does it have what it takes to be an internationally accepted container of value?
Bitcoin’s success as a commodity is (to some extent) incompatible with its success as a currency.  A commodity's success is relative to its return as measured against the rate of return of a low risk asset. This way, as the price goes up, holders of said commodity benefit.

With currencies it is a stark contrast -- the metrics which are used to measure success are quite different. A currency's widespread acceptance is no good if it cannot buy truly needful things. For example, the success of the dollar as a currency is not measured in how much it trades for against the Euro, but rather what users can buy with it, ie resources - and which markets are trading for it.

While its volatility is certainly a mark against it as a viable global currency, there is one much more barring issue -- the processing power, and subsequent cost in real resources to produce these securities -- and the cost of exchanging them through the blockchain is becoming increasingly expensive. (as seen in the poopy lil graph I found)

if increase in demand for Bitcoins can be correlated with the price then certainly its inverse, that is, the price to send the coins becomes as important.  Will it eventually become the digital gold which is never spent, only hoarded as a commodity by the rich, and the powerful? Ironic that making transactions is the security's most fundamental use of bitcoin, it’s only made more expensive as usage increases, pushing it toward the territory of commodity.

 

image.png

i think it will always still but will never beat dollar, let seee, maybe in the future but not at the moment, dollar makes the world go round.

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Биткойн и криптовалюты, подобные ему, останутся средством спекуляции и ничего более, пока не произойдет лучший прорыв. Ведь есть и положительные стороны - это та же скорость операций.

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I echo some of the opinions in this thread as well, that Bitcoin is hardly viable as a transactional currency (in its current state) and is way more suitable as a store of value (like gold) where there is lesser movement.

What I really want to ask though is apart from Supply & Demand that moves the price, does the actual no. of transactions by users over any time period affect the price in any way?

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On 8/22/2019 at 8:50 AM, echang426 said:

Bitcoin is never going to be a viable currency in my opinion, only as a store of value. Volatile prices, high transaction costs, and long transaction times prevent it from performing as a currency for real world transactions which need to be completed and verified in a matter of seconds not minutes or hours.

I think it's more of a matter of time, and yet Bitcoin is really a viable and very promising thing of the future. Maybe we just need to wait 5-10 years, another question is that I don't quite understand what mechanism we need to move to BTC 2.0

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In my opinion, volatile prices, high transaction costs and long transaction times make it impossible to act as a currency for real-world transactions that need to be completed and verified in seconds, not a few. minutes or hours.

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Bitcoin is both a commodity and a currency. We can sell bitcoin and get something we need, therefore, bitcoin goods. We can also pay with bitcoin for something necessary here, he is in the role of currency. so bitcoin is a commodity and a currency at the same time

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Personally I'd rather see it as a currency because that's what it always has been to me. Even when I was buying drugs with it on SilkRoad in 2014.

It's a currency and I don't really see myself being swayed from that opinion.

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I'll start with a good one. There is one big advantage in Bitcoin - the speed of payments.

Yes, it is the speed. Someone may object: "How so, I pay by card instantly, and then I wait for 20-30-40 minutes for the transaction to hit the block and confirm it.

But everything is not quite so. When you pay by card, the shop agrees to give you the goods "on credit". In Russia he will receive a refund for your goods only on the next working day, and the banks themselves lend to such a shop, as the movement of money in international payment systems is only on the third working day. In Europe, it can be longer - for example, once a week.

You have to admit that 30 minutes and a few days is a significant difference.

The same swift payments take several days. Imagine that you can only ship the goods after you pay the supplier - i.e. you have to cover the cash gap from your pocket. And that's how all modern payment systems work.

As you evolve from a barter economy to increasingly complex money systems, transaction costs and overall handling costs are reduced. The less time we spend on money transfers, the lower the transaction costs. And that's where Bitcoin wins over conventional interaccount transfers.

However, Bitcoin is not a means of payment, and that's why: its main problem is its finitude.

As the economy grows, the money supply should grow.

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I see bitcoin as a currency cause you can buy anything from it. but I think it's hard for them to go out to real world because once the BTC will be approved as a real money every crypto that has a value will try to be approved to because they got no difference from BTC there difference is that BTC got a higher value than them.

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4 hours ago, katkadno said:

Биткойн можно рассматривать только как инвестицию на длительный срок

Почему? Как по мне есть ещё много других вариантов

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On 8/22/2019 at 4:54 AM, BLXN said:

It’s quite clear that bitcoin is great as tool for financial speculation- and hence a valuable commodity profit-seeking traders eager to give up a little security for large gain. Bitcoin has gained an epithet of the best performing currency - and while there is some doubt that it will ever reach the propheted 100k USD-- its performance as of late has been enough to keep people guessing endlessly.

However -- just how does BTC compare to a traditional currency -- and does it have what it takes to be an internationally accepted container of value?
Bitcoin’s success as a commodity is (to some extent) incompatible with its success as a currency.  A commodity's success is relative to its return as measured against the rate of return of a low risk asset. This way, as the price goes up, holders of said commodity benefit.

With currencies it is a stark contrast -- the metrics which are used to measure success are quite different. A currency's widespread acceptance is no good if it cannot buy truly needful things. For example, the success of the dollar as a currency is not measured in how much it trades for against the Euro, but rather what users can buy with it, ie resources - and which markets are trading for it.

While its volatility is certainly a mark against it as a viable global currency, there is one much more barring issue -- the processing power, and subsequent cost in real resources to produce these securities -- and the cost of exchanging them through the blockchain is becoming increasingly expensive. (as seen in the poopy lil graph I found)

if increase in demand for Bitcoins can be correlated with the price then certainly its inverse, that is, the price to send the coins becomes as important.  Will it eventually become the digital gold which is never spent, only hoarded as a commodity by the rich, and the powerful? Ironic that making transactions is the security's most fundamental use of bitcoin, it’s only made more expensive as usage increases, pushing it toward the territory of commodity.

 

image.png

Hello blxn,
As my opnion, eth will be more safe and highter than btc for this years I think. I just scare to trust bitcoin price, I mean hight is good, but if goes down like last 4 or 5 months. What should we do :( .

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On 8/22/2019 at 5:24 AM, BLXN said:

It’s quite clear that bitcoin is great as tool for financial speculation- and hence a valuable commodity profit-seeking traders eager to give up a little security for large gain. Bitcoin has gained an epithet of the best performing currency - and while there is some doubt that it will ever reach the propheted 100k USD-- its performance as of late has been enough to keep people guessing endlessly.

However -- just how does BTC compare to a traditional currency -- and does it have what it takes to be an internationally accepted container of value?
Bitcoin’s success as a commodity is (to some extent) incompatible with its success as a currency.  A commodity's success is relative to its return as measured against the rate of return of a low risk asset. This way, as the price goes up, holders of said commodity benefit.

With currencies it is a stark contrast -- the metrics which are used to measure success are quite different. A currency's widespread acceptance is no good if it cannot buy truly needful things. For example, the success of the dollar as a currency is not measured in how much it trades for against the Euro, but rather what users can buy with it, ie resources - and which markets are trading for it.

While its volatility is certainly a mark against it as a viable global currency, there is one much more barring issue -- the processing power, and subsequent cost in real resources to produce these securities -- and the cost of exchanging them through the blockchain is becoming increasingly expensive. (as seen in the poopy lil graph I found)

if increase in demand for Bitcoins can be correlated with the price then certainly its inverse, that is, the price to send the coins becomes as important.  Will it eventually become the digital gold which is never spent, only hoarded as a commodity by the rich, and the powerful? Ironic that making transactions is the security's most fundamental use of bitcoin, it’s only made more expensive as usage increases, pushing it toward the territory of commodity.

 

image.png

"However -- just how does BTC compare to a traditional currency -- and does it have what it takes to be an internationally accepted container of value?
Bitcoin’s success as a commodity is (to some extent) incompatible with its success as a currency.  A commodity's success is relative to its return as measured against the rate of return of a low risk asset. This way, as the price goes up, holders of said commodity benefit."

I like on your statement above mate. As we know bitcoin function for digital currency payment in a whole world is not argued anymore. Bitcoin payment is  new life style online payment. There a prove if bitcoin as a major cryptocurrency beside fiat which determine global economic, a problem is if bitcoin not yet legals aswell. I think bitcoin the best is for main comodities in cryptocurrencies. Valuable and tradeable.

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On 9/17/2019 at 2:14 PM, Germaniv said:

 

 

Too much money is pouring into bitcoins. Therefore, he will live a long time. And it does not matter whether it is a product or a financial instrument. Its price will be only growth.

Edited by nvz2010

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