If I ask you how much the BTC is worth right now, what is your reference? What will you base your answer on?
Now, try think outside the box (I know it is impossible, but one may still try) and explain how this works.
So, what makes the value of a BTC any less subjected to the same manipulative forces than fiat currency is subjected to?
Don't get me wrong, I believe bitcoin is a great great tool, but there is misunderstanding about how it compares to fiat as for its market value and its safety* is and I am not the best person to explain it.
*All people don't define safety the same way do they?
I personally believe that offer and demand is the way prices should be determined, and I believe it works as long as "big players" are not manipulating it. The price of a stock, for instance, will gain or loose value depending on how much people seem to value it, or how much people think others value it... see the concept of a Keynesian beauty contest.
However, if a player, such as the US gov gets in and buy an a LOT of ammunition (just an example) then the price of ammunition would go up. Or, it could print (digitize) money and make the value of the dollar decrease. (Also just an example)
While most (correct me if I'm wrong) use major exchanges as a reference for the value of the BTC, those exchanges may decide to hold on to them or basically just decide to charge more for them, therefore increasing its price. Large purchases of bitcoins, particularly through those exchanges, would likely boost the price quickly. On the other hand, if a exchanges were to decide* to stop buying any bitcoins, wouldn't that make the market price drop suddenly? Also, if someone (anyone) holds a lot of bitcoins and would start selling them very quickly, would that not have that same effect.
Note that a decision is usually made in the "light" of something, for example.... I don't know... regulations? (if that's possible)
Food for thought: If price drops suddenly, does that mean that value drops proportionally?
Sure my private key protects my bitcoins and I can store them in my brain, but I would like someone to explain thoughtfully what the difference is, value-wise, between holding bitcoins and holding dollars.
Anyone?