Quote from: Hunterbunter on June 23, 2011, 11:45:05 PM

Quote from: minor_miner on June 23, 2011, 11:25:30 PM

I don't get this one.

We still generate Bitcoins at 50 BTC/Block, which means 300 BTC/hour at the average 6 Blocks/hour.

So how is the BTC supply now connected to the dollar? (non-rethorical question, I'm serious)

I believe he was referring to the creation of BTC being linked to the cost of equipment/electricity in $$. The more expensive it is to mine, the fewer BTCs will be around...although for that to really be correct it can only apply to a particular 2016 block cycle, what with difficultly adjustments and all.

No, I was referring to the textbook definition of supply, which is the function of units offered at a given price. As the price goes up more units are offered.

People also keep thinking that the mined coins are the only supply and that they all go onto an exchange immediately and that they sell regardless of the price. All of these things aren't true. Before Mt. Gox went down, the daily volume was 8 times the mining rate, we all know that miners hoard their btc, and if the market rate goes down, a lot less people would sell. Similarly, if the cost to mine goes up, then the supply curve will move. This is very basic economics.