Post
Topic
Board Bitcoin Discussion
Re: Bot to operate a price bloc to stabilize price of BitCoins
by
Deprived
on 28/08/2011, 23:42:33 UTC
Before proposing a solution, maybe you should go back a step and define the following:

What is the problem you are trying to solve?

Then look at your solution and determine:

1.  Does it solve the problem?
2.  What's the cost of that solution?
3.  Is 2 worth the benefits of 1.?

Until you can answer those questions there's no real point looking at the details of implementing your solution as it may either:

1.  Not solve the problem.
2.  Solve a problem that isn't really a problem anyway.
3.  Cost so much to implement (in terms of opportunity cost and risk) that it's not worth doing anyway.

You appear to be proposing either setting a minimum price on BTC (in $) (what your solution would achieve) OR pegging the BTC vs the US$ in a narrow range (what you talk about wanting to achieve).  I'm not seeing how either of those is desirable.

I already discussed your apparent confusion between price and value in the newbie forum - so I'll ignore that for now.  But here's a few questions for you:

What is the benefit of artifically trying to peg the BTC to the US$?
Do you not accept that the BTC should have its own value (and price) rather than being pegged to the US$?
If the US$ falls dramatically vs other fiat currencies is it really your belief that people using those other fiat currencies should also see a fall in the value of their BTC (expressed in their local currency)?  And vice-versa of course.
Are you by any chance someone with a ton of early-mined BTC who would love a minimum sell price set so you could dump all your BTC at a fixed price?

I don't believe the instability of the exchange-value of the BTC is best addressed by trying to price-fix it.  The right solution is for non-speculative use of BTC to increase so that the majority of BTC use (and hence it's perceived value and price) is no longer driven by speculation/hoarding.