When I first discovered bitcoin back in 2011, I was very excited about it and was telling everyone to check it out.
http://arimaa.com/arimaa/forum/cgi/YaBB.cgi?board=other;action=display;num=1305495730
At the time I had been studying money for a couple of years and was writing a paper called "Sound Money Without Commodities", so I really appreciated what bitcoin was doing. I even mentioned bitcoin in an early version of the paper.
http://arimaa.com/money/SoundMoneyWCOrig.pdfAlthough bitcoin has many good properties, I was more interested in a currency which would be very stable and could be used to price other goods and services. A currency that could be used for purchases on a daily basis. It seemed that the limited amount of bitcoin would cause it to behave much more like a digital commodity rather than a stable currency. It would not be accepted by many merchants unless they could convert it quickly to a fiat currency.
So far that has proven to be true. Major merchants that accept bitcoin use a processor that can convert it for them. We know that bitcoin is currently being used mostly as a store of value and hedge against national currencies; similar to gold, but with much better properties. That's an awesome use case and that alone can lead to valuations of trillions of dollars for bitcoin.
But will bitcoin ever succeed at being used as a stable currency? I've been told many times that when bitcoin matures to the point that everyone knows about bitcoin and owns some the price will stabilize and it can serve as a currency that is stable enough to be used for daily transactions; assuming that scaling to handle millions of transactions per second is not an issue. I still think that the price of bitcoin will be volatile even at this stage, purely due to speculation and the limited quantity. I also think that the world will need another currency that is stable by design. I've written this paper to capture some of the key features of such a currency. It would be based on UBI and demurrage and would be fair to everyone regardless of when they discover it.
http://arimaa.com/money/GETCoin.pdfDo you think there is room for another currency to provide the use case for daily transactions; or will bitcoin eventually succeed at this? If you think bitcoin will succeed, how long do you think it will take?
BTW, if you are interested to help with GETCoin, please PM me.
This has been the questions of every crypto users right from the beginning. Although, bitcoin is being accepted by some merchants as a means of payment, it cannot be generally considered a currency.
The price of bitcoin is currently very volatile and as such is very difficult for the evaluation of goods and services. I, however, believe when gets adopted to an extent and is valued at certain price, it will become stable and then can be used. No matter what the price is then, the equivalence of goods and services will be found using the unit of bitcoin, Satoshi