Re: Why does acceptance of Bitcoin has to do with the price of Bitcoin?

The more merchants = more btc flowing = stronger economy.

Price will increase if demand increases more than supply. To make that happen, people has to be interested to buy bitcoin for whatever reason. It may be for privacy, it may be to save in a non inflationary currency, it may be because there are merchants willing to sell their products for a discount with bitcoins... So yes, it's essential that more merchant accept them, but that's just one of the reasons to want to have bitcoins.

The main reason why investors and speculators are buying bitcoin is because they are hoping that a lot of consumers will eventually buy it for the purpose of spending it on goods and services. This is ultimately what will be the demand for bitcoin in the long run (if it is to be successful). Bitcoin is not an income generating asset so investors will buy it for no reason other then hoping for price appreciation, however if the only reason anyone buys an asset is because they hope the price will increase then it is nothing more then a bubble.

We need bitcoin banks, to get interest on our bitcoins. Grin

In order for a bank to potentially offer interest on deposits they would need to also lend out depositors' money and run on a fractional reserve system. If I knew how people on this forum feel about sites running on a fractional reserve (and I do), then I would say that this idea would not be taken very well.