Every few years I think to myself: here we go again: Bitcoin is doing that thing where the price goes up, news stories get written about how the Bitcoin price is at an all-time high, more people get excited about it because the price is going up, driving it even higher, making more people excited...
... until something bad happens or speculators get bored and decide to cash out and buy something else they think will be The Thing.
I'm thinking that's happening right now. And I think it will happen again in a few years; I'm not sure the Bitcoin price will ever be stable if it just functions as a place to park I-don't-know-what-to-spend-it-on-right-now wealth.
Thirteen years ago, when one BTC was selling for under a dollar, I said:
"There's a small possibility that in 50 years Bitcoin replaces the dollar as the world's reserve currency."
Today I think I'd say "significant possibility." And I think there is a pretty high chance some cryptocurrency or basket of cryptocurrencies replaces the US dollar as the world's reserve currency in the next forty years.
do you think Bitcoin price will ever be stable, if so, what might be the causes. if not, will its volatility prevent it to be the world's reserved currency?
ReplyDeleteI don't think it will ever be 100% stable relative to some broad measure of purchasing power, because I think economic activity will continue to grow but the supply of BTC will not. BTC is destined to be deflationary as long as it is a popular way to park wealth.
ReplyDeleteBut if it is popular enough, it will be stable enough to be the world's reserve currency. After all, the US dollar is not stable either-- it is just more popular and more stable than the alternatives.
If (when?) somebody figures out how to implement a "flatcoin" that is ~100% stable and figures out how to make it popular, that might be an even more attractive reserve currency than deflationary BTC.
Galvin, I have been trying to get a hold of you. Please contact me at Sangiod1@yahoo.com. It is very urgent, that you get a hold of me. Sometimes the truth comes in mysterious ways. But I do need some assistance, in which you may be able to assist.
DeleteI think to be 100% stable (or close to it) and popular, a cryptocurrency should have some kind of rule where the monetary mass can expand according to the number of participants in it, and where new currency units are somehow distributed to all as a universal dividend. More participants = more money creation distributed to all. Fewer participants = slower money growth.
ReplyDeleteThe universal dividend makes lowers the entry barrier for newcomers, while the relative growth % ensures (in theory) that the currency is neither deflationary nor inflationary.
Some people have theorised such a thing under the "relative theory of money".
I really wonder why you have suddenly withdrawn your statement on the Wright signing? Your post is what lead me in the direction. There seems very little info available. How can a signing be faked?
ReplyDeleteAre you still doing the bitcoin faucet? I missed out on that :(
ReplyDeleteHere's for the opportunity.
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Gavin, are you still the same person?
ReplyDeleteIn Bitcoin Cash we can use anyHedge to hedge against any BCH volatility, we can put our savings in gold, silver, fiat currencies or even other cryptocurrencies like BTC/ETH... there will be more options in the future where we can shelter the value of our Bitcoins.
I thought you would be aware of the project you were working on with Satoshi.
Well i don't think that bitcoin can be stable. I am also thinking to work on as on development i am trying to add a new part as but still not able to understand it's criteria that how it works
ReplyDeleteHello Mr Gavin - Given the fact that you were an early bitcoin pioneer and personally interacted with Satoshi I would like to ask... How come you don't contribute to bitcoin anymore on the code side? Did you give up? Did you contribute to BTC what you did at the time and are content with those contributions? I've always viewed you as a benevolent individual and miss the old days where you made great contributions and discussions in the community. I'm happy you are doing well, I have so many questions. Take care!
ReplyDeleteWhy don't I contribute code to bitcoin any more?
ReplyDeleteMostly because I don't want to, and because there are plenty of talented younger coders who do. Bitcoin is doing well without me.
Why don't I want to? I think the type of coding that is best for a trillion-dollar project (extremely careful, slow, layers of review, etc) is too bureaucratic for me. I like shiny new things and I like working on things at the cutting edge.
Have you read the Holochain white paper? They have a “how often do you get the chance to work on a potentially world-changing project” mentality. Mutual credit currencies and an economy not based on scarcity. P2P energy grids, data validation layers at low cost and way more. Holochain is part of a bigger project called Ceptr. It’s truly what the world needs. The use cases are endless. Take a look at it when you have a chance.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteWhat sort of shiny new things on the cutting edge interest you most outside of bitcoin and cryptocurrencies going forward?
ReplyDeleteits cool to read the early blogs on bitcoin you wrote. a nice glimpse of history.
" I like shiny new things and I like working on things at the cutting edge."
ReplyDeleteI might have something then for you.
And it would also fit to the first part of your other statement.
"If (when?) somebody figures out how to implement a "flatcoin" that is ~100% stable and figures out how to make it popular, that might be an even more attractive reserve currency than deflationary BTC."
The 2nd part of this statement "how to make it popular" I have not figured out at all so far because I tend to over-think and over-complicate things and so ruined my launch pretty much - so far. I have published some of the basic concepts in a more "meme" format on solanaland dot org and we would not just have a coin that changes how we live together, how we work, how we eat healthier and create value together but also how we can transform barren lands into permaculture food forests and communities automatically creating value in the process.
Any feedback whatsoever is highly appreciated.
>Thirteen years ago, when one BTC was selling for under a dollar, I said:
ReplyDelete>"There's a small possibility that in 50 years Bitcoin replaces the dollar as the world's reserve currency."
>Today I think I'd say "significant possibility." And I think there is a pretty high chance some cryptocurrency or basket of cryptocurrencies replaces the US dollar as the world's reserve currency in the next forty years.
I have been monitoring bitcoin since 2009. I don't think Bitcoin will replace the U.S. dollar as the world's reserve currency. That is not to say that the U.S. dollar is better. It's not. However, there is, and always will be, non-technical people which is a problem. Until getting a wallet, swapping fiat for crypto and sending/receiving crypto becomes significantly easier for these non-technical people to do, it will not become ubiquitous. It is currently too complicated for the average person to start using. If I give a child a dollar, they don't need to know how to use it, they just need to know how to count. Crypto requires that you learn how to use technology (computer, mobile device, etc.). One mistake sending your crypto somewhere, and it's gone forever, there is no manager to speak with for a refund. While I do think that fiat (particularly the U.S. dollar) will eventually be made illegal by the United States (with the internal government logic eventually concluding that the government cannot currently monitor every single U.S. dollar, where it goes, whose hands it passes through, cannot control inflation, etc. and would prefer to have each of those issues rectified), I don't think Bitcoin will be the replacement for it. The government will create their own crypto to mimic aspects of Bitcoin/Ethereum, and then declare the U.S. dollar obsolete (or declare paper and coin versions of the U.S. dollar obsolete and assign the "U.S. dollar" name to its new digital currency).
>I'm not sure the Bitcoin price will ever be stable if it just functions as a place to park I-don't-know-what-to-spend-it-on-right-now wealth.
This is another problem. People currently hopping into Bitcoin are not doing it solely because they understand the significance of it, they are doing it because they are hoping to turn their fiat into more fiat. They buy crypto with their fiat, hoping the price goes up against their current fiat, so they can cash out and have more fiat on hand to buy whatever they want. Part of the reason for that is you cannot currently buy whatever you want with crypto. It requires too many additional steps in many cases, too much extra time, work, is not accepted everywhere, and has fees that are not easily instantly known or predictable. These are problems that need to have people developing solutions for so that crypto CAN become mandated, and required by law particularly for its anti-inflation and ledger aspects, and then we will begin to see more transparency and less fraud occurring in business.