
Bitcoin Price Tops $1,000 in First Day of 2017 Trading - sidko
http://www.coindesk.com/bitcoin-price-1000-january-1-2017/
======
kneel
Bitcoin is living up to it's reputation as digital gold.

The Chinese are running away from RMB and buying bitcoin, Venezuelans are
running away from Bolivares into Bitcoin. And to a lesser extent some Indians
are escaping the Rupee.

It'll be really interesting to see how governments try to deal with
decentralized currencies if they really take off. Governments lose a lot of
control when they can't control money.

~~~
pg314
It's hard to get reliable numbers of the number of Venezuelans having bitcoin.
According to [1], surbitcoin.com had 85,000 users in November 2016 (on a
population of 30 million). Quartz reported in November 2016 a weekly bitcoin
volume below 400 bitcoin on localbitcoin.com. That is not bad, but I would not
call it Venezuelans running away from Bolivares into Bitcoin.

One of the problems is that you would have to be crazy to want to sell bitcoin
for Bolivares if you can't immediately spend them.

[1]
[https://www.theguardian.com/technology/2016/dec/16/venezuela...](https://www.theguardian.com/technology/2016/dec/16/venezuela-
bitcoin-economy-digital-currency-bolivars)

[2] [http://qz.com/876067/the-chinese-principle-wu-wei-
eliminates...](http://qz.com/876067/the-chinese-principle-wu-wei-eliminates-
the-need-for-lifehacks/)

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aphextron
So is Bitcoin a currency or an investment vehicle? How can such volatility in
a currency be considered desirable?

~~~
readhn
It's simply a highly speculative and volatile vehicle. It's not a currency or
am investment.

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legulere
Isn't that a problem because it will mean also higher transaction costs (in
dollar)?

~~~
pmorici
No, as Bitcoin appreciates the transaction costs go down in Bitcoin terms and
stay the same in fiat currency terms everything else being equal.

~~~
firebones
When the block rewards decrease, the transaction costs will necessarily have
to increase. Right now, the block mining reward dwarfs the transaction cost
(effectively subsidizing it). So what increase in transaction volume (relative
to capacity) will have to happen in order to keep transaction rates so low?
Right now, it looks like there needs to be an order of magnitude volume
increase for mining interest to remain.

~~~
pmorici
Miners costs are denominated in their local currency so you need to look at
the USD or CNY value of the transaction fees over time not the BTC amount to
understand the financial picture as seen by miners.

In USD terms transaction fees have increased more than 7x over the course of
2016. [0] The block reward only halves roughly every 4 years so total USD
denominated fees are growing much faster than the coinbase reward is
shrinking.

Long term either the block size will have to be raised or the average value
transferred per transaction will have to go up to increase fees. Either way
rising Bitcoin price isn't bad for the cost of transactions. If anything it
makes the coinbase more valuable and causes miners to care less about
transaction fees.

[0] [https://blockchain.info/charts/transaction-fees-
usd](https://blockchain.info/charts/transaction-fees-usd)

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readhn
"Double top" Just like gold it will deflate.

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rixrax
To the moon!!!

~~~
firebones
Dogecoin ironically seemed to capture the potential of everycoin: failure,
hype, what have you.

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67726e
OK, I'll be that guy.

Is this actually intellectually stimulating to hackers? Should I start posting
stock tickers for karma?

~~~
johndevor
Just the world's first digital, decentralized currency succeeding. Hackers can
and will use it to create new and fascinating projects.

~~~
rhino369
Is it succeeding or are people gambling on the value of it?

~~~
adamnemecek
> or are people gambling on the value of it?

Welcome to investing. Adoption is success.

~~~
eli
Does a skyrocketing penny stock imply a successful company?

~~~
jron
A penny stock that skyrockets and holds value is no longer a penny stock.
Bitcoin is 8 years old and has hit $1000 USD twice now over multiple years.

The "market cap" is currently over 16 billion dollars. It would place 68th
when compared with 192 countries M1 money supply (2015) data:
[https://www.cia.gov/library/publications/the-world-
factbook/...](https://www.cia.gov/library/publications/the-world-
factbook/rankorder/2214rank.html)

The hash rate securing the network is currently at 2.5 quintillion operations
per second which is really 5 quintillion SHA256 operations every second:
[http://bitcoin.sipa.be/](http://bitcoin.sipa.be/) Speaking of pennies... if
every operation was a penny laid flat on earth, you could cover the surface of
the earth, land and sea, twice over every second.

Bitcoin surpassed the penny stock phase a long time ago.

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chx
[https://www.washingtonpost.com/news/wonk/wp/2015/06/08/bitco...](https://www.washingtonpost.com/news/wonk/wp/2015/06/08/bitcoin-
isnt-the-future-of-money-its-either-a-ponzi-scheme-or-a-pyramid-scheme/)

~~~
sidko
You'll find a lot of such dismissive articles about Bitcoin throughout its
existence. Here's a collection of 'Bitcoin obituaries' if you want to
reinforce that view:
[https://99bitcoins.com/bitcoinobituaries/](https://99bitcoins.com/bitcoinobituaries/)

~~~
chx
It's not an obituary, it's a fact. I am tired of rehearsing how a currency is
enforced to be accepted in the issuing country, has a monetary authority etc.
Otherwise while theoretically it could be called a currency, that's a thing
for dictionary writers, it's just not usable in everyday life therefore anyone
pushing for it has a not-entirely-straight agenda. There's no killer app for
bitcoin yet and it's hard to even imagine a (legal) one.

It's possible future blockchains will be better but so far, this is not.

~~~
asdfasdfa11112
If you are in the US, what is your opinion on the common prison trope that
smokes are money in prisons?

