In my view, Bitcoin is likely to gain wide adoption worldwide over the long haul -- that is, over a period of many years or even decades. Its price is therefore bound to rise far above current levels over time.
I've laid out my reasoning here: http://cs702.wordpress.com/2011/05/29/on-the-potential-adopt...
According to the latest stats at http://www.bitcoinwatch.com, the market value of all bitcoins currently in existence is just under $100 million; so, trading volume of $1 million per day means that around 1% of Bitcoin's entire float turns over every day, around 30% of the float turns over every month, and the entire float turns over about once every three to four months. That's more liquid than a lot of publicly traded stocks with similar float.
PS. moonchrome, I'm not sure how your comment relates to my post, which is about trends over the long run ("many years or even decades"). Why are you responding with a comment about current trading volumes?
The fact that it's trading at $10 again is also very significant to the Bitcoin community, it hasn't done that in more than a year. And it'll probably reach 12 by the end of the year before it stabilizes again.
Again - as a currency this is insignificant. I agree that bitcoin is a great technical accomplishment but talking about it's price as it has any meaning outside of a few hackers playing traders is not realistic.
One of the world's large credit card networks processes on the order half a trillion dollars in a typical 30 day period. So bitcoin has a way to go yet before it's volume is significant compared to other ubiquitous electronic payment methods.
Consider that they need to grow by a great many orders of magnitude to become globally economically significant, yet consider that the supply of bitcoins is relatively fixed.
How smoothly do you think that is going to work?
If you believe in the future bitcoins, you also have to believe that their value will have to eventually sky rocket by several orders of magnitude. If you believe this you should hoard every bitcoin.
So if you actually believe in bitcoins, why would you ever spend one?
If you don't believe in bitcoins, why would you ever accept one?
do you see the problem yet?
Because you have to, and there is no other realistic or better choice.
As such, it's interesting to see when and how such situations arise.
"Bitcoin Seeks New Life in Africa: A digital currency without a central bank could be ideal for economies where the mobile phone is king but the banking systems are weak."
(This on a website for hackers and startups. Pfft.)