Very relevant - Market emotions cycle:

http://cuffelinks.com.au/wp-content/uploads/AO-cycles.png

People have been saying this for the last $100 or so of rise.

And yet here we are.

My experience was that buying Bitcoins from other exchanges is usually much more expensive than Mt.Gox. I'm not sure about selling, though.

Disrupt is fine. Its basically a quick way of saying a company is in a specific industry.

disrupt industry x.

Bubble, lets lose that. People are so bad a predicting bubbles it is laughable.

By that time you won't need to sell. Besides, are you seriously gonna risk your money like that? Switching back to a currency system that can be frozen/confiscated, inflated, etc.?

Gray Swan investing!

The upper bound on how many coins he's mined is roughly 1 million (the best estimates I'm aware of come from https://bitslog.wordpress.com ). So you can just interpret the current exchange rate of X as X million. On http://bitcoincharts.com/markets/currency/USD.html I see Bitstamp at $169 right now (MtGox, as pointed out here, is not a useful benchmark anymore), so that's $169m in bitcoins.

(modulo all the usual reasons it's less than $169m: the estimate should be an upper bound and so the real amount lower, he may have lost his bitcoins, you can't cash out that much without crashing the price, he'd have to pay taxes on such an enormous amount, etc etc)

Satoshi does not need CV :)

Wrq ZpPnyro with high probability. Look at what he has done, where he lives and how he writes.

An exchange will allow you to trade instantly; the moment your sell/buy orders go through, the btc/usd is available in your account for usage, however getting USD into the exchanges can take some time and in the case of mtgox, getting USD out is almost impossible (it's why the price at mtgox is about 10% higher than elsewhere). Your location matters most, if you're in Europe you could get money into Bitstamp within a couple of hours if you pay for a fast transfer and once it's in you can trade instantly.

If you maintain some inventory at coinbase, you can effectively buy and sell instantly.

If you trade rarely, then buys and sells are effectively instant too, you just don't see the results of your trade for 10 days.

I believe that for verified/tier 2 customers, coinbase offers faster turnaround.

Orders don't take long. Most of the time (i.e. when the exchange is operating normally and isn't down) they pretty much just happen so long as you know, the orders can match with other orders. If you buy 10BTC at market rates and tell mtgox that you don't really care what you pay for it, then it'll just go ahead and do it. There's not much waiting involved other than the web interface refreshing, which isn't strictly necessary since you could trade by API too if you'd prefer that.

buy & sell occurs at an exchange, which is instant as long as the exchange does it instantly. The exchange is keeping tracking of which account inside their exchange has what stuff. So it is just the exchange writing its records to database.

This has nothing to do with how long a bitcoin transaction (sending bitcoin from address a to address b) takes. bitcoin transaction occur in bitcoin network. The buy & sell is just internal to an exchange (eg. mt. gox) and occur outside of bitcoin network.

One cool thing that has happened over that several months is that Mt Gox has drifted down to a market share of around 30% of the total trade volume (generally speaking; ocasionally this trend weakens on days with huge swings, but less often than before). It is good to see more healthy exchange competition.

Assuming you have $5000 worth of Bitcoin that's 25 bitcoins at the current $200 exchange rate.

So bitcoin has to go to $40.000 for you to become a millionaire.

Bitcoin at launch was $0.05. So value of bitcoin has doubled 12 times since launch, and the value of bitcoin has to double 8 more times for your to become a millionaire. So that's quasi-plausible. Not holding my breath, though :)

[1] Source https://docs.google.com/spreadsheet/ccc?key=0AmcTCtjBoRWUdHJ...

So take a decision now about when you'll sell, write it down, and stick to it. Mine has a 5 year timeline, or a specific value (a few orders of magnitude more than today) at which I'll sell.

If you currently held 0 BTC, would you spend a few thousand dollars on BTC now in anticipation of huge price increases later?

Because nowadays any exponential growth is called a "bubble in forming". And because all stochastic exponential process eventually crash, or "underperform", it sounds really smart to "predict" a crash months or years in advance. Especially when using non-logarithmic axes, the predictions and the crash look really impressive.

You don't, however, often see these prophets of doom profiting from their predictions, because the exact timing of crashes isn't that easy at all.

It was a bubble at $100 apparently. So this must be a double bubble :)

Well, price has risen not because of businesses across the world adopting the currency but because of only Baidu saying they will accept Bitcoin. That does not justify 50% rise at all.

It doesn't.

>How many legitimate real world services and products currently accept Bitcoins? I understand it is only the Chinese search engine.

The hundreds (thousands now?) of (mostly) small businesses accepting bitcoin for goods and services include gift card vendors. [1]

You can spend your bitcoins on gift cards (a form of virtual currency in itself) which you can use at some of the world's largest retailers, for example Amazon[2] or Walmart [3].

It's a two-step process, but you can use your bitcoins at Amazon or Walmart, today.

[1] https://en.bitcoin.it/wiki/Trade#Gift.2FDebit_Cards

[2] http://www.gyft.com/shop-for-gift-cards/

[3] http://www.reddit.com/r/Bitcoin/comments/1om2jm/egifter_now_...

Bitcoin growth will be led by investors and speculators. Day to day transactional use will be a consistently lagging indicator that helps buttress the rising exchange rate floor. Until the whole thing falls apart (or not). Time will tell :)

I am too lazy to create a lmgtfy link for you, sorry. Google yourself. Lots of places accept Bitcoin. Although I am not sure how many people actually use it for shopping.

You don't need to be a prophet to guess that. Of course they don't like it. To me, it's not even a question. The question is, what are they gonna do about it and for how long will they manage to delay Bitcoin adoption.

China would be looking at SDRs (= special drawing rights issued by the IMF) for a world currency, though

What leads you to believe so ?

Or the many headlines about SR acted as sort of advertising.

Well, maybe because it only took such a small hit when SR went down and quickly recovered, whereas everyone expected it to greatly lose in value. It basically has proven it can exist without SR. Also, there are two big new markets and countless smaller ones already.

It's a terrible idea for a sovereign currency for a country, sure. For a store of value ... seems pretty good to me?

I wonder if someone could build a new digital currency that starts let's say at 1 trillion units, and is expanded by 2 percent per year (that 2 percent being split so a slight increase happens every day, so it doesn't happen all at once, but after a year, the increase rounds up to 2 percent).

The problem would be seeding it and distributing it early on. But it could still be mined much like Bitcoin, with the difference being that the total amount will never be limited. Also, it should be easier to mine them, since the (non-finite) total (1 trillion) would be a lot larger than the 21 limit for Bitcoins. Someone should also do the math for this new currency's adoption rate, so all of the 1 trillion units (adjusted with the 2 percent inflation rate) get distributed in 3-5 decades.

Basically we don't want a few thousand people to get that whole trillion within 10 years. I'd also prefer if anonymity would be built it (look to Zerocoin for that). Perhaps it shouldn't be anonymous by default, but you should be able to "switch it on"). It should also be as easy to use and as secure as possible (the clients), so normal people can use it safely on all of their devices.

I know too little about currencies but to me it looks like that our "real currencies" are inherently deflationary as well... At least this is how it is supposed to work - right? I mean what if governments weren't printing new money all the time? Then there would also be a limited amount of money available in a big pool... Wouldn't it depend on the growth rate of country to determine weather or not a currency is deflationary?

- Number of people is growing, same amount of money for the people, no new money is printed => deflationary?

vs.

- Number of people is shrinking, same amount of money for the people, no new money is printed => inflationary?

It's extremely implausible for everyone to know that the value of ${commodity} will rise steadily, with no risk, for the foreseeable future.

Why? Think of the second-order effects of what you're saying--I expect the value of ${commodity} to rise indefinitely, so what do I do? Buy ${commodity}. Or, I own a bunch of ${commodity} and expect the price to rise indefinitely--what do I do if someone offers to buy my ${commodity}? Either sell for a higher price, or don't sell at all.

Both of these have the effect of bringing the future price increase into the present. If everyone expects a 10% increase in the next year, the price today will increase by roughly (10% - the risk-free interest rate).

Now, is the picture different for currencies? Yes. Economists call short-term prices "sticky," and sticky prices are why demand-side recessions are possible. If I'm earning $40,000 a year today, and my boss decreases my pay to $39,000 a year, I don't say "well, there was deflation this year, so I actually got a raise!" On the other hand, if I'm earning $40,000 a year, and my boss doesn't increase my pay at all, I don't say "there was inflation this year, so I just got a pay cut!" In the short term, sticky prices make things (like labor) cost more or less than they would in a frictionless market. That stickiness is why countries with deflationary currencies have problems.

Now then--bitcoin may be a currency of sorts, but are bitcoin prices sticky? No. Companies selling products for bitcoins overwhelmingly price their goods in dollars. At whatever time the transaction is conducted, the buyer converts that price into bitcoin and transfers bitcoin to the seller, who sells the bitcoin for dollars. A buyer will never say "yesterday your price was 1BTC, and today it's 1.2BTC--why have you increased your prices?" A seller will never say "yesterday you offered to pay me 1BTC, and today you're only offering 0.8BTC--no sale!" Both sides of the transaction are dealing in dollars, only using bitcoin as a medium to exchange those dollars. In other words, bitcoin is a medium of exchange but not a unit of account.

Is bitcoin likely to become sticky in the future? Well, if a large proportion of people were paid solely in bitcoin, and could live comfortable lives spending bitcoin instead of dollars, it's possible that we could have a cultural shift to thinking "I'm paid 333BTC a year" instead of "I'm paid $60,000 a year." And at that point, bitcoin's deflationary nature would be an issue. How likely are we to reach that point? Not very, not least because it's a self-limiting cycle--if the sticky-price/deflation combo is an issue in the bitcoin economy and not in the dollar economy, people have very little incentive to switch their accounting to bitcoin. But that's an entirely separate issue from whether bitcoin is or will remain a useful medium of exchange.

Only if that currency is the basis for your economic system, and you wish to continuously stimulate artificial demand in your economic system through continuous currency debasement.

It has been theorized that though such continuous stimulus may lead to greater growth on paper, that growth is more likely to be malignant than it would be were the economy allowed to grow at a more natural rate. Furthermore, continuous inflation is also at least partially responsible for the business cycle. The price of money is the interest rate at which it can be borrowed, and constant inflation is what keeps interest rates low. When money's cheap, people tend to borrow more of it and are less careful about what they do with that money. Hence, due diligence declines, and economic bubbles become more likely.