@scottalanmiller said in How far will bitcoin and other cryptos fall?:
@IRJ said in How far will bitcoin and other cryptos fall?:
@Harry-Lui said in How far will bitcoin and other cryptos fall?:
0 is the answer, eventually. Could be 1 year from now, 5 years from now, 20 years from now, etc.
That's a true statement. With the exception of precious metals, every currency will eventually be 0.
Precious metals are the same. Only precious because we randomly say so. It's so arbitrary to associate some metals as having crazy value. Almost identical to paper money. It's worth a lot, only because someone says so.
That runs contrary to the terrible logic of metal backed currencies though, such as claims that gold/silver/whatever has always had value to mankind/been precious which is #1 not true and #2 not universal, this lack of seeing gold as super precious, rare, and valuable was one of the ways the Spanish got over on the Natives of South America.
Nevertheless, metals do have value in that they have industrial use. It's extraordinarily primitive and backward to hoard it to put another currency in front if it, and ironically, that doesn't stop inflation or any other problems, both the arbitrary price change in the value of metals hurting the currency and over printing of currency which happens every time metal backed currency is in use. The reason is because there's far more value in the world than there are precious metals to back them unless you arbitrary pretend even more so that the metals are worth more than they really are. This didn't work for Spain when tons of gold flooded in and it sure doesn't work for rapidly expanding industrial economies of today.
Plus the weird idea that Steven Schiff kept pushing was "bitcoin will never be used because it's not backed by anything," which is like saying the US Dollar won't be used because of Nixon finally removing any metal backing it had. He promotes extremely pre-capitalist views of monetary policy. Under such a nightmare of gold backed dollar you'll have cars and milk either having the same value or having to create new micro-cent values to deal with the fact there's vastly far more value than metal. This in addition to any industrial purpose gold, silver, etc have will be basically removed and the available uses will be so expensive as to cause the average person to not be able to afford items with it, and interest rates will explode because nobody will want to loan due to the hugely retracting value vs currency.
If you want a monetary system fiat is the only way to go. How you manage it is a totally different story, there's no reason to suggest that Keynesian economics is linked with it, even though that's a leap often made to a crazy degree.
I just think about the mad over pricing of gold some years ago, if the currency were backed by gold at that time, the purchasing value of it would have gone up, until gold prices went down either the banking system would have to pretend it didn't happen which is extremely dangerous or they would have to retract value of everything in return.
As for bitcoin and other coins go, yeah people pump and dump and the instability basically makes it a casino, but that's not what most people I know, including myself use it for, it's used to near-instantly convert currency and/or purchase things, and very little time is spent as bitcoin. I never would keep any more stable hard currency as bitcoin. I think people in the west often lack the experience of dealing with two currencies at the same time, one stable and one unstable, the idea that one which is unstable is useless or a scam is missing its use, especially when it comes to dealing with states (governments) and grey/black markets. There's also black market currency values as well but that's not really relevant to bitcoin.
I remember a time when depending on what items you bought or services rendered, you paid either in a hard currency (typically USD, later also EUR, sometimes GBP) or just regular currency (like roubles or whatever). The services and items aren't the same anymore, but the double use is plenty useful. Perhaps bitcoin won't last into the future in the same way, but it or something else like it will continue to exist much like p2p or torrents in order to deal with both legal and illegal exchanges of money, and sometimes it's not illegal because of illict drugs or crime, but because of dictatorships, because of embargoes, and so on.
... I was kind of all over the place there.
tl;dr the rise and fall of the price doesn't matter with bitcoin so long as you are just using it as a way to quickly convert currency either to move money or buy items/services otherwise unavailable. If you sit on it, it's basically like playing slot machines.