Not a single entity in the world will stand between you and that delicious brew.
Except the exchange rate. Your 1/300th of a coin might buy you coffee if it is a good day, but the next day it might cost 1/100th of a coin.
I just bought in because I'm hoping that what I can buy with 1/100th of a coin will only cost 1/300th by Christmas.
Bitcoin is having a bad day and I hope to capitalize on it. Having bought at $650 I will be sad if it turns out that the new price is $500, and happy if BAML was right and we are off to $1300.
But All of your arguments fall down in that you are either using an exchange to get from currency to BTC. Or you are keeping coins in a wallet and they could swing 50% in value in a day.
No, my arguments do not fall down. You are making the terribly flawed assumption that bitcoin will always be this volatile. Bitcoin is less volatile than it used to be, and with greater adoption will continue to decrease in volatility.
The volatility in bitcoin today is nothing compared to 2011. Is it still bad ? Yes. Will it continue being bad ? Probably not. The long term trend supports the assumption that volatility will decrease with greater adoption.
Furthermore volatility has little effect on the 'money transmission' element of bitcoin as long as transfers and conversions take place immediately. It's still a viable way to legally move USD from the USA to Singapore with very low fees.
Another example, I'd like to add is that I had a large part of my savings in Indian Rupees. They depreciated by 30% over the past 2 years. That's definitely pretty bad but it didn't prevent me from buying coffee. Euros have also swung around by 15-20% over the past 2-3 years. The Brazilian Real lost 25% of it's value last year. Does that make them as bad as bitcoin ?
Your motivation for getting into bitcoin is your personal choice and I certainly hope that you profit from it. However, don't forget that bitcoin is an emerging technology going through fairly rapid adoption, as such, volatility, crashing exchanges, bubbles, bubble pops, etc. will be a part of it. And of course, I have to convert money from USD to BTC. Or from Marks to Euros. Or from escudos to Euros. That's just how it works.
Euros have also swung around by 15-20% over the past 2-3 years.
In relation to the dollar. Which is totally irrelevant for day to day transactions inside the Euro zone. I still pay the same price for a coffee I did 2-3 years ago.
But at the moment Bitcoin volatility is still huge: It's currently not reasonable to offer coffee for a fixed number of Bitcoins, that, say, stay stable over a year.
Your analogy between debit cards and Bitcoins seems a bit flawed too: For the purposes of international transfers it might be apt, but for small day to day business like buying coffee, it may be better to compare it to cash. And then there's no bank stopping you from transacting in cash.
You pay the same price for coffee but you will certainly pay more for coffee beans, the market will only absorb the difference for a while.
I wasn't drawing an analogy between bitcoins and debit cards. I was taking about how a bank lets me access my money vs me having direct access to it. I cannot get cash in a foreign country without my bank cooperating unless I carry a world recognized currency (USD, Euro) in cash and try to exchange it somewhere.
The problem is that you read a comparison as an analogy. It's a comparison of our current dependency on the banking system vs bitcoins relative independence from the same.
Comments
Except the exchange rate. Your 1/300th of a coin might buy you coffee if it is a good day, but the next day it might cost 1/100th of a coin.
I just bought in because I'm hoping that what I can buy with 1/100th of a coin will only cost 1/300th by Christmas.
Bitcoin is having a bad day and I hope to capitalize on it. Having bought at $650 I will be sad if it turns out that the new price is $500, and happy if BAML was right and we are off to $1300.
But All of your arguments fall down in that you are either using an exchange to get from currency to BTC. Or you are keeping coins in a wallet and they could swing 50% in value in a day.
No, my arguments do not fall down. You are making the terribly flawed assumption that bitcoin will always be this volatile. Bitcoin is less volatile than it used to be, and with greater adoption will continue to decrease in volatility.
The volatility in bitcoin today is nothing compared to 2011. Is it still bad ? Yes. Will it continue being bad ? Probably not. The long term trend supports the assumption that volatility will decrease with greater adoption.
Furthermore volatility has little effect on the 'money transmission' element of bitcoin as long as transfers and conversions take place immediately. It's still a viable way to legally move USD from the USA to Singapore with very low fees.
Another example, I'd like to add is that I had a large part of my savings in Indian Rupees. They depreciated by 30% over the past 2 years. That's definitely pretty bad but it didn't prevent me from buying coffee. Euros have also swung around by 15-20% over the past 2-3 years. The Brazilian Real lost 25% of it's value last year. Does that make them as bad as bitcoin ?
Your motivation for getting into bitcoin is your personal choice and I certainly hope that you profit from it. However, don't forget that bitcoin is an emerging technology going through fairly rapid adoption, as such, volatility, crashing exchanges, bubbles, bubble pops, etc. will be a part of it. And of course, I have to convert money from USD to BTC. Or from Marks to Euros. Or from escudos to Euros. That's just how it works.
In relation to the dollar. Which is totally irrelevant for day to day transactions inside the Euro zone. I still pay the same price for a coffee I did 2-3 years ago.
But at the moment Bitcoin volatility is still huge: It's currently not reasonable to offer coffee for a fixed number of Bitcoins, that, say, stay stable over a year.
Your analogy between debit cards and Bitcoins seems a bit flawed too: For the purposes of international transfers it might be apt, but for small day to day business like buying coffee, it may be better to compare it to cash. And then there's no bank stopping you from transacting in cash.
You pay the same price for coffee but you will certainly pay more for coffee beans, the market will only absorb the difference for a while.
I wasn't drawing an analogy between bitcoins and debit cards. I was taking about how a bank lets me access my money vs me having direct access to it. I cannot get cash in a foreign country without my bank cooperating unless I carry a world recognized currency (USD, Euro) in cash and try to exchange it somewhere.
The problem is that you read a comparison as an analogy. It's a comparison of our current dependency on the banking system vs bitcoins relative independence from the same.