Skip to comments.Aussie Bank Asks "Will Bitcoin Replace The Dollar?"
Posted on 12/27/2013 7:39:33 PM PST by Errant
Bitcoin is rapidly becoming part of the everyday lexicon. Following David Woo's investigation, National Australia Bank's Emma Lawson looks at its creation, use, and quality as "currency," and find that Bitcoin meets most, but not all the conditions required to be a currency. Lawson concludes Bitcoin may not be the most efficient monetary system, given the costs to create, and that the supply set-up can be seen as both an advantage (hyperinflation is not possible) but also a disadvantage (there are conditions which may create deflation). But, if enough people believe in it, and use it, it may be here to stay as a payment system. Simply put, its success (or failure) will depend on establishing trust and adoption.
(Excerpt) Read more at zerohedge.com ...
How many divisions does Bitcoin have?
Very good article with plenty of relevant information.
Up to 8 digits.
Mmmm...first I hear of Overstock.com, now the Aussie’s. This Bitcoin concept is sure gaining currency (no pun intended). Well, maybe a little.
“(hyperinflation is not possible)”
If it were to replace the dollar as a reserve currency it would have to hyperinflate just to catch up.
No, it would be the opposite. Hyperinflation is when a currency buys less and less. If Bitcoin were to skyrocket in price, say by replacing a country’s currency, it would purchase more and more.
Your right. The price of bitcoins would have to raise dramatically.
I'd rather have deflation than hyperinflation any day, as long as the money is good. Bitcoin is yet to be fully tested, IMO.
Will be glad when Overstock.com starts accepting them. I have my eye on a new watch that they carry. ;)
How will the word, “bitcoin” be used in a sentence when used as a verb? Anyone have some good examples?
No. There’s not enough of them to handle our economy.
The idea that deflation is an unspeakable horror that must be prevented at all costs is absurd. This is promoted by entities such as the US federal government and the financial elite who benefit from fiat currencies that constantly diminish in value.
Prior to the establishment of the Federal reserve in 1913 US dollars consistently increased in value. If you stuffed $100 into your mattress in 1850 it would be worth a lot more in 1900.
the current bitcoin market cap is under $10b.
the market cap of a valid world wide currency would have to exceed $1 trillion
that means the bitcoin market cap will need to grow at least 100x it’s current value. possibly 1000x
Bitcoin is going the way of the unicorn.
Since it's divisible by up to 8 digits, you could have something like 2,100,000,000,000,000 units to work with. And there are other crypto-currencies like Litecoin, of which there will be four times as many. So it should meet the market demand.
22,000,000 bitcoins ... divisible to 8 digits
that’s 2,200,000,000,000,000 units of currency.
the minimal demonization of the US dollar is the penny. there are less then $3,000,000,000,000 in the M1 supply, or about 300,000,000,000,000 units of currency
or 1/7 th the total amount able to be represented by bitcoins
more then adequate to become an M1 currency unit
I read the whole thing but I don’t know any more than I did before. I don’t understand the language in which it was written. I’m too old to learn it.