[ExI] "Law of the Crypto Coin" proven by new data point?

[Brent Allsop]

Hi Kelly,

That is interesting to see this max valuation, but I think the leading 
crypto currency could go way beyond this, simply because of the hording 
factor. USD is a very poor investment, because of inflation, and is only 
used because of it's safety.  Also, China hoards it so they can keep 
their exchange rates low, but that is a different story, and they are 
about to pay for that Bigtime.  But people will want to hoard and invest 
in Bitcoin, much more so than USD, simply because it will be a 
significantly better investment.

Many People still think that Bitcoin is way more risky, so will stay in 
USD for way to long.  But volatility does not equal risk. If, every 
Bitcoin valuation valey is an order of magnitude higher than the 
previous one, in less than a year, and if Bitcoin has less chance of 
default than USD, it is a way safer AND a way better investment by any 
measure except volatility.  People just still place too much value on 
stability, and they will pay for such dearly.  Not smart.

Brent Allsop




On 12/18/2013 12:02 AM, Kelly Anderson wrote:
> On Tue, Dec 17, 2013 at 3:35 AM, Brent Allsop 
> <brent.allsop at canonizer.com <mailto:brent.allsop at canonizer.com>> wrote:
>
>       Predicted Crypto Currency End Game
>
>     https://docs.google.com/document/d/1G2NaqU2ut1yZOd-AT9an6OPlGZJMVGvr214JWtJ373k/edit?usp=sharing
>
>
> I agree that Bitcoin is highly likely to increase in value 
> exponentially at something close to the current rate until the market 
> cap of Bitcoin approaches somewhere between 1 and 10 trillion dollars. 
> The upper limit in my mind is set by the fact that you don't need more 
> money than that to do the kinds of online transactions that Bitcoin is 
> good for.
>
> Quoting from HowStuffWorks
> "All told, anyone looking for all of the U.S. dollars in the world in 
> July 2013 could expect to find approximately $10.5 trillion in 
> existence, using the M2 money supply definition. If you just want to 
> count actual notes and coins, there are about U.S. $1.2 trillion 
> floating around the globe."
>
> So if we suppose that Bitcoin replaces the US dollar ENTIRELY, we 
> won't need much more than 10 trillion (current value) dollars worth in 
> order to transact business.
>
> So I predict as Bitcoin market cap exceeds 1 trillion dollars it will 
> have grown into its usefulness, and the need for exponential growth in 
> value will stop because you'll be able to buy EVERYTHING that exists 
> with the then extant Bitcoin. There is absolutely NO POINT to having 
> more money than stuff to buy.
>
> So I agree up to a point, but I don't think the economy of the world 
> will support a market cap of 100 trillion dollars. I'd love to hear 
> your argument against this Brent, assuming you have one.
>
> -Kelly
>

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