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1018 sats \ 4 replies \ @SpaceHodler 26 Oct 2023 \ on: What if price matters a lot? bitcoin
Price doesn't matter, but purchasing power does.
If 1 BTC buys me a car today, and less than a car in 10 years, it's not serving as a SoV.
If it still buys me a car in 10 years, it is. If it buys me a better, newer model, its fixed supply is also doing its job of allowing me to share in the benefits of the world's growth. I wouldn't want to buy a 2023 smartphone in 10 years for the same sat amount it costs today.
Also, early adopters, taking on more risk, can justify reasonable expectations that its purchasing power will grow faster than merely to catch up with the world's growth. That it will grow not only due to the fixed supply, but also increasing demand, a.k.a. adoption.
This.
Price matters if you define price as the exchange rate between bitcoin and other goods. After all, what is the point of bitcoin if we don't use it in exchange for other goods? And one of the things we like about bitcoin is that its value won't be depreciated relative to other goods by endless printing.
However, the way I would phrase it is short term price fluctuations don't matter. So the people who constantly stare at the ticker price and obsess over it are wasting their time. Short term fluctuations can happen for any number of reasons at this early stage. In the long run, Bitcoin is the superior monetary technology and will be adopted
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I would say fiat price doesn't matter, regardless of whether it's short term or long term.
I'm not interested in whether bitcoin goes to $1m by a given date, but rather what I can buy for it. If I can still buy a car, good. If I can only buy a bicycle or a pack of chewing gum for that $1m, then I've lost purchasing power.
Short term price doesn't matter, because we're in it for the long haul. Long term price doesn't matter, because price is only a short term proxy for purchasing power.
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Contrived circle jerky response, just accept that the US dollar is more than an accurate measure of value -- and if you want to be pedantic, you would normalize to productive capacity of the planet i.e. be smarter if you really want to be a smartass.
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I think you're right but unless something crazy happens the price is a proxy for purchasing power anyway. In other words, if it costs 1 BTC to buy a car you can be certain you'd also be able to sell your 1 BTC for $35,000.
That said, in a hyperbitcoinized world we would eventually reach a point where nobody wants to trade BTC for dollars anymore and therefore you could argue it no longer has a price in dollars (it's either zero or infinite, whichever way you want to look at it). In that case, purchasing power is all that's left.
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