Thanks!

In these charts, are the outer edges real, or just plotting artifacts?

I mean, does the leftmost edge of the green plots indicate the lowest extant bids in that exchange, or just the lowest bids that were considered by the plotter?

Ditto for the right edge of the red (ask) plots.

Let's assume that the bitcoin "network" will be alive 10 years from now.  What will it look like?

Let's say that the "material value" of a bitcoin, at a certain moment, is the amount of materal goods one could buy with it at that moment. (This notion is a bit fuzzy because the demand for different goods like cars and houses may vary in different ways. But we may ignore that problem for this discussion.)

10 years ffrom now, the material value of a bitcoin, like that of any commodity, is likely to be some predictable "trend" plus some unpredictable "noise".   How big will be the noise compared to the trend?   That is, by how much can one expect the material value of a bitcoin to change in addition to the predictable trend in the next hour? In the next day? Month? Year?

What will be the prevailing predictable trend for the material value of a bitcoin:  constant? Increasing (deflation)?  Decreasing (inflation)?  By how much % per year?

Since there are only ~20 million bitcoins, if 2 billion people are using bitcoins, the average wallet will have 1/100 of a bitcoin.  How much would that buy, if translated in today's dollars?

Why woud they want to do that?

Once mining becomes unprofitable, there is no point in outlawing it.

While mining is still profitable, it adds to the bitcoin supply and hence lowers the value of coins in people's wallets. You get bitcoin inflation, just as governments printing causes inflation of ordnary currencies.  This will make bitcoin less attractive.

Moreover, the government will profit by taxing the miners' income.

Just moments ago, 1 BTC was 900 USD on Mt Gox, 850 USD on Btc-e. 

Why is there such a large price difference between exchanges? What prevents people from making a profit by buying bitcoins on BTC-e and selling them on Mt Gox, until the prices match?  Is it the difficulty of moving dollars between the two countries?

Is there a NuCoin? I did not now, sorry, should have picked some other name.

That is my guess too.

Say, 5 years from now, you own 1 BTC that you bought a week earlier for 100,000 USD.  Then you (and everybody else) learn that NuCoin already accounts for 5% of world cryptocurrency payments, and its share is increasing 1% per week at the expense of Bitcoin's share. Its market price is still only 1000 USD but is rising fast.

Presumably you will want to convert your BTC to NUCs, directly or through USD.  Will you find buyers, and at what price?

I am skeptic about Bitcoin as investment, in case you haven't noticed    (Are skeptics welcome in this forum?)

It seems I am not expressing myself clearly.  When European countries junked their currencies for the Euro, each State took care to swap the old (soon to be worthless) currencies for Euros so that owners would not suffer any loss.  Other countries did the same when they replaced hyperinflated currencies for new money.

But there is no entity that would offer to do that service for Bitcoin, if (OK, let's say it is onlly a possibility) and when it is replaced by something else.  Sure, Bitcoin owners would want NuCoin to be just an evolution of Bitcoin, preserving its blockchains and hence the value of their coins; but why would the NuCoin community want to do that? 

But Bitcoin is not just a brand name, or a network of users; it is a specific computer technology.

It is hard to name a computer technology that has not become obsolete in a few years.  Punched cards, magtapes, floppies, CDs were all "universal" information interchange media that were quickly and completely superseded by better technologies,  Encryption standards are replaced every few years.  IPv4 is being replaced by IPv6, FTP by BitTorrent, and so on.  

Currently it takes over 5 minutes to confirm a Bitcoin transaction.  If a NuCoin transaction could be confirmed in 5 seconds, would it not become more attractive than Bitcoin?

So one must at least admit the possibility of Bitcoin being superseded by some other system in the medium term.  What would happen then?

Bitcoin WILL become obsolete one day, like punched cards and floppy disks; whether it is next year or 15 years from now, I do not know.

Litecoin and other crypto-currencies are already being used as means of payment, and the existence or success of Bitcoin does not seem to hamper that; on the contrary they are learly riding on Bitcoin's success.


I don't see why, but in any case it does not answer the question.  WHEN Bitcoin is superseded by a NuCoin, how will Bitcoin owners swap them for NuCoins?

Bitcoin cannot claim eternal divine perfection, so inevitably there will arise a "NuCoin" that has the same nice properties but is technically better in some respect -- and will therefore replace Bitcoin as  the preferred medium of payment for internet commerce.   

What will happen to the Bitcoin then? Owners of course would like to swap them for equal worth of NuCoins.  But who will agree to the swap?

How much bitcoin value would be needed to support a given amount of internet commerce?

Let say that the daily value of all internet purchases is X US$, and suppose that the payments are made with N bitcoins whose market value is B US$ each.  How big must N and B be?

It is not as simple as X = N × B, because in practice the same bitcoins will probably be be reused many times during the day.  Most clients will start out with common currency, and merchants will want to have common currency in the end, so the bitcoins will make many short trips exchange->client->merchant->exchange.  In fact, if both client and merchant use the same exchange, then the bitcoin conversions could be bypassed entirely and the transaction would be just a bank transferof ordinary currencies, only cheaper. 

Presumably, with automated exchanges these transactions would be very fast, and the bitcoins could be reused may times per day.

So, what is the minimum ratio N × B / X?  Is it 10%? 1%? 0.01%?

Euro/Dollar exchange rate over last week: low 1.353, high 1.370 (1.2%)
Ditto, over the last year: low 1.278, high 1.380 (7.6%)
Ditto, over the last 12 hours: low 1.37039, high 1.37056 (0.01%)

So the merchant must still quote his prices in conventional currency (dollars, euros. etc.); he cannot quote in Bitcoins.  And the Bitcoins he gets are instantly sold to the exchange agent.

If the same facility is given to the client (he buys the bitcoins moments before the transfer) then the Bitcoins are just an internal mechanism of transfer between exchanges; as seen by client and merchant, the transaction used traditional currencies with the exchange(s) playng the role of a bank, except perhaps with a reduced tariff.

If the client does not have the same facility, then the volatility problem I mentioned is shifted to his side.  He buys US$ 100,000 in bitcoins in order to pay for a US$ 100,000 car, runs to the bathroom, when he comes back he finds that those bitcoins are worth only US$ 80,000.

I still do not see how Bitcoin could ever replace traditional currencies as an explicit instrument of trade if its value can change 20% in a few minutes, many times per day.

The price of a Bitcoin has fallen 50% in 48 hours and is still oscillating by 20% every few minutes.

Why would a merchant trade in Bitcoins?  He sells a US$ 100,000 car for US$ 100,000 worth in bitcoins, runs to the bathroom, and when he's back he finds that those bitcoins are worth only US$ 80,000, or US$ 50,000, or maybe US$ 1,000.

Bitcoin will never take over a significant fraction of commerce if its price keeps changing like this.  Its use will be restricted to sales where the profit margin is high enough, say 50% or more; which is mostly illegal trade.