jsalvatier comments on Less Wrong used to like Bitcoin before it was cool. Time for a revisit? - Less Wrong

16 Post author: betterthanwell 20 June 2012 01:40PM

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Comment author: jsalvatier 24 June 2012 06:20:58PM 0 points [-]

A bit of a tangent, but the increase in supply of bitcoin is not the only thing that affects the value of bitcoin. A key determinant is how much people want to hold bitcoin. How much people want to hold a currency is not a very stable thing, meaning that the even with a fixed quantity of bitcoin in circulation, the future value of bitcoin will be highly uncertain. This will also tend to produce gluts and shortages of bitcoin, which have their own negative effects.