Rise and rise in value/price of Cryptocurrencies

  wee eddie 13:13 30 Jan 2018

Why does the value/cost/price of a Cryptocurrency keep rising, when the supply keeps increasing to meet demand?

Surely this is the exact opposite to the basic Economic concept of Supply & Demand

  qwbos 21:00 30 Jan 2018

wee eddie

But what causes the price to rise?

Speculators, people who think it's easy money? Who knows. There may also be an element of good old fashioned "pump and dump".

bumpkin

There have been quite a few Bitcoin thefts, and given the nature of the currency, we probably don't hear about them all. There's also the tale, possibly urban myth, of the bloke who threw away his faulty hard drive, and with it, a small fortune in Bitcoin.

  bumpkin 21:32 30 Jan 2018

qwbos, I have heard about the lost hard drive be it fact or fiction. If that is your only security i.e. storing your hyperthetical money on a computer then I would think that is a risky thing to do.

  bumpkin 21:36 30 Jan 2018

*In Bitcoin's case, the supply is limited to 21 million Bitcoins. *

How do you know this.

  bumpkin 21:44 30 Jan 2018

There's also the tale, possibly urban myth, of the bloke who threw away his faulty hard drive, and with it, a small fortune in Bitcoin.

What I wonder happens about that, is it lost forever thus reducing the number available or some more mined.

  Forum Editor 22:49 30 Jan 2018

"I have to admit that your last paragraph sounds like Flim Flam. There are either 21 Million, or there aren't. surely no amount of mining will alter that".

A limit of 21 million Bitcoins has been set by the system. What happens after that is anyone's guess, but I wouldn't worry about it, it has been estimated that it will be at least 100 years before the whole 21 million Bitcoins are mined. As time goes on, it will become increasingly difficult to mine the coins.

Bear in mind that we are talking about a virtual currency here - your statement that "There are either 21 Million, or there aren't." doesn't apply. Bitcoins don't 'exist' in a physical sense.

  canarieslover 07:36 31 Jan 2018

click here
And the taxman cometh.

  Quickbeam 09:15 31 Jan 2018

Eventually someone will decide that the supply is insufficient and some quantitive easing will be in order that will see the virtual bubble burst!

  Forum Editor 10:17 31 Jan 2018

Quickbeam

"Eventually someone will decide that the supply is insufficient"

That is unlikely to happen for at least 100 years, as I explained earlier.

As the value of a single Bitcoin rises, transactions will take place in increasingly small fractions of a single Bitcoin. Seven years ago, you could buy a single Bitcoin for ten US cents. Today, the same Bitcoin would cost you over $10,000 dollars. It's a phenomenon, and of course it could be a bubble that will eventually burst. Meanwhile, you might find yourself buying a foreign holiday for, say. 200 millibitcoins.

The problem with Bitcoin is - perversely - its popularity, and the fact that currently its value can fluctuate by as much as 20% in a day. That kind of instability works against Bitcoin being used as a day to day common currency - who wants to buy something today with a $10,000 coin that might be worth $12,000 tomorrow?

Bitcoin's future is anyone's guess, but if it can stabilise it might conceivably be the international trading currency of the future.

  canarieslover 14:12 02 Feb 2018

Do we really need a currency as volatile as this.click here and suppliers couldn't calculate prices from one day to the next.

Manufacturers

  wee eddie 14:16 02 Feb 2018

Perhaps we should be trading Bitcoin alongside the Bolivar, the two currencies appear to be behaving in exactly the same way

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