It starts slow, but gets increasingly interesting as it progresses.
I suppose that I always could have deduced that Coinbase is not an actual exchange, but I always assumed it was.
Interesting, I was operating under the assumption that they were an exchange as well and not just a broker. I think the idea of having "features" like being able to leave a bitcoin "will" is interesting. It does seem like a perfect storm for successful adoption, bitcoin is a commodity people are purchasing for trade and investment now but as the market stabilizes, there will be more incentive to use the coin for purchases. This is the point when we will see a large influx of merchants willing to accept it. Where does Amazon stand in regards to Bitcoin acceptance? They could change everything.
Seriously, dude, as a business person, would you ever accept payment in the form of a commodity whose price could vary by 1, 5, 10, or even 50% in the space of a day? If the Euro changes 1% relative to the dollar in a week it's news. The whole thing is a neat intellectual exercise, but ultimately not much more than that. None of the numbers behind bitcoin suggest anything other than it's destined to be a colossal failure.
This reminded me of the troubles with Icelandic Krona. Their money got to be such a mess after the 2008 market crash that prices in stores were literally changing during the day, the government stepped in, shit got bad. You can skip to about 4:45 in the below podcast to hear about some of the shit they have to go through. It got to the point where the currency became completely worthless.
Most coinbase merchants only use bitcoin for the transaction, and immediately convert to dollars. This results in much lower transaction fees, and they aren't exposed the the variability. This IMO is a story that is buried under the speculation hype. Coinbase is targeting PayPal and Visa. For merchants that feel a lot of transaction pain, bitcoin looks very attractive. EDIT: You'll notice in the video Armstrong only refers to price in terms of the attention it brings. They are actually focused on bitcoin as a network for transactions. That's the upside that they are building a service around. There are actually a number of things that the bitcoin protocol can do, but aren't currently implemented, like doing m of n party transactions, whereby a transaction doesn't occur unless m of n parties agree. The means that escrows, trusts, etc can be a function of the network itself. I'm pretty sure that's what he is alluding to with the wills.
No I wouldn't. It will take time, but eventually the transition from commodity to currency could take place. There are some key things that need to happen: 1. It needs to be way easier to obtain and store coin. -so that my mom could buy it and understand how to store it. 2. It needs to be easily available internationally. 3. It needs powerful marketing behind it to transition from something techies understand and ordinary people see as novelty to something sought after as a status, "see me using my Bitcoin... I'm in the know." In short I think this is still very much in its infancy.
I just posted this article about dogecoin and it ties in nicely with your point that "It needs to be way easier to obtain and store coin. -so that my mom could buy it and understand how to store it." From the article: “In hindsight it was obvious that cryptocurrency was ready for something that was more accessible, and a meme is obviously really accessible," Markus said. "Everyone recognizes the doge meme. It’s based on a dog, and everyone loves dogs. It was a perfect storm.” Dogecoin is bizarre to say the least, but bitcoin could take a page out of that book.The crucial struggle for Bitcoin, and cryptocurrency at large, is getting people to understand what it is, how it works, and how it can be useful to them. People are curious about cryptocurrency, but they don’t understand it. While Dogecoin still has a much smaller market cap than Bitcoin, anecdotal evidence suggests its meme-based accessibility is helping attract new users.
To me, it's turning into a joke played by a few rich techies, the butt of which is all the possible investors and users. Bitcoins are super concentrated into the hands of a very few people. They aren't being produced at a rate that's going to dilute that concentration. So, the only way to distribute them efficiently enough to actually be used transactionally is for these few people to sell, and sell a lot. Can you imagine if a hand full of people owned half the supply of USD? It'd be chaos, and a national security threat. That is a way bigger barrier to usage than the practicalities of storing and exchanging, which are mere technical issues. What I'm taking about is a structural issue.