It's all an oldddd story...

What is an ocean, but a multitude of drops?

Welcome to the Age of Aquarius, my friend

For sure. A successful and widely used cryptocurrency will likely have a capitalization in the trillions. That's a million USD or so per coin for coins with millions-of-coin supplies like BTC or XMR (technically XMR has unlimited supply but it will be in the millions for 100+ years so still trillions is about a million per coin in practice).

You only have to believe something has a 1/100000 chance to reach a million USD for it to be worth 10 USD.

This also indicates the silliness of any cryptocurrency that claims to be in the lead on the basis of current market caps (ignoring the liquidity and manipulation factors). That's like being one inch ahead of the starting line in a marathon.

forget my comment about making a couple of good calls. at $2 bitcoin you only have to make one good call.

Few observations.

Bitcoin has maintained a sustained downtrend despite:

- Good attributes
Bitcoin is probably the most perfect form of money. It's extremely divisible, eminently transferable,  and vanishingly scarce. Its cost of storage is zero. It's indestructible.
People are investing in an eyeglasses retailer called Warby Parker (started in 2010) at a 1.2 billion dollar valuation.
http://time.com/3842342/warby-parker-valuation/
Having superior attributes is good but does little to spark growth.

- Merchant "adoption"
Bitcoin has many big-name merchants participating in so-called merchant adoption. Merchants accept USD and Bitpay sells bitcoin. It also has a significant number of black market merchants using it.  All of them endeavor to hold bitcoin for the least amount of time possible. We shouldn't be surprised that this isn't propping up the price.

-Vastly improved accessibility
People around the world can buy bitcoin quite easily these days. There are ways to buy bitcoin at any 7/11 in some countries.

Counterparty has not recovered from its sustained downtrend despite:

- ZERO inflation.

Therefore, the following arguments regarding XMR:

1) adoption is lacking!
2) inflation is killing the coin!
3) the superiority of the coin's attributes will speak for themselves eventually!
4) XMR isn't accessible enough!

are beginning to appeal to me less and less.

Instead, I am beginning to think that the most successful coin will give its users some kind of benefit for HOLDING it. Both Darkcoin masternodes, BitShares "yield" for bitassets, and Proof-of- stake (in general) provide this motivation in arguably flawed ways, but the idea that there should be motivation to hold is sound, and I've come to believe that this is the final key to unlocking viral growth of bitcoin.

With regards to XMR, Crypto-Kingdom is currently the only thing that's proving that motivation.

Like central banks, Masternodes and other PoS schemes use centrally/locally determined/conjured magic numbers that should be set by the market, not core devs.

It is a category error for the software to (attempt to) explicate, in a vacuum, the appreciation motivation with specific reward values better found by the invisible hand, within the totality of the economy.

I agree that the software should not attempt to do it at the protocol level. But it can be done semi-externally. As I said, Crypto-Kingdom is already achieving it.

^^ interesting post (Jehsts post - didn't feel like quoting textblock).

It seems though you're defining "successful" as market valuation, as in if the price of each coin goes up, then that means that the coin is succesful. Again, its treating the currency like a stock. Which seems to be what this particular thread is about, so that makes sense.

But yes, I think generally the sentiment that a currency that has incentives to hold does go up in value simply because people aren't incentivized to sell.

But a coin can be successful and still not be worth 1 bajillion per coin. If I can go to the grocery store and pay for my groceries using my Monero Card, I think thats pretty successful as a currency. If I can do so and not have my neighbor go "hey, Ginger, what'd you think of that grocery store?" because for whatever reson my neighbor watches the blockchain, I'd say thats pretty successful.

existing bitcoin merchant adoption is nothing. When a cryptocurrency becomes the equivalent of visa mastercard in the public mind, thats when merchant adoption has been reached. When the little VeriSign VeriFone whatever its called  terminal has a bitcoin monero logo on it, thats when merchant adoption has occurred.

What we're seeing now isn't  "adoption" in as much as its some companies realizing they can make a quick buck by being some of the first to accept bitcoin. I come to this conclusion due to the following hypothesis: the bitcoiners that have the amount of bitcoins to "waste" at current valuation levels are the ones with boatloads of bitcoin (I'm assuming). Those buying at current prices are hoping their value will go up - they aren't spending. Therefore, these early merchant adopters are essentially, as one monerian put it, prying them out of your hands in order to extract value. This is, of course, evident by the fact that they immediately convert to fiat.

IMO, what you want to look for to see the future of cryptocurrencies is somewhere on the other end of the spectrum. The story posted about argentina is where its at. One of my favorite lines from that article was "Bitcoin was invented where its needed the least".

Due to this fact, I think what will springboard any particular cryptocurrency into a leading position, market cap wise, is the ability to run completely and independently on a smart phone. The countries that need cryptocurrencies are the ones that don't have infrastructure, therefore I think mobile platforms are key. Now, how we can apply this to monero is unknown. Perhaps the whole tippero side-chain concept can be worked such that the chain remains tiny by resetting every 24 hours, with the assumption being that someone in the network will have the ability to sync to the master chain.

Hrm, yes... perhaps that is doing - local micro chains can just pop in and out of existence , and the master chain can record somewhere whether a particular micro chain has been settled.... interesting....

Yes, I'm defining success as a high market valuation because that means that the coin is in demand. Everything else is sentimental.


Even if this happens, it's still not very significant. First, customers don't have a huge reason to use bitcoin to purchase Coca Cola at the grocery store. Second, even if many people used bitcoin to make daily purchases, the velocity of bitcoin is extremely high. All these merchants constantly sell their bitcoin back to people who are going to use bitcoin to buy products. In the aggregate, a very small number of bitcoin can be used to facilitate a huge volume of transactions. I'm a firm believer that merchant adoption as a driver of crypto growth is a lie. Because no one is holding.


If Argentines or Kenyans start using cryptocurrencies, it'll be in the Bitpay-style. In other words, they'd be using cryptocurrencies only as a bridge. For example, an Argentine will hold his money in the form of bitfinexUSD on bitfinex on his smartphone. Then, when he needs to spend money, he buys the necessary amount of BTC and sends it to the merchant. Then the merchant immediately sells the BTC for krakenEUR or whatever he wants to hold. Don't listen to Andreas. The unbanked are not going to hold pure bitcoin. They will use it to do what they need to do. They are not bitcoin fanatics. Kenyans driving crypto growth is  a lie.

That amount of time is infinitesimal with good software. These transactions in and out of bitcoin can be accomplished in fractions of a second.

Precious metals have great holding appeal. People just dump money into them and let them sit, even while paying large sums of money to guard them.

I think games are one good way to lock up a cryptocurrency and take it out of supply. Much better than merchant activity.
We should think of other mechanisms that require longer-term holding instead of holding for fractions of one second. That's really my point. I'm not praising DASH.

EDIT: the unbanked want to be banked. They just don't want inconvenient banking or corrupt, negative interest rate banking or banking with fake exchange rates (as in Argentina). They are not cryptoanarchists who want to hold bitcoin.