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by RoboPlumber
3386 days ago
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Experimental evidence suggests that having lots of users isn't a guarantee of stability. See Venezuela (right now), Zimambwe Dollar, German Reichsmark, Argentine Peso, Mexican Peso, Thai Baht, etc. All of these had tremendous collapses despite a solid user base. However, I think you are right in that a small user base implies some level of volatility. A large user base is perhaps a necessary, but not sufficient, condition for stability. Bitcoin's instability is also generally overstated, in my opinion. There have only been a few instances where it was so volatile that you wouldn't want to use it for day-to-day transactions. |
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True. I don't think this negates your point, but it's worth noting that in each (or at least most) of these cases there's a feedback loop between the financial and socio/political collapse which might increase the currency's volatility. In fact, perhaps we see this even more strongly with Bitcoin vs. a state-backed currency due to the current speculatory climate, but this may be another false characterization of the current culture (I'm not sure).
> Bitcoin's instability is also generally overstated, in my opinion. There have only been a few instances where it was so volatile that you wouldn't want to use it for day-to-day transactions.
As someone who's only tinkered with Bitcoin and tends to otherwise read about it only in the news in situations like this, I think you're right.
I appreciate your reply!