Heh, we (miner community) were selling out Newegg of GPUs 18 months ago. If you were just getting in 6 months ago you might as well just buy bitcoins and store them.
I genuinely got interested in bitcoins 12 months ago or so. But at that time it just looked like something exciting and mining looked not that profitable. The break even looked very far to reach. I always kept an eye on bitcoins. A few months ago when it looked really serious I still waited.
And now it looks profitable to mine and invest. Many say I'm too late to mine, many say its still not late.
Quite a large number, I'm afraid. I know a few people who keep hundreds to several thousand+ without spending any in anticipation of a massive buyout (or financial collapse). These were very early adopters that ran their vid cards 24/7 for years.
The good thing about the price increasing is that the early adopters are more willing to spend BTC and also convert BTC into fiat.
This increases the overall value of BTC because as more people who own BTC bought in at a higher price, it will be harder and harder for the price to crash down to levels lower than the average price of BTC purchased. (I argue this based on the psychology of buying BTC at a certain price)
Back when the large 2011 crash happened and even now to a slightly lesser degree the average BTC acquired/bought is still low, (i'd wager around $5 for the entire network of BTC still accessible, as a example)
As more earlies sell and purchase items, this average will increase, and as it does the possibility for BTC to fall below this average becomes harder and harder.
I remember that crash. A couple of those people were freaking out. And I think your price estimate is correct.
I'd much rather they start spending them within the BTC economy than cashing in for "real" currency instead. The biggest hurdle for BTC isn't even the hoarding, it's that they hoard just because it's still not seen as a real alternative by most folks so they're waiting for the "realization, spike" in prices (I don't think we're there yet).
Few people these days actually hoard cash; instead, they invest in commodities or companies. But these people are hoarding for the value of the currency itself. It's like gold all over again.
I must confess though, the first time I heard about BTC, I did take it for just a very elaborate ponzi scheme. The irony is that the hoarding may, if left unchecked, turn it into exactly that.
Perhaps things like this ATM (which looks very simple to use) and user-friendly online tools like Coinbase will serve to expand real-world use and the BTC economy as a whole. It would be awesome to see it become an even more stable international alternative currency.
Well, it isn't very rational to collect pile of money and then just sit on it until you die. At some point these early adopters are either going to sell, or use their bitcoins.
The more people buying up bitcoins, the bigger the price is, the more early buyers sell some portion of their stash, the more bitcoins dissolve into the market. If at some point, everybody who wanted to invest, already done so, the price will stop rising. Some guys will sell, some others will buy more and realize that now much more people own some bitcoins and are ready to participate in exchange.
Therefore, "investors" build a market among themselves as a side effect of "hoarding". And since there will be non-zero amount of people willing to exchange directly rather than sell, the price will rise further, attracting even more people. And so on until everybody who needs BTC gets some. And then nobody would need fiat.
But now I want to invest, waiting for a dip so I could buy some BTCs. Also considering mining.