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Comment by jgord | Hacker News Reader

High BTC Fees are hitting lots of legit businesses who were previously making the move to support Bitcoin. If they are halfway thru the rollout, its not a lot of work to switch to supporting BitcoinCash instead, due to the similarity of the apis & protocol.

Median BTC fee has been $10 to $25 USD over the past couple weeks. Meanwhile, median BCH fee is under 10c.

Regardless of small-block vs big-block ideology, its pretty clear that a 25 dollar transaction fee rules out a lot of business use cases.

From where I sit, we are witnessing the birthing pains, not of the Internet of Things, but of the Internet of Money.

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> High BTC Fees are hitting lots of legit businesses

Why do people always think that BTC—only because it has started as a p2p cash system—needs to stay there?

From my point of view BTC evolved to the best value storage system available:

- Limited supply

- Easily available in any country without a bank as an intermediary (try to purchase or sell gold without a bank, good luck and real, physical gold as an value storage is just cumbersome)

- Probably a good value storage when the stock markets crashes (because again no banks are involved which might also go bankrupt, in particular in countries with a weak economy/currency/infrastructure)

- The strongest brand and most popular with mainstream and retail investors, just go to Google Trends and you see that the search volume of Bitcoin is insanely high (~50% of 'iphone' just to stress how much mainstream bitcoin went); just imagine: which crypto people will choose to put a large part of their money first when a crash comes? To the biggest brand I guess

- Biggest ecosystem around (wallets, etc.) + high reliability even if slow (just look at some other coins with a huge market cap where people even struggle to send and receive coins)

- Highest liquidity

This is a very strong use case for me to buy and hold BTC. If there is any other coin better as an value storage please let me know.

my urine is also of limited supply, but no one buys and holds it

You missed a golden liquidity joke.

> best value storage system available

Except that nobody has any idea how much value it will have next week, let alone next year. The variance is just too high.

As long as it's growing on a yearly base (which Bitcoin does for years and significantly) a high volatility shouldn't hurt any value store.

As long as it's growing, correct.

But if you want to get that value, then bitcoin is unreliable in the amount you get. And that is only if it has grown over the period you stored your value for.

Disagree. Every currently available value store is volatile, even gold (which is highly volatile): http://finance.google.com/finance?q=NYSEARCA%3AGLD&sq=gold&s...

I still don't see any other value store better than BTC considering my prior bullets.

Well, for one, if someone tells you Gold is an excellent store of value, it's probably bad advice, there are better places to put your money (like a bank account or ETF)

Plus, Gold might be highly volatile by some stock standards but it barely moved a percent over the last 24h while Bitcoin does percent movements on the hour mark.

Stores of value require a predictable purchasing power to be useful, bitcoin does not have predictable purchasing power. Or the guarantee that in 20 years I'll still be able to use bitcoin at all.

The major difference here is that gold has been used for about 2000 years plus now and has proven to be somewhat valuable in a functioning society. Bitcoin hasn't been around for a full percent of this time and nobody knows if it'll be around for another percent to begin with.

Ring me up though if Bitcoin will survive the next 100 years for sure.

> Stores of value require a predictable purchasing power to be useful

Think you confuse matters: A currency should have "a predictable purchasing power", not a store of value. Latter should rather grow (which requires a deflationary nature/limited supply) and offer stability in times when stocks and/or currencies nosedive. Gold is not that bad for this use case and BTC is even better.

But instead of so much meta talk I would be happy if you let me know which asset is a better store of value than BTC and why (for all kind of countries, also those with weak economies/currencies/infrastructures).

> "a predictable purchasing power", not a store of value

The two go together, surely? What kind of value is it if it doesn't translate into purchasing power?

Hard to get better than US T-Bills for value preservation. That's the standard financial advice. There is a point in Bitcoin being available in countries where capital controls make USD hard to obtain, but the bitcoin is hardly easy to obtain in that situation either.

> bitcoin is hardly easy to obtain in that situation either.

It's def. easier than getting US T-Bills. BTC is widely available in most countries and if not, you just go to a meetup and trade it in person (with higher fees but still easier than... US T-Bills). So, you still owe us after all this discussion a better alternative for an internationally available store of value than BTC.

A well aged wine is usually not a bad idea if you have some money.

In a deep crisis, cigarettes aren't a bad idea, they usually end up being a black market currency. In other regions of crisis bullets might also be a good idea.

For a proper financial market with money, a good store of value might just be a long term savings account in a bank, that's a very stable value store and usually those keep up with inflation pretty well. If you can have a bit more risk there are index fonds and ETFs but those are more money making than store of value.

In places with weak economies it usually doesn't make sense to establish much of a store of value, bartering is more common and people just live with what they have, the accumulation of wealth beyond the daily necessary can be rare in some african countries.

BTC is also a bad solution since it's rather expensive, weak economies have more people who can't afford the rather extreme transaction fees (which are laughably high compared to EU SEPA transactions even at comparable confirmation times)

> For a proper financial market with money, a good store of value might just be a long term savings account in a bank

Not sure. Look what 2008 happened: States had to rescue banks which would have gone bankrupt otherwise and because of this the entire economy/currency suffered. A FIAT saving account—even in a developed country/financial market—is a terrible store of value.

> weak economies have more people who can't afford the rather extreme transaction fees

When I look at Google Trends https://trends.google.com/trends/explore?q=bitcoin I see many weaker countries or low-income countries (South America, Russia) which have a quite high interest in BTC.

The transaction fees don't hurt if it's just about putting your savings in a safe spot. The people are not going to buy groceries with BTC.

> Easily available in any country without a bank as an intermediary

> because again no banks are involved which might also go bankrupt

> Highest liquidity

I'm not sure what you mean by this. Banks certainly are involved, and provide the liquidity you mention by facilitating transactions for exchanges between crypto and traditional currencies. A disruption to this process either with a beneficiary bank or as an intermediary bank[1][2][3] ripples through the ecosystem. While yes, it's possible to interact with Bitcoin without involving a bank if you mine it yourself, the moment you involve an exchange and want to liquidate your bitcoin for more commonly accepted currency (or the other way around), you indirectly involve traditional banks. And if exchanges can't provide liquidity, then the value of bitcoin can and will drop precipitously.

[1] https://news.bitcoin.com/bitcoin-exchanges-victim-banking-pr... [2] https://medium.com/@whalecalls/taiwan-aml-reforms-usd-crypto... [3] The above articles mention the issue was related to new regulations. But insolvency of intermediary banks (or even beneficiary banks) could cause similar issues in the future as well.

> The moment you [...] want to liquidate your bitcoin [...] you indirectly involve traditional banks

Not necessarily, you could liquidate f2f with another person providing you cash. Just think of the worse case, stock crash, bank crash, etc. Then, it's good to have BTC in your wallet. They are accepted and easily transferred, without any bank).

Well an actual worst case scenario also brings down your internet connection. Without banks various internet providers wouldn't be able to pay each other for connections. I mean they could theoretically let each other communicate for free. But we're talking ISPs and such.

> Well an actual worst case scenario also brings down your internet connection.

Not sure if we talk about the same: The last worst case scenario was 2008 (stock crash, banks went bankrupt) but the Internet was still fine.

Do Bitcoin nerds really think people are going to liquidate 5 figures of Dunning-Krugerrands in person? Get real.

It's not about liquidation in person—it's about that you could and this would keep BTC's value stable in times when stock/banks/currencies crash (in a worst case scenario).

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