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Comment by bumby | Hacker News Reader

Are there any numbers on how much crypto is being used as a currency (i.e. actually buying things) vs. how much is being used as an investment (i.e. buying and holding/trading with the hope it goes up in value)?

I'm curious how each compares to traditional currency and how much this affects the competitiveness of it as a common currency. My initial thought is that so many people look at it as an investment it may limit it's ability to be a good medium for exchange.

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It's quite hard to get numbers.

Firstly the reported trading volumes are about 95% fake. https://www.forbes.com/sites/cbovaird/2019/03/22/95-of-repor...

Then much of the thing buying is illegal stuff like drugs that doesn't get well reported. Wikipedia has "A reviewed 2013 analysis put the Silk Road grossing $300,000 a day, extrapolating to over $100 million over a year."

Coinmarketcap has daily crypto volume at $43bn a day

so say 5% is real that's $2.1 bn/day trading

and say drugs trade etc is $1m a day, that's a small proportion.

comission on those trades is probably about 0.2%*2.1bn= $4m/day

Regular retail business, not much https://news.ycombinator.com/item?id=19280689

I've gotten user donations from Bitcoin.

I've paid friends in Bitcoin and they have paid me.

I also got a Shift card, which is super cool.

My only reluctance with Bitcoin, is getting a mortgage in BTC. What happens if BTC hits 100k USD/coin?

Ha, I'd love a BTC mortgage. I'll take those odds.

Guess if it was no recourse it could work.

If you are a legit company with pesky things like bookkeeping and accounting then you do not want Bitcoins on your books. You might accept Bitcoin as a gimmick by utilizing a third party service which buys them and gives you money (like BitPay) but there's no legic economy. How could there be when it is so volatile and it's basically held up by hype? The risks are clear for a business and what's the advantage...?

Not to mention the tax implications.

In 2017 I worked for a company that often took payment in ETH and held a lot of it long-term. They had a bookkeeper and two lawyers on payroll, and about fifty other employees.

You’d be a fool to spend your bitcoins. It’s a deflationary currency. That means it’s worth more later than now in the long run. As opposed to dollars, which is inflationary and worth less as time goes on.

You'd be a fool to spend your dollars, when you could instead just buy bonds, which you could redeem for more dollars in the long run.

Well lots of bonds tend to have negative returns nowadays...

So you'd be a fool to get paid in dollars, since it's worth less as time goes on.

Money is always a trade with a spending and receiving side. So the real question is what the person who has the goods wants to get in return.

Well, if you follow that logic your whole life, you will have lots of bitcoins when you die. Happy life I guess?

The point of money, currency or any financial asset is to produce value to your life. If you think bitcoin will develop in value, it makes sense to spend less-valuable assets before those bitcoins, but at some point you probably want to use your bitcoins as well for living. Money should be a tool to enable nice life, you shouldn't live for money.

You'd be a fool NOT to spend them. Spending them helps to improve their value by growing the ecosystem. Spend and replace.

This was what I was looking for insight on. At least in some people's view, Bitcoin isn't much of an investment because it has no intrinsic value, yet if the majority holds on to it, it has litle value as a currency/medium of exchange

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