Quote:
Originally Posted by kane
To me the potential threat is if more and more countries and banks start acting the same way. Right now the value of the bitcoin is based on its ability to be converted into actual cash that you can spend anywhere. If all banks stopped allowing bitcoin purchases or sales (an example would be how US banks can't approve transactions from online casinos) then people would no longer be able to take the bitcoin and turn it into actual cash.Without that ability I could see its value going down and its role being diminished.
Right now the appeal of it is that it continues to go up in value. If you buy $5,000 worth of bitcoins today they might be worth $7,000 a month from now. If 1 bitcoin was only worth 1 bitcoin and never changed value because you couldn't convert it into cash it would lose its appeal and its usefulness.
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The rarity of Bitcoin is a strong point because there are only 21,000,000 bitcoins. That is about 1 btc for every 300 people on the earth...compared to gold which there is about 377 million pounds of above ground (and still more below ground) which actually could provide every person on the earth with just under an ounce (about .88 ounce) if my calculations are correct. Combine all that with the fact that it grows everday as an accepted form of payment online and if I'm not mistaken the number of people buying goods online is still growing everyday aswell ;)