Exchange rates in Bitcoin. Bitcoin is traded on international markets against 30-45 national currencies, in real-time. It’s affected by fluctuations between those currencies indirectly. The exchange rates are defined by market dynamics (supply and demand). It is still a very small currency; it was a global currency from the day one but it is still small in size, therefore it has more volatility than many of the currencies you’re used to. Over the last seven years we’ve seen that the volatility has gradually reduced; as it gets bigger, it becomes more stable.
Why are cryptocurrency prices so volatile? Would pegging make them less volatile? Cryptocurrency markets are like boats: the bigger the boat, the bigger the wave you need to move it. It’s volatile because it’s still small, but it’s getting less volatile and more stable as time goes on because the market is getting bigger with more transactions. Volatility has two sides. We look econometrically at negative volatility as being damaging, not so much with upward volatility. There are national currencies with higher volatility than even bitcoin. The problem with tying / pegging a currency to an external asset is that it may work in the short term but not in the long term, as differences between the two markets emerge and at some point they can’t stretch enough to accommodate fluctuations in the other. Eventually someone does an audit of the gold vault and discover it’s not there, it’s not real, or it’s been loaned out to three different people and they all think they own it. The advantage of bitcoin is that it’s on the public blockchain, everyone knows where each bitcoin is, and only the person controlling the private keys can make claim to it.
The first question is from a talk which took place on October 11th 2016 during the Merkle Conference in Paris, France: http://www.merkleconference.com/
Watch the full talk here: https://youtu.be/SVdIbtWPYw4
The second question is from a talk which took place on July 7th 2017 at a Bloktex event hosted by the Wisma BeeOn Group in Kuala Lumpur, Malaysia: https://antonopoulos.com/event/the-future-of-money-kuala-lumpur-malaysia/
Watch the full talk here: https://youtu.be/HaJ1hvon0E0
CLARIFICATION: At 1:17 I say that Bitcoin’s market cap is ~$10 billion. At the time this video was made (October 2016), that was true. However Bitcoin’s current market cap is fluctuating around $70 billion.
RELATED:
Price premiums and arbitrage – https://youtu.be/B4tsk-ZiHuE
Divisibility and deflationary monetary policy – https://youtu.be/xhLgxX_wU6E
Who determines the value of bitcoins? – https://youtu.be/DucvYCX1CVI
Altcoins and the scaling debate – https://youtu.be/slbpdW-H3yk
Global financial crisis – https://youtu.be/JU3gNC_ZPKM
Could governments take over exchanges? – https://youtu.be/9PrJQeKl9w4
Why we should resist financial surveillance – https://youtu.be/KBFedmrDTQw
Someone said “Bitcoin is dead,” what do you say? – https://youtu.be/_osg3W7VI-Q
Andreas M. Antonopoulos is a technologist and serial entrepreneur who has become one of the most well-known and well-respected figures in bitcoin.
Follow on Twitter: @aantonop https://twitter.com/aantonop
Website: https://antonopoulos.com/
He is the author of two books: “Mastering Bitcoin,” published by O’Reilly Media and considered the best technical guide to bitcoin; “The Internet of Money,” a book about why bitcoin matters.
THE INTERNET OF MONEY, v1: https://www.amazon.co.uk/Internet-Money-collection-Andreas-Antonopoulos/dp/1537000454/ref=asap_bc?ie=UTF8
MASTERING BITCOIN: https://www.amazon.co.uk/Mastering-Bitcoin-Unlocking-Digital-Cryptocurrencies/dp/1449374042
[NEW] MASTERING BITCOIN, 2nd Edition: https://www.amazon.com/Mastering-Bitcoin-Programming-Open-Blockchain/dp/1491954388
Subscribe to the channel to learn more about Bitcoin & open blockchains!
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Music: “Unbounded” by Orfan (https://www.facebook.com/Orfan/)
Outro Graphics: Phneep (http://www.phneep.com/)
Outro Art: Rock Barcellos (http://www.rockincomics.com.br/)
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That's wrong asumption to say when bitcoin goes up in price, because volatility is created in most cases by the amount of % used for speculation by those who own big stacks of bitcoins. If btc will go in price will have same price for those speculators. So the point is… btc can go at 100millions in price, also same price will go for those who own large quantity, so every time they decide to exchange that coins into alt coins the volatility will be exactly same like now in %.
Thank you
For those who read this in sept 2017: don't worry 😉 in bitcoin we believe. hodl!
Love the pullover!
It's rehypothication
this is 2016 ?
Clicked video about pegging, instead got some people talking about bitcoin. Not really what I had in mind but oh well
he's a bitgod
It is not a currency at all. It is traded as a digital asset.
All Crypto's are trackable via the ledger and enslaves those that use it.
A couple of weeks ago I was told by somebody in a Starbucks: "Crypto currencies are a threat to freedom. Even if they are independent, it's only a matter of time until the Fed or IMF declares all crypto's completely illegal and gives everybody a chance to convert to the Fedcoin or equivilent.
Once that happens, those with control over it WILL be able to identify and track the purchase from every single person via the ledger. As soon as that happens, you will no longer have the freedoms to buy what you like, nor will you have the ability to revolt.
If a Pol-pot comes to power and decides your child needs to report for "re-education" (to be killed) are you going to go along with it, fight them, or run? because you can't buy guns and ammo without your purchase being spotted, and other militia can't converge on your location with you without them being revealed also. You also can't run because everyplace you try to buy gas or food reveals your current location. Either way, stormtroopers will converge on you and take your child.
Any company or government entity pushing the use of crypto currencies is aiding the enemy of our freedom and is subject to a military response."
I personally believe in peaceful solutions, but he is essentially correct.
It's wrong to say the main/only reason crypto currencies are volatile is their small size. I think a lot of it as cause they're used more for speculation and less as a currency compared to national currencies.
"What about exchange rates?"
I love how it's really not even a question, yet he takes it so seriously and gives the guy a really thoughtful and patient explanation. Good teachers need that kind of patience.
The man behind the scusess of bitcoin.
check out the crypto rap https://www.youtube.com/watch?v=PT5inG_4tBo&t=20s
Hehe, pegging… XD
Andreas, Please, you need to go back on Joe Rogan, but with Peter Schiff and Debate Cryptos, or just go back and respond to his claims. If you haven't listened to him on Rogan, listen to the last 45 minutes. or the 2:13:00 mark.
love this guy
Hey Tether (USDT) and bitfinex. This message goes to you
It's so sweet grabbing the calculator and going 4500 x …. oowwhhhhh.
Please Andreas in your talks, take a mic for the people asking questions , a small thing that will make a big difference to the quality of your channel
The best bitcoin educator
He's escaped. QUICK! Someone call the cops ?