Re:Bitcoin value dives after China banks ban
by ok_craig on Thursday December 05, 2013 @02:36PM
(#6856615)
I just bought a $1000 plane ticket a few days ago for bitcoin. Seems like that's fulfilling the role of a currency.
You should know that you don't actually have to hold bitcoin to accept it as a payment method. Services like Coinbase let you instantly exchange it to cash if you use their merchant tools, so the merchant is actually exposed to zero risk.
Re:Bitcoin value dives after China banks ban
by sentenza on Thursday December 05, 2013 @03:35PM
(#6857035)
Ah, that explains it. It would be interesting to know what mechanisms Coinbase et al use to avoid balance sheet fallout by sudden downward fluctuations.
Re:Bitcoin value dives after China banks ban
by YourCupOTea on Thursday December 05, 2013 @04:12PM
(#6857279)
They would have to employ some sort of currency risk hedge. http://en.wikipedia.org/wiki/Foreign_exchange_hedge
Re:Bitcoin value dives after China banks ban
by jonknee on Thursday December 05, 2013 @05:37PM
(#6857895)
Easier said than done when you don't have an actual currency to hedge against and the complete lack of a functioning options market.
Re:Bitcoin value dives after China banks ban
by ChrisClark on Thursday December 05, 2013 @01:35PM
(#6856176)
That's the thing. Bitcoin needs to grow a LOT more before it can start becoming stable.
How many of these multi-dozen-percent downward fluctuations will it take before those storeowners and shops that take bitcoin stop doing so or start maintaining an insane markup on Bitcoin prices?