Quote:
Originally Posted by dev777
i see lots of people jumping on this mining bandwagon, buying big computer setups, trying to make a quick buck.
So that means more bitcoins being introduced to the market. What happens though when the trend doesnt pickup with merchants? I'm having a hard time seeing Amazon accepting bitcoins in the near future.. As a currency.. it has no room for growth outside of the black market.
supply will soon outweigh demand and the value will shit itself.
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how soon?
bitcoins are produced at very predictable quantities, difficulty variable keeps that balance. more miners and hashing power more difficult to produce block of bitcoins, less miners and hashing power easier to find new blocks. difficulty resets each 2016 blocks, which averages to every 10-14 days. it tries to keep production to 1 block (50 BTC atm) every 10 minutes or 10 blocks/hour. based on this you can calculate how many bitcoins are introduced in existence annually, at the end of 2012 and on 1 block will have reward reduced in half to 25 bitcoins. its made to reduce reward in half approximately every 4 years
If supply outweighs demand it simply means price per BTC will decrease. miners mostly try to hoard bitcoins (who wants to sell at cost or below of production?) unless they need money right away. this means that most new bitcoins don't get introduced in the market right away which keeps supply in check with demand.
Amazon is far away, you are right about that, which gives leverage to smaller merchants to get head start.
I'm not sure if black markets can go totally unnoticed being on internet and using bitcoins, unless they going to be very private with limited members, they surely would not want to be in the spotlight of media and authority's attention.
Overall there is a long way to go although it's been growing exponentially thus far .