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Comment by avar | Hacker News Reader

    > Buying Bitcoin is not investing,
    > it is speculation. This may sound
    > pedantic, but its not.

There's no such generally agreed-upon definition of what constitutes speculation and investing[1][2][3]. The most common use of the word "speculation" just seems to mean "high-risk investment", but what constitutes "high-risk" is a matter of taste.

    > nobody knows for sure if its too late.

If it ends up replacing all money then the value of a single bitcoin will be around $200B, but I'd happily characterize that claim as speculation :)

1. https://en.wikipedia.org/wiki/Speculation#Speculation_and_in...

2. https://en.wikipedia.org/wiki/Investment#Related_terms

3. http://www.investopedia.com/terms/s/speculation.asp

4. https://bitcointalk.org/index.php?topic=8113.0

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Investments generally have some reasonable “safety“ of principal, which typically means they’re based on something with an intrinsic value. A stock gives you a claim to future profits, a loan/bond: legal claim on underlying collateral, and currencies back in the day: gold.

Investments are a bet that intrinsic value will increase.

Speculations are a bet about beliefs and psychology of future buyers.

Right now, bitcoin is purely speculative.

If it becomes sufficiently pervasive, it will enter the territory of most fiat currencies that have left the gold standard. With sufficient volume, liquidity, and traders, arbitrageurs will make it tightly track some asset/assets with intrinsic value.

> If it ends up replacing all money then the value of a single bitcoin will be around $200B, but I'd happily characterize that claim as speculation :)

Assuming "the total amount of money in the world is $84 trillion" http://www.businessinsider.com/bitcoin-compared-to-all-of-th...

BTC currently has a market cap of ~$94b

$84t / $94b = ~894

894 * $5625 (current BTC price) = ~$5m/BTC

Am I missing something? I may be. But from my calcs seems like your $200b estimate is off by a factor of 40,000x.

Your number sounds correct, I just remembered it was some really high number and incorrectly skimmed that thread looking for it.

That sounds like a good guestimate :) it would be interesting to take into account how diluted normal money vs bitcoin will be which could push the numbers to something like 250t (5% inflation over 20 years) vs idk how much extra bitcoin will be created, i'm guessing not much

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