Volatility is a downside to bitcoin adoption: the risk of having wealth evaporate before you can spend it is unnerving. But when authors trot this as a definitive rebuttal to digital currency, I get frustrated.
So, for Dr. Jonathan Parker, author of Is bitcoin a viable currency? It's probably too volatile, I have three questions:
1) Why didn't you acknowledge that if valuation is to move through 4 (5?) orders of magnitude, to not expect volatility is absurd? The interesting question is "Are volatility measures trending downward?" (A wonderful example of a testable claim.) Have you done this, chosen a volatility measure and plotted it in time?
2) Why did you not address strategies those who are unhappy with volatility can take to remove risk, e.g. Coinbase?
3) Why did you lack the courage to make a falsifiable claim or prediction, even when preceding your conclusion with "I'm guessing?"
Best,
John @JohnSteill on twitter
Tuesday, May 27, 2014
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