I would definitely not. For many reasons, but the volatility alone is enough to put me off of it. Losing a months income to a flash crash?
Not only that, but I'd have to convert it to fiat anyway to pay for 99% of the things I spend my salary on. With the fees involved in the exchange and fluctuations, I'd end up with less money in the end most likely.
Bitcoin is a fun toy, and spending some of my disposable income on it sounds ok. But my whole salary? not on my life. I sincerely hope there is no one around that is so blindly invested in the idea of Bitcoin they are converting their whole salary to Bitcoin.
Bitcoin is not a toy, it's a very useful tool for transferring value across borders and very good at that, especially when banks and companies such as Western Union impose unreasonable fees on their users.
Also, Bitcoin is not as volatile as it was once anymore, have you checked the price in the last few months? It has stayed around 200-300-ish USD.
It's fine if you don't want to use Bitcoin, but please stop spreading FUD.
I have looked at the price lately. In fact using the Coindesk chart[0], over the last 3 months it has swung between 200 and 300 USD you are correct. But a drop from 300 to 200 USD is still volatile as hell. It means that my Salary could lose one third of it's value in the space of a month. The one year chart is worse. Of course it could swing the other way too, but I like a little more safety in my income.
As for it not being a toy, that's a matter of how we each use it. You use it as a more serious financial instrument evidently. Personally I prefer services such as TransferWise, for reducing those bank fees, but if that's how you use Bitcoin then good for you!
Literally in the link he posted, if you look at the 3 month pricing chart, the low point is $209 and the high point is $309. This isn't speculation or guessing, those are some pretty huge swings in such a short amount of time the data quantitatively shows.
I wouldn't want my salary to have that kind of volatility.
They're not saying that. They're saying that those advantages don't directly apply to them, but volatility does. They aren't dismissing it, just saying that for them the disadvantages far outweigh the advantages, which is perfectly acceptable.
> I'm not saying it's stupid to prefer a stable currency, I'm all for price stability and making a consistent amount of money.
>I understand, but is the volatility really a problem as some people think it is?
You seem to be contradicting your own idea. Yes, volatility is a problem.
Why? Because your rent, utilities, and other living expense aren't based on the same volatility. The "money going out" has the potential to be valued very differently than the "money coming in".
Do you really want to be evicted because the money you were paid was valued differently than your rent? Completely possible with BTC.
Fiat currencies work because a large collection of people around you agree on & depend on their value. If my landlord disagreed about the value of a dollar, my getting paid in dollars would be just as useless as getting paid in BTC.
For a fiat currency to be worthless to everyone around you it would requires a failure of Government, or some other very large catastrophe. At that point, paying rent is the least of your problems.
Edit: and to reflect your edit, yes, I have tried BTC. I made a not-unsubstantial amount of money by essentially gambling with it's value. But had my timing been even slightly different, I would have lost money instead, and a lot of it. I bought it when it was priced around 50 dollars, and sold when it got to 680 dollars a while back. But what if had been the other way around?
Edit2: If you change it out immediately after getting paid, the risk is lower (you'd basically be operating like many Payment Processors who process transactions in different currencies). That would also eliminate any possible benefit, as it's being used purely as a transfer currency.
> I'm saying it's disappointing everyone focuses on volatility, yet everyone dismisses the other advantages of Bitcoin.
There are no advantages for the vast majority of people and the volatility disadvantage applies to anyone being paid in bitcoin. I'd consider accepting bitcoin for a single job or project if it was the preferred method of payment for the client, but I'd never accept a regular salary as bitcoin since I like to save part of my check each week and saving money in the form of bitcoin is a terrible idea.
I love Bitcoin, but why would I work for Bitcoin? It provides no single benefit. In fact, it only provides risks and more hassle (have to convert it to EUR to be able to use it).
Burned my fingers on freelancing for Bitcoin a couple of times already.
Every store in my country accepts fiat currency. I can pay taxes and fines in it, or pay for government services. It's legal tender for all my debts. If I could do all that with bitcoin, it might be real enough.
I'm guessing that by "real" he means "useful", as in it can be "used" to pay for things like medical bills, insurance, student loans, taxes, rent, utilities, groceries etc. Bitcoin is definitely "real" in some sense of the word, but for most situations it functions similarly to money that is not real (like monopoly money) in that it won't be accepted in exchange for tangible goods and services. Even the relatively few establishments that accept bitcoin as payment don't really regard bitcoin as real enough to accept directly and instead hire a middle man to convert bitcoin into "real" money on their behalf.
In most places, probably the fact that the local fiat currency is vastly more likely to be treated as real currency by the counterparties you need to deal with in real transactions; bitcoin has some direct acceptance, and a some additional reach from entities that have arrangement with other parties who will exchange it into more widely accepted currency for them.
> There's nothing fake about Bitcoin.
Bitcoin is a real thing, sure, that's clear. Whether it is real money -- and particularly whether it is something that effectively performs the medium of exchange function of money in common circumstances for which people need that function performed -- is a little less obviously true.
You can exchange it for food and housing and pay your taxes and bills. Try doing that in a city with any value store other than a fiat currency.
The original question is fundamentally similar than asking if you'd like to be paid in gold bars, grain futures, stock certificates, or live cattle. Would you want your salary to be given to you in a volatile commodity that you would be responsible for converting to currency?
If you really really really want some bitcoin, it would be more prudent to get paid in currency and then immediately convert some portion of it to bitcoin.
I've heard of some FinTech startups that are offering forward-contracts (think futures, or put-options) on Bitcoin. If I can get my hands on those kind of contracts, I'd totally accept my salary in bitcoin. It seems like that would eliminate any potential downside, as long as those contracts are relatively cheap to buy.
I can't imagine options would be cheap to buy, as the seller is taking on all the risk, and they will take into account the volatility of the underlying asset when determining the price they would be willing to accept.
Forward contracts are different from options. But what's the point of being paid in BTC every month, if you enter into a set of forward contracts to convert that BTC into USD? It's equivalent to being paid in USD.
32 comments
[ 4.3 ms ] story [ 84.3 ms ] threadNot only that, but I'd have to convert it to fiat anyway to pay for 99% of the things I spend my salary on. With the fees involved in the exchange and fluctuations, I'd end up with less money in the end most likely.
Bitcoin is a fun toy, and spending some of my disposable income on it sounds ok. But my whole salary? not on my life. I sincerely hope there is no one around that is so blindly invested in the idea of Bitcoin they are converting their whole salary to Bitcoin.
Also, Bitcoin is not as volatile as it was once anymore, have you checked the price in the last few months? It has stayed around 200-300-ish USD.
It's fine if you don't want to use Bitcoin, but please stop spreading FUD.
As for it not being a toy, that's a matter of how we each use it. You use it as a more serious financial instrument evidently. Personally I prefer services such as TransferWise, for reducing those bank fees, but if that's how you use Bitcoin then good for you!
[0] http://www.coindesk.com/price/
I wouldn't want my salary to have that kind of volatility.
I'm saying it's disappointing everyone focuses on volatility, yet everyone dismisses the other advantages of Bitcoin.
Some people make a lot of assumptions, but I bet none of those people ever tried Bitcoin.
> I'm not saying it's stupid to prefer a stable currency, I'm all for price stability and making a consistent amount of money.
>I understand, but is the volatility really a problem as some people think it is?
You seem to be contradicting your own idea. Yes, volatility is a problem.
Why? Because your rent, utilities, and other living expense aren't based on the same volatility. The "money going out" has the potential to be valued very differently than the "money coming in".
Do you really want to be evicted because the money you were paid was valued differently than your rent? Completely possible with BTC.
Fiat currencies work because a large collection of people around you agree on & depend on their value. If my landlord disagreed about the value of a dollar, my getting paid in dollars would be just as useless as getting paid in BTC.
For a fiat currency to be worthless to everyone around you it would requires a failure of Government, or some other very large catastrophe. At that point, paying rent is the least of your problems.
Edit: and to reflect your edit, yes, I have tried BTC. I made a not-unsubstantial amount of money by essentially gambling with it's value. But had my timing been even slightly different, I would have lost money instead, and a lot of it. I bought it when it was priced around 50 dollars, and sold when it got to 680 dollars a while back. But what if had been the other way around?
Edit2: If you change it out immediately after getting paid, the risk is lower (you'd basically be operating like many Payment Processors who process transactions in different currencies). That would also eliminate any possible benefit, as it's being used purely as a transfer currency.
There are no advantages for the vast majority of people and the volatility disadvantage applies to anyone being paid in bitcoin. I'd consider accepting bitcoin for a single job or project if it was the preferred method of payment for the client, but I'd never accept a regular salary as bitcoin since I like to save part of my check each week and saving money in the form of bitcoin is a terrible idea.
Burned my fingers on freelancing for Bitcoin a couple of times already.
In most places, probably the fact that the local fiat currency is vastly more likely to be treated as real currency by the counterparties you need to deal with in real transactions; bitcoin has some direct acceptance, and a some additional reach from entities that have arrangement with other parties who will exchange it into more widely accepted currency for them.
> There's nothing fake about Bitcoin.
Bitcoin is a real thing, sure, that's clear. Whether it is real money -- and particularly whether it is something that effectively performs the medium of exchange function of money in common circumstances for which people need that function performed -- is a little less obviously true.
The original question is fundamentally similar than asking if you'd like to be paid in gold bars, grain futures, stock certificates, or live cattle. Would you want your salary to be given to you in a volatile commodity that you would be responsible for converting to currency?
If you really really really want some bitcoin, it would be more prudent to get paid in currency and then immediately convert some portion of it to bitcoin.
Forward contracts are different from options. But what's the point of being paid in BTC every month, if you enter into a set of forward contracts to convert that BTC into USD? It's equivalent to being paid in USD.
I enjoy BTC for sending/receiving payments as it is very easy, but I don't see it as a safe 'investment'.
What options do you suggest for converting to local currency, USD in your case?