3 comments

• @halu 17 July 2022

  What do you think the fate of the merchants who accept bitcoincash if the price of bitcoincash goes down while they shop for goods when the price of bitcoincash goes up?

  • @PanteraOnNoiseApp 17 July 2022

    I guess the price volatility and the loss of purchasing power would be detrimental to the survival of a business operating solely on Bitcoin Cash and having no reserves in a more "stable" local currency. A merchant is a business. It has a balance sheet accounting for every asset and liability in its possession. The issue here is that BCH is not a unit of account. It will always have to use the local currency as a unit of account to deal with payments or to collect. If a business deals with BCH and doesn't immediately sell for a fiat currency like the dollar but held BCH in its reserves, it will have to present losses in its local currency depending on the current rate at the moment of the accounting change. In a similar sense, a business that holds two monetary values (i.e. dollar and euro) will have to present a loss because of the exchange rate of these assets, based on the local currency. Now, I'm not sure if this response helps at all. Businesses are registered and follow regulations governments set. Their survival depends on following the laws and regulations, otherwise, the merchants or businessmen risk heavy fines and even prison time. In terms of almost any fiat currency except the Bolivar, and the Turkish Lira, perhaps the Argentinian peso as well, BCH and the rest cryptocurrencies lost more value so far this year. Still it depends on the accounting approach and many factors. If a business just held all its reserves in BCH, then it suffers a big loss right now. Usually merchants don't like to speculate too much, so they prefer stable fiat that don't inflate or appreciate too much.

    • @halu 17 July 2022

      Thank you for your opinion. It is a very sad condition for a merchant who accepts bitcoincash with the current price situation.