1/ Watching #btc volatility & thinking about current use cases, I finally appreciate why @VitalikButerin says it's important to make a StableCoin. Ppl should be able to store value w/o taking on all this currency risk.
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What is the required valuation of a crypto to minimize day to day fluctuations to, say, 1%?
It has nothing to do with valuation. The crypto either needs totally stable supply/demand (basically impossible), or a built in mechanism which either pegs it to an external value, or attempts to dynamically maintain a price.
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Thought experiment: what if valuation was really large. Would not the supply/demand be a small fraction of the valuation? And hence, stability achieved?
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No. For valuation to be very large, demand would have to be very large, hence it's fluctuations would be large. In other words: demand fluctuations are proportional, hence so are price fluctuations.
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