Is the understanding accurate that the relatively high transaction cost to use BTC for purchases renders it more economically viable as a store of value (eg. inflation hedge) than as a regular currency for buying/selling ? (ignoring purchases where economic efficiency of transaction cost is not highest priority) If so, then shouldn't analysis of its current price factor in fundamental demand for store of value? Yield spread between different tenors of treasuries has collapsed in the past year or two. Perhaps an inflation hedge might be the least of our needs? https://fred.stlouisfed.org/series/T10Y2Y
Yes, high transaction costs (and high volatility) make bitcoin noncompetitive as a medium of exchange. A number of companies have stopped accepting BTC for purchases.
I would not say that relatively high transaction costs make BTC more viable as a store of value. Relatively high transaction costs of BTC are not as intolerable for store of value. Store of value users also prefer the lowest possible transaction costs. but those BTC transaction costs will be small in percentage terms for the larger transactions typical of store of value activities.
BTC's attractiveness for store of value probably has more to do with the store side than the value side. Some might seek to store assets outside the reach of kleptocratic tax authorities.
Given that BTC can be prone to hyperinflation -- losing 10% of its value in a week certainly qualifies -- I don't see how it is a hedge against inflation.
Haha -- love how these rationales always come out after the move. Reminds of a few years back when the gold bugs were promoting the "Indian wedding season" seasonal. Personally, I blame the drop on the obviously poor feng shui alignment of Coinbase's headquarters.