Although the problem right now is that for remittance to work you need to be very certain that the amount you're sending is going to be equivalent to the amount being received. It wouldn't be unusual for BTC to have periods of extreme volatility (compared to regular currency exchange). You'd also hit issues because the IRS won't classify BTC as a currency, so there's a whole world of tax pain waiting to be uncovered.
How the IRS classifies BTC is irrelevant for people sending BTC out of the US, unless they make a huge paper profit in the window from buying the BTC and sending it. But that can be done minutes apart.
Extreme volatility is also irrelevant if the alternative is for your money-less family in some other country to receive no money, or once the hoops you have to jump through to do it legally with USD gets too difficult.
The risk of volatility, legal hassles, and so on is a cost. You can price it by asking how much people would be willing to pay to avoid it. There will be some price where it's a wash.
I don't know what that price is, but if it's higher than what banks and money transfer companies are charging, Bitcoin is the more expensive alternative.
> The risk of volatility, legal hassles, and so on is a cost. You can price it by asking how much people would be willing to pay to avoid it.
Actually, to price it, you need to find out how much you would need to pay someone to take on that risk (i.e. the cost of hedging the risk). If people's willingness to pay to avoid the risk is higher than the cost of hedging it, then you have a profit opportunity.
Lately the volatility is not that bad really. There are some price corrections upwards at times, but most people don't mind to be there. They are accompanied by downwards swings too, but it's not an orders of magnitude thing. In fact Bitcoin stayed in the $400-$700 price band since months moving quite slowly.
Actually that's normal. People overestimate BTC volatility because the price goes wild during periods of intense press interest, and so of course there's a big population of people who are only paying attention to Bitcoin during these times. In quieter times when the media spotlight is elsewhere the price usually settles into a somewhat specific band and stays there until the next press cycle.
I find it interesting how people talk about markets: increases are "price corrections" and decreases are "downward swings" implying that that they are temporary and will come back up.
This isn't Bitcoin specific but getting both in two adjacent sentences was a good opportunity to comment on it.
