Cryptocurrency - where's the actual value?
Discussion
So if coins are given out for mining - that is solving mathematical problems and in so doing helping to ensure the security of the system - where's the actual value in cryptocurrencies, other than as speculated-upon e-tulips?
I have scoured the web looking for the answer to this point, but articles only describe how clever it is (and, yes, blockchain tech is).
I have scoured the web looking for the answer to this point, but articles only describe how clever it is (and, yes, blockchain tech is).
It allows anyone with a computer & internet connection to make a financial transaction independent of third parties and thus independent of their fee structures (banks, forex) and broader currency interference (government manipulation of currency to meet fiscal targets). Transactions are reliable, secure, cheap, quick and worldwide. If you don't see that these capabilities are of value, then just move on 
Behemoth said:
It allows anyone with a computer & internet connection to make a financial transaction independent of third parties and thus independent of their fee structures (banks, forex) and broader currency interference (government manipulation of currency to meet fiscal targets). Transactions are reliable, secure, cheap, quick and worldwide. If you don't see that these capabilities are of value, then just move on
Yes - this is exactly what every website says, but what have those who have 'earned', say, Bitcoins, done other than to help maintain the system? Where's the actual value?It's all good fun until it starts to mix with real money.
Beneath the undoubted elegance of blockchain technology, aren't cryptocurrencies just tradable ponzi scheme shares?
Behemoth said:
It allows anyone with a computer & internet connection to make a financial transaction independent of third parties and thus independent of their fee structures (banks, forex) and broader currency interference (government manipulation of currency to meet fiscal targets). Transactions are reliable, secure, cheap, quick and worldwide. If you don't see that these capabilities are of value, then just move on
While crypto-currencies have their uses, they are also prone to wild value swings, exchange manipulation, and downright fraud (see Mt. Gox).Whats the difference between a BTC and a £10 note? Neither are backed by anything other than 'the system', since we departed from the gold standard. If £10 is a stretch, what about 10 pesos or (insert other questionable economy currency here).
Obviously there is a huge difference in terms of acceptance, backing, take-up etc, but in real terms arent they both just numbers backed by nothing other than trust?
Obviously there is a huge difference in terms of acceptance, backing, take-up etc, but in real terms arent they both just numbers backed by nothing other than trust?
Ooh you're in for a spanking daring to question the future!
Most people who are "into" cryptocurrencies will tell you it is the future of money (even though it is not money) and it allows you to carry out transaction (even though the amount of transactions on purchases is quite tiny).
The vast majority buy cryptocurrencies to make a profit and they are all holding onto to them because they have continued to go up. When they drop there will be a sell off.
"Money" as we know it is tried and tested and is used and held in many countries, USD for example.
Cryptocurrencies is not money. It is a commodity.
Most people who are "into" cryptocurrencies will tell you it is the future of money (even though it is not money) and it allows you to carry out transaction (even though the amount of transactions on purchases is quite tiny).
The vast majority buy cryptocurrencies to make a profit and they are all holding onto to them because they have continued to go up. When they drop there will be a sell off.
"Money" as we know it is tried and tested and is used and held in many countries, USD for example.
Cryptocurrencies is not money. It is a commodity.
Edited by bongtom on Wednesday 6th September 16:42
Edited by bongtom on Wednesday 6th September 16:43
Benjaminpalma said:
Yes - this is exactly what every website says, but what have those who have 'earned', say, Bitcoins, done other than to help maintain the system? Where's the actual value?
It's all good fun until it starts to mix with real money.
Beneath the undoubted elegance of blockchain technology, aren't cryptocurrencies just tradable ponzi scheme shares?
So do you think there's no value in banks & governments maintaining & securing pound sterling or dollars? Of course there is.It's all good fun until it starts to mix with real money.
Beneath the undoubted elegance of blockchain technology, aren't cryptocurrencies just tradable ponzi scheme shares?
Bitcoin is serious and is as close to real money as you can get. Peddling the tulips & Ponzi stuff is tiresome & covered well elsewhere. Bitcoin is as close to either of them as any traditional currency or commodity.
Maxf said:
Whats the difference between a BTC and a £10 note? Neither are backed by anything other than 'the system', since we departed from the gold standard. If £10 is a stretch, what about 10 pesos or (insert other questionable economy currency here).
Obviously there is a huge difference in terms of acceptance, backing, take-up etc, but in real terms arent they both just numbers backed by nothing other than trust?
No. Traditional currencies (i) have real-terms comparable historical value, and (ii) are supported globally by thousands of tonnes of gold reserves and diversified investments.Obviously there is a huge difference in terms of acceptance, backing, take-up etc, but in real terms arent they both just numbers backed by nothing other than trust?
Somebody, at some point, has added value and earned each, say, pound in existence. The only exception to this is when money is simply printed but even then the money is spent by governments on actual goods and services.
bongtom said:
Most people who are "into" cryptocurrencies will tell you it is the future of money (even though it is not money) and it allows you to carry out transaction (even though the amount of transactions on purchases is quite tiny).
Yet again - more description about it's qualities. I get all this. There's still no hint of real value.bongtom said:
The vast majority buy cryptocurrencies to make a profit and they are all holding onto to them because they have continued to go up. When they drop there will be a sell off.
We're back to tulips again, aren't we? 
Behemoth said:
Benjaminpalma said:
Yes - this is exactly what every website says, but what have those who have 'earned', say, Bitcoins, done other than to help maintain the system? Where's the actual value?
It's all good fun until it starts to mix with real money.
Beneath the undoubted elegance of blockchain technology, aren't cryptocurrencies just tradable ponzi scheme shares?
So do you think there's no value in banks & governments maintaining & securing pound sterling or dollars? Of course there is.It's all good fun until it starts to mix with real money.
Beneath the undoubted elegance of blockchain technology, aren't cryptocurrencies just tradable ponzi scheme shares?
Bitcoin is serious and is as close to real money as you can get. Peddling the tulips & Ponzi stuff is tiresome & covered well elsewhere. Bitcoin is as close to either of them as any traditional currency or commodity.
Instead lets put our trust in some bloke who may or not exist that created crypto and is probably (sensibly) never going to reveal his identity!
You now that in prison they use cigarettes as currency? Can we call that a form of money? Or is it merely bartering?
One would assume then that cigarette has a value. That value is based on the initial cost of a pack of fags bought in a known trusted currency. Where is cryptocurrencies value? In the difficulty in mining?
Currently most buyers of crytocurrencies are hording and not spending.
Why do crypto loons get so defensive when people question their baby? Very odd.
When the Great War starts and all the networks go down then who'll be laughing, apart from Nakamoto?
(For the record I own a few wallets I purchased in 2014. Not a lot of money but enough for a new car.)
Edited by bongtom on Wednesday 6th September 17:12
Behemoth said:
It allows anyone with a computer & internet connection to make a financial transaction independent of third parties and thus independent of their fee structures (banks, forex) and broader currency interference (government manipulation of currency to meet fiscal targets). Transactions are reliable, secure, cheap, quick and worldwide. If you don't see that these capabilities are of value, then just move on
No one is denying that. However, there's a difference between the block chain technology and all the various instances of it (i.e. different flavours of coin).I can't understand why the coins themselves have value - I understand there's scarcity, but it's a bit like gold without even the jewellery demand.
NickCQ said:
Also, it seems like many of the boiler room scam artists are using 'initial coin offerings' as a new way to play the 'pump and dump' game
I cant deny that. ICOs seem like the easiest way in the world to raise a casual £100m. If people were putting real money in, rather than ETH, they'd do a lot more DD imo - half of these ICOs would fall utterly flat. It's a form of gambling in most cases.
Maxf said:
Whats the difference between a BTC and a £10 note? Neither are backed by anything other than 'the system'
But that's the whole point. The £10 note IS backed by "the system". It's backed by trust in the Bank of England and the UK economy.Cryptocurrencies aren't. They're backed by... well, they're backed by shadows, and no more. They're backed by trust in anonymous nobodies who may or may not simply disappear one day. That's really all the blockchain is built on...
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