Cryptocurrency - where's the actual value?
Discussion
Benjaminpalma said:
This is exactly my point. Innovative? Yes. Elegant? Yes. Of real value? Nope.
The coins have value because there has to be a reward for keeping the network running and securing the transaction ledger. Otherwise nobody would bother doing it.I don't get your point about lack of real value but I'm sure a bit more discussion will nail it.
I'll stick to talking about Bitcoin - there are too many me-too, fantasy & downright scam ridden coins out there to talk of all crypto as a group.
what value are looking for. each coin has its merits, daily volumes are there for a start for moving money fast ans secure, so there is value there. i mean a company that makes finanicial transactions will be worth billions as there is demand.
why are trying to work value out though. i here people say they a certain coin is at a good value, but it is arbitrary. value is secondary, people like the principle ideas behind the technology, the future prospects. It is like Telsa being valued at higher than Toyota, the value comes from expected future value..
why are trying to work value out though. i here people say they a certain coin is at a good value, but it is arbitrary. value is secondary, people like the principle ideas behind the technology, the future prospects. It is like Telsa being valued at higher than Toyota, the value comes from expected future value..
Behemoth said:
The coins have value because there has to be a reward for keeping the network running and securing the transaction ledger. Otherwise nobody would bother doing it.
It is secure. Understood. But what - of value - is being secured?Sorry to keep reverting to the tulip comparison, but isn't the reward for watering the tulips, er, more tulips?
Yes - let's stick to Bitcoin.
Behemoth said:
The coins have value because there has to be a reward for keeping the network running and securing the transaction ledger. Otherwise nobody would bother doing it.
That's a bit circular...We keep the network going because the coins have value.
The coins have value because we keep the network going.
But who is "we"?
TooMany2cvs said:
Who are they, what's in it for them, and how much do you trust them with your money?
enthusiasts like to check the btc running for nothing, if you don't understand how btc works then it is hard to explain how the nodes work. The network is cryptographically secure, probably more secure than the banks transaction information.No individual or organization can control or manipulate the Bitcoin protocol due to this.
The Spruce goose said:
TooMany2cvs said:
Who are they, what's in it for them, and how much do you trust them with your money?
enthusiasts like to check the btc running for nothing,The Spruce goose said:
if you don't understand how btc works then it is hard to explain how the nodes work.
Oh, I do.The Spruce goose said:
The network is cryptographically secure, probably more secure than the banks transaction information.
Or so they say... But that doesn't stop some kind of rug being pulled out. A sudden flood of new coins. A sudden flood of transactions. Are they real or fraudulent? DoS?The Spruce goose said:
No individual or organization can control or manipulate the Bitcoin protocol due to this.
Really? Who controls the cryptographic master keys? What's to stop some massive corruption being spread?At the simplest, what happens if the market collectively looks around, shrugs, and decides that this is a bloody stupid house of cards, and walks away? Bubbles pop. If there's nothing beneath the bubble, there's no inherent value - bar some geeks finding this a fun way to spend their evenings and weekends, because there's value there...
Benjaminpalma said:
The Spruce goose said:
people exchange fiat for Bitcoin, or invest in mining computers to mine BTC.
History said:
people exchanged fiat for tulips, or invested in gardening equipment to grow TULIPS.
And people exchanging fiat for <bubble> is all very lovely. It's what happens when lots of people simultaneously want to exchange <bubble> for fiat that gets entertaining...
Benjaminpalma said:
At the Japanese Olympics they are going to use BTC, a pretty big deal, BTC is legal tender in Japan. the list goes on. If you don't understand it then it might look like a bubble, the value is at an all time high, but there is limited supply and increasing demand....The law of economics dictates the price will go up.
The Spruce goose said:
if you think tulips bubble and btc have similarities then it is pointless trying to explain how it works. For a start BTC has been around nearly 10 years to develop, and grow, the tulup mania was a short period of time. Yes there are bubbles in the crypto world, but BTC isnt one.
The Spruce goose said:
At the Japanese Olympics they are going to use BTC, a pretty big deal,
Lovely, an' all. A bit of fairly low-risk, short-term speculation wrapped up in some geekchic.The Spruce goose said:
BTC is legal tender in Japan
Well, it's a legally recognised payment mechanism. That's not quite the same thing.The Spruce goose said:
If you don't understand it then it might look like a bubble, the value is at an all time high, but there is limited supply and increasing demand...
Just like tulips.The Spruce goose said:
the law of economics dictates the price will go up.
<raises eyebrows>Yes, so long as supply is outstripped by demand. But that assumes nothing changes...
TooMany2cvs said:
<raises eyebrows>
Yes, so long as supply is outstripped by demand. But that assumes nothing changes...
I'm confused the op was asking about a bubble i explained points which you reply to line by line but add nothing of value. if you think it is a bubble and unsafe then provide more information so he can make a decision.Yes, so long as supply is outstripped by demand. But that assumes nothing changes...
The thing is it is a complex subject and can only be understood by reading up about it.
The Spruce goose said:
I'm confused the op was asking about a bubble i explained points which you reply to line by line but add nothing of value. if you think it is a bubble and unsafe then provide more information so he can make a decision.
The thing is it is a complex subject and can only be understood by reading up about it.
I understand all the mechanics. Every last bit. I do complexity.The thing is it is a complex subject and can only be understood by reading up about it.
I understand that there is a USD exchage rate.
But - and please help me here - where is the value? What has been forgone by those who hold wealth in Bitcoin - other than helping Bitcoin to exist?
Without substance, it must surely be a bubble - albeit with more longevity than tulips. It is comparable with say the Railway mania of the late 1830s to late 1840s, although that had at least some substance in the form of an increased rail network.
National debt is a bubble. There are bubbles in loads of things you use and buy everyday. Say it is a bubble and no value how are you proved right. I know one newspaper columnist has 'predicted' the death of BTC 5 times already.
The value is derived fro loads of different things. That is an economics question.
The value is derived fro loads of different things. That is an economics question.
The intrinsic value of bitcoin is in its utility as a medium of exchange and as a store of value. As adoption develops, both aspects will grow. Adoption happens because it works. It has utility and it functions in that utility very well indeed. This makes is very different from any tulip.
Gassing Station | Finance | Top of Page | What's New | My Stuff