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I think that Bitcoin's intrinsic value lies in its system that can securely, verifiably, transferably and trustlessly store numbers, assign them to password-pro

I think that Bitcoin's intrinsic value lies in its system that can securely, verifiably, transferably and trustlessly store numbers, assign them to password-protected wallets and keep the sum of those numbers below a constant (21M). Due to these traits, such a system is suitable for representing value just like gold (but BTC is more easily transferable). It is pretty hard to create such a system, therefore it is valueable.

deleted 9y ago
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dozzie 9y ago
And what would you do with that number? Eat it? Wear it? Grow a plant on it? A shovel has intrinsic value. A sheet of cardboard has intrinsic value. A pair of underpants has intrinsic value. Even silver, gold, and platinum have intrinsic value, given their physical and chemical properties. Raw number, even if timestamped, has no intrinsic value. That's the point.
- peterisza 9y ago
  I meant that the system has the intrinsic value, we just use that system to represent some other kind of value with its coins. However, the total value represented by the coins should reflect the amount of trust in the system, so these are not totally independent things. EDIT: Maybe you are right about this intrinsic value thing. In case the consensus is lost, gold will at least keep some of its value but Bitcoin could drop to 0 (just like dollar bills).
dpiers 9y ago
It may be very hard to create such a system, but it is extremely easy to copy it. Bitcoin is a proof-of-concept for a new technology, but that doesn't mean it has value. I used to work at BitTorrent, and the extreme popularity of the protocol did not translate into revenue for the company. There is nothing special about the BTC blockchain that makes it any more valuable than any other chain.
- peterisza 9y ago
  Good point. Maybe just the consensus around it and its history make it more valuable than its copies. However, almost the same applies to gold, as there are other scarce metals that could become an alternative to it. If that happens, those will also be worth more than just their industrial value (which is now the case I believe).

deleted 9y ago

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dozzie 9y ago

And what would you do with that number? Eat it? Wear it? Grow a plant on it? A shovel has intrinsic value. A sheet of cardboard has intrinsic value. A pair of underpants has intrinsic value. Even silver, gold, and platinum have intrinsic value, given their physical and chemical properties. Raw number, even if timestamped, has no intrinsic value. That's the point.

peterisza 9y ago
I meant that the system has the intrinsic value, we just use that system to represent some other kind of value with its coins. However, the total value represented by the coins should reflect the amount of trust in the system, so these are not totally independent things. EDIT: Maybe you are right about this intrinsic value thing. In case the consensus is lost, gold will at least keep some of its value but Bitcoin could drop to 0 (just like dollar bills).

dpiers 9y ago

It may be very hard to create such a system, but it is extremely easy to copy it. Bitcoin is a proof-of-concept for a new technology, but that doesn't mean it has value. I used to work at BitTorrent, and the extreme popularity of the protocol did not translate into revenue for the company. There is nothing special about the BTC blockchain that makes it any more valuable than any other chain.

peterisza 9y ago
Good point. Maybe just the consensus around it and its history make it more valuable than its copies. However, almost the same applies to gold, as there are other scarce metals that could become an alternative to it. If that happens, those will also be worth more than just their industrial value (which is now the case I believe).