5 ms·

Nod - I'm coming to the conclusion that the effective store of value is the mining infrastructure. Even if it's not that explicit, they move in lock-step.

fe2ijwe99 9y ago
Isn't that true of basically any computing task? Can't generate AI, websites, etc with the computing infrastructure. No software patents if no computers to create software.
- jwilliams 9y ago
  At a really abstract level, yes. However, many computing tasks generate results that can be used near-infinitely. For example, that supercomputer that generates the weather can distribute the results to every person in the region. Whereas in cryptocurrency, that's split. The miners provide security and integrity for the chain. They also take their own very specific fee.
codemac 9y ago
This is the exact same conclusion Marx came to about labor.
- simplify 9y ago
  Could you expand on this?
  - zhte415 9y ago
    The value of a product is equivalent to the amount of labour exerceted in its production.
    - goldenkey 9y ago
      Except this ignores scarcity. And also ignores post-scarcity; this is the time period when robots do all work and farm all resources leaving humanity to decide the value of things divorced from rarity and labour. I will concede to Marx one aspect of his maxim; that is, scarcity is directly correlated with human effort towards a reseller market. So it still applies even if indirectly. For example, there is less labour spent trying to skim off the top of automotive mechanics work than labour spent reselling gold or limited edition Nike Airheads, etc....
    - alexasmyths 9y ago
      "The value of a product is equivalent to the amount of labour exerceted in its production" This is one of the most problematic statements ever made in Econ. The 'value' of a product is different for everyone, and it's what you (or anyone else) will pay for it. The idea that 'work = value' is one of the most distortionary ideas in business, even today. Just had a discussion today about pricing a product, and it was derived from component prices. Trying to convince a room of people that 'price is not a function of cost' ... in 2017. Yes - when things are commodities, often, price is a function of cost, because competitive pricing means just a small margin above cost, which will roughly be the same for most.
      - codemac 9y ago
        Exactly, which is why Marx uses the concept of a labor value, use value, and exchange value. Labor is what's gone in, use is the inherent/intrinsic value in the object, and exchange value is what people will trade in exchange for it. That's a bad summary, and there's a lot more to the dialectic examination of them. Reading Capital (along with David Harvey's lectures) is worth it if you find these things interesting, it's a deep analysis of markets and capital.
        owlmirror 9y ago
        It still ignores scarcity and arbitrarily picks one specific limiting resource in the production process as essential. Labor theory of value might be interesting from a philosophical standpoint but really has no practical application when it comes to understanding the market. And it introduces a major can of worms when it presumes stuff like intrinsic value.
        boomboomsubban 9y ago
        It doesn't ignore scarcity, scarce goods are inherently more labor intensive. And it doesn't presume intrinsic value, the labor necessary is a subjective concept so the value must be as well. You're probably right about it's use in understanding a capitalist market, Marx spends no shortage of time on how capitalists warp that basic idea.
alfiedotwtf 9y ago
The problem with mining rigs is that they have high upfront cost AND a short life span. Once a faster rig comes out, NOT upgrading is effectively a tax against future profits
- himalay 9y ago
  Sad but true

fe2ijwe99 9y ago

Isn't that true of basically any computing task? Can't generate AI, websites, etc with the computing infrastructure. No software patents if no computers to create software.

jwilliams 9y ago
At a really abstract level, yes. However, many computing tasks generate results that can be used near-infinitely. For example, that supercomputer that generates the weather can distribute the results to every person in the region. Whereas in cryptocurrency, that's split. The miners provide security and integrity for the chain. They also take their own very specific fee.

codemac 9y ago

This is the exact same conclusion Marx came to about labor.

simplify 9y ago
Could you expand on this?
- zhte415 9y ago
  The value of a product is equivalent to the amount of labour exerceted in its production.
  - goldenkey 9y ago
    Except this ignores scarcity. And also ignores post-scarcity; this is the time period when robots do all work and farm all resources leaving humanity to decide the value of things divorced from rarity and labour. I will concede to Marx one aspect of his maxim; that is, scarcity is directly correlated with human effort towards a reseller market. So it still applies even if indirectly. For example, there is less labour spent trying to skim off the top of automotive mechanics work than labour spent reselling gold or limited edition Nike Airheads, etc....
  - alexasmyths 9y ago
    "The value of a product is equivalent to the amount of labour exerceted in its production" This is one of the most problematic statements ever made in Econ. The 'value' of a product is different for everyone, and it's what you (or anyone else) will pay for it. The idea that 'work = value' is one of the most distortionary ideas in business, even today. Just had a discussion today about pricing a product, and it was derived from component prices. Trying to convince a room of people that 'price is not a function of cost' ... in 2017. Yes - when things are commodities, often, price is a function of cost, because competitive pricing means just a small margin above cost, which will roughly be the same for most.
    - codemac 9y ago
      Exactly, which is why Marx uses the concept of a labor value, use value, and exchange value. Labor is what's gone in, use is the inherent/intrinsic value in the object, and exchange value is what people will trade in exchange for it. That's a bad summary, and there's a lot more to the dialectic examination of them. Reading Capital (along with David Harvey's lectures) is worth it if you find these things interesting, it's a deep analysis of markets and capital.
      - owlmirror 9y ago
        It still ignores scarcity and arbitrarily picks one specific limiting resource in the production process as essential. Labor theory of value might be interesting from a philosophical standpoint but really has no practical application when it comes to understanding the market. And it introduces a major can of worms when it presumes stuff like intrinsic value.
        boomboomsubban 9y ago
        It doesn't ignore scarcity, scarce goods are inherently more labor intensive. And it doesn't presume intrinsic value, the labor necessary is a subjective concept so the value must be as well. You're probably right about it's use in understanding a capitalist market, Marx spends no shortage of time on how capitalists warp that basic idea.

alfiedotwtf 9y ago

The problem with mining rigs is that they have high upfront cost AND a short life span. Once a faster rig comes out, NOT upgrading is effectively a tax against future profits

himalay 9y ago
Sad but true