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> In your opinion, what is the intrinsic value of Bitcoin? I use the 1:10000 rule (https://xkcd.com/1053/ https://xkcd.com/1053/) for this argument. It is my

> In your opinion, what is the intrinsic value of Bitcoin? I use the 1:10000 rule (https://xkcd.com/1053/ https://xkcd.com/1053/) for this argument. It is my opinion that the intrinsic value of bitcoin is far far greater than anyone really comprehends. People generally are too focused on people just buying and selling the asset, but not about the cryptographic proof, and incentive structure that perpetuates the network functioning. So when people like to ask what the intrinsic value of bitcoin is, I say : You are thinking of the store of value property without the cryptographic property that secures it. You are talking about it as one would talk about valuable shells, and even shell sellers, and not the security that separates it from all forms of value exchange before it. To understand the intrinsic value of bitcoin it is good to use the analogy of an envelope. So i ask you : does an envelope have intrinsic value? If I have a letter that I need to send securely, would I prefer to send it open, and ready to be read? Or would I prefer for it to be sent within the confines of an envelope? Now let's think... would I prefer to just leave an open envelope, or would I think it necessary to put some seal across it to ensure that it isn't opened, and read whilst en-route. Does a sealable envelope have more intrinsic value than an unsealable one? Hmm... but what if someone can counterfeit the seal? I need some method of ensuring that the message I want to get to that person isn't read, and preferably, isn't even identified as a message. That's when you need to get lawyers involved. Sounds expensive. There's obviously something intrinsically valuable about such a service, because many people pay oh-so-very-much money for it. Now let's imagine we're not talking about letters, we're talking about money. Would you address a $100 note through the mail to your child for their birthday? You'd pay for a stamp at least. Would you encase it in an envelope that you paid for at the local post-shop? Hmm... bill in the envelope. Anyone will be able to see that it is money. Perhaps encase it in a card? What if it is $1000? $10,000? $10 million? Does the protection service of an envelope somehow decrease because the value of the contents of the package increases? It's the opposite, isn't it? Bitcoin is both the cryptographically sealed envelope, and the network to deliver it. What say you? Is an envelope intrinsically valuable?

corndoge 9y ago
so your argument is that its value is just that it's cryptographically secure?
- Frogolocalypse 9y ago
  No.
  - victor106 9y ago
    I agree with most of what you say. There is intrinsic value in bitcoin. The two more important questions are:- 1. Can that value be measured? 2. Do the people buying bitcoin know the reasons behind why they are buying it? I think not. I know so many of my friends who own bitcoin and they have no idea what the hell this thing is. They just bought it as it’s growing up in value. These are the people who would sell it when the value goes down and we all know how that ends...
    - Frogolocalypse 9y ago
      > Fixed assets, goods and services, etc., are stable relative to fiat, at least USD. Of course it can. Its price. Bitcoin is money. Its price is the only measure of value. What I'm saying is that it doesn't matter what people want it for. It's money. It enables things. It is just better money, because it can't be seized, payments can be made to anyone, it can be transported anywhere easily and redeemed anywhere easily, and most of all, it can't be debased. Any of these reasons is enough to want to use it, and people might not know all of the details, but they certainly understand the effects on their wealth.
    - Frogolocalypse 9y ago
      Responding to > 1. Can that value be measured? Of course.
billfeng 9y ago
Isn't the intrinsic value of Bitcoin the fact that it is decentralized and that no government or other entity has direct control over it? Sure it's cryptographically secure, but what is the difference between that and a regular bank using encryption on their money transfer network? I think the reason it's hard to say whether or not Bitcoin is worthwhile is that there has never been a decentralized currency at this scale before, and for all we know, unless it can serve some kind of purpose that a regular currency issued by a country cannot serve, it's not that useful. This is why Bitcoin is used a lot by people from countries were their own currency is struggling. But with the central banks of many first-world countries printing money uncontrollably, some even bringing about negative interest rates, many fear the collapse of large economies in the near future. If that happens, Bitcoin will be a way to store your wealth and prevent all your money from becoming worthless pieces of paper. Other ways of doing the same would be buying gold or some other form of valuable goods and storing it in your house or have someone else store it for you somewhere, but obviously the fact that Bitcoin is digital makes it a much easier to use and viable option. But, we don't know if that will ever happen. Bitcoin itself also has so many problems. It's also arbitrary as to which digital currency to use since there are so many to invest in, some more popular than others, some have evolved to fix problems with previous versions, so it's really hard to say if all of this will amount to something useful.
- Frogolocalypse 9y ago
  > Sure it's cryptographically secure, but what is the difference between that and a regular bank using encryption on their money transfer network? Bitcoin is the network to deliver it too. I say that right there.
  - billfeng 9y ago
    Yea but what makes the bitcoin delivery network any better than a bank's delivery network, unless you take into account of the fact that it's decentralized? Banks deliver money all the time.
    - Frogolocalypse 9y ago
geezerjay 9y ago
> It is my opinion that the intrinsic value of bitcoin is far far greater than anyone really comprehends See? It's all speculative bullshit, where people who took a bet on bitcoin increasing price and expect to profit from this price increase are trolling other fools to keep pumping the bubble until they cash out. Bitcoin is quite clearly a pump-and-dump scheme, and here we see some users cheering fools to keep on pumping the bubble with their cash. The only intrinsic value that bitcoin has is it's use in money laundering deals, and only in short time scales. That's it. The rest is just speculative fraud.
- Frogolocalypse 9y ago
  I don't think you read past the first sentence.
  - Twisell 9y ago
    And this was the intended effect of your post you wrote a long monologue instead of a clear answer. Thus proving his point, there is no clear answer. Any truth-holder (on both side) is a blatant liar.
    - Frogolocalypse 9y ago
      I don't think you even understood the first sentence, or any other.
  - corndoge 9y ago
    And rightly so, since the rest of it was a bizarre analogy comparing envelopes to cryptographic hashes that ultimately served no discernible purpose
    - Frogolocalypse 9y ago
      Don't buy it then. Problem solved.
- josh2600 9y ago

corndoge 9y ago

so your argument is that its value is just that it's cryptographically secure?

Frogolocalypse 9y ago
No.
- victor106 9y ago
  I agree with most of what you say. There is intrinsic value in bitcoin. The two more important questions are:- 1. Can that value be measured? 2. Do the people buying bitcoin know the reasons behind why they are buying it? I think not. I know so many of my friends who own bitcoin and they have no idea what the hell this thing is. They just bought it as it’s growing up in value. These are the people who would sell it when the value goes down and we all know how that ends...
  - Frogolocalypse 9y ago
    > Fixed assets, goods and services, etc., are stable relative to fiat, at least USD. Of course it can. Its price. Bitcoin is money. Its price is the only measure of value. What I'm saying is that it doesn't matter what people want it for. It's money. It enables things. It is just better money, because it can't be seized, payments can be made to anyone, it can be transported anywhere easily and redeemed anywhere easily, and most of all, it can't be debased. Any of these reasons is enough to want to use it, and people might not know all of the details, but they certainly understand the effects on their wealth.
  - Frogolocalypse 9y ago
    Responding to > 1. Can that value be measured? Of course.

billfeng 9y ago

Isn't the intrinsic value of Bitcoin the fact that it is decentralized and that no government or other entity has direct control over it? Sure it's cryptographically secure, but what is the difference between that and a regular bank using encryption on their money transfer network? I think the reason it's hard to say whether or not Bitcoin is worthwhile is that there has never been a decentralized currency at this scale before, and for all we know, unless it can serve some kind of purpose that a regular currency issued by a country cannot serve, it's not that useful. This is why Bitcoin is used a lot by people from countries were their own currency is struggling. But with the central banks of many first-world countries printing money uncontrollably, some even bringing about negative interest rates, many fear the collapse of large economies in the near future. If that happens, Bitcoin will be a way to store your wealth and prevent all your money from becoming worthless pieces of paper. Other ways of doing the same would be buying gold or some other form of valuable goods and storing it in your house or have someone else store it for you somewhere, but obviously the fact that Bitcoin is digital makes it a much easier to use and viable option. But, we don't know if that will ever happen. Bitcoin itself also has so many problems. It's also arbitrary as to which digital currency to use since there are so many to invest in, some more popular than others, some have evolved to fix problems with previous versions, so it's really hard to say if all of this will amount to something useful.

Frogolocalypse 9y ago
> Sure it's cryptographically secure, but what is the difference between that and a regular bank using encryption on their money transfer network? Bitcoin is the network to deliver it too. I say that right there.
- billfeng 9y ago
  Yea but what makes the bitcoin delivery network any better than a bank's delivery network, unless you take into account of the fact that it's decentralized? Banks deliver money all the time.
  - Frogolocalypse 9y ago

geezerjay 9y ago

> It is my opinion that the intrinsic value of bitcoin is far far greater than anyone really comprehends See? It's all speculative bullshit, where people who took a bet on bitcoin increasing price and expect to profit from this price increase are trolling other fools to keep pumping the bubble until they cash out. Bitcoin is quite clearly a pump-and-dump scheme, and here we see some users cheering fools to keep on pumping the bubble with their cash. The only intrinsic value that bitcoin has is it's use in money laundering deals, and only in short time scales. That's it. The rest is just speculative fraud.

Frogolocalypse 9y ago
I don't think you read past the first sentence.
- Twisell 9y ago
  And this was the intended effect of your post you wrote a long monologue instead of a clear answer. Thus proving his point, there is no clear answer. Any truth-holder (on both side) is a blatant liar.
  - Frogolocalypse 9y ago
    I don't think you even understood the first sentence, or any other.
- corndoge 9y ago
  And rightly so, since the rest of it was a bizarre analogy comparing envelopes to cryptographic hashes that ultimately served no discernible purpose
  - Frogolocalypse 9y ago
    Don't buy it then. Problem solved.
josh2600 9y ago