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This is why I hate the comparison of crypto to gold or any other "value asset'. Houses are lived in. Stocks act as a cashflow for companies. Even if the world

This is why I hate the comparison of crypto to gold or any other "value asset'. Houses are lived in. Stocks act as a cashflow for companies. Even if the world economy collapses you can still use a solid gold bar as a blunt instrument to kill an animal and eat it. Cryptocurrencies have exactly 0 secondary uses.

deleted 9y ago
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criddell 9y ago
What's the secondary use of all the shares of AMZN one might have in their eTrade account? That's also just data, right?
- throwaway2312 9y ago
  Those shares represent the stake in value of a corporation that exists in the real world with real services. Very very different than Bitcoin.
- notatoad 9y ago
  the value backing AMZN shares is the value of the utility that amazon, inc provides to society.
  - nxsynonym 9y ago
    Exactly. The value of the shares are tied directly to the output and monetary value of the company they are backing - and not hype and word-of-mouth.
    - notatoad 9y ago
      there's definitely some hype and word of mouth involved in corporate valuations. but it's at least somewhat based in reality.
  - neosavvy 9y ago
    I agree, I was discussing the total market cap of all coin offerings in general as being around $500B which is just over half of the value of Apple. I'd take ownership in Apple all day over any coin, as I suspect more people out there value the Apple Stock over the ever-increasingly tough to exchange Bitcoin.
  - criddell 9y ago
    Yeah but if the world economy collapses so completely that the main value of gold is as a weapon to hit people with, your shares of Amazon will probably be about as useful as your Bitcoin wallet.
- ggg9990 9y ago
  The United States government enforces, with lethal weapons, the right of Amazon shareholders to Amazon’s assets.
- schoen 9y ago
  I guess their secondary use is offering them in support of a prospective acquisition (or dissolution) of Amazon, in exchange for which the acquirer or trustee would offer some other value at that time. These events both seem very unlikely right now, but they provide a last-resort value for an ownership interest in Amazon. (I don't mean to support other people in this thread who are criticizing cryptocurrencies for their lack of inherent value, but stocks do have a particular basis for their value that cryptocurrencies commonly don't.)
paulddraper 9y ago
Okay....livestock bludgeoning explains 0.001% of gold's value.
- nxsynonym 9y ago
  It's a ridiculous example, of course. But it's something. Not to mention the actual real applications that were mentioned above. The point is - crypto-currencies are fairy dust. There is nothing real or tangible about them.
  - noir_lord 9y ago
    > The point is - crypto-currencies are fairy dust. There is nothing real or tangible about them. Most money in circulation is 0/1's on hard drives. I'm bearish on cryptocurrencies because frankly the entire thing is hilarious but modern currencies aren't entirely dissimilar.
    - notahacker 9y ago
      Those 0/1s on hard drives are backed by trillions of dollars of debt and tax obligations people are obliged to trade labour and physical goods for though. Being backed by demand from the entire economy of a stable polity is certainly better than being backed by sunk (energy) cost fallacy and speculator enthusiasm.
    - wtetzner 9y ago
      > I'm bearish on cryptocurrencies because frankly the entire thing is hilarious but modern currencies aren't entirely dissimilar. I think this thread started out with someone saying that crypto-currencies aren't very useful as currency, but as assets (like a gold bar) instead. And then it was argued that they're not very good as assets either.
  - zolthrowaway 9y ago
    I don't have a horse in this race, but what about pyrite? It has most of the aesthetic properties of gold (which I think everyone agrees is where most of the value comes from), but almost none of the value. Pyrite is a real, physical thing that will not disappear tomorrow. However, it has almost no value. I guess what I am trying to say is that there is a lot more that goes into value than utility. That's why I do not think that people always act rationally. Clearly there is something irrational about people's relationship with gold that makes it valuable. I don't see why crypto cannot have a similar irrational evaluation. Sure, it could go "poof" tomorrow, but I don't know if that will stop people from seeing it as valuable.
newintellectual 9y ago
That's false. Google up Ethereum and you'll immediately see thousands of uses besides currency for it, because of its full programming language and massively distributed processing power.
dr_win 9y ago
Bitcoin token's (secondary) value is the right/ability to write a new row into a global eternal immutable append-only decentralised censorship-proof spreadsheet table (blockchain). It is valuable not only in economic context to create a border-less cash-like digital commodity. It could be used for proof of publication or proof of existence and in many other useful ways (smart contracts). In other words, owning a non-dust amount of Satoshis gives you some useful property. Anything scarce and useful will have value and market will price it. Anything with a price and good properties to become means of exchange, unit of account or store of value could under some circumstances become a form of money. Similar as with gold. You can use it in electro-industry. That's its secondary value for people who see value in electronic devices. If you were to explain why gold is valuable in electro-industry to a member of native african tribe, he would not see that value, because electricity and electronic devices is something not considered in his mind. You are in the same boat with Bitcoin here :-)

deleted 9y ago

[deleted]

criddell 9y ago

What's the secondary use of all the shares of AMZN one might have in their eTrade account? That's also just data, right?

throwaway2312 9y ago
Those shares represent the stake in value of a corporation that exists in the real world with real services. Very very different than Bitcoin.
notatoad 9y ago
the value backing AMZN shares is the value of the utility that amazon, inc provides to society.
- nxsynonym 9y ago
  Exactly. The value of the shares are tied directly to the output and monetary value of the company they are backing - and not hype and word-of-mouth.
  - notatoad 9y ago
    there's definitely some hype and word of mouth involved in corporate valuations. but it's at least somewhat based in reality.
- neosavvy 9y ago
  I agree, I was discussing the total market cap of all coin offerings in general as being around $500B which is just over half of the value of Apple. I'd take ownership in Apple all day over any coin, as I suspect more people out there value the Apple Stock over the ever-increasingly tough to exchange Bitcoin.
- criddell 9y ago
  Yeah but if the world economy collapses so completely that the main value of gold is as a weapon to hit people with, your shares of Amazon will probably be about as useful as your Bitcoin wallet.
ggg9990 9y ago
The United States government enforces, with lethal weapons, the right of Amazon shareholders to Amazon’s assets.
schoen 9y ago
I guess their secondary use is offering them in support of a prospective acquisition (or dissolution) of Amazon, in exchange for which the acquirer or trustee would offer some other value at that time. These events both seem very unlikely right now, but they provide a last-resort value for an ownership interest in Amazon. (I don't mean to support other people in this thread who are criticizing cryptocurrencies for their lack of inherent value, but stocks do have a particular basis for their value that cryptocurrencies commonly don't.)

paulddraper 9y ago

Okay....livestock bludgeoning explains 0.001% of gold's value.

nxsynonym 9y ago
It's a ridiculous example, of course. But it's something. Not to mention the actual real applications that were mentioned above. The point is - crypto-currencies are fairy dust. There is nothing real or tangible about them.
- noir_lord 9y ago
  > The point is - crypto-currencies are fairy dust. There is nothing real or tangible about them. Most money in circulation is 0/1's on hard drives. I'm bearish on cryptocurrencies because frankly the entire thing is hilarious but modern currencies aren't entirely dissimilar.
  - notahacker 9y ago
    Those 0/1s on hard drives are backed by trillions of dollars of debt and tax obligations people are obliged to trade labour and physical goods for though. Being backed by demand from the entire economy of a stable polity is certainly better than being backed by sunk (energy) cost fallacy and speculator enthusiasm.
  - wtetzner 9y ago
    > I'm bearish on cryptocurrencies because frankly the entire thing is hilarious but modern currencies aren't entirely dissimilar. I think this thread started out with someone saying that crypto-currencies aren't very useful as currency, but as assets (like a gold bar) instead. And then it was argued that they're not very good as assets either.
- zolthrowaway 9y ago
  I don't have a horse in this race, but what about pyrite? It has most of the aesthetic properties of gold (which I think everyone agrees is where most of the value comes from), but almost none of the value. Pyrite is a real, physical thing that will not disappear tomorrow. However, it has almost no value. I guess what I am trying to say is that there is a lot more that goes into value than utility. That's why I do not think that people always act rationally. Clearly there is something irrational about people's relationship with gold that makes it valuable. I don't see why crypto cannot have a similar irrational evaluation. Sure, it could go "poof" tomorrow, but I don't know if that will stop people from seeing it as valuable.

newintellectual 9y ago

That's false. Google up Ethereum and you'll immediately see thousands of uses besides currency for it, because of its full programming language and massively distributed processing power.

dr_win 9y ago

Bitcoin token's (secondary) value is the right/ability to write a new row into a global eternal immutable append-only decentralised censorship-proof spreadsheet table (blockchain). It is valuable not only in economic context to create a border-less cash-like digital commodity. It could be used for proof of publication or proof of existence and in many other useful ways (smart contracts). In other words, owning a non-dust amount of Satoshis gives you some useful property. Anything scarce and useful will have value and market will price it. Anything with a price and good properties to become means of exchange, unit of account or store of value could under some circumstances become a form of money. Similar as with gold. You can use it in electro-industry. That's its secondary value for people who see value in electronic devices. If you were to explain why gold is valuable in electro-industry to a member of native african tribe, he would not see that value, because electricity and electronic devices is something not considered in his mind. You are in the same boat with Bitcoin here :-)