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The intrinsic value of a cryptocurrency is in its utility: moving an accounted and measurable unit across the internet peer to peer.

by hapnin 9y ago

blattimwind 9y ago
That's a property of the network (if it works, that is), and not an intrinsic value. The answer to "What is this item [the bits comprising your private wallet key] worth on its own?" is "Nothing" for cryptocurrencies, much like a 5 Euro bill is worth essentially nothing on its own. A gold bar or a bucket full of copper cents has an intrinsic value: it's metal that can be used for many engineering purposes.
- hapnin 9y ago
  Cryptocurrencies are predicated on networks. So is cash, wrt meatspace networks of humans. Cash is only worth anything because we can transact with it in the meatspace. Cryptocurrencies are worthless for use in the meatspace, just as physical cash is worthless on the network.
- AnimalMuppet 9y ago
  True for copper; less true for gold. That is: The value of copper is set by its industrial usefulness. Gold? Not so much. The price of gold, in my view, is set primarily by worldwide demand for a short on fiat currencies. Even if you don't buy that interpretation, though, financial (and therefore non-industrial) demand pretty clearly sets the price for gold.
- sshine 9y ago
  >> The intrinsic value of a cryptocurrency is in its utility: moving an accounted and measurable unit across the internet peer to peer. reply > That's a property of the network (if it works, that is), and not an intrinsic value. The value of a cryptocurrency can be a property of the network and be intrinsic. intrinsic, adj.: belonging to a thing by its very nature. Gold has more alternative purposes (teeth, electronics, jewelry, etc.), but a cryptocurrency provides bookkeeping, even to some effect after its network dies. Bookkeeping, and not the assets kept track of, has intrinsic value. I know what I'll hold on to, though, when the great blackout comes in 2022. And that's wood.
mikro2nd 9y ago
I think the real value is the absence (non-necessity) of trust in the transfer. I need to think about this some more...

The intrinsic value of a cryptocurrency is in its utility: moving an accounted and measurable unit across the internet peer to peer.

by hapnin 9y ago

The intrinsic value of a cryptocurrency is in its utility: moving an accounted and measurable unit across the internet peer to peer.

blattimwind 9y ago

That's a property of the network (if it works, that is), and not an intrinsic value. The answer to "What is this item [the bits comprising your private wallet key] worth on its own?" is "Nothing" for cryptocurrencies, much like a 5 Euro bill is worth essentially nothing on its own. A gold bar or a bucket full of copper cents has an intrinsic value: it's metal that can be used for many engineering purposes.

hapnin 9y ago
Cryptocurrencies are predicated on networks. So is cash, wrt meatspace networks of humans. Cash is only worth anything because we can transact with it in the meatspace. Cryptocurrencies are worthless for use in the meatspace, just as physical cash is worthless on the network.
AnimalMuppet 9y ago
True for copper; less true for gold. That is: The value of copper is set by its industrial usefulness. Gold? Not so much. The price of gold, in my view, is set primarily by worldwide demand for a short on fiat currencies. Even if you don't buy that interpretation, though, financial (and therefore non-industrial) demand pretty clearly sets the price for gold.
sshine 9y ago
>> The intrinsic value of a cryptocurrency is in its utility: moving an accounted and measurable unit across the internet peer to peer. reply > That's a property of the network (if it works, that is), and not an intrinsic value. The value of a cryptocurrency can be a property of the network and be intrinsic. intrinsic, adj.: belonging to a thing by its very nature. Gold has more alternative purposes (teeth, electronics, jewelry, etc.), but a cryptocurrency provides bookkeeping, even to some effect after its network dies. Bookkeeping, and not the assets kept track of, has intrinsic value. I know what I'll hold on to, though, when the great blackout comes in 2022. And that's wood.

mikro2nd 9y ago

I think the real value is the absence (non-necessity) of trust in the transfer. I need to think about this some more...