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That has no value at all. Nobody cares that it took "so much energy" to mine that bitcoin block, otherwise bitcoin value would rise infinitely as the mining dif

That has no value at all. Nobody cares that it took "so much energy" to mine that bitcoin block, otherwise bitcoin value would rise infinitely as the mining difficulty increases. Bitcoin has no inherent value. None. Zilch. Nada. We assign it value completely arbitrarily, hence it going from pennies per bitcoin, to $20k, to $4k.

littlestymaar 7y ago
Nothing as any inherent value either though. Gold can't be eaten and food is worth nothing when you just had a feast. Value is a social construction highly dependent on the context.
sparkie 7y ago
The value of bitcoin isn't how much energy it took to create, but how much energy it would take to steal. By being energy intensive, it ensures that an attacker or malicious agent who wishes steal it, or install an involuntary tax on its users, is unable to do so without consuming at least an equivalent amount of energy. If they fail to muster up the majority of the energy, they end up wasting money on electricity spent. The bigger the cost of "electricity wasted" through mining, the bigger the risk the potential attacker must take to attempt to undermine its security. So turns out there are some people who want to save money without it being involuntarily taxed (through forced inflation), and that itself is valuable. Bitcoin has inherent value, and unlike the fiat money it is competing with, that value cannot be arbitrarily adjusted by a monopoly control of money printers, but it is dictated entirely by supply and demand in a free market. The "BTC/USD" exchange rate is not the value of bitcoin, but is a big distraction. If you are tied up in thinking of bitcoin in dollar cost you will end up being the greater fool who only buys when the price is rising rapidly because of FOMO. Or instead, you might be the greatest fool, who resists it until the last possible moment when you realize the world has moved on and nobody wants paper money anymore.

littlestymaar 7y ago

Nothing as any inherent value either though. Gold can't be eaten and food is worth nothing when you just had a feast. Value is a social construction highly dependent on the context.

sparkie 7y ago

The value of bitcoin isn't how much energy it took to create, but how much energy it would take to steal. By being energy intensive, it ensures that an attacker or malicious agent who wishes steal it, or install an involuntary tax on its users, is unable to do so without consuming at least an equivalent amount of energy. If they fail to muster up the majority of the energy, they end up wasting money on electricity spent. The bigger the cost of "electricity wasted" through mining, the bigger the risk the potential attacker must take to attempt to undermine its security. So turns out there are some people who want to save money without it being involuntarily taxed (through forced inflation), and that itself is valuable. Bitcoin has inherent value, and unlike the fiat money it is competing with, that value cannot be arbitrarily adjusted by a monopoly control of money printers, but it is dictated entirely by supply and demand in a free market. The "BTC/USD" exchange rate is not the value of bitcoin, but is a big distraction. If you are tied up in thinking of bitcoin in dollar cost you will end up being the greater fool who only buys when the price is rising rapidly because of FOMO. Or instead, you might be the greatest fool, who resists it until the last possible moment when you realize the world has moved on and nobody wants paper money anymore.