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> When you buy precious metals, they also have an intrinsic value. There is over $7.5 Trillion in gold in reserves held by governments and institutions as a st

> When you buy precious metals, they also have an intrinsic value. There is over $7.5 Trillion in gold in reserves held by governments and institutions as a store of value. [1] Only around $17B worth of gold is used for electronics annually (~320 tons) [2]. Thus annual electronics usage is around 0.22% of the world's gold reserves. Pretending like the "intrinsic value" of gold is from its use in industry is ridiculous and ignorant. The value of gold comes from the fact that the world uses gold as a store of value -- because it does not oxidize and is relatively rare. The same attributes that make gold a good store of value make bitcoin an even better store of value -- one that isn't simply a protection against inflation but is naturally deflationary given the limited supply. [1] https://en.wikipedia.org/wiki/Gold_reserve https://en.wikipedia.org/wiki/Gold_reserve [2] https://unu.edu/news/news/only-15-of-gold-and-silver-used-in-high-tech-goods-is-recovered.html https://unu.edu/news/news/only-15-of-gold-and-silver-used-in...

Rochus 6y ago
There are a lot of other precious metals than gold, some with heavy use by industry. And even if industry doesn't use a lot of gold, it has its merits; you can store it, it's persistent, and you can use it as a means of payment. Bitcoins are virtual, a promise with no government guarantee; you can't put your hands on them; they're too complicated for most people to handle, and if there's no electricity or computer networks available, there's little you can do with them.
- randallsquared 6y ago
  You also can't put your hands on email, or videos, or most US Dollars. That doesn't mean they cannot be useful and valuable. Gold's value is based on people wanting it. Bitcoin's value is based on exactly the same thing: higher demand than supply.
  - Rochus 6y ago
    Would you bet your fortune on an email or a video? Already the monetary currency of most countries is built on sand and one is well advised not to hold all one's assets in cash. Until someone finds a formula to produce gold cheaply (like diamonds), it will continue to be a useful currency with good inflation protection; of course, you wouldn't invest your entire fortune in gold either. But with Bitcoins, we have more of a situation like we had with investment certificates; they may also protect against inflation if everything works as promised, but they can also vanish into thin air very quickly.

Rochus 6y ago

There are a lot of other precious metals than gold, some with heavy use by industry. And even if industry doesn't use a lot of gold, it has its merits; you can store it, it's persistent, and you can use it as a means of payment. Bitcoins are virtual, a promise with no government guarantee; you can't put your hands on them; they're too complicated for most people to handle, and if there's no electricity or computer networks available, there's little you can do with them.

randallsquared 6y ago
You also can't put your hands on email, or videos, or most US Dollars. That doesn't mean they cannot be useful and valuable. Gold's value is based on people wanting it. Bitcoin's value is based on exactly the same thing: higher demand than supply.
- Rochus 6y ago
  Would you bet your fortune on an email or a video? Already the monetary currency of most countries is built on sand and one is well advised not to hold all one's assets in cash. Until someone finds a formula to produce gold cheaply (like diamonds), it will continue to be a useful currency with good inflation protection; of course, you wouldn't invest your entire fortune in gold either. But with Bitcoins, we have more of a situation like we had with investment certificates; they may also protect against inflation if everything works as promised, but they can also vanish into thin air very quickly.