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Every time someone has attempted to explain to me why bitcoin has value, they instead explain why blockchain technology is cool or why they don't like "the man"
by kgin 6y ago
Every time someone has attempted to explain to me why bitcoin has value, they instead explain why blockchain technology is cool or why they don't like "the man" in a monetary sense. Those are both interesting discussions, but they don't address why there would be any floor whatsoever to bitcoin's value, specifically.
USD, for all its issues, is required for the payment of taxes. So as long as anyone wants to do business or live in the United States, there is a legally mandated demand for USD. (If an event has occurred to cause no one to want to do business or live in the United States, money of any kind is probably the least of your concerns.) Then on top of that confidence of an absolute floor in demand, you can build more layers of demand like the petrodollar, etc.
Bitcoin could go to zero tomorrow without any real change in the real world. For USD to go to zero, the United States and perhaps the world order itself would have to collapse.
- noman-land 6y agoBitcoin gets its value from its anti-authoritarianism.
- hakfoo 6y agoIt's interesting to look at cryptocurrency on a philosophical level-- what does money mean in an era when it's no longer just abstractions that eventually reference a hoard of gold coins somewhere. The "you need it in order to pay taxes" is a solid argument. In a way, the inverse also holds true: cryptocurrency's volatility problems are in part because there are no real-world anchors to its price, like real-world products priced in it or having to settle an annual tax bill in it. But "value from anti-authoritarianism" is sort of a concerning argument. If its value is based on being compelling to a certain community, it creates some severe shock risks. Say that Bitcoin goes mainstream in a big way-- Wells Fargo starts putting bitcoin kiosks in every branch, McDonalds introduces the 10-satoshi value meal, and every payment processor figures out how to hammer it into a shape ordinary consumers will find palatable. The enthusiasts who bought in for the anti-authoritarian message will probably flee for something else-- Monero, Zcash, Transdnisterian plastic roubles-- and then you lose their interest in trying to guide the platform forward. TBH, I suspect we passed that moment years ago. The primary stakeholders now are speculators-- anyone with mere technical or philosophical vision doesn't have the hash-clout to steer these protocols. So the value is the old joke about the old woman in a strapless dress: what's holding it up? The combined will of everyone in the room!