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It's not the "same kind of network effects" though. It'd be the same kind of network effects if the only reason people had Facebook (or telecoms) accounts is b
by notahacker 5y ago
It's not the "same kind of network effects" though.
It'd be the same kind of network effects if the only reason people had Facebook (or telecoms) accounts is because they thought someone else might buy their account off them for more money. And if a social network came along with that value proposition - "sure, it doesn't actually do anything but the fact I sold some to this other sucker at a higher price than I bought it proves it's a store of value" - nobody would hesitate to call it a pyramid scheme.
- vekker 5y agoBut it does do something and network effects have a tremendous positive impact on that utility: cryptocurrencies provide us platforms for decentralized finance. Make of that what you will; payments, providing liquidity, lending, storing value, whatever ... These trustless systems are what give cryptocurrency some intrinsic value which increases logarithmically with the number of participants in the network. I don't think this will disappear any time soon, on the contrary. Usage will increase as the technology develops and the world becomes ever more interconnected.