3 ms·

For both gold and BTC the price is purely believe based. The only way quantity in existence matter is if it makes people believe that it makes it less worth.

For both gold and BTC the price is purely believe based. The only way quantity in existence matter is if it makes people believe that it makes it less worth. So if I hypothetical conjure a few tons of gold as long as no one believes it makes a difference it doesn't, but if a make people believe there is tons of more gold then they thought I could make the market crash without the amount changing. Similar if I make people bribe Bitcoin gets outlawed by the whole world, Bitcoin can crash without the amount changing. Or in other words, it doesn't really matter weather the quantity for good it's know as long as it's generally beloved that is "low enough". Similar it doesn't matter that BTC had known limits as it does crash (or spike) due to external factors.

unicornmama 5y ago
It’s a hyperbole to claim that the price of gold is purely belief based. Gold has demand from jewelry (50%) and for industrial uses (7.5%). https://www.investopedia.com/financial-edge/0311/what-drives-the-price-of-gold.aspx https://www.investopedia.com/financial-edge/0311/what-drives...
- dathinab 5y ago
  The "actual" gold price is so much below the current price that it doesn't matter. I would say that a non-small part of it's jewelry usages is either because of it's perceived value or wouldn't drive the price nearly as much, sure people would still buy gold jewelry if it would not be perceived as that expensive, but they wouldn't be willing to pay nearly as much as they do today. As far as I can tell at least 50% maybe up to 90% of the value is "believe" based. But that doesn't mean it's a bubble or anything like that, believe drives value all the time and can be long term stable, as seen in the history of gold. (Through gold wasn't always in that position, silver was in golds position before the western world ran into a major trade deficit with china and mined much more of it, similar there had been cultures where gold was see as nice looking but otherwise worthless gifting it away to colonialists, which lead to misunderstandings about the amount of gold available.)
ykevinator2 5y ago
You can't make a new gold out of thin air but you can a new crypto out if thin air. This is why all crypto is fictional, if you missed the last speculation bubble, just make a new crypto.
- dathinab 5y ago
  Most cryptos exist for themself, and you can't really just arbitrarily mint new BTC without the majority of miners agreeing on it. And for BTC wether a new crypto is made or not doesn't really matter that much. (Through it can, if it implicitly shakes the believe in BTC, which is quite unlikely.) (Also some crypto currencies are build with different marked mechanism in mind, where minting new tokens is not just possible but expected/required.)

unicornmama 5y ago

It’s a hyperbole to claim that the price of gold is purely belief based. Gold has demand from jewelry (50%) and for industrial uses (7.5%). https://www.investopedia.com/financial-edge/0311/what-drives-the-price-of-gold.aspx https://www.investopedia.com/financial-edge/0311/what-drives...

dathinab 5y ago
The "actual" gold price is so much below the current price that it doesn't matter. I would say that a non-small part of it's jewelry usages is either because of it's perceived value or wouldn't drive the price nearly as much, sure people would still buy gold jewelry if it would not be perceived as that expensive, but they wouldn't be willing to pay nearly as much as they do today. As far as I can tell at least 50% maybe up to 90% of the value is "believe" based. But that doesn't mean it's a bubble or anything like that, believe drives value all the time and can be long term stable, as seen in the history of gold. (Through gold wasn't always in that position, silver was in golds position before the western world ran into a major trade deficit with china and mined much more of it, similar there had been cultures where gold was see as nice looking but otherwise worthless gifting it away to colonialists, which lead to misunderstandings about the amount of gold available.)

ykevinator2 5y ago

You can't make a new gold out of thin air but you can a new crypto out if thin air. This is why all crypto is fictional, if you missed the last speculation bubble, just make a new crypto.

dathinab 5y ago
Most cryptos exist for themself, and you can't really just arbitrarily mint new BTC without the majority of miners agreeing on it. And for BTC wether a new crypto is made or not doesn't really matter that much. (Through it can, if it implicitly shakes the believe in BTC, which is quite unlikely.) (Also some crypto currencies are build with different marked mechanism in mind, where minting new tokens is not just possible but expected/required.)