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That’s the previous commenter’s point, isn’t it? The crypto advocates claim that crypto has intrinsic value simply because of its scarcity (supply-side only). T

That’s the previous commenter’s point, isn’t it? The crypto advocates claim that crypto has intrinsic value simply because of its scarcity (supply-side only). The commenter’s rebuttal is that if this were true, their kid’s doodles would be extremely valuable, yet they are not because only the parent treasures them (demand-side). With gold, one can come up with a plausible story for the demand side of the argument that it has intrinsic value: gold’s combination of beauty and scarcity has made it a potent status symbol across many eras and cultures (not to mention its industrial uses). With crypto, it’s much harder to imagine what the demand side of the story is. There’s a finite supply of Bitcoin, and people demand it because… well, it’s not because they can pay for anything with it. They mostly seem to demand it because they believe someone else will pay them more for it in the future. And what do we call it when an asset has nothing going for it besides that hope? I’m still waiting for a compelling story about why demand for Bitcoin or any other cryptocurrency will persist beyond the current vogue, which is driven by the notion that “it’s gonna be huge in the future”. How long can people keep the faith, and what happens to demand if and when they stop?

Eisenstein 4y ago
I have contended that the only use for cryptocurrency which provides value for people is for anonymous transactions for which cash is not an option or a poor option. The only cryptocurrency that can do this that I know of is Monero. Therefore Monero will have lasting value. Whether you can make money speculating on it is dubious, which is probably why not many people do. * Note: I am speaking regarding the markets I know; I cannot say anything regarding economies suffering rapid inflation or which lack access to banking
- amluto 4y ago
  Except that holding Monero is of rather less clear value. Sure, the ability to take $100, turn it into Monero, and turn it back into almost $100 that cannot be trivially traced to the original $100 is of some value. But this value is there for people who have no particular interest in Monero-the—asset. They want Monero-the-mixer. If I put $100 into Monero and hold it, I’m betting that Monero is still worth something in the future. That’s a risky bet. For example, the Treasury department could sanction Monero. Or the next great mixer could come along and supplant Monero, making my old Monero mostly useless.
  - Eisenstein 4y ago
    The whole point of currency is to use it. If you are buying a currency to hold on to it, then it is a terrible currency and there is a disincentive to use it as one, thus making it useful only for speculation. I know that there was a pivot when people realized Bitcoin and Ether are not practical for their purported use as currencies, where they are now claimed to 'hold value', but that is ridiculous. They were designed to be currencies and they suck at it. You can make up any reason you want, but if you want a cryptocurrency that has value as a currency then in my view Monero is an example of one, because it has a valued use case.
    - randomswede 4y ago
      ON the international currency market, one traditional role of the US dollar is exactly "store value". You trade your currencies on the FX market during your day, and comes close to "close of your trading", you exchange all your positions for US dollars, to keep in store for your quiet period. Comes the following day, you trade out your dollars for other currencies. Then the cycle continues. Does this mean that the US dollar is a terrible currency? No. If another currency meets the same stability criterion, it can (and probably is) used as a short-to-medium term value store. I don't really see any crypto-currency work well, they're thinly traded, so there's a lot of inherent volatility in the pricing. It is also getting increasingly harder to exchange crypto-currencies for more traditional currencies.
      - Eisenstein 4y ago
        > ON the international currency market, one traditional role of the US dollar is exactly "store value". I do know that 'store of value' is the term I used, but it is in reference to the people who hold Bitcoins in expectation of rising price, and the fact that they would claim it 'stores value' while being extremely volitile is indicative of their lack of understanding or their lack of honesty in representing their motives. People who shelter their dollars overnight are most likely not expecting a return on it.
      - amluto 4y ago
cwkoss 4y ago
Bitcoin is the first (and most stable) theoretically unseizable currency. You can store bitcoin in your brain, get persecuted by your national government for criticizing their actions, travel across a border, get kidnapped, offer up a decoy wallet, get released 3 years later, wander into a town with an internet cafe, and theoretically, you could have access to your funds within hours, without the consent of or dependence on any other centralized entity. Is this a fantasy that few if any people will ever utilize? Sure. Is it also super cool? I think so. I think the main demand of bitcoin is "money that isn't subject to federal reserve policy". No fiat currency in the world is effectively accomplishing that today. (Note: I had to stop using brainwallets three bubbles ago because I had recurring nightmares of getting a brain injury and losing access to my funds. Don't recommend it.)
- Cheezewheel 4y ago
  >Bitcoin is the first (and most stable) theoretically unseizable currency This is an absolute farce. Maybe talk to us when there are no longer reports of being able to easily scam someone out of all of their money with a non-reversable transaction just by sending them an image with a script in it.
  - crummy 4y ago
    Emphasis on the "theoretically", I think.
  - cwkoss 4y ago
    Name a currency that scammers don't get fools to part with.
    - bryananderson 4y ago
      At least with fiat currency you have a chance of getting the transaction reversed! Most people will not trust a currency where this is not possible, or at least they will hold it with a centralized trusted custodian who can offer transaction reversal—which defeats the purpose!

Eisenstein 4y ago

I have contended that the only use for cryptocurrency which provides value for people is for anonymous transactions for which cash is not an option or a poor option. The only cryptocurrency that can do this that I know of is Monero. Therefore Monero will have lasting value. Whether you can make money speculating on it is dubious, which is probably why not many people do. * Note: I am speaking regarding the markets I know; I cannot say anything regarding economies suffering rapid inflation or which lack access to banking

amluto 4y ago
Except that holding Monero is of rather less clear value. Sure, the ability to take $100, turn it into Monero, and turn it back into almost $100 that cannot be trivially traced to the original $100 is of some value. But this value is there for people who have no particular interest in Monero-the—asset. They want Monero-the-mixer. If I put $100 into Monero and hold it, I’m betting that Monero is still worth something in the future. That’s a risky bet. For example, the Treasury department could sanction Monero. Or the next great mixer could come along and supplant Monero, making my old Monero mostly useless.
- Eisenstein 4y ago
  The whole point of currency is to use it. If you are buying a currency to hold on to it, then it is a terrible currency and there is a disincentive to use it as one, thus making it useful only for speculation. I know that there was a pivot when people realized Bitcoin and Ether are not practical for their purported use as currencies, where they are now claimed to 'hold value', but that is ridiculous. They were designed to be currencies and they suck at it. You can make up any reason you want, but if you want a cryptocurrency that has value as a currency then in my view Monero is an example of one, because it has a valued use case.
  - randomswede 4y ago
    ON the international currency market, one traditional role of the US dollar is exactly "store value". You trade your currencies on the FX market during your day, and comes close to "close of your trading", you exchange all your positions for US dollars, to keep in store for your quiet period. Comes the following day, you trade out your dollars for other currencies. Then the cycle continues. Does this mean that the US dollar is a terrible currency? No. If another currency meets the same stability criterion, it can (and probably is) used as a short-to-medium term value store. I don't really see any crypto-currency work well, they're thinly traded, so there's a lot of inherent volatility in the pricing. It is also getting increasingly harder to exchange crypto-currencies for more traditional currencies.
    - Eisenstein 4y ago
      > ON the international currency market, one traditional role of the US dollar is exactly "store value". I do know that 'store of value' is the term I used, but it is in reference to the people who hold Bitcoins in expectation of rising price, and the fact that they would claim it 'stores value' while being extremely volitile is indicative of their lack of understanding or their lack of honesty in representing their motives. People who shelter their dollars overnight are most likely not expecting a return on it.
    - amluto 4y ago

cwkoss 4y ago

Bitcoin is the first (and most stable) theoretically unseizable currency. You can store bitcoin in your brain, get persecuted by your national government for criticizing their actions, travel across a border, get kidnapped, offer up a decoy wallet, get released 3 years later, wander into a town with an internet cafe, and theoretically, you could have access to your funds within hours, without the consent of or dependence on any other centralized entity. Is this a fantasy that few if any people will ever utilize? Sure. Is it also super cool? I think so. I think the main demand of bitcoin is "money that isn't subject to federal reserve policy". No fiat currency in the world is effectively accomplishing that today. (Note: I had to stop using brainwallets three bubbles ago because I had recurring nightmares of getting a brain injury and losing access to my funds. Don't recommend it.)

Cheezewheel 4y ago
>Bitcoin is the first (and most stable) theoretically unseizable currency This is an absolute farce. Maybe talk to us when there are no longer reports of being able to easily scam someone out of all of their money with a non-reversable transaction just by sending them an image with a script in it.
- crummy 4y ago
  Emphasis on the "theoretically", I think.
- cwkoss 4y ago
  Name a currency that scammers don't get fools to part with.
  - bryananderson 4y ago
    At least with fiat currency you have a chance of getting the transaction reversed! Most people will not trust a currency where this is not possible, or at least they will hold it with a centralized trusted custodian who can offer transaction reversal—which defeats the purpose!