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"The original run-up in prices could easily be explained as a speculative bubble, and the subsequent decline as the popping of that bubble. But if that were the
by mrb 15y ago
"The original run-up in prices could easily be explained as a speculative bubble, and the subsequent decline as the popping of that bubble. But if that were the whole story, then the value of Bitcoins should have continued to decline"
What a stupid statement to make. By definition, a bubble grows, then bursts, then things are back to normal. Similarly, the stock market did not indefinitely continued to decline after the dot com bubble... It is like the author is saying "the price of this stock should decline in the future because it has declined in the past".
- binarybits 15y agoStocks are valuable because they're a claim on a stream of future dividends. Bitcoins, in contrast produce no dividends and aren't intrinsically useful. So the question is why are they valuable at all? Also, the name-calling isn't necessary.
- mrb 15y agoThat's not the reason stocks have value. For one thing, many stocks don't return dividends. They are valuable because legally a stock owner owns a piece of the company, therefore a piece of its assets (and future revenus which will help grow its future assets.) Secondly, Bitcoin's decentralized nature, unfrozable assets, etc, is inherently valuable because unmatched by any other system.