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> Gold has intrinsic value as a commodity though. It's scarce, has industrial uses, and has aesthetic value to a lot of people. Yet this value is a small fract

• bandrami 3y ago
  Gold, like stocks and real estate, trades at some multiple of book (with metals this ratio is generally between 0 and 1, with stocks it's generally greater than 1). In fact, looking at the P/B ratio is often one of the first things someone does when evaluating an investment. That ratio for bitcoin is infinite which is why it's not an "investment" in the usual sense of the word.
  • chii 3y ago
    why is BTC ratio infinite, but not gold?
    • bandrami 3y ago
      Gold has industrial uses; the gold traces on a PCB add $X value to it which is a floor for the value of the gold itself
  • tasuki 3y ago
    That ratio is a somewhat arbitrary thing. Who says it's a good measure? For gold, perhaps 20% of its value is its actual use and 80% is for the scarcity. For bitcoin it's 0% for actual use and 100% of the price is its scarcity. When you look at it like this, the difference between gold and bitcoin is not nearly as dramatic.