4 ms·

I have a hard time understanding what the value of that is in its pure form. What is the value of a scare digital commodity in and of itself?

lurking15 3y ago
apparently the value is $47k and counting
hollerith 3y ago
People need a way to store money. Sometimes, the government-approved ways of doing that have severe problems. Gold would be worth much less than it actually is if people weren't using it to store money. It is easier to store bitcoin than to store gold. (E.g., bitcoin is easier to hide from thieves than gold is.)
- hellojesus 3y ago
  I agree with both your statements. There is a tradeoff between friction of a nonapproved system and having your money in it. The US has tried to KYC as much as possible, and the psuedo anonymous addresses have mostly been linked to meatspace owners, so I have trouble completely believing that the currency is completely free of gov intervention. Any sufficiently large state actor can simply buy a zero day exploit to try and remotely get into a target computer and then steal the pk of the wallet. There are mitigation techniques such as multiparty signing and hardware based keys/wallets, but nothing is perfect. And the most secured active users of it are likely already on gov radar.
  - hollerith 3y ago
    Bitcoin doesn't seem particularly useful for evading government controls in the US or the EU, but it does in much of the rest of the world, where the governments are typically incapable of something like the US anti-money-laundering regime. A sensible reason for a US investor to invest in bitcoin would be to sell it in the future for more than he paid for it to some saver in some non-US non-EU country, and most US investors would have no particularly strong motive to hide such an investment from the US government.
    - hellojesus 3y ago
      Very interesting perspective. Thank you.
imiric 3y ago
What is the value of physical currency, or a balance in a digital system? It's all supply and demand. When physical currency used to be backed by gold reserves, then it could be argued that gold itself has material value, but nowadays it's all fairy dust[1]. [1]: https://www.youtube.com/watch?v=IiTfnpgNkmI https://www.youtube.com/watch?v=IiTfnpgNkmI
- hellojesus 3y ago
  Agreed that gold's value was largely increased it's demand as a reserve currency, but it does have stand alone value. Jewelry, conductivity, etc. all contribute to a baseline market for it. To me, store of value commodities are interesting when unpegged from a mainstream currency in that they provide no dividends. Their ownly roi is via speculation of the masses. Castles in the skies. That is where I have a hard time underatanding the value preposition of crypto.

lurking15 3y ago

apparently the value is $47k and counting

hollerith 3y ago

People need a way to store money. Sometimes, the government-approved ways of doing that have severe problems. Gold would be worth much less than it actually is if people weren't using it to store money. It is easier to store bitcoin than to store gold. (E.g., bitcoin is easier to hide from thieves than gold is.)

hellojesus 3y ago
I agree with both your statements. There is a tradeoff between friction of a nonapproved system and having your money in it. The US has tried to KYC as much as possible, and the psuedo anonymous addresses have mostly been linked to meatspace owners, so I have trouble completely believing that the currency is completely free of gov intervention. Any sufficiently large state actor can simply buy a zero day exploit to try and remotely get into a target computer and then steal the pk of the wallet. There are mitigation techniques such as multiparty signing and hardware based keys/wallets, but nothing is perfect. And the most secured active users of it are likely already on gov radar.
- hollerith 3y ago
  Bitcoin doesn't seem particularly useful for evading government controls in the US or the EU, but it does in much of the rest of the world, where the governments are typically incapable of something like the US anti-money-laundering regime. A sensible reason for a US investor to invest in bitcoin would be to sell it in the future for more than he paid for it to some saver in some non-US non-EU country, and most US investors would have no particularly strong motive to hide such an investment from the US government.
  - hellojesus 3y ago
    Very interesting perspective. Thank you.

imiric 3y ago

What is the value of physical currency, or a balance in a digital system? It's all supply and demand. When physical currency used to be backed by gold reserves, then it could be argued that gold itself has material value, but nowadays it's all fairy dust[1]. [1]: https://www.youtube.com/watch?v=IiTfnpgNkmI https://www.youtube.com/watch?v=IiTfnpgNkmI

hellojesus 3y ago
Agreed that gold's value was largely increased it's demand as a reserve currency, but it does have stand alone value. Jewelry, conductivity, etc. all contribute to a baseline market for it. To me, store of value commodities are interesting when unpegged from a mainstream currency in that they provide no dividends. Their ownly roi is via speculation of the masses. Castles in the skies. That is where I have a hard time underatanding the value preposition of crypto.