6 ms·
Bitcoin does have an intrinsic value: the ability to buy things online privately. People have a need to buy things online without their credit card company usin
by tlb 14y ago
Bitcoin does have an intrinsic value: the ability to buy things online privately. People have a need to buy things online without their credit card company using that information to target marketing or update their risk profile.
People continue to use cash in the physical world, even though it's less convenient than cards, because it is private and the merchant gets 100% of the money. Bitcoin has the same virtues online.
FWIW, you can't actually pay your taxes with cash.
- bitcartel 14y ago> Bitcoins will attain their true value of zero sooner or later, but it is impossible to say when... Bitcoins are the most demonstrably valueless financial asset ever created It looks like John Quiggin is basing his views upon his extensive prior research[1] into Bitcoin, and he is not simply jumping onto the bandwagon like so many other economists. [1] http://johnquiggin.com/?s=bitcoin http://johnquiggin.com/?s=bitcoin
- gwern 14y agoSince in the OP he fails to explain any reasons why anyone might find Bitcoin useful or valuable in the first place, one could doubt the quality of his 'extensive prior research'.
- argonaut 14y agoYou're misinterpreting the definition of intrinsic value. The ability to buy things online privately is something entirely extrinsic to BTC. Even people who say that the US dollar has intrinsic value (aside from the paper) are mistaken - value derived by fiat only gives the dollar legal value. You most certainly can pay taxes with cash. But that's not the point. The point is that you have to pay your taxes in US dollars.
- deleted 14y ago[deleted]
- Evbn 14y agoAnd the value of the ability to fill your mouth with gold is completely extrinsic to gold.
- deleted 14y ago[deleted]
- deleted 14y ago[deleted]
- deleted 14y ago[deleted]
- return0 14y agoTo be fair, the article recognizes intrinsic value in the dollar, but not in bitcoin, applying double standards. Btc 's divisibility, the fact that it s hard to counterfeit, and anonymity are intrinsic values although the whole concept of intrinsic value is vague, because in the end all values are market-determined That doesnt make sense. The dollar has extrinsic value too, which comes from the legal requirement of governments to accept it as payment. Unless you feed on paper, it doesn't paper money has less intrinsic value than digital, the latter is more divisible and easily exchangeable worldwide. http://en.wikipedia.org/wiki/Intrinsic_value_(numismatics) http://en.wikipedia.org/wiki/Intrinsic_value_(numismatics)
- argonaut 14y agoYou are correct that intrinsic value is very vague. That wikipedia article, for example, is incorrect if you apply a strict definition of intrinsic value. Since all currency value is essentially subjective, all fiat currencies / digital currencies are devoid of intrinsic value. The value from satisfying legal requirements is extrinsic.
- oleganza 14y agoNo, non-monetary value of Bitcoin is in ability to store a proof of anything in its blockchain without trusting any third party. E.g. timestamping documents, registering contracts, registering intellectual property etc. See more here: http://blog.oleganza.com/post/42262765318/direct-use-value-of-bitcoin http://blog.oleganza.com/post/42262765318/direct-use-value-o... PS. "intrinsic" value does not exist in anything. Value is something that people put in things. Nature itself has no meaning, values or purpose. It's we, the actors who make the choices and valuations.
- bayesianhorse 14y agoYes, you are absolutely right with Bitcoin being a means of proving a transaction. But the journalists aren't going to pick up on that distinction soon.
- baddox 14y agoEven aside from its utility in commercial exchanges, bitcoin has an arguably minor but often-overlooked "intrinsic"* value. A bitcoin is nearly irrefutable proof that a certain amount of difficult computation has been done by (or on behalf of) its owner. That has some inherent value, in the vein of Hashcash, for potentially rendering spam or DDOS attacks unprofitable. But unlike Hashcash, the work can be done long before hand, and there is a decentralized network preventing double spending. * I put "intrinsic" in quotes to broadcast that I am aware of the philosophical and semantic difficulties the word introduces into a conversation. Do apples have intrinsic value because people can eat them? What if I'm allergic to apples? What if the human race goes extinct?
- dmix 14y agohttp://en.wikipedia.org/wiki/Subjective_theory_of_value http://en.wikipedia.org/wiki/Subjective_theory_of_value > advances the idea that the value of a good is not determined by any inherent property of the good, nor by the amount of labor required to produce the good This is what most economists agree upon.
- baddox 14y agoIndeed, and yet, you see so many bitcoin articles in major publications talking about bitcoin's lack of intrinsic value.
- nsfmc 14y agoyou can pay your taxes with cash, but you have to do it at a physical IRS office. http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Payment-Options---Ways-To-Make-a-Payment http://www.irs.gov/Businesses/Small-Businesses-&-Self-Em...
- tlb 14y agoYou're right. I was thinking of Canada, where they eliminated the option several years ago.