3 ms·
> willingness to hold the asset depends on the fact that it has value independent of that willingness. Tobacco can be smoked or chewed, gold can be used to fill
by return0 14y ago
> willingness to hold the asset depends on the fact that it has value independent of that willingness. Tobacco can be smoked or chewed, gold can be used to fill teeth or make jewellery, and U.S. dollars can be used to meet obligations to the U.S. government.
Gold has very few industrial uses. If its price was its 'independent' value, it would cost a hell lot less. It's a value store because people believe is safe, even though it's much easier to steal a bar of gold than to fake bitcoins. Gold is also difficult to move around, or to make anonymous transactions with, or to split in small pieces etc. Gold is the old world's bitcoin, and, if anything its more flawed than bitcoins. As digital currencies prove their robustness and reliability, we will probably see a massive move from 'precious' metals to digital value stores.
This professor will be shaking his head in disbelief in a few years.
http://en.wikipedia.org/wiki/Gold_as_an_investment http://en.wikipedia.org/wiki/Gold_as_an_investment
- mey 14y agoBitcoins may be hard to "fake", but not hard to steal. People are generally more familiar (currently) with physical security then digital security.
- olivier1664 14y agoYes and no: it is just a question of habit. You will no more need some physical coffer. You will just need to remember a big password (or just a small coffer where you put a unique printing of your password). The protection of your property will be cheaper.
- return0 14y agoIt would be interesting to see statistics on this. Does digital theft happen more often than physical? In the end, you can always encapsulate a wallet in a crypto physical device.