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According to some very sound economic currency theory, you're 100% wrong. http://bitcoinsurvey.wordpress.com/ http://bitcoinsurvey.wordpress.com/ tl;dr About

According to some very sound economic currency theory, you're 100% wrong. http://bitcoinsurvey.wordpress.com/ http://bitcoinsurvey.wordpress.com/ tl;dr About half the current value of a bitcoin is speculation. The rest is fundamentally supported by its trade volume. There is no way a bitcoin can crash unless its use in trade crashes. The paper money I use every day, which can burn instantly in a flame, has no intrinsic value either.

Ologn 13y ago
> According to some very sound economic currency theory, you're 100% wrong. I should first say that what that web site talks about is not a crank theory. They base their arguments on what many consider a very sound economic currency theory. I happen to disagree with the theory. But you're right in that the perceived value of Bitcoin is based on serious economic currency theory, which many prominent people consider very sound. > About half the current value of a bitcoin is speculation. The rest is fundamentally supported by its trade volume How much of the value of Pets.com, Webvan, eToys, Kozmo etc. was supported by trade volume in 1999? > There is no way a bitcoin can crash unless its use in trade crashes. I guess I agree - if people realize Bitcoin is worthless, they'll stop trading with it. The crash in price will be eventually followed by a slowdown in trading. > The paper money I use every day, which can burn instantly in a flame, has no intrinsic value either. I've talked about this in other places in this thread. As five current US dollars could not buy one 1972 US dollar, as throughout history every government fiat currency in history has eventually collapsed in value (while gold has kept its value), as the current fiat experiment in the US is only 42 years old, in essence I agree over the long term. US currency is completely based on the power of the US government and its willingness to support its currency. Translated into what I have been saying, it means you can go to places like http://www.usps.com http://www.usps.com and send the government dollars, and it will send you valuable items in return. You are right though that over the long term, US paper money has no intrinsic value.
- lectrick 13y ago
  > I happen to disagree with the theory. That's great. You disagree with it... without any counterarguments. What's the sand smell like that your head is buried in? :) > How much of the value of ... webvan Webvan? Dude... Webvan? http://en.wikipedia.org/wiki/Webvan http://en.wikipedia.org/wiki/Webvan Webvan died because its expenses VASTLY outstripped its earnings at the time. But oddly, you didn't mention Flooz at all, which would have been a better (though still failing) argument than all of the dotcom bust stocks you mentioned. http://en.wikipedia.org/wiki/Flooz.com http://en.wikipedia.org/wiki/Flooz.com Flooz was killed first by a lack of adoption, and second by an FBI case due to a Russian crime syndicate using them for money laundering. And of course, it was centralized, which means it could be shut down. Bitcoin is growing in adoption, suffers from no central authority, cannot ever be shut down, may facilitate money laundering although the US government seems to only be prosecuting obviously nefarious cases such as the Liberty Reserve case and the Ponzi scheme guy and leaving bitcoin itself alone due to its potential economic value. Cash also facilitates money laundering, and I don't see that getting shut down anytime soon. > if people realize Bitcoin is worthless, they'll stop trading with it And if people realize the US Dollar is worthless, they'll stop trading in it too. If you're saying that the value of something is what people believe it is, then this argument holds for anything of any value, which is always subjective.

Ologn 13y ago

> According to some very sound economic currency theory, you're 100% wrong. I should first say that what that web site talks about is not a crank theory. They base their arguments on what many consider a very sound economic currency theory. I happen to disagree with the theory. But you're right in that the perceived value of Bitcoin is based on serious economic currency theory, which many prominent people consider very sound. > About half the current value of a bitcoin is speculation. The rest is fundamentally supported by its trade volume How much of the value of Pets.com, Webvan, eToys, Kozmo etc. was supported by trade volume in 1999? > There is no way a bitcoin can crash unless its use in trade crashes. I guess I agree - if people realize Bitcoin is worthless, they'll stop trading with it. The crash in price will be eventually followed by a slowdown in trading. > The paper money I use every day, which can burn instantly in a flame, has no intrinsic value either. I've talked about this in other places in this thread. As five current US dollars could not buy one 1972 US dollar, as throughout history every government fiat currency in history has eventually collapsed in value (while gold has kept its value), as the current fiat experiment in the US is only 42 years old, in essence I agree over the long term. US currency is completely based on the power of the US government and its willingness to support its currency. Translated into what I have been saying, it means you can go to places like http://www.usps.com http://www.usps.com and send the government dollars, and it will send you valuable items in return. You are right though that over the long term, US paper money has no intrinsic value.

lectrick 13y ago
> I happen to disagree with the theory. That's great. You disagree with it... without any counterarguments. What's the sand smell like that your head is buried in? :) > How much of the value of ... webvan Webvan? Dude... Webvan? http://en.wikipedia.org/wiki/Webvan http://en.wikipedia.org/wiki/Webvan Webvan died because its expenses VASTLY outstripped its earnings at the time. But oddly, you didn't mention Flooz at all, which would have been a better (though still failing) argument than all of the dotcom bust stocks you mentioned. http://en.wikipedia.org/wiki/Flooz.com http://en.wikipedia.org/wiki/Flooz.com Flooz was killed first by a lack of adoption, and second by an FBI case due to a Russian crime syndicate using them for money laundering. And of course, it was centralized, which means it could be shut down. Bitcoin is growing in adoption, suffers from no central authority, cannot ever be shut down, may facilitate money laundering although the US government seems to only be prosecuting obviously nefarious cases such as the Liberty Reserve case and the Ponzi scheme guy and leaving bitcoin itself alone due to its potential economic value. Cash also facilitates money laundering, and I don't see that getting shut down anytime soon. > if people realize Bitcoin is worthless, they'll stop trading with it And if people realize the US Dollar is worthless, they'll stop trading in it too. If you're saying that the value of something is what people believe it is, then this argument holds for anything of any value, which is always subjective.