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Do you have $10? In dollars, euro, yen, or whatever? Is a domain name worth $10 to you? Then buy it. If not, don't. Your decision shouldn't depend on whether y
by pash 13y ago
Do you have $10? In dollars, euro, yen, or whatever? Is a domain name worth $10 to you? Then buy it. If not, don't.
Your decision shouldn't depend on whether your $10 worth of money is denominated in dollars or in bitcoin.† Why not? Because if you have $10 worth of dollars, you can spend it on a domain name, or you can turn it into bitcoin. If you have $10 worth of bitcoin, you can spend it on a domain name or turn it into dollars. (And in an economist's perfect world, you could just as easily sell your domain name for $10 worth of dollars or bitcoin.)
All you have to decide is what relative allocation of dollars, bitcoin, and domain names (and everything else) you want. Then you just exchange one for another to get there. This is the basic idea behind opportunity cost [0]. You have to consider all your alternatives at once, and those alternatives are the same whether your money happens to be in dollars or bitcoin at the moment.
† — Except to the extent that prices differ with the currency of denomination (i.e., there are arbitrage opportunities), or transactions costs hinder your ability to exchange one currency or good for another.
0. https://en.wikipedia.org/wiki/Opportunity_cost https://en.wikipedia.org/wiki/Opportunity_cost