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Definitely: the distinction needs to be made between Bitcoin the currency and Bitcoin the transaction network. The former's value is intrinsically fluid to the
by ihsw 13y ago
Definitely: the distinction needs to be made between Bitcoin the currency and Bitcoin the transaction network.
The former's value is intrinsically fluid to the point where it's a weakness as well as a strength, however the latter's value is quite distinct. The BTC transaction network is reliably robust, spans the globe irrespective of national boundaries, quite secure, and fast.
Some people call BTC the internet's gold, but that couldn't be further from the truth -- gold just sits there gathering dust. Gold has some industrial applications but at the end of a day it's just a store of value, whereas BTC encompasses the transaction network just as much if not more than acting as a store of value.
- OmarIsmail 13y agoThe rub is that the currency and the network are inextricably linked together. This is the underlying genius of Bitcoin and it's the main thing that most people don't appreciate. Put another way the value of bitcoin is the value of the network. How do you value the network is the big question.
- maxerickson 13y agoThe value of the transaction network is highly dependent on the exchange value. I'm not sure exactly what you mean when you call it distinct, but miners will certainly respond to changes in the exchange value, which may end up removing much of the vaunted security of the ledger (which removes interest, which makes mining less lucrative, which ...). (I don't necessarily think there is strong case for those scenarios, but it's pretty hard to decide at what exchange rate the thing becomes unstable).