I get that anything is worth whatever someone is willing to pay for it. That’s besides the point. My point is, beyond speculation, what do crypto coins represent?
I also understand that the value of the US dollar is being questioned almost as much without the backing of gold.
But what I really want to know is what is at the foundation level of Bitcoin that people are buying into?
I have a basic understanding of the blockchain, etc. I sold 1BTC in 2017 for $1200 when I thought that was as high as it would go. At this point, at over $100kUSD and rising steadily, what is the $ limit and what is that limit based upon? I thought it was based on the value of mining to check transactions but this seems… not worth $100k to me.
I’ve been thinking, the only tangible value I personally see in Bitcoin, because it’s not really being used as legitimate currency, is for criminals. By now, there must be trillions of dollars in BTC acquired by criminals holding corporations hostage. When you’ve got people like Trump involved (either explicitly or by way of manipulation) with an executive order to establish a crypto czar, this suggests to me that he’s creating pathways for bad actors to more effectively gain more wealth. These are the people who are most excited in Bitcoin, beyond speculation.
I mean, there’s little to nothing on the up and up with crypto, right? It’s a scam. Right?
Please, factual answers only. I’m looking for someone to dispel my speculation with genuine economics of the matter.
Paper money isn’t worth anything innately. Gold isn’t either. Not diamonds. Nothing has innate worth except food, air, drinking water, and possibly shelter.
Gold and diamonds have intrinsic value
Gold is needed for computer parts, and diamonds are used for cutting
They are more than just shiny
Their value will “never” hit 0 (Bitcoin would be worthless without gold for computers)
Yes, we could find substitutes in the future, but for the substances to not be useful somehow is so low and would have to be an apocalyptic scenario. And in an apocalypse, gold could even be worth more.
…Except that gold, like the dollar, and like bitcoin, has the value it does because people believe it does. Sure, gold’s a great semiconductor. But if that was all we used it for, the price of gold would be a tine fraction of what it is. Diamonds are great as abrasives and in certain cutting applications, but that’s all synthetic now. Natural diamonds only have high value because of artificial scarcity and advertising.
That’s intrinsic value.
Yes.
But many people–and I’m not saying you do this–but many people get gold, silver, and diamonds confused, and think that their intrinsic value is linked to their perceived value. does that make sense?
(Paper) money is practically actually valuable because you need it to pay taxes. Gold, diamonds etc you could do without. Of course there is more nuance but taxes force people to value currency and therefore also accept it from others (because you need some of it or you go to jail), which gives currency the circular value.
It’s not valuable, it’s a convention. You may as well use conch shells or Bitcoin. Don’t matter what it is, it doesn’t have value until we all agree it has value