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.
the only tangible value I personally see in Bitcoin, because it’s not really being used as legitimate currency, is for criminals.
Please, factual answers only.
In 2021, 0.15% of known cryptocurrency transactions conducted were involved in illicit activities like cybercrime, money laundering and terrorism financing
You’re gonna have to give me a source for that buddy.
It came from here but this source has more detail.
Is that by total number of transactions or by bitcoin volume?
I copied that from Wikipedia which got their reference from through NY times.
For specific details, this is probably a better source https://www.trmlabs.com/resources/reports/the-illicit-crypto-ecosystem-report-2022
sounds like the word “known” is doing some heavy lifting there
So you know how fiat currency is backed by nothing more than the fact the government says it’s valuable and we all agree to that? Crypto is sort of like that except without the government bit
Yup, all boils down to faith in the currency. For something like the dollar, it’s backed by faith in the US government. For something like Bitcoin, it’s backed by faith in the resilience of the blockchain and the value buyers place on it. Emperor Norton minted his own currency which was accepted all around San Francisco based purely on the fact that people accepted it.
It’s a lot more backed by the faith that if you don’t manage to get some you go to jail.
Except the lack of government AND the massive amount of pollution and resources waste.
Fiat currency is backed by taxation, which can only be paid in the very same currency that the taxer prints.
📺 Your Taxes Pay for NothingSome states have been looking into allowing you to pay your taxes with crypto, so checkmate atheists.
No stable state with a strong currency would ever do that.
Based on … What exactly? Your gut feelings?
But I can buy anything with fiat curency and with bitcoin I can basically buy nothing. And I never will be able probably, bitcoin is too slow to be used as an actual curency to buy common things like groceries
bitcoin is a bad currency but you absolutely can buy legal things. like, check shopinbit. there’s also a similar website that buys the thing for you from amazon
People buy big ticket items like cars and houses with bitcoin, not chocolate bars.
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.
(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
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.
But if that was all we used it for, the price of gold would be a tine fraction of what it is
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?
I get that
I wouldn’t buy diamonds or gold hoping they increase in price just as much as I wouldn’t buy bitcoin to do the same.
If you offered me 1USD in Gold, Diamond, or Bitcoin.
I would take the gold. It has the most intrinsic value.
The probably that gold hits 0USD is less than bitcoin hitting 0USD.
The only reason you’d take bitcoin is if you think that it has a higher ceiling. Intrinsic value is the floor. But that is gambling
Bitcoin doesn’t even attract criminals as it’s traceable. You can easily tell who bought what and traded what. Since all the exchanges are KYC, no criminal worth their salt would use Bitcoin. Instead, they would rather use Monero. The only people buying and selling Bitcoin are people who want to gamble on it getting higher
No
Bitcoin has massive value as a tool to transfer money, anonymously, and through borders effortlessly. Its extremely valuable for money laundering, scamming, stealing, and dodging tariffs or raising money (see how much crypto is stolen by north Korea)
In the same way that MLM and Ponzi schemes are worth something.
How profitable it is is directly proportional to how willing you are to fuck over everyone around you. To how much of an asshole you are.
Bitcoin specifically? No. It’s a janky prototype that should have been superseded a long time ago.
Crypto in general? Probably something. It’s good for buying and selling illegal things.
Modern blockchain protocols dominate bitcoin in every dimension except market cap.
My views on it are the same as the DPRK. A tool used by capitalists that can help fight against capitalism.
Can you provide a source? I haven’t heard that perspective before but it sounds interesting
https://www.thecoinrepublic.com/2025/03/16/north-korea-bitcoin-holdings-top-el-salvador-bhutan-after-bybit-hack/ basically, DPRK hackers constantly steal bitcoin from insecure exchanges or whatever. This helps them get around the genocidal sanctions the west places on them. It isn’t disclosed what they use the funds for, but likely in trade with Russia and/or China.
The real answer is: It depends how you define value.
Can you make money with Bitcoin? Yes. Are you likely to make money? No Is the technology useful applicable? Yes Is it being used and applied ethically and for the good of people? No. Is it a ‘store of value’? No, it’s more like an extremely volatile stock or a lottery ticket. Can you use it like money? Yes Is there any reason to use it like money? Not really, not even among other cryptocurrencies.
Depending on which of these aspects of Bitcoin matter to you it will be more or valuable.
not even fiat (heh) is worth anything if we don’t accept it as store of value, let alone an electronic register on a digital ledger.
I don’t think bitcoin provides much value in itself. Its basically an asset that is hard to make more of, like money or gold, which are also valuable because of this and that gold and specific currencies are relatively widely used.
bitcoin’s supposed added value over money is private digital transactions across the globe in a private way, so that you can send money whoever you want, but it’s not practically private, and has so large operating costs (even just the transaction fee) that it’s not really better than bank transactions.
so in short: its value is in its scarcity, and that you can speculate on it. the other possible advantages are not realized.
since the value is in speculation, the dollar limit is when investors start selling enough of it so that others will do the same out of fear. which is who knows how much. but it’s probably more related to other factors than the dollar value.
From a basic labor theory of value perspective, bitcoin requires labor to produce because mining it requires massive amounts of compute power. This computer power is supplied using GPUs and electricity, both of which require labor to produce.
If you use this calculator, and enter the values 67 TH/s (tera hashes per second, the rate at which you are mining), 2680 watts for electricity consumption rate, and 5 cents per kilo watt hour as prices, you will see
4.25 USD revenue per day 3.22 USD cost per day Profit rate = 32.0%
To make the values of the the hash rate and energy consumption rate realistic, I consulted the specs of the machine antminer S17, which is aparantly a machine used in the bitcoin mining world (I ain’t into crypto mining). The cost of electricty comes from Kazakhstan, which has cheap electricty and substantial mining operations.
So basically, at the current price of bitcoin can support a gross profit rate of 32% for the people who produce bitcoin, assuming you keep all the profit (no taxes, interest, rent), have no employees or maintainable costs. This is the price currently settled at based on the technological conditions and level of competition.
It is nothing too crazy of a price, and the rapid growth of price in bitcoin is due to how the currency was designed. Basically, once a certain number of bitcoin have been mined, the bitcoin generation rate per mined block halves. This forces an exponential rise in the difficulty of mining bitcoin, and therefore an exponential rise in its price.
Most probably, if bitcoin was designed to have a constant difficulty of producing, its price wouldn’t have increased at all.
Just like anything else, it’s worth what people are willing to pay for it vs what people are willing to buy it for.
Currently bitcoin is just a digital commodity with a finite supply which makes it a good store of value if people continue to use it.
The thing is, there’s nothing preventing bitcoin from tanking and becoming essentially worthless besides people buying it because the price is low.
If in a hypothetical future the bitcoin price becomes stable then it will become a valuable commodity. It’s value is wholly derived from it’s users and nothing else.
It’s not very convinent for governments or large institutions to hold it in it’s current form since it’s too easy to steal without leaving a trace. For government use there is going to be needed some development to allow for government or Central banks to have complete control over the currency without giving that control away which I think might be possible. In that case settling international transactions in bitcoin as opposed to the dollar for BRICS countries might be an option which doesn’t use the US dollar.
All the other uses IMO are pretty much fluff such as paying in bitcoin.
The US dollar actually is tied to something of value: it’s the format the us government will take their taxes in or else they will increasingly use their powers as a monopoly on fhe legitimate use of force until you give them what you owe
Crypto is only worth what others will pay for it. Which is why I don’t own it
Further to that it is also what they pay their debt in. You can buy debt in dollars and earn interest in dollars
This is a negative for dollars, not a positive.
Being able to inflate your way out of debt makes a currency less valuable.
In value yes, but as a tool it’s very valuable
Valuable to the people creating debt in that currency. Not to other stakeholders.
