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tayjohno | 2 years ago
There are plenty of highly liquid investments that are quite speculative, like gold, but you can at least make some reasonable assumptions and say "Would people still pay for a gold ring if it cost $1,000/oz? $10,000/oz? $100,000/oz? There's a natural feedback because of the underlying value of the object.
How do you do the same with Bitcoin? People point to factors of the technology as having some inherent value, but if things like divisibility or the distributed ledger were what give cryptocurrencies their value, then any crypto currency should be just as valuable as any other. There are other intangibles that help explain why Bitcoin out-values other coins, like the brand recognition, or the network effect, but there's no explanation for what those are worth. The problem with this is that bitcoin goes up _because_ bitcoin goes up, and bitcoin goes down _because_ bitcoin goes down. There are no other levers to move the price other than sentiment.
RetpolineDrama|2 years ago
Does USD have value? If you say yes, and I can then exchange X for USD in a reasonable amount of time then X is also valuable.
You don't have to _like_ it, you don't have to think it's a good thing that X has value, but your emotional reaction does not change the reality that X has value.