How does Bitcoin have any value at all?? Isn’t it all based on supply and demand, and in turn, based on desire of people to conduct financial transactions outside the banking system?
And since Bitcoin is not backed by any assets, is not a national currency backed by full faith and credit of anyone, isn’t it really all a matter that, since the participants in the Bitcoin market believe it has value, and buy and sell it as a commodity, that this is why it has value???
Gold has value because people believe it has value.
This has always been the case. Gold is so traditional, that we think nothing of it. “Gold has value” — everybody knows that.
But bitcoin is not substantially different — although the current opinion of the value of bitcoin may not last thousands of years. So Gold probably has an advantage there.
It has value because people are willing to pay for it. In the hope that someone down the line will pay more for it.
There is no intrinsic value, like silver or gold or wheat, and bitcoin is not backed by a promise to pay, like the US dollar.
What is Gold but a shiny rock.
Same way anything has value. People want it. People are the source of all value, even the very money we spend to get things only has the value the people give it. The “full faith and credit” backing of currency has no meaning. It’s the willingness of the recipient to take it that matters.
It actually is closer to GOLD than the US Dollar is. The only thing keeping the US Dollar from collapsing is the idea that the US cannot collapse.
Bitcoin is limited by scarcity in that once the last bitcoin is mined...that is it...there is no more.
Add to that it is THE cryptocurrency...the brand name, and there will always be a demand for that.
Now where it settles as a fair price is anyone’s guess....but I certainly wish I had bought it at $30.00 a bitcoin a few years ago as I had thought about. But I talked myself out of it.