Posted on 02/11/2021 9:38:19 AM PST by SeekAndFind
Nothing backs gold, silver, etc.
What backs gold, silver, and bitcoin is demand from people or institutions that want it and are willing to pay for it.
This is true of the dollar and most other currencies. The reason Bitcoin is valued so high is the supply is strictly limited. The Fed can print as many dollars as they want. Not true of bitcoin.
If Bitcoin continues to be a store of wealth and global demand increases as it is now Bitcoin is going to go a lot higher. I see bitcoin well north of 100k in the next five years or less. The numbers tell us it could easily be in the 250k range. Which sounds crazy but not with the supply so limited coupled with global demand and holding.
There were many posters here several years ago screaming Bitcoin is the equivalent of tulips. That was several years ago. They were incorrect.
Unfortunately scarcity is meaningless without demand. Lots of things are very very rare but have little to no value because nobody wants them.
As far as what is driving demand that really does not matter. As long as the demand remains high and supply limited then the price will remain high.
This is what is happening with Bitcoin. There are many different reasons people want to own some bitcoin today yet the supply is fixed so there is only so much to go around so you can guess what happens. The price goes up.
Maybe there will be a new found pass time of collecting Avon cars. You might be rich!
This is why I compare Bitcoin to Tulip bulbs. There was high demand until there wasn’t.
Pet rocks were a thing when I was in College.
Sadly, I don’t expect the Avon cars to be worth much in my lifetime. ;)
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