What are your thoughts on BitCoin?

[El_Machinae]

Well, people do lose the ability to plan. Right now, I literally don't know if the Canadian government will print money during the next recession. So even if I want to prepare for the future, I'm paralyzed into not being able to prepare as I see fit.

The upside of having a central government affect money is that they have additional mechanisms to prevent all wealth from shuttling upwards. They're just bad at it

 

[hobbsyoyo]

why? people who bought google and windows and apple stocks in the 90s were the real winners. doesn't make stocks a ponzi scheme in any way.

I'm not sure if you're joking. Are you really comparing bitcoin to tech giants?

 

[Farm Boy]

In my personal experience, I've found I've met two types of people who want to go back to the gold standard

You can also think of them as people who are just starting to grate at a nascent understanding that their neighbors will take all the **** they already worked to create and own if said neighbors happen to find them not particularly useful for a year or two. And that they'll escalate fairly rapidly to killing you on the spot if you resist effectively.

Unless, of course, you're rich. Then you have bought "friends."

 

[Moriarte]

That's not quite what we're talking about - any values can fluctuate, but national currencies are guaranteed to have value. No matter what happens, the United States will always give you value for US dollars, and the United Kingdom will give you value for British pounds, etc. No one is guaranteeing Bitcoin, it's entirely different.

Yes, if you don't trust in the stability of those countries, then you wouldn't value their guarantee - but that's why everyone buys US dollars and unstable banana republics can't find investors.

We all talk about different things. That’s why we’re here - to lay out different perspectives for each other. I don’t trust and criticize cryptos for what they are. But it’s not hard to see how well they’ve done in such a short timeframe. The tech is here to stay but it will have to evolve.

 

[Lexicus]

We all talk about different things. That’s why we’re here - to lay out different perspectives for each other. I don’t trust and criticize cryptos for what they are. But it’s not hard to see how well they’ve done in such a short timeframe. The tech is here to stay but it will have to evolve.

The major problem in the world today is that a lot of rich people have more money than they could use in 10 lifetimes let alone one, so just because something is successful doesn't mean it is actually viable or socially useful. It means someone has managed to convince rich people to dump money into it.

 

[Moriarte]

The major problem in the world today is that a lot of rich people have more money than they could use in 10 lifetimes let alone one, so just because something is successful doesn't mean it is actually viable or socially useful. It means someone has managed to convince rich people to dump money into it.

Yeah, that’s history. But what’s the prognosis? ASICs and gpu’s get thrown into trash bin along with the wiring, value plummets to zero, dozens of crypto exchnages go bust, few thousand software engineers go out of business, people stop dealing in crypto, big money moves on into something else?

 

[Lexicus]

Yeah, that’s history. But what’s the prognosis? ASICs and gpu’s get thrown into trash bin along with the wiring, value plummets to zero, dozens of crypto exchnages go bust, few thousand software engineers go out of business, people stop dealing in crypto, big money moves on into something else?

Haven't the foggiest. I don't know where it's going and don't pretend to.

 

[Zardnaar]

Problem is we don't really have any other idea what to do.

We used to do barter but there's no real data available to how it worked. We know they traded copper ingots for wine or whatever.

Romans described inflation but didn't know what it was.

Even the gold standard only exists because people believe gold's worth something.

Now we believe money's worth something.

Underlying concept is the same.

 

[Lexicus]

We used to do barter

Well, actually, we mostly didn't but that is a whole nother topic.

 

[Zardnaar]

Well, actually, we mostly didn't but that is a whole nother topic.

Well local production true. I meant as a method of trade.

Currency predates history books.

 

[innonimatu]

Blockchain technology is interesting and has other uses than currency/money, a technology firm wants to use the technology to completely wipe out piracy in using the technology against intellectual rights thefts especially with movies, I didn't quite understand how they would do this but I do remember reading they are certain they can permanently stop movies being pirated with the blockchain technology.

"blockchain technology" is a marketing ploy. The so-called "blockchain" is an old concept that was already sued long before the "blockchain technology" thing was dreamed up. There is noting "innovative" in it, and there is nothing useful provided by it but for a few cases. Such as those where it was already being used.

 

[Hygro]

Crypto currency has intrinsic value. For international purchases it has about the lowest transaction costs. For places without functional banking you can bank and trade with your phone. It is still the only way to buy and sell things “untraceable” (for now) as if it was in cash, but from a distance.

Does that justify its prices? I suppose, the more it is used the more valuable it is in total, but it’s not relevant to someone like me who if I want to make a purchase I will buy exactly the amount I need to make the one purchase. Bitcoin could be worth half a cent or a zillion, I’ll buy a bunch or a fraction of one.

A good currency doesn’t increase in price. A good currency doesn’t wildly swing in value. Bitcoin will never be good money. But it or other cryptos are valuable in today’s world.

 

[MaryKB]

Crypto currency has intrinsic value.

It has perceived value, intrinsic value means it's valuable on its own for something other than trading it to someone else.

 

[Hygro]

It has perceived value, intrinsic value means it's valuable on its own for something other than trading it to someone else.

The intrinsic value is its ability to perform those aforementioned functions.

For example, outside crypto, the intrinsic value of a tractor is not simple it’s recyclable materials, it is in its functionality when running.

The intrinsic value of crypto currencies is what it can do that existing institutions of exchange cannot.

 

[MaryKB]

That's not what intrinsic value means. A tractor like you say has intrinsic value, because you can do something with it.

Outside of exchanging crytocurrency to someone else who wants it (this includes either selling it or trading it for something else), there's nothing you can do with it. If no one wants it any more, then it has absolutely no value.

For intrinsic value, think about like "What value does this have for its own sake?" - value for what you can do with it, outside of its market value (which Bitcoin has)

For investing, you want to compare something's market value to its intrinsic value ... if its intrinsic value is higher than its market value, then that's a good thing to buy. But if its market value is higher than its intrinsic value, that's a bubble.

Cryptocurrency's intrinsic value is zero.

All currency is like this too, except national currencies are backed by their country. If you have United States dollars, you can always use those to pay your liabilities to the US government, even if no one else wants it. Since the US government is extremely strong and stable, most people have solid faith in US dollar value.

 

[Samson]

It seems there are 2 very different versions of what intrinsic value means; philosophical which sounds a bit more like how Mary is using the word, and economic which is more like how Hygro is using the word.

 

[MaryKB]

It seems there are 2 very different versions of what intrinsic value means; philosophical which sounds a bit more like how Mary is using the word, and economic which is more like how Hygro is using the word.

Your linked economics article is further elaborating on what I'm saying, but specifically talking about how a company's intrinsic value is calculated. It really goes a lot with what I was saying in my previous post.

You don't calculate a company's intrinsic value based on what its stock price is going for, that's market value. Like your article says, you look at things such as profitability, cash flow, and other factors like quality of management. A business has intrinsic value, because it generates income (currency by itself does not)

So like I said, if you're thinking of investing in a company, you want to determine its intrinsic value to see if it's favorable to its market value, so you don't make a bad investment.

 

[Farm Boy]

When trying to figure out what my dog is worth, I've always kind of wondered how many calories I'd get from eating him.

 

[Samson]

Your linked economics article is further elaborating on what I'm saying, but specifically talking about how a company's intrinsic value is calculated. It really goes a lot with what I was saying in my previous post.

You don't calculate a company's intrinsic value based on what its stock price is going for, that's market value. Like your article says, you look at things such as profitability, cash flow, and other factors like quality of management. A business has intrinsic value, because it generates income (currency by itself does not)

So like I said, if you're thinking of investing in a company, you want to determine its intrinsic value to see if it's favorable to its market value, so you don't make a bad investment.

Surely the point is that when evaluating the value of a company, you consider how much profit it can make by continuing to function, rather than the value of the physical things it owns. In the same way you could evaluate bitcoins value you consider how much commerce it allows, rather than just the value of the bits it is composed of.

 

[MaryKB]

Surely the point is that when evaluating the value of a company, you consider how much profit it can make by continuing to function, rather than the value of the physical things it owns. In the same way you could evaluate bitcoins value you consider how much commerce it allows, rather than just the value of the bits it is composed of.

I didn't say that, I said above one of the things you look at when determining a company's intrinsic value is its revenue and profit.

So say for example I have a business, and you decide to buy stock for say like $10 a share. And you now own 10% of my company. Say I'm profiting $1000 a year; you get $100 as a shareholder (I'm being really simple here! ) But let's also say that for whatever reason, my share price has fallen to $5.

Well, the market value of your shares is $500, and if you're looking just at the market worth of your shares, you've lost half your investment. But you're earning income because my company is profitable, so you have intrinsic value in your investment.

I do hope I'm making sense?

But lets say my company didn't make money, say I was just simply a currency. You've lost your money, because there's nothing else you can do with it except sell it (or buy things with it, but value fluctuates) If no one wants to take your currency, then your holdings become absolutely worthless, because it has no value on its own.