Bitcoin on fire Over $42k

Mountain Master wrote:

Gchjh wrote:

Might as well let air be money. “Hello sir, my I buy this Maserati - I have 400 jars full of air.”

What other nonsense can we call money?

All of you folks saying Bitcoin is not based on anything and is thus worthless have no clue how money works.

The dollar, the euro, the pound, the yen, etc. are all fiat currencies. That's just a fancy way of saying that they're not based on anything. But they don't have to be. They are just a way of saying "I'll give you this dollar in exchange for something that is actually useful and then you can take the dollar I gave you and use it to get something else that is useful." Currencies are ways to denote storage of value even though they have zero intrinsic value.

Bitcoin works exactly the same way.

And you can buy a Maserati with Bitcoin.

Precious Roy wrote:

There is a big difference between whether or not you can buy something with bit coin and whether you should buy something with bit coin. Yes, there are some dealers and online marketplaces where you can buy vehicles, mostly exotics and high line vehicles, with crypto. But if you handed over 5 bit coin to buy a Ghibli in December of 2022, you would have actually paid $290k in bit coin at today's value for a vehicle that would have cost you $85k in cash. Currencies actually have intrinsic value because they are backed by a central bank that protects the currency from wild swings in value. For crypto, wild swings in value are a feature and not a bug. That is why they have no intrinsic value like an actual currency. The only value crypto has is the same value a casino table has. It is just an opportunity to make a bet and get a windfall if you are lucky.

Mountain Master wrote:

Precious Roy wrote:

There is a big difference between whether or not you can buy something with bit coin and whether you should buy something with bit coin. Yes, there are some dealers and online marketplaces where you can buy vehicles, mostly exotics and high line vehicles, with crypto. But if you handed over 5 bit coin to buy a Ghibli in December of 2022, you would have actually paid $290k in bit coin at today's value for a vehicle that would have cost you $85k in cash. Currencies actually have intrinsic value because they are backed by a central bank that protects the currency from wild swings in value. For crypto, wild swings in value are a feature and not a bug. That is why they have no intrinsic value like an actual currency. The only value crypto has is the same value a casino table has. It is just an opportunity to make a bet and get a windfall if you are lucky.

How is Bitcoin's dollar exchange rate today relevant to buying something with Bitcoin in December 2022? Did you know in December 2022 what Bitcoin would be worth in dollars now? And if you did, did you exchange your dollars for Bitcoin? If not, why not?

"Currencies actually have intrinsic value because they are backed by a central bank that protects the currency from wild swings in value."

The main thing I learned from this is that you don't know what "intrinsic value" is. That is the value something has based on its own characteristics, not because of an external factor. Besides, the Fed is backing dollars with dollars and IOUs. That doesn't give the dollar any worth.

As far as wild swings go - In my lifetime (I'm 61) the dollar has lost 90.1% of its value relative to what it can buy. Not only does the central bank not prevent wild swings, it actually creates an environment that causes the dollar to lose value by targeting a 2% inflation rate.

Precious Roy wrote:

Mountain Master wrote:

How is Bitcoin's dollar exchange rate today relevant to buying something with Bitcoin in December 2022? Did you know in December 2022 what Bitcoin would be worth in dollars now? And if you did, did you exchange your dollars for Bitcoin? If not, why not?

"Currencies actually have intrinsic value because they are backed by a central bank that protects the currency from wild swings in value."

The main thing I learned from this is that you don't know what "intrinsic value" is. That is the value something has based on its own characteristics, not because of an external factor. Besides, the Fed is backing dollars with dollars and IOUs. That doesn't give the dollar any worth.

As far as wild swings go - In my lifetime (I'm 61) the dollar has lost 90.1% of its value relative to what it can buy. Not only does the central bank not prevent wild swings, it actually creates an environment that causes the dollar to lose value by targeting a 2% inflation rate.

The fed backing of the dollar is not an external factor. It is by law part of our currency system. Bit coin lost nearly 400% of its value in just a year. The affect of inflation on the dollar is nothing by comparison. And if you financed the purchase of the Maserati, inflation just makes your payment cheaper compared to the current market. So, the guy who finances the Maserati and keep the bit coin comes out ahead by over $200k compared to the dud who gave up the bit coin. While it is true that you cannot predict whether bit coin will go up or down over time (mostly because bit coin has no intrinsic value and is purely a bet on a casino game), you do know that your dollars will not drop in value by 400% in a year because they are backed by a central bank. Of course, dollars are not an investment, unless you are a hedge fund looking to sit out a market correction. But bit coin is not a viable currency unless you are a terrorist, drug dealer or sanctioned Russian oligarch.