Tatar... wrote:
Bitcoin doesn't seem rational.
1) No intrinsic value - you won't be eating or living in, or able to sell ₿ during a crisis. No internet and you've got nothing to redeem against.
2) Doesn't represent any labor hours or work, although some people could argue it's some sort of robotic labor [This point could probably be its own thread].
3) It can't make you more money, it's not like holding corporate stock, where production will create dividends
Why do libertarians like it? It doesn't have any of the features of commodity money that they are usually attracted to and has entirely artificial monetary rules.
Are people buying it because they think it will become the medium of exchange? What if it doesn't?
I have a lot of questions.
I'll try and answer a few bits, it will be simplified as the crypto world is hugely complex, and often people just think of Bitcoin alone and not what's tied in with it...
1) Firstly, the intrinsic value thing is a red herring. "Currencies" don't typically have intrinsic value. Fiat has no intrinsic value, nor any use value, most aren't backed by anything. It's just a method of exchange, and really the value is what you can exchange for it, alongside the confidence in it etc.
What about Bitcoin ? Well, I can't buy any toilet roll with it, so it must be useless right ? Well, no. There's a whole massive ecosystem with the cryptoworld and Bitcoin just happens to be the daddy. To buy into that crypto world, whether it's transferring money between countries (with low fees), "investment", buying NFTs, duff memecoins, entering the world of decentralised finance, making money by loaning, staking, gaming, sharing files, sharing space, sharing resources, advertising, chances are you will buy Bitcoin or similar.
So the value, comes from all of that. Is it overvalued because a lot of people speculate ? Quite possibly, but there's a value in that also.
What happens if no internet ? As been as there's no use case in that value if there is no internet, then it's completely irrelevant. It's a bit like saying what's the point of fiat if the shops are shut at 4am. Do you think the internet is going to grow and get more entangled in our lives or less ?
2) I'm not sure what the point here is. It's not "designed" to. Dollars don't represent hours worked either. I suspect there's some miscommunication there though.
3) Why does it need to make you more money ? Sure, people may invest hoping the price goes up, just like stocks without dividends. That's where a lot of the money comes from, business and people ultimately thinking there's a future in it, and the price will go up.
I think libertarians is a redherring, no need to label people to make a point. To try and answer a bit though. I think many people have a dream of a better system that's not loaded in the same way (it's loaded in others, make no mistake, there's a lot of money from big corporations in it influencing things). You can shove all your money in a bank/building society and get a few percent and slowly watch it devalue, or maybe get an account with stocks and shares and hope it does a bit better. Kickass, not exactly the things the young folk dream of (maybe they should be that's another matter). Many people just thing in the current age, they will get screwed over in the future, and they feel like they want to be part of a system that's changing. Ultimately I actually think the volume of money from these folks are small potatoes though. There's a LOT more money from big business in this than people realise.
The crypto world has a market cap of 2.6 Trillion. 112 Billion dollars a day is traded. Do you think that's just libertarians ?
Nobody (well very few) is buying Bitcoin because they think it will be the medium of exchange (assuming you mean the publics medium of exchange on a day to day basis for goods).