edwinbear said:

---

dimitrig said:

---

edwinbear said:

---

dimitrig said:

---

edwinbear said:

---

sycasey said:

---

bear2034 said:

---

sycasey said:

---

I guess my hesitation about bitcoin is: what's behind it? If you hold stock in a company, there is something behind that, a business that does things. If it's currency, there's a country behind that. Gold is an actual physical thing. What backs bitcoin?

---

Bitcoin is digital but it takes a tremendous amount of energy (and time) to mine it just like gold. Mining bitcoin involves solving math problems that take large amounts of computing power. The supply of bitcoin is also finite (21 million coins) unlike gold where you can always mine for more and unlike fiat currency where governments can always print more. What drives bitcoin's price is demand for the asset as the global money supply increases and purchasing power decreases.

---

What exactly prevents someone from just making more bitcoin?

---

The laws of physics, which is why bitcoin is the only credibly finite/scarce thing in the world. And NOTHING prevents the US government from making more dollars, which is the real problem, because historically governments only ever abuse this privilege.

---

There is nothing scarce about cryptocurrency.

Bitcoin hard to come by? How about etherium? Don't like either of those two? Create a new one! Or buy a NFT!

---

Bitcoin is not "crypto". I fully agree that "crypto" for the most part are scams. Bitcoin is different. Nobody highly educated about bitcoin thinks what you said.

---

Bitcoin is a cryptocurrency like every other one. It has no intrinsic value. Anyone who thinks differently has just consumed the Kool Aid.

---

Alright. I guess all these nation states, public companies, asset managers and other high net wortheres acquiring bitcoin are just idiots. YOU are the smart one. You know better.

---

No.

All of these "players" that you speak of are just trying to make money and then get out before the music stops and the "bubble" pops.

Some, are simply involved because its just another asset class to be a market-maker in ... and they believe they can make a lot of money off of retail order flow.

Just because various institutions are "involved" doesnt necessarily mean that they endorse it, embrace it, or are "married" to it. For most, it's just another trading vehicle.

Any student of history of the financial markets is aware of this.

dimitrig said:

---

Cal88 said:

---

dimitrig said:

---

edwinbear said:

---

dimitrig said:

---

edwinbear said:

---

sycasey said:

---

bear2034 said:

---

sycasey said:

---

I guess my hesitation about bitcoin is: what's behind it? If you hold stock in a company, there is something behind that, a business that does things. If it's currency, there's a country behind that. Gold is an actual physical thing. What backs bitcoin?

---

Bitcoin is digital but it takes a tremendous amount of energy (and time) to mine it just like gold. Mining bitcoin involves solving math problems that take large amounts of computing power. The supply of bitcoin is also finite (21 million coins) unlike gold where you can always mine for more and unlike fiat currency where governments can always print more. What drives bitcoin's price is demand for the asset as the global money supply increases and purchasing power decreases.

---

What exactly prevents someone from just making more bitcoin?

---

The laws of physics, which is why bitcoin is the only credibly finite/scarce thing in the world. And NOTHING prevents the US government from making more dollars, which is the real problem, because historically governments only ever abuse this privilege.

---

There is nothing scarce about cryptocurrency.

Bitcoin hard to come by? How about etherium? Don't like either of those two? Create a new one! Or buy a NFT!

---

Bitcoin is not "crypto". I fully agree that "crypto" for the most part are scams. Bitcoin is different. Nobody highly educated about bitcoin thinks what you said.

---

Bitcoin is a cryptocurrency like every other one. It has no intrinsic value. Anyone who thinks differently has just consumed the Kool Aid.

---

It definitely does have a value, as a product and asset that you can store, access from anywhere and transfer to others independently. That kind of functionality, along with the safeguards associated with it, have contributed to its success.

---

It has a value because people have agreed that it does.

That might be enough but this talk about scarcity contributing to its value is silly.

---

DiabloWags said:

---

edwinbear said:

---

dimitrig said:

---

edwinbear said:

---

dimitrig said:

---

edwinbear said:

---

sycasey said:

---

bear2034 said:

---

sycasey said:

---

I guess my hesitation about bitcoin is: what's behind it? If you hold stock in a company, there is something behind that, a business that does things. If it's currency, there's a country behind that. Gold is an actual physical thing. What backs bitcoin?

---

Bitcoin is digital but it takes a tremendous amount of energy (and time) to mine it just like gold. Mining bitcoin involves solving math problems that take large amounts of computing power. The supply of bitcoin is also finite (21 million coins) unlike gold where you can always mine for more and unlike fiat currency where governments can always print more. What drives bitcoin's price is demand for the asset as the global money supply increases and purchasing power decreases.

---

What exactly prevents someone from just making more bitcoin?

---

The laws of physics, which is why bitcoin is the only credibly finite/scarce thing in the world. And NOTHING prevents the US government from making more dollars, which is the real problem, because historically governments only ever abuse this privilege.

---

There is nothing scarce about cryptocurrency.

Bitcoin hard to come by? How about etherium? Don't like either of those two? Create a new one! Or buy a NFT!

---

Bitcoin is not "crypto". I fully agree that "crypto" for the most part are scams. Bitcoin is different. Nobody highly educated about bitcoin thinks what you said.

---

Bitcoin is a cryptocurrency like every other one. It has no intrinsic value. Anyone who thinks differently has just consumed the Kool Aid.

---

Alright. I guess all these nation states, public companies, asset managers and other high net wortheres acquiring bitcoin are just idiots. YOU are the smart one. You know better.

---

No.

All of these "players" that you speak of are just trying to make money and then get out before the music stops and the "bubble" pops.

Some, are simply involved because its just another asset class to be a market-maker in ... and they believe they can make a lot of money off of retail order flow.

Just because various institutions are "involved" doesnt necessarily mean that they endorse it, embrace it, or are "married" to it. For most, it's just another trading vehicle.

Any student of history of the financial markets is aware of this.

---

You're free to believe this. That's all I'll say.

sycasey said:

---

edwinbear said:

---

sycasey said:

---

bear2034 said:

---

sycasey said:

---

I guess my hesitation about bitcoin is: what's behind it? If you hold stock in a company, there is something behind that, a business that does things. If it's currency, there's a country behind that. Gold is an actual physical thing. What backs bitcoin?

---

Bitcoin is digital but it takes a tremendous amount of energy (and time) to mine it just like gold. Mining bitcoin involves solving math problems that take large amounts of computing power. The supply of bitcoin is also finite (21 million coins) unlike gold where you can always mine for more and unlike fiat currency where governments can always print more. What drives bitcoin's price is demand for the asset as the global money supply increases and purchasing power decreases.

---

What exactly prevents someone from just making more bitcoin?

---

The laws of physics, which is why bitcoin is the only credibly finite/scarce thing in the world. And NOTHING prevents the US government from making more dollars, which is the real problem, because historically governments only ever abuse this privilege.

---

How do "laws of physics" apply to a purely conceptual thing? You can't literally hold a bitcoin in your hand, can you?

I'm not being facetious here. I literally do not understand how this works and how there is any actual control on bitcoin's scarcity.

---

When I say "backed by the laws of physics," sure, I am being a bit tongue in cheek, but not really.

The US dollar is backed by the "full faith & credit of the US." What that really means is that the US has the power to manipulate the monetary policy and characteristics of the currency it issues on a whim. Add some more zeroes to some digital ledger they control and suddenly the supply of dollars is increased by trillions, debasing everyone else. So it's backed by "faith" in the US, but history shows that governments often abuse that faith.

Bitcoin is a money that NO one, no matter how big or wealthy, can manipulate. This is one of the reasons why its valuable, as a truly neutral money that anyone can trust. Its monetary policy and characteristics are etched in stone. One can predict with precision the supply issuance of bitcoin 1,000+ years into the future and trust that the rules of the game won't change. Jerome Powell can pinky promise he will never print another dollar. Does that suddenly make the dollar finite/scarce? No. As long as something can be manipulated by humans, it will be. Maybe Jerome Powell makes good on his word and never prints another dollar. But what about the next guy? And the one after that? Etc. Bitcoin's policies aren't governed by people, they are protected by math/physics.

How is this achieved? This is why bitcoin mining is important. Bitcoin mining is essentially the act of expending energy to secure the bitcoin network and its properties. The more energy expended, the more secure the network. At this point, bitcoin is THE most secure network in the world. Unlike the dollar which can be changed on a whim, the ONLY way a bad actor can (maybe) change/manipulate bitcoin is by not only generating enough electricity equal to 51%+ of the entire bitcoin mining network, but sustaining that expenditure for a period of time. At this point, it is basically impossible given how large and geographically distributed bitcoin mining has become. If a government wanted to "kill" bitcoin this way, they might have had a chance back in the early 2010s when there were fewer miners, but since then, bitcoin has achieved escape velocity and then some.

This is what I mean when I say bitcoin is backed by the laws of physics. The laws of physics say that proof of energy expenditure can't be counterfeited. With energy, you either have it or you don't. For a bad actor to change bitcoin you need to conjure up and sustain that enormous amount of energy, so that impossibly large task is what secures bitcoin and why you can trust that bitcoin's rules, unlike just about every other money, won't change,...and that is valuable.