Essentially, nothing is backed. Certainly not the Dollar and Euro.


Some people seem to think that gold is some legit kind of backing in and by itself. But gold being intrinsically valuable "because it's a commodity" is circular reasoning. Look up the dictionary meaning of 'commodity': something that is bought and sold, something or someone that is useful or valued. So this actually boils down to: "gold is valuable, because.. it's valuable".

So, again, what backs gold?


Sure, it's nice for jewelry and shit.

But then Bitcoin certainly isn't useless either: in today's global, 24 hour online economy, a frictionless, virtually free, worldwide, digital, instant, 100% secure, transparent, flexible, decentralized payment system is extremely useful.

There's a lot going for both gold and Bitcoin, that can't be said about euros and dollars: they're scarce, they can't be created at whim out of thin air, they're not controlled or issued by some authority, they don't require a 3rd party payment infrastructure (especially one that is fully owned by a handful of private commercial organizations) so they're independent, they can't be counterfeited, and so on. And in terms of ease and costs of transport, security, storage, validation, supply predictability, divisibility, and scalability, Bitcoin does way better than gold.

There's your intrinsic value right there!


Value is 100% subjective, so if (and only if) enough people think a bitcoin, or a brick of gold, or a piece of paper with "€100" written on it has value, it has value.
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