Post
Topic
Board Bitcoin Discussion
Merits 1 from 1 user
Re: Bitcoin's value: From Network or Scarcity?
by
pooya87
on 18/12/2020, 08:35:39 UTC
⭐ Merited by BlackHatCoiner (1)
We can argue that what is giving value to Bitcoin isn't only its properties as a scarce p2p e-cash system.
I disagree, what gives anything value is their utilities meaning bitcoin value comes from its utility as the decentralized currency. Scarcity is only a contributor to increase of that value not its reason.

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The network is actually extremely valuable by itself, as an immutable time-dependent database.
Not the network but the "blockchain" is immutable. And it is not time-dependent, it is timestamped.

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Then the question coming next is the one of the chicken and egg:
Is it Scarcity --> Network --> Price ?
Or Scarcity --> Price --> Network ?
Neither. It is:
Utility > value (then it is ) more adoption > higher value (then it is) fixed supply > deflationary > increasing value.

Whereas in contrast:
Lack of utility > no value and dumping in long term (then) less adoption or no adoption > lower value (and finally) unlimited supply > inflationary > decreasing value.