Bitcoin is essentially a modern  moneygram.


This example is based on bitcoin maintaining price stability which is likely to occur when widely adopted.


example1
Person A pays x for a £100 money gram to which is sent to Person B. Person B trades the money gram to  x  and receives £100. The money gram is now worthless and disgarded. Person x charged £2.50 for holding and releasing the fiat currency.

example 2
Person a pays x for £100 worth of Bitcoin to which is sent to person b.Person B trades the bitcoin with person x  and receives  £100.  Person x retains the bitcoin and is free to trade again.

The only difference between the two is that in example 2 the transfer method is reused in other transaction. i.e the bitcoin continues to be used and owned by new people. Wheras in example 1 the moneygram is destroyed at the end of the transaction. A new one is printed for a new transaction.

So despite the obvious advantage in speed and it being free...what gives the bitcoin any more value than a single money gram? i.e why would anyone pay £350just to hold what is essentially the right to send a transfer.

Any comments?