Quote from: amspir on March 27, 2014, 05:57:10 PM

Quote from: hello_good_sir on March 27, 2014, 05:50:36 PM

Quote from: Robert Paulson on March 27, 2014, 05:34:36 PM

the only reason bitcoin is a store of value is because people anticipate it will be useable for daily purchases.

No way. I can't use gold for daily purchases. That doesn't stop it from being worth a rather huge amount per ounce. Bitcoin, even if accepted by no merchants, can achieve a price in the tens of thousands of dollars per coin.

That's kind of silly, since there would be no value in using bitcoin. It makes it a ponzi scheme, where the smart sell to the stupid and cash out before it collapses. Speculators provide a service to bitcoin, by giving it value. When it has value, it can be used as a means to trade for goods and services.

Gold has industrial value, so its value will remain until viable alternatives compete with those industrial applications. Fiat and part of BTC value is created by the perception of people like you and me. A piece of paper has no intrinsic value or utility, however BTC goes beyond this and actually does have a very valuable function which is the blockchain.

http://www.forbes.com/sites/kashmirhill/2014/03/26/warren-buffett-says-bitcoin-is-a-mirage-why-marc-andreessen-thinks-hes-wrong/

A value of a BTC is not arbitrary, in fact its the opposite of arbitrary, he says. It equals the value of a single slot in a finite sized public cryptographic ledger through which value can move. The total Bitcoin ledger has value corresponding to the volume and velocity of transactions that will run through it in the future; by extension, each slot in the ledger has fractional value determined by the total number of slots (which, in Bitcoins case, are limited to 11 million today and 21 million ever).

So saying what Warren is saying is like saying a car is great technology but itll never actually get anyone from point A to point B, he continued. Bitcoin is great technology BECAUSE it lets people get value from point A to point B through the public ledger; that functional use creates the value of the ledger, and a single BTC has a corresponding fractional value of the ledger.