Quote from: larry_vw_1955 on June 20, 2022, 03:24:55 AM

i dont understand why bitcoin has to be just base on people perceive value of it. and for someone to just artrarily fix the supply of them at 21 million doesn't make any sense. it should be able to contract and expand the # of bitcoins in existence. but because bitcoin is design very simplistically it is kind of like monopoly money. not backed up by anything.

Quote from: death_wish

It's a common myth. Bitcoin’s price is not directly caused by subjective perceptions: It is a result of the market, based on supply and demand. Perceptions are one factor in the “demand” side of that. There are other factors to demand; and perceptions do not alter supply.

Ultimately, Bitcoin’s fundamental value derives from its facilitation of productive economic activity, which would be costlier, infeasible, or impossible without Bitcoin. I know that I have done productive non-Bitcoin, non-market business with Bitcoin, which I could not have done without Bitcoin. That’s not extraordinary: It is being an ordinary Bitcoiner who uses Bitcoin as money, rather than a purely speculative buyer who just wants “number go up”. The more such people they are, the higher the organic, non-speculative demand for BTC.

i'm not saying bitcoin doesn't do that. but bitcoin has weaknesses. you can't deny that. the main weakness being that it is not backed up by something like gold. gold could then be used to measure the value of bitcoin. and gold has real world use. people wear it. it gets used in all kinds of electronics. bitcoin doesn't get used anywhere for any purpose. it's just imaginary.

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This discussion of economics is far off-topic for the development forum. I feel obliged to answer something that is more usually nocoiner FUD or newbie confusion. If you have further questions about this, I refer you to Bitcoin Discussion or Economics.

ok well, the topic belongs somewhere.

Question to you specifically. What is gold backed by? Nothing. It has value because it meets the 5 monetary properties. It backs itself. It takes a great amount of work and energy to mine gold. So does Bitcoin. Bitcoin also meets 7 monetary properties. It also takes an extreme amount of computational work and energy to create it. Thats why it is called a Bearer Asset, Base layer, apex property. Its the properties that it meets for monetary value, not backing.