First... the world had barter, but that proved "inconvenient" To replace barter, we had "gold and silver coin standard" as money. Next we had "paper money, backed by gold/silver coin" Then we got "paper money, backed by the full faith and credit" of some goverment issuing it. Now we have cryptos. Backed by nothing... ABSOLUTELY NOTHING... other than hope, greed, and stupidity.... of "players/hopers" with no monetary sense at all. Personally, I'm surprised cryptos have lasted as long as they have*. Ultimately, "going to zero". * That said, wish I'd bought some when BTC was $.06.
All gold and silver represent is a commodity with limited supply. So the concept of limited supply is what gives money it's value. Cryptos are also backed by limited supply via the mining process. So basically what I'm saying is your crypto assessment is seriously flawed.
Disagree. The "limited supply" could be increased exponentially any time somebody (the right person) wants. "Limited supply" or not, they're still backed by nothing. There are more than 2000 cryptos now... something like 99% of them doing bupkis. And there is no restriction upon how many new cryptos can enter the "world of crypto"... all of which will dilute demand.
Not true. Not just "limited supply", but desirability. Precious metals have been coveted by mankind all through history. "Electronic crypto credits" are different. I get the notion of "hope and faith" by young people in cryptos. Just saying it's not based in reality.
You're just making up that statement out of thin air and then believing it to be true. That's because the 99% have no use. But that has nothing to do with whether they are backed by something or not. And why do you think precious metals are coveted? Specifically, what makes gold or silver more coveted than other metals with similar looks, like brass or steel?
You got me. I was thinking about posting, "why the world covets gold and silver is beyond me, but they have and do."
Whether they "have use or not"... the "field" of cryptos is wide open. Any number of new issues can come into the environment... all with the effect of "diluting demand" in general... even if not for BTC. BTC is what is what it is primarily because it was first. A handful of other early adopters have been dragged along to a lesser degree. After that, basically nothing.
Rhinoceros turds are in limited supply, yet somehow we have managed to keep worldwide markets open without they're being in active trade. What you're proffering Baron is Say's Law -- Supply makes its own Demand -- which does not fly so well. https://en.wikipedia.org/wiki/Say's_law What flies a whole lot better? Consumer Sovereignty. https://en.wikipedia.org/wiki/Consumer_sovereignty wherein, it does not matter how sweet your product is, if it ain't bought, you're dead-in-the-water. (BetaMax!) and similarly (as with tulips and blockchain's bastard offspring "crypto-currency"), if there is demand, and it's worthwhile to supply it, there will be persons seeking to do just that. De Gustibus Non Est Disputandem. ("Ooo! Ooo! Another wikipedia cite!") https://en.wikipedia.org/wiki/De_gustibus_non_est_disputandum
If you polish a piece of brass you can make it look almost identical to yellow gold. If you polish a piece of steel you can make it look almost identical to silver. Yet gold is more valuable than brass. And silver is more valuable than steel. The answer to the question is simple. Limited supply. The reason why gold is more valuable than brass is because the components of brass which are copper and zinc, are in far greater supply than gold. The same applies to steel. There's way more supply of the components of steel which are primarily iron and carbon that there is supply of silver.