That is an interesting thought, but works only in a staid objective value system. The land of androids. In our lives, we live by the subjective value system, where our value is proportionately tied to our desires... Take a new car, for example. You feel that a new car is worth only $20,000, and that is all you wish to pay for the car with the options package you desire. But the lowest price you can find anywhere for that same spec car is $25,000. However, for a plain ol' base model, you could pay just $20,000. (This assumes all haggling has been done by now). So you hem and haw about it as you have reached a decision point. Pay what you think the car is worth without your options, that would perhaps leave you unsatisfied, or $5,000 more for the car you really want. If you really WANT that red stone and it is the only one available for $20K, then you will have to fork up the $20K to have it. It doesn't matter what you think it is worth...You will pay what the market price bears. Thankfully we live in a system that embraces competition. What Baron was pointing out was just the basic supply/demand thing. What Scat was griping about was the crypto bullshit. Both are correct. Cryptos are a sort of bullshit, in that they are backed by nothing but what the market price will bear, along with the added value of their anonymity and use as an actual accepted form of payment between consumers and merchants. AFAIK there's only like 2-3 of them currently being used regularly. bitcoin, BitCash, Ethereum? Anyways, of course all the rest are just speculative garbage, backed by truly no value...Only by what value the people who buy and sell them are willing to pay each other for exchanging them. Like the Pet Rock, and bottled Manhattan air. And these days, we have Gwenyth Paltrow selling https://shop.goop.com/shop/products/mini-cuff-sado-chic-chain-mini-o-r-mini?taxon_id=1489 For that price, you'd think the thing is made of palladium. Nope, just a $100 chunk of silver, if that.
Crypto doesn't have to be backed by the full faith of any govt in order to be an effective currency. The world wants a digital currency that is independent of a governments control to print more currency at will. The problem with gold/silver a currency is that it's tough to break down and tough to transport. Every other currency out there has the same physical restrictions and all the fist currencies are in some ways controled by a small group of people as the government of nations. The fact that I can transfer millions of dollars in USD equivalent to anyone in the world right now (20:00 in my timezone) and have it arrive to anyone in the world by 20:30 is actually unbelievable if you think about it. Thats a big part of the reason why Bitcoin has value. It's has a lot of utility and the supply is predictable which to me makes it safe. Also once cryptos mature and prices stabilize I believe it's even safer to store wealth in it than storing usd at the bank since no law enforcement agency can freeze it and the bank can't go under and effectively steal it. If porperly stored and secured (which is not that hard really) nothing can ever touch your money. I don't expect anyone who hasn't used it to really get it and it doesnt need your approval and will still continue to exist without you. Your opinions means shit all. That being said btc can function at any price point so it doesn't need to be priced high to still have usefulness to me. Btc worked just as well when it was priced 1 dollar vs 6000. It's success I don't think is determined by its price. By all measures btc has been very successful as an international currency experiment and the cat is out of the bag so to speak. From here on out cryptocurrency is here to stay.
I wonder why these discussions shroom up again and again. I mean, there is no point arguing about something having value or not. There is a bid, so there is the value. No bid, no value, simple as that. Thread starter may be a gold bug and it's never wise to argue with them, but I mean we're on ET. This is a gamblers den. 95% of all equities are shit since you'd never go public if you have a profitable company that can grow organically. But nobody argues with that. Bonds are trash corporate or government issued, doesn't matter. You hope you get your money back for a small fee. Money, fiat or crypto....also trash. You guys might not notice that since the USD is so wildly accepted. But if you go to a shop in the US with 1000 HUF and the owner wont accept them....whats the value of your HUF? So everything that you cannot eat, live in, move around in it or use in any other way is only backed by trust. So if you want to "invest", you need to trust that you can exchange your investment into something else later. If you want to trade (or make markets), you already see the exit before you even get into a position so you don't care about the value and can do anything with it. As long as there are bids in crypto, it makes sense to trade. Buy it from the FUDlers and sell it to the FOMO guys.
I agree in general with your posting, but this part is very incomplete, close to nonsense. Companies can go public fo various reasons: because the founders can make more money from going public then from not going. He can take a big profit on the shares he sells and at the same time all the shares he still has are rated at the same price althought they were never sold. because there is no future growth possible, so going public at the optimal time when things look still very bright. because his growth cannot finance the investments needed to grow enough anymore. because they have to quickly take as much marketshare as possible before the competition arrives. Equities have assets and liabilities, crypto's haven't, they only have thin air. Management can be taken to court, in crypto's there is nobody you can take to court. There is a German company (Rocket internet, 33,000 employees) that had money and was scanning the market for startups. If there was a startup with an interesting idea, the Germans quickly started to build a similar company in other countries and sold it later with huge profits to the company taht coiuld not grow quickly enough to take the market. The Germans were specialized in webshops. So growing quickly to take a strategic size in the market is very important, or somebody else could become rich from your idea. PS: Rocket Internet. The company has been criticised for its "copycat" strategy of founding startups which replicate the business models of other established, successful companies.
A currency does not have to be backed by anything. As long as the integrity is guaranteed, there's no need for a backing. A currency is a mean of transaction, agreed by 2 parties or more. If you and I agree that we will use crypto to transact, then so be it. As for the unlimited possibility of supply, it's not relevant. Because if you and I agree to use say BTC, unlimited supply of other cryptos is irrelevant. They have nothing to do with BTC.
I suppose 99% of crypto owners just have it for speculative reasons. Not for the reason you explain. They dream about becoming billionaires. If crypto's would stay at a stable rate almost nobody would be interested in it, and also not use it.
The real use of BTC and other alt-currencies is to be used as money. There are lots of "niche" (supposedly) coins, but their stated use is "specific". Take for example, Electroneum (ETN). I've followed that one a bit because it came "highly recommended" by some newsletter which was soliciting me. The niche of ETN was supposedly to be "carried on your smart phone and used to transact purchases". Don't we alread have an equivalent... DEBIT CARD? DUH! Of course ETN has lost 95% of its initial public price. And there are 1,000+ others in a similar boat.
If the price is stable, more people will use it. People will still use it if it fluctuates, but they will have to convert to fiat currency immediately after the transactions to preserve it's fiat-equivalent value. I do agree that most crypto owners are there for speculation, but that does not undermine the usage of crypto as an alternative means of transaction.
Crypto is an alternative payment to debit card. It's cheaper, possibly faster, and in some cases anonymous. Losing values of cryptos is irrelevant in most cases, of course unless if you are speculating. Most of the time, the user will convert the fiat equivalent crypto (USDT) to ETN only during the payment. Therefore, the value of their cryptos will always be equivalent to the fiat value.
I like how you ignore the real technical question I put in front of you as proposed by Baron and instead you turn to answering my rhetorical question. But hey if that helps you get on your soapbox. Guess traffic on ET must be down.