Why does Bitcoin have to be a currency that's backed by a government in order to have value? Works of art including paintings and sculptures have fetched ridiculous amounts of money over the years, and those works are not currencies, but yet these works of art continue to fetch higher and higher prices each time they change hands. And these are things that you can't do a damn thing with other than look at them. It's because scarce and desirable assets are the exact things that wealthy people are interested in owning. I'll give you an example from one of my friends who is an art dealer at the top end of the spectrum. I visited his house several years ago and we got into a discussion about this topic. I remember asking him, "I don't get this art business at all. Why would anyone want to spend $100 million for a painting?" And you know what his reply was? He said, "You should try sending someone across the world $100 million dollars. Just try it. The amount of scrutiny and red tape by the banking system makes that task virtually impossible. But you know what you CAN DO? You can buy a Picasso worth $100 million and ship it anywhere in the world with no problem whatsoever. And because it's a scarce and desirable asset that holds its value globally, the person or business you sent the painting to can easily sell it today or 20 years from now for at least what it last sold for, plus a nice premium. So.... The art market is essentially a storage and transport mechanism for the wealthy to exchange value with each other outside of the bank system." And when he told me that, the light bulb in my head turned on. I thought, "Now I get it. It's not about the "thing" in itself, it's about the ability of the thing to hold a certain value and it being easily transferable and portable." And that's why Bitcoin is so attractive. It's a scarce and desirable asset (that's actually becoming more scarce over time) that can store value and be sent to anyone on the globe in a matter of minutes, and the shipping costs are virtually non-existent. And because it exists outside of the banking system, the transactions can't be instantly questioned, confiscated, blocked, seized or stolen like money traveling across the international banking system can, especially if that money is traveling to certain third-world countries. So... Bitcoin is a modern-day wealth storage and transfer mechanism for the wealthy. That's what it is. It's got nothing to do with it being a currency, or being able to buy coffee with it one day, or any of that other trivial bullshit that small naysayers seem obsessed about talking about. It's already serving its purpose for the wealthy of the world, and it really doesn't need to do anything more than what it is already doing to be an ongoing success.
David Geffens artwork is worth billions. Purchased in the 80s-90s at a fraction of the worth now. It’s actually made him more money than any of his other ventures… I’m just going by memory of something I read a while back…. Didn’t bother googling it lol and it’s oil on canvas period. Steve Wynn poked a whole in one of his expensive paintings , try doing that with btc lol
Doesn't the wild fluctuations concern you? It doesn't seem to have the ability to hold a certain value. I'd put faith in a painting thats grown in value over the years over something that could be worth 1/2 of what I paid for it a year from now. The question I'm asking myself now is not how high BTC will go but how long until the next winter.
You don't need to understand the math to understand Taleb's black paper argument. His argument is that if bitcoin is ever worth zero in the future then its present value is zero now. "Earnings-free assets with no residual value are problematic. The implication is that, owing to the absence of any explicit yield benefiting the holder of bitcoin, if we expect that at any point in the future the value will be zero when miners are extinct, the technology becomes obsolete, or future generations get into other such "assets" and bitcoin loses its appeal for them, then the value must be zero now" I think Taleb's arguments in the paper of why this applies to bitcoin and not gold are really weak. I know he is big into the idea that if something has been around for thousands of years then it has been stress tested. In this instance though I don't find that a compelling argument if that is the whole argument. You also can't forget that Taleb is basically a troll who almost surely has made more money in selling books and speaking fees than he has at trading. On the other hand, he surely made money selling bitcoin. I know he had this change of heart around $50k and had previously been a bull for years.
Bitcoin is considered a store of value due to its limited supply, with only 21 million bitcoins set to ever exist, akin to precious metals like gold. Additionally, its decentralized nature, operating on a network without a single controlling authority, adds to its perceived value as it is not subject to government manipulation or inflationary pressures.
Yeah but the problem being, they keep printing tethers and propping up the price, working against me. For Tether to collapse there has to be a run on the bank, where they would be unable to redeem which would break the peg. That would be triggered in a bear market/steep price declines. But every time price dips, they print more tether and keep the price up. Another trigger would be if there was a government intervention or if there was leak of their finance as was the case for FTX.... In good conditions(as we have them now), they can keep the scam going and government doesn't seem to be doing anything about it. Madoff wasn't even caught, he was only arrested once he admitted of running a ponzi scheme to his children, who then reported him to the police. What might actually pressure the regulators into taking action are the sanctions violations. There have been quite a few reports of sanctioned countries like Russia using Tether to avoid sanctions and Tether being the preferred currency of choice for criminals worldwide. For year and a half Tether ignored the OFAC sanctions as well. Whereas USDC blocked all the addresses immediately, Tether even posted a blog how they disagree with the rules and they didn't comply for a year and a half(only started in December 2023).
I’m sure if art would trade on an exchange, where people could hit the bid on a whim it would fluctuate more than we would ever imagine. Specially if you could sell 1/100th of the paintings value. Like you can Bitcoin where one could sell .07 etc.