Well having only so much utility presumably trumps having no utility?!
Then please clarify, I'm trying to understand why you provided that specific link preceded with the 'If Bitcoin has no utility...' What about that report or its publication confirms that bitcoin has utility?
You phraseology suggests you believe this report confounds Brendan's claims of no utility. How did you arrive at that conclusion?
However, I have chosen not to answer it until my two initial and prior questions to Brendan are answered. In addition, I would like that he apologises for misrepresenting me.
As a matter of curiosity, do you accept that he misrepresented me?
Ok, so you now make a distinction between what you perceive has 'fundamental' demand - lets say this is Dukey-approved demand and non-Dukey approved demand when it comes to bitcoin. Same question to you as to Brendan. How do you price a barrel of oil? Should it be $100, $10, -$40 today?For those who have been keeping [gold]] in vaults they are not especially concerned by the new discovery, they might have to build lead vaults. But can anyone doubt that nonetheless its price would collapse.
The point I am making is that the demand for store of value has to be underpinned by fundamental demand.
And with bitcoin there is no fundamental demand.
Brendan doesn't. He expects a higher standard from bitcoin by comparison with gold, other monetary/precious metals and commodities which somehow get a free pass when it comes to pricing.Everyone accepts that price is decided by supply and demand.
There's a 7.49% 'fundamental demand' for gold - which in NO WAY explains or accounts for its price today.And with bitcoin there is no fundamental demand.
Here is the worlds foremost bitcoin-bashing 'economist' - Nouriel Roubini - doing a u-turn on bitcoin and for the first time, recognising its characteristics as a store of value in an interview last week. LINKFinally mainstream economic thought is dismissive of bitcoin.
And with bitcoin there is no fundamental demand.
So where should I hold my money or wealth?
That reads to me a bit circular. Shortie seems to be arguing a Store of Value demand for bitcoin. The Marmalade Principle states that "store of value demand depends on there being fundamental demand :- no fundamental demand->no store of value demand". If we are then to define some aspect of the store of value demand as fundamental demand, as Shortie appears to, then clearly the Marmalade Principle becomes ad absurdum.Good post.
The exception being, there is a fundamental demand. Rather than get caught up in the mechanics of bitcoin, what does it offer to prospective buyers.
TheBigShort (me!) touched on this earlier in this thread - only to be somewhat dismissed as an apocalyptic doomsdayer.
I referenced gold, property, stocks, antiques, art etc.....
Most of these, if not all, are out of the reach of most people on the planet, and even closer to home, in this country, by way of long-term investment plan. I would hazard a guess that, despite the frenzy of the Celtic Tiger and outside of inheritance, the proportion of people with second properties or home is still relatively low compared to the rest of the population?
Bitcoin offers a fundamental demand to place money outside of a system that has, for a long time now, failed to return any significant amount to those who have no access to the markets of property, stocks, anitques in their own right, only savings (replaced by debt) and wages.
This market is huge.
In turn, for those who do have access to all those other markets, it has the potential to act as a prospective benchmark against which everything can be valued. This is a potentially massive market.
The Marmalade Principle doesn't pass peer review. Gold established itself as a store of value long before there was any 'fundamental demand' as you put it. All the while, that 'fundamental demand' is peripheral at 7.49%.The Marmalade Principle states that "store of value demand depends on there being fundamental demand :- no fundamental demand->no store of value demand"
It seems he asked you to justify your valuation of bitcoin.
Anybody making that interpretation is delusional. This was a strong denunciation of cryptocurrencies. Yes he has a kinder word for bitcoin over the other sh1tcoins (his expression). He uses the words "part store of value". Obviously it has a part store of value. If someone offered me a bitcoin, I would accept it. Even I would have 100% certainty that I could exchange it over the next few months for a reasonable amount of fiat.Here is the worlds foremost bitcoin-bashing 'economist' - Nouriel Roubini - doing a u-turn on bitcoin and for the first time, recognising its characteristics as a store of value in an interview last week. LINK
If gold was a poisonous putrid smelling substance it would never have achieved any value no matter how scarce it is. Gold is clearly attractive to the human senses; that underpins its fundamental demand and was there before its demand as a store of value.tecate said:Gold established itself as a store of value long before there was any 'fundamental demand' as you put it.
We're not talking about cryptocurrencies plural - we're talking about bitcoin. His comments were referenced in relation to bitcoin. If you want to discuss other crypto's, then by all means, open a new thread.Anybody making that interpretation is delusional. This was a strong denunciation of cryptocurrencies.
Precisely that - that's what I was referring to. And he'll crap all over btc still in other ways (for the moment) but he's never made this admission. It's a first - and it's a u-turn.He uses the words "part store of value".
This is priceless! Show us where any one of you and your fellow bitcoin critics have suggested anything like that in three years of discussion here. Provide a link to the post or posts!Obviously it has a part store of value.
How can you be sure when he just came out and referred to it as a store of value (partial or otherwise). He's doing a u-turn - maybe you should pay attention as chances are you'll have to do one yourself soon enough.My post was arguing that the unique situation of something having a demand as a store of value not underpinned by some fundamental utility demand is unsustainable. I am sure Nouriel would agree with me.
Beauty can be found in nature in all manner of things - they don't have to be putrid. They DO have to be scarce to be a store of value. Your fundamental demand argument doesn't stand - just like your claim that bitcoin can't establish itself as a store of value without first being pervasive as a means of exchange. Ask Nouriel - through gritted teeth (as he's politically and diametrically opposed to it), he understands that.Gold is clearly attractive to the human senses; that underpins its fundamental demand and was there before its demand as a store of value.
Not sure we are mixing terminology a bit. Yes there is a demand to store money..., not sure that translates to a demand for money. But is bitcoin money? Is bitcoin a medium of exchange, ergo money? I agree with John Kelleher that it is necessary for bitcoin to make the grade as a medium of exchange to be considered money and therefore justify store of value status. Where I disagree with him is that I don't think it will (be allowed to) make that grade.The fundamental demand is for the ability to store money securely (trustless) outside of the prevailing banking system. This is its utility.
Not sure we are mixing terminology a bit. Yes there is a demand to store money..., not sure that translates to a demand for money. But is bitcoin money? Is bitcoin a medium of exchange, ergo money?
Re. your post above, aren't you now saying that you believe it IS a (part) store of value....I agree with John Kelleher that it is necessary for bitcoin to make the grade as a medium of exchange to be considered money and therefore justify store of value status.
Not sure we are mixing terminology a bit.
Wolfie it has to establish a utility value to be a sustainable long term store of value. The only utility it can possibly supply is as a medium of exchange. The desire for bitcoin to achieve this utility value does not mean it will happen.Perhaps. But the driving force behind my interest in bitcoin is, aside from my initial speculative curiosity, the option to place money outside the banking system. My reasoning for that is no different to placing money outside the banking system in stocks, property or gold or whatever. I consider any number of factors and I believe that they provide an opportunity to protect the value of the money that I have placed in it long-term.
I could of course be wrong and lose my shirt, but ditto, property, stocks and gold.
As discussed elsewhere, bitcoin has been around for 12yrs. Along with smartphone technology and the internet, access to bitcoin is probably more readily available to the masses than the banking system is, which has been around for donkeys years, and is quite clearly shy of offering proper financial services and access to those with limited and restricted opportunity.
The digital currency age is upon us, the race is on for a internationally recognised standard. I like some of what the Libra White Paper says about its own project;
Bitcoin may, or may not be, the standard bearer. I would be inclined, at this point, to think that it will be.
- We believe that many more people should have access to financial services.
- We believe that people have an inherent right to control the fruit of their legal labor.
- We believe that global, open, instant, and low-cost payment networks create immense economic opportunities and more commerce across the world.
Like the tweeter you linked to you seem to believe you have a big gotcha on the Duke and on Roubini. I am not the sort to reject facts as they present themselves. Bitcoin has a price. Bitcoin will have a price in a week's time, a month's time and yes in a year's time, this despite the fact that I believe it is a BOHA. So of course it has a (part) store of value on those timescales. Where's the big gotcha here?Re. your post above, aren't you now saying that you believe it IS a (part) store of value....
Wolfie it has to establish a utility value to be a sustainable long term store of value. The only utility it can possibly supply is as a medium of exchange. The desire for bitcoin to achieve this utility value does not mean it will happen.
I wasn't looking for one - but I do see a change when its set out before me. Ask anyone in crypto circles for who above anyone else epitomises bitcoin-hate and more often than not, the answer you will get is Nouriel Roubini. Of course, there are others - your friend fax machine guy took great joy in socking it to crypto folk during the 2018 bear market. But nobody has topped Nouriel.Like the tweeter you linked to you seem to believe you have a big gotcha on the Duke and on Roubini.
Well that is at least true in this instance Duke, where both you and Nouriel acknowledge for the first time that bitcoin is a store of value.I am not the sort to reject facts as they present themselves.
I wasn't chasing a 'big gotcha'. However, just like many in crypto see Nouriel's acknowledgement of bitcoin as a store of value as a complete change, I also take yours as significant in the development of this discussion - as you've never described it in those terms before.Bitcoin has a price. Bitcoin will have a price in a week's time, a month's time and yes in a year's time, this despite the fact that I believe it is a BOHA. So of course it has a (part) store of value on those timescales. Where's the big gotch here?
Thats fair enough although I don't agree that volatility has a lot to do with the characteristics of a good store of value. It does come into play with regard to a medium of exchange though.I do not think it is a good store of value over those timelines. not because of BOHA but because of the massive volatility.
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