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Comment by sowbug | Hacker News Reader

If you're thinking of this event as a split, dividend, or spinoff, then it doesn't make sense. But it's more like a company cloning itself but adopting a different vision/mission, and awarding shares to all existing shareholders.

They could have started fresh like the zillion other cryptocurrencies that have started up since 2009, some of which appear to have real value. You wouldn't look askance at those, at least from a healthy-market perspective. The only difference here is they distributed initial currency fairly perfectly to the best possible audience of Bitcoin fanatics -- without a single spam email!

Cloning a company makes no sense in the physical world. But when it's a purely digital asset, it can be copied very cheaply.

Why isn't this zero-sum? Because it increases the TAM, rather than competing with its doppelganger in a saturated market. Maybe one ends up killing the other, but for now there's room for both.

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> it's more like a company cloning itself but adopting a different vision/mission, and awarding shares to all existing shareholders.

And that doesn't sound... insane to you? I mean, skipping the problems with physics where a "split" company would have to clone its employee talent pool as well: such a company would share the same products and the same markets and the same sales channels and have zero share of all of those at the start. And you're saying that a "healthy market" would be expected to bid up shares of that crazy reincarnated zombie company thing to like 20% or whatever of the original value? Based on "different mission"?

This is crazy, and I want no part of it. The coin community is literally inventing phantom cash and pretending like there's no bubble. How often has that been true in history?

Why do you say "zero share" of the same sales channels? It's literally the exact same audience/"customers" as BTC. 100% share.

It's no different than all the third world countries inventing phantom cash every time they trot out a new currency because the old one suffered astronomical inflation.

All money is funny money. The US government regularly invents phantom cash out of thin air in order to maintain the desired 3% annual inflation. That's hundreds of billions of dollars every year that just poof into existence.

I'm basically with you though, but just out of having not had any need for it yet.

If a need arises, I'll get some just like I had to get 8 different currencies while traveling Europe before the EU. Those leftover bills feel pretty much like funny money to me. There are lots of people who would trade me US currency for them, but I still subjectively value them as basically worthless because ... well it doesn't really matter why (truth is, I'm too lazy/"busy" to go to the bank).

The value of a currency, any currency, (like any other object) is subjective to the holder.

Some of us remember way back when the crypto dorks were claiming that bitcoin would be the first unfunny money :)

Looks like you vapor-locked on the physical/digital point before you finished reading.

Let's stay with purely digital. There's an app on your phone that you bought for $1, which seemed like a fair deal to you at the time -- you paid $1 for something you thought was worth $1.

The author adds a feature to the app. You like the feature, and now if someone asked you what the app were worth to you, you'd say $2. In effect, a dollar of value just appeared out of thin air. No magic needed so far for this to happen, I hope.

Same situation but you don't care about the feature -- it's something you don't personally use. But now new buyers are more interested in the app, so more people pay $1 for it. Again, some extra wealth got created just by coding up the new feature. Bubble? New paradigm? It's different this time? Nope.

A new feature got added to Bitcoin. The market says it's more valuable now.

A spin-off (or more correctly, demerger) is almost exactly what you describe: a company cloning itself but adopting a different vision/mission, and awarding shares to all existing shareholders.

With companies it is usually done with a particular division, or business area - but in the case of an anti-trust settlement (go and compete with yourself) it would be exactly what you describe and be implemented as a demerger.

Except even people not owning shares in the company can split it.

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