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Comment by eksemplar | Hacker News Reader

Gold wasn’t picked as “the” original metal for coin, it was just one of many metals used. What they had in common that bitcoin doesn’t, was the value of the material the coin was made of. It wasn’t the idea that made gold coins valuable, it was the ability to melt them down and produce jewelry, teeth or other valuable things.

Gold still has that value even though it’s price has been inflated and corrected many times.

Bitcoin on the other hand has no real world value outside of crime because it never evolved to a real currency. Which means that the only way to gain a net value on your investment, is for orher people to come in and buy bitcoin after you.

Which means you’ll also have to sell it before those people too.

I’m not telling you not to buy bitcoin. It’ll probably go much higher than it is now, but it will some day go to zero because it lacks any innate value.

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...it was the ability to melt them down and produce jewelry, teeth or other valuable things

Not true. Gold has its value mostly because it is rare. Jewelry can be made of silver, copper, and any number of other metals. Its "real" value exists because people believe in its "intrinsic" value, not practical value.

That's not exactly true. Bitcoin does have intrinsic value. Bitcoin is expended to move bitcoin. This sounds a bit circular, but if you think about it, it's not really. Value transfer is a service that Bitcoin (the network) provides. It provides that service using Bitcoin (the currency) as its incentive mechanism. This is the kernel of intrinsic value around which Bitcoin's valuation is built, and why it is, in fact, analogous to gold.

Now, what that means for the price is nothing really. Speculation commodities (like Bitcoin and gold) go up and they go down without a whole lot of rhyme or reason. But the analogy to gold is valid.

Gold gets it’s value from it’s application and bitcoin has none of that outside of crime.

You’re right that you need to expend bitcoin to trade it, but this is more a weakness than a strength. It gives you a banking system of sorts, in that you’re guaranteed someone will handle your transaction for money. This also means that if the value of bitcoin drops then nobody will be around to do the calculations required to do transactions, making it an inherent risk.

It's use as fuel for transactions is its application. Gold's intrinsic value is very very tiny relative to its price. Same with Bitcoin's.

Financially that's not application though, it's a scam along the lines of your bank lending you money to invest in your bank.

You can downvote it all you want, but the value of the transaction is directly tied to the value of Bitcoin. This makes it profitable on the way up, and an outright danger in the way down because it'll prohibit you from selling your bitcoin when the value crashes.

Like I said, invest all you want, there are plenty of money to be made still, but at least be aware of the risks.

You have it backwards. Jewels are valuable because they are made of gold, not the other way around.

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