Storing of value is not just "hoarding", useless activity. It is an important ingredient in making many of the business processes and just things work in general. It is a very impotant function. And thus if we have tools that make that function work well, - they will be valueable.
And as it turns out, there aren't that many things that work well as a store of value. It's not like you can take any thing or instrument or contract or whatever else, and make it work as a store of value. In some sense, the ability to act as a store of value is scarce in itself. We already have some instruments, like gold, properties, land, etc. Stocks and ETFs and such are also kinda a store of value, but have a lot problems (but also other functions besides just storing the value). So yes, we welcome another way to store value, this market is by no means saturated as it turns out. Gold has it's own problems.
If I want to store value, what I am looking to avoid at all costs is volatility and risk. That's why instituations are even accepting to lose a little bit of value in return for security by buying bonds from Northern European countries.
It's kind of in the definition of the word "storing": If you want to store water you won't put your bucket of water on to a race car, even though it might drive through a heavy rain.
Some people tried this before by branching off the bitcoin blockchain. That was called bitcoin cash, and it failed.
Bitcoins, meaning not any cryptocurrency but just actual bitcoins, are scarce and will almost certainly remain so.
At worst your coin takes time and attention away from Bitcoin, and thus takes value. At best it outgrows Bitcoin, and grows the entire space.
But that's like saying you could build your own alternative to Facebook by whipping up some corporate partnerships and venture capital. Go ahead, we'll see which one wins in the long run.
You're right that it is a community belief. If enough people were convinced that supply should be increased, they could fork the blockchain and move to the new chain. The change in supply would alter the price appropriately.
But that's no different to the community belief that it has any value to begin with. If everybody was convinced that gold was worthless (outside of its practical industrial uses), it would cease to be a store of value too.
I think it would actually be easier to increase the supply of gold via asteroid mining than to increase the Bitcoin supply. That doesn't require consensus and will probably happen someday.
This is a cultural property of the community, not an intrinsic property of bitcoin. If Satoshi signed a PGP message with a compelling call to alter the scarcity it would likely happen; maybe you disagree, but the point is that it's very possible to change the scarcity because it's a distributed computer program.
Bitcoin is not just "a computer program", it is a program and a blockchain. The same program with a different blockchain is not Bitcoin (there are plenty of those out there). Adding more supply to the Bitcoin blockchain would require large numbers of people to work against their own interests, decimating the value of their own infrastructure investments and bitcoin holdings.
It would be much, much more difficult to change Bitcoin than e.g. the supply of dollars or euros which are considered scarce enough for most purposes by most of the world. And, I contend, even more difficult than changing the supply of gold via asteroid mining. I doubt that even the second coming of Satoshi would be enough to do it (and I also very much doubt that Satoshi is still alive, or that he would want to if he was, considering his known political/economic stances).
> It would be much, much more difficult to change than e.g. the supply of dollars or euros which are considered scarce enough by most of the world
This thread is about gold not fiat money, obviously the scarcity of fiat money can change, that's the whole point of fiat money.
This is simply not the case - see 2017 bitcoin cash fork or Segwit2X push. At the end of the day money is a human invention, meant to facilitate value exchange between humans. So it requires consensus between the users of the money, if some fraction want to change the rules they are free to.
We went for something we found in nature with properties that were pretty good for that, but with some downsides (not absolutely scarce, difficult to transport, easy to steal) to something created specifically for the purpose.
There still has to be consensus on using gold as money, if there isn't it will lose its monetary premium to something that has better monetary properties.
This is a great point. The choice to value gold as currency over other rare metals is 'a cultural property of the community' and yet not 'trivial' to change, just as Bitcoin's consensus isn't.
A single bitcoin is infinitely divisible, unlike most physical assets. How does that affect scarcity?
A 10 year old asset that has wild price fluctuations is a "store of value"? By what measure?
And not just a little bit more value..
Is an index fund a store of value? Would you recommend someone store their value there if they wanted it back out in less than 4 years? Gold? Property? Or would you suggest those stores of value are only suitable for longer time frames? How much more value does someone who stored it in Bitcoin 10 years ago have now?
Gold is a physical thing that is scarce and has real uses other than being treated as 'money'. We have only mined a cube with 28 meter sides of gold from the dawn of time! It's useful- that's why it has value.
If it wasn't useful (pretty for jewelry and an essential industry product) then it would be fairly worthless.
You say crypto is scarce? The scarcity is artificial, and you can create an infinite number of crypto currencies...
So yes, useful cryptocurrencies are scarce.
I'm not sure this is a rock-solid argument. Ponzi schemes also have value (until they don't). MLM's are often massively valuable, too. But most people would acknowledge they're little more than scams to the huge majority of people "invested" in them.
Everyone is investing in bitcoin on the promise that its going to be so much more useful than dollars, in the hopes that they will make a lot of... dollars? Do you see the contradiction? If they think it's going to be so much better than dollars what are they going to do with their long term investment dollars if, in the long run, bitcoin surpasses them?
Don't use economics terms to explain the usefulness of bitcoin when economics itself disagrees.
Not thinking about the value of it, but of its future usefulness as value store and as mean of payment
I don't believe you can separate the value of Bitcoin and it's usefulness because the more valuable Bitcoin is, the more useful it becomes.
The more people who hold Bitcoin, the more scarce it becomes and therefore the more valuable it becomes. In 20 years, Bitcoin could go to 0, or become a widely used currency and skyrocket in value.
Once the number of Bitcoin holders reaches equilibrium then the value would remain stable, but we are definitely not at that point yet.
For the simple reason that it exist in the physical space and can't disappear, unless the laws that regulate our existence change, which is quite improbable
Gold will also work and retain a value even if society suddenly shuts down and reset to a "sticks and stones" state
Bitcoin advocates have this weird tendency to completely ignore decades of game theory
That's why people don't trust them
I doubt this is true in every case, maybe even most cases. Though this sentiment does seem to become more rigid toward the core of the crypto community, a huge swath of other investors are playing price action. There are tons of technical traders in crypto, and they tend to care much more about MA deviations, gaps, pennants, and candlestick forms than what's going to replace USD.
You can also think of it as a play by (people who don't have as many concerns about the dollar) off the fears of (people who are afraid about the future of the dollar).
IMO there is a lot of room in a speculative ecosystem for non-value, non-traditional-economics, and even hugely irrational viewpoints. They can all meet with success by using their own sets of strategies.