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Here's an article that explains the fundamentals of Bitcoin and they tie to its price: https://medium.com/@100trillionUSD/modeling-bitcoins-value-w...

> Is the purpose just to become more valuable because of its scarcity with no utility?

Being a reliable store of value is great utility. Nothing else can come close to btc at that.

A $100 trillion market value for Bitcoin?! Predicated on the view that nation states will trade all their resources for BTC?! This is not the basis of a sane valuation and also doesn’t address fundamental value.

Is Bitcoin more inherently valuable than garlic coin? If so, why? Just first mover advantage or just because other people think its valuable?

Also how is BTC the most reliable store of value? It’s had multiple crashes and is one of the most volatile instruments.

As is often the case, bitcoin's volatility has been overstated:

“In our long-term study of bitcoin, we had compared bitcoin correlations to traditional asset classes and now see another interesting recent trend with its volatility,” according to Gurbacs. “In our current volatility research, we compared the 90 day and year to date volatility—as measured by their daily standard deviation as of November 13, 2020—of bitcoin against the constituents of the S&P 500 Index. We found that bitcoin has exhibited lower volatility than 112 stocks of the S&P 500 in a 90 day period and 145 stocks YTD.”

https://www.etftrends.com/alternatives-channel/bitcoins-vola...

> Is Bitcoin more inherently valuable than garlic coin? If so, why?

Because of built-in scarcity. No other asset is as provably scarce as btc.

> Also how is BTC the most reliable store of value? It’s had multiple crashes and is one of the most volatile instruments.

Two points here:

- BTC is of course not good for short-term speculation, it's a long-term savings vehicle. Short-term volatility doesn't affect the properties of a long-term store of value.

- There was no period in history of btc where you would buy it and lose $ after 5 years of holding. Most likely, never will be due to my answer to #1 - inherent and ever increasing scarcity.

Bitcoin meets the basic requirements of money better than anything else that came before it. It's like gold, which has been money for 5,000 years, with teleportation capabilities.

From https://breedlove22.medium.com/money-bitcoin-and-time-part-1...:

    Hardness — resistance to unpredictable supply increases and debasements of value
    · Fungibility — units are interchangeable and indistinguishable from one another
    · Portability — ease of transporting or transmitting monetary units across distances
    · Durability — resistance of monetary units to rot, corrosion or deterioration of value
    · Divisibility — ease of subdividing or grouping monetary units
    · Security — resistance to counterfeiting or forgery
    · Sovereignty — the source of its value, trust factors and permissions necessary to transact with it (natural social consensus or artificial government decree)

Bitcoin used to be an alternative currency that was anonymous, but with a current $7 transaction fee it's clearly not going to be used as a currency to buy a morning coffee (i.e. it fails the transferability requirement of a currency).

Not sure why bitcoin skeptics keep pointing to these transaction fees. As I write this, it takes 3 sats/byte to get into a block in 30 minutes and 1 sat/byte for 1 hour.

And as I write this, 1 sat = $0.00027210. A typical transaction is about 250 bytes, so to get a transaction into a block in 30 minutes costs about 7 cents. If it's more important, you could pay $1 or something.

Of course, Lightning Network is faster and cheaper than using bitcoin's blockchain for every transaction, which cost a fraction of a sat for every hop the transaction has to travel.

Because a 30 minute transfer time, or $1 fee means you can’t do small and fast transactions (which are the vast majority of transactions for a traditional currency).

This means Bitcoin is simply not a good currency for most transactions.

First, it usually doesn't make sense to buy coffee with bitcoin. Why would I do that if I had the choice to use depreciating fiat instead?

As a currency, the dollar is great for quick, low-cost transactions. But it's no longer a good store of value.

Besides, I can use my Cash App debit card or app and get cash back in bitcoin, which is rapidly appreciating in value [1].

As I already mentioned, lightning network provides fast (less than a few seconds) and cheap (fractions of pennies) off-chain bitcoin transactions—http://lightning.network/.

[1] https://cash.app/help/us/en-us/30982-bitcoin-boost

Here's an example of a $165,000,000 bitcoin transaction. Cost: about $1.20:

https://twitter.com/coinbeastmedia/status/133612299565221888...

The issue is the transaction fees at the lower, faster end (i.e. I might be able to use Bitcoin to buy a car, but I can't use bitcoin to buy a coffee).