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Comment by asperous | Hacker News Reader

If you think about it like gambling it makes sense.

It takes about $14 billion per year to maintain the current price given that new bitcoins are "mined", so that's the theoretical supply inflation right now not subtracting deflation from lost coins.

The gambling industry worldwide revenue is $219 billion.

That's just one theory of its value if its purely used for speculation. That said I still believe it could totally collapse at any time or perhaps hit an all time high and slowly decline from there, with several smaller rallies on its way down.

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> It takes about $14 billion per year to maintain the current price

I would put this in the "speculation" bucket.

First: as surprising as it may seem, not all miners sell their coins (it's cheaper to mine coin than to buy them, therefore someone wanting to invest 10M in BTC is better off buying mining equipment and paying for the power to run it).

Second: it's very likely that, the exact supply of Bitcoin there ever will be being a known quantity, the "cost" of as-of-yet-unmined coins is priced in.

It takes about 14 billion per year to maintain the current price given that new bitcoins are "mined"

14 billion what to maintain the current price? How does that work?

I think what GP means is that X amount of new bitcoins are "mined" every year, which is to say that X new bitcoins spring into existence from nowhere, so if the current exchange rate is Y dollars per bitcoin then XY dollars needs to flow into bitcoin per year for bitcoin to retain its current market capitalisation.

And I guess XY = $14 billion but I haven't bothered to look the numbers up.

I got 17bn, but with constantly changing prices a rough figure is fine.

Here's the previous day's block reward and current price. https://bitinfocharts.com/bitcoin/

The other thing about mining is the their costs are in hard currency, so there's not much opportunity to "hodl".

Those mined coins need to be sold once the electricity bill is due, so to maintain a stable price bitcoin needs an ongoing net dollar investment proportionate to the current price (taking halvings into account).

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