Comment by Ologn | Hacker News Reader

Comment by Ologn | Hacker News Reader

> it argues that the entire technology field is worthless and cannot be used for any practical purpose

Which I concur with. Cryptocoins are worthless, the idea Bitcoin has a market cap of $5-6 hundred billion is absurd, and maybe the increasing fed funds rate etc. will pop this speculative bubble more than it already has (Bitcoin had the even more absurd market cap of $1 trillion toward the end of last year).

Why is a Bitcoin worth anything? I know why my M1 Mac is worth something, I know why a box of raisins is worth something, I know why a bar of gold is worth something. I see no worth in a Bitcoin. I ask why it has any worth and the bag holders cast around looking for an equivalent, and only seem to find that dollars have been unmoored from value for half a century and the response is it's like the dollar (of course the dollar is implicitly, not explicitly like before 1971, backed by tens of thousands of tons of bullion gold among other things, but that's another tangent...)

Well your Mac is worth ‘something’ because of what people are willing to pay for it. It would be worthless to certain people, just as you find bitcoin worthless. What’s the difference?

No, the Mac is worth something in and of itself. It is a tool of productivity, entertainment, education, creation, etc. And, failing all of that, it's valuable for its parts.

A bitcoin is an ID number pointing to pretend money. It has zero intrinsic value.

I'm sure that if someone were to gift you one Bitcoin you would not refuse it on the basis that it's just an ID number pointing to pretend money with zero intrinsic value, would you?

Sure - today, as the situation stands, I'd sell it in a heartbeat, because there is still a vast supply of greater fools. That doesn't mean it has intrinsic value, nor that it would be an ethical / moral choice. Just means that I have loose enough morals to be happy to take an idiot's money.

When suddenly it loses its popularity and/or supply of greater fools, it'll fall apart, and I'll have taken some poor sap's actual money, even if it was delayed / distanced / distributed by some thousands of layers.

And what is the intrinsic value of actual money again?

Correct, I can exchange a Mac for something else, or I can use it. Bitcoins are obviously exchanged but have not use.

This.

In the event that the world falls apart, the Mac is at least usable as a weighted object, if all else fails.

Bitcoins become purely thought in such a situation, and even in far less catastrophic ones.

Productivity, entertainment, education, and creation are all subjective, just like the value of an entry in a ledger.

I could say "I don't use Macs because I find I can't be productive with them." That's a subjective statement.

Or I could say "I don't find it entertaining to sit in front of a Mac," or "I don't learn anything when I use a Mac," "I can't create anything valuable using a Mac." None of the properties you listed are intrinsic properties of the Mac, they're all a function of the Mac's utility to certain people in certain situations.

Perhaps I'm Amish. Or perhaps I don't have an internet connection. Or I am old and blind and don't have a friend to teach me to use a screen reader. The Mac would be valueless to me.

So, the Mac's value is derived solely from its utility to a certain group of people. It lets that group of people perform tasks that they couldn't perform (or would perform less efficiently) without it. That's the same way Bitcoin's value is derived.

> pretend money

All money is pretend.

> It has zero intrinsic value.

All money has zero intrinsic value. Extrinsic value is still value.

Value is subjective in many cases, yes, but there is still intrinsic value in the device itself, if we have to boil it down. You missed that bit - the intrinsic part is literally the metals of which the device is made. Even failing that, it's useful as a weighted object. You can get down to the nuts and bolts of a thing with intrinsic value, such that even in the vent that society collapses and there's no coordinated economy to speak of, there is still SOMETHING for which the thing/service can be used. Cryptocurrencies literally stop existing in such an event, and become entirely worthless in even less catastrophic situations.

Money is an agreed upon tool for exchanging items/services of value - but it also a store of value, because it retains at least a semblance of stability. Cryptocurrencies are... well, not currencies, for starters, but they're also simply a proxy for "real" money (ie: fiat).

Where cryptocurrencies entirely fall apart is when the realization hits that they all fall into the greater fool category - once you run out of new marks, the scheme collapses, and all the money - note actual currency - ends up in the hands of a few early adopters and a couple extra lucky folks who timed it right. Negative sum games are not a good thing to prop up.

I'm not going to argue with you about how a Macbook is valuable to melt down, or has intrinsic value as a paperweight. Frankly I think that line of thinking is a dead-end for insight.

I also don't believe it's helpful to ponder the value of objects in the context of societal collapse. If that's your definition of intrinsic value, I don't think it's useful or practical.

All money falls into the greater fool category. The difference is that fiat money is not opt-in. It too is held mostly people who adopted earlier than you and lucky folks. Millennials are over 20% more likely to cry when trying to buy a home than the general population.[1]

> Negative sum games are not a good thing to prop up.

Your logic is circular - crypto has no value, therefore it's not useful, therefore it's a negative sum game, therefore it has no value.

You could just as easily say the opposite. People perceive crypto to have value, therefore due to its unique storage/transfer properties it has usefulness or extrinsic value, therefore it provides utility and is positive sum, therefore it has value.

It's all subjective.

[1]: https://zillow.mediaroom.com/2022-06-02-Half-of-Americans-cr...

I mean, sure, if you'd like to ignore the entire point of inherent or intrinsic value, then... go for it? Weird flex, but sure.

And no, it's not circular - "negative sum game" is literally baked into the concept of a purely speculative unbacked "asset". More money has to go in than can possibly come out, and there's precisely zilch to show for it.

Any place that accepts crypto is simply immediately selling it for fiat, and making the customer pay more than they otherwise would in fees and headache.

Anyway, it's fun to be obtuse, I know, but you're pushing the limits here.

> "negative sum game" is literally baked into the concept of a purely speculative unbacked "asset"

The dollar is also a negative sum game, a purely speculative unbacked "asset".

More effort has to go into keeping track of it than can possibly come out.

> Any place that accepts crypto is simply immediately selling it for fiat, and making the customer pay more than they otherwise would in fees and headache.

Crypto payment processor fees are usually about 1%, which is less than half of the typical credit card processor fee. As for "headache", you'll have to elaborate on that.

Wait did you actually say "all money falls into the greater fool category"?

You... Really ought to look up what greater fool theory is. And maybe money, too, while you're at it.

Well, don't just sit there and hand-wave. I want to hear why you believe non-state-backed currencies categorically fall into the greater fool theory, but state-backed currencies categorically don't.

Bitcoin is used by people - for example in countries with capital controls or hyperinflation. It is also legal tender in El Salvador.

In any case your argument is a bit silly? There is an infamous Italian artist who sold tins of his own shit [1]. Would you like to argue that these tins are worth ‘something’ because I can empty the shit out and reuse the tin? I’ll take the bitcoin thanks.

[1] https://en.m.wikipedia.org/wiki/Artist's_Shit

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