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Comment by epolanski | Hacker News Reader

How being the supply finite is relevant? This idea that being scarce implies value makes no sense.

You realize we can go on github and setup a bitcoin network too, we call it BitcoinYC, our coins have the same properties of bitcoins, why would that have a value?

Please repeat with me:

- currencies (wheter fiat or crypto) have no value. You can't do anything with them, maybe watch dead national heroes printed or them. They hold no assets and don't generate value.

- Currencies have a price though, in other currencies, assets or services. E.g. Both usd and bitcoin are worthless but both have prices set by demand vs supply

- scarcicity does not mean value. Intrinsic value means value. E.g. water has tremendous value but low price. Gold has tremendous value and price. A car has some value, a business has a value. But currencies only have a price.

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If we are defining value, I would not say that value is equivalent to intrinsic value, or else the phrase "intrinsic value" would be redundant. Currencies have value even though they do not have intrinsic value. Notably, this value is as a medium of exchange, a unit of account, and as a store of value. Bitcoin's capped supply increases its ability to store value, and so too does its demand increases. Yes, you could make a currency the exact same as Bitcoin, but it probably wouldn't be as good as a long-term store of value, because its network is smaller.

If we are defining value, I would not say that value is equivalent to intrinsic value, or else the phrase "intrinsic value" would be redundant.

Nothing has intrinsic value, value is a relational and marginal property - I value things differently than you, and you value the first litre of water differently than the thousandth. And even then the value of something is not fixed and may change over time, you probably now value things differently than you did as a child.

> - currencies (wheter fiat or crypto) have no value. You can't do anything with them

You can pay taxes to stay out of jail with fiat, which seems desirable.

The example you've chosen reiterates that currencies have a price (letting you out), not a value.

If you had only Deutsche Marks to pay would that help you avoid prison?

No. Because they have no value, same as USD, on top of that, they have no price either because there's no demand for Deutsche Marks.

Food allows me to stay alive -> it has value for me

Legal tender of the country I live in allows me to pay taxes and stay out of jail -> it has value for me

Please send me all Deutsche Marks you have. I will then go to the Deutsche Bank and exchange them for Euros :)

We should get rid of them since they have no value. Personally I like them because they facilitate trade and finance on a global, immense scale and allow for decentralised price discovery and information distribution. But then does trade and finance have value? ..wait maybe money networks do have value

Don’t need to pay taxes if you don’t earn or own anything

You buy oil with USD.

P.S. Currencies allow you to exchange debt obligations with entities you don't know and for certain entities to issue debt.

P.S.2 I think you should formally define your denotation of value, as you do not seem to follow the usual definition. Same for price.

For now.. until it’s not the dollar anymore

> until it’s not the dollar anymore

which you'd better hope is not within your life time, because the implications is that the US has fallen, and that a new world order would've taken over. It is unlikely that you, as a citizen of the west (presumably) is going to fare as well as you are today.

As a non-USA citizen, that would be probably good for me.

But I know the USA would manufacture some bogus claims about dangerous weapons and go to war rather than letting it happen.

I'm not from or in the US, and I don't get paid from a US company. I'll get popcorn and enjoy the show

Scarcity has driven value before [0]. And the more scarce, then more valueable. This being combined with other characteristics necessary to be money: Divisibility, fungibility, salibility across time and space.

Some examples: wampum seashells, mammoth ivory beads, glass beads. None of these have "intrinsic" value.

By the way, the main point of the article I linked is that since humans like to collect random, valueless things (like seashells on the beach) then there must exist an evolutionary explanation for that. Meaning, the behavior must have been selected for.

[0]: https://www.fon.hum.uva.nl/rob/Courses/InformationInSpeech/C...

You can clone HN, or any number of things but they'll have little or no value just because of user adoption

Absolutely, see all the Github and Stackoverflow clones polluting search results all over the web. :D

if it has a price, it has value.

Why would the two concepts be related.

why would demand be related to supply and demand? hmm...

> This idea that being scarce implies value makes no sense

You’re putting words into their mouth, they didn’t say scarcity was important at all. They said that it was compelling the supply was finite. We can only guess what they meant since the comment didn’t elaborate, but they maybe meant that if there’s known, fixed quantity of BTC in existence there’s no chance of a big surprise quantity of BTC appearing from nowhere, and causing a price crash (like the Spanish mining silver in South America eventually did for the price of silver).

Personally I don't find that very convincing (BTC price already fluctuates wildly and there are enormous BTC “deposits” that could suddenly cause a crash if they were used) but maybe that's not what was meant either. Either way, I don't think projecting a non-obvious meaning onto this comment and using it lecture people on price-vs-value is very persuasive.

> there’s no chance of a big surprise quantity of BTC appearing from nowhere

Like from Satoshi's huge stash?

Precisely - there's a chance Craig Wright's bonded courier shows up with the missing pieces that allow him to produce the key necessary to access them ;) Hence:

> there are enormous BTC “deposits” that could suddenly cause a crash if they were used

Of course that Craig Wright thing was a hastily cobbled together lie he came up with based on Back To The Future, but there's still the outside chance the real "Satoshi" could show up and do something.

> You realize we can go on github and setup a bitcoin network too, we call it BitcoinYC, our coins have the same properties of bitcoins, why would that have a value?

Miners will only mine the blockchain with the longest proof-of-work. They won't mine yours, as Bitcoin's preexisting blockchain is longer. This principle was explained in the Bitcoin paper and is the heart of what makes Bitcoin work. Miners can only use their electricity for one thing at a time, thus the competition to secure the underlying asset (energy) forces what might seem to be otherwise unrelated projects to in actuality compete against each other.

Miners will mine whatever they can get paid to mine. Otherwise nothing but BTC would have any hash rate.

Miners mine the longest chain for a given coin. This poster is proposing just making another coin, not forming the existing Bitcoin chain.

why would mining something make it valuable?

I can dig up rocks in a field and they won't be valuable just because I'm tired and sweaty and don't have anything else to show for it

You could convince investors there's gold in there and give you money to extract it. (and run away with the investors' money)

Change the word mining to computing, and it’s more intuitive.

A network of nodes compute stuff together, making data available across the network. It’s like asking why is a distributed network valuable.

During the process of computing, the network validates stuff about the data, guaranteeing it properties, so that people can rely on it to a certain degree when reading from and writing to it.

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