"Real" Value of Bitcoin?

[davis196]

have you ever tried to find out fiat's real value? just try once, trust me, you will get shocked with the results.

Fiat money's real value matches the value of the paper of the banknotes.Nobody cares about fiat money "value" here.To be honest,I don't care that much about the real value of bitcoin.This is a topic for an  academic research and complex calculations.I'm not very good at math.

[franky1]

You can see the price formed by supply-demand balance in the market conditions.

"supply and demand" (facepalm)
PRICE is not VALUE
also the PRICE is not formed simply by supply and demand

what if i told you an exchange has at most times a supply of 50k coins per per exchange and the similar amount of fiat balance day in day out.

you would still see a markets PRICE vary even if there were a fixed amount of sellers supplying coin and a fixed amount of buyers demanding coin.

the variation is not simply supply and demand changes.
its actually
desire and utility(speculation) :- the ups and downs
cost:- bottom line the majority wont sell below
expense:- the top line the majority wont buy for
value:- the minimum sellers would sell for and maximum buyers would buy for

(i personally concentrate on minimum value. as thats something that can be seen easily beyond the speculation)

[pat4cryptoreal]

Has anyone else developed a model for valuing Bitcoin? What number did you reach?

Context: I believe Bitcoin is currently overvalued by around $500. I have been playing with some valuation models recently (have a quant/finance background) and have been measuring relationships between wallet growth, tx info like volume and fees, and transaction velocity against social sentiment over time, which got me to a "true" value of ~$5812. This isn't exactly speculation, but it's not baseless either so I'm interested in how you guys have approached the problem.

In reality the price of bitcoin is not determine by the factors and the mathematical formular you just mentioned. If traders or investors with huge volume of bitcoin just enter the market and place bitcoin at high price and some other person buy's it, We will have an upward spike in price within a twinkle of an eye.

[Buttermellow]

If you're calculating it by comparing the prices of hardware you're not coming up with the real value but the lowest possible value that keeps miners mining. Why would the lowest value be the "real" value? You don't measure the real value of a car by the cost of parts and labor needed to make it. If we did that a lamborghini would be worth $50,000 instead of 500,000.

Yeah how could be the value of bitcoin to be evaluated? I am also confused to this and I have seen your post agreeing to it that the real value does not compromises on the hardware of bitcoin. However, my idea of evaluating bitcoin value is all about the supply and demand for it. The more demand from users for bitcoin the more its market price will be expensive.

[P.Mahin]

Yes,Bitcoin is real value able coin.This is Best value able coin from world wide.Bitcoin price day by day increase. This coin user Million Billion people.This is gd coin. This is real value able coin for world wide.Bitcoin user very lucky. Bitcoin user people future bright. So I there for Bitcoin real value for good price.Many people bitcoin buy for coin market cape.This coin world.wide business. Bitcoin is one of tge best coin for world.

[Halmater]

Although some kind of approximations can be used to predict price of bitcoin, people can't be predicted totally. I think, none of bitcoin investors would accept to sale their bitcoin below 6k.

[franky1]

Although some kind of approximations can be used to predict price of bitcoin, people can't be predicted totally. I think, none of bitcoin investors would accept to sale their bitcoin below 6k.

you can never predict what people will do tomorrow but you can see what they did yesterday and then form a baseline from that.

EG people had 11 months, yep 330 days... yep nearly 8000 hours to decide to sell below $5800... no one bit.
soo many opportunities but no takers. which justifies that tomorrow is unlikely to be the day when someone finally bites. as there is a 330 to 1 odds they wont.

and as new baselines rise. like a 3 month $6100 baseline.. it becomes that much harder for individuals to push against the masses.. where $5800 becomes that much further away

[pixie85]

If you're calculating it by comparing the prices of hardware you're not coming up with the real value but the lowest possible value that keeps miners mining. Why would the lowest value be the "real" value? You don't measure the real value of a car by the cost of parts and labor needed to make it. If we did that a lamborghini would be worth $50,000 instead of 500,000.

<snip>
(hope it makes sense.. i had a few drinks but tried best to keep my thoughts logical tonight)
in short: price and value are not the exact same numbers

It makes perfect sense. I asked because you were pointing to the real value of Bitcoin as the value of acquisition and I've always thought that the real value should be the average retail value.
If we compare Bitcoin to goods sold at 300% the acquisition cost it starts to look much better. I wasn't even thinking of such high numbers but I guess it should be always trading at the very least 10% above the minimum needed to sustain the network. Half of the retail (150%) would be perfect as a stable average since nobody has to market Bitcoin. It's only acquisition and profit.

[franky1]

If you're calculating it by comparing the prices of hardware you're not coming up with the real value but the lowest possible value that keeps miners mining. Why would the lowest value be the "real" value? You don't measure the real value of a car by the cost of parts and labor needed to make it. If we did that a lamborghini would be worth $50,000 instead of 500,000.

<snip>
(hope it makes sense.. i had a few drinks but tried best to keep my thoughts logical tonight)
in short: price and value are not the exact same numbers

It makes perfect sense. I asked because you were pointing to the real value of Bitcoin as the value of acquisition and I've always thought that the real value should be the average retail value.
If we compare Bitcoin to goods sold at 300% the acquisition cost it starts to look much better. I wasn't even thinking of such high numbers but I guess it should be always trading at the very least 10% above the minimum needed to sustain the network. Half of the retail (150%) would be perfect as a stable average since nobody has to market Bitcoin. It's only acquisition and profit.

your always going to get varience due to speculation and othr things. but generally "value" is a range of a healthy 2-3x above cost
but as i said in another post. if you take away the speculation of volatility. and look at the baseline.. then you can make good judgement of the range of value that prices will sit within. so i prefer to only concentrate on the baseline.. yea i never care about ATH

when i judge the value growth per year i dont shout out $20k
i shout
2016 always above $300
2017 always above $900
2018 always above $5800

but yea "value" right now is $5800-$20k (centering more around $6k $18k)
depending whether your a buyer or seller is where you will judge "best" value (buyers want low sellers want high)