Bitcoin is a “bubble” only if you think the rise of information is a “bubble”

[Severian]

http://peculium.net/2013/04/08/bitcoin-is-a-bubble-only-if-you-think-the-rise-of-information-is-a-bubble/

Bitcoin is a mirror. It reflects the world in which it finds itself. As Bitcoin continues to explore and subsume the environment around it, it reflects the informational structure that is its native soil while also reflecting the economic environment around it.

If there was no need for Bitcoin in the economic sphere, it would have no room in which to grow. People that keep calling Bitcoin a “bubble” are off the mark. It’s a longterm explosion being graphed, much as we’ve seen with the information explosion of the past 20 or so years.

[Dunbar]

BTC is not information. We dont measure the rise in BTC in a rise of information. We measure in USD.

Every USD that is invested in BTC is backed by labor, not by information.

[Severian]

BTC is not information.

What do you call a private key?

[Dunbar]

?

If you transfer BTC, you transfer monetary value, not information.

You are trying to compare grapes and oranges.

People are hoarding BTC at the moment because they treat it as a commodity, 'BTC is the new gold'. Two years ago it was because 'the financial system is collapsing'. There is absolutely no resemblance between the rise of information and complexity of society, and the USD value of BTC. There really isnt.

[Severian]

If you transfer BTC, you transfer monetary value, not information.

Perhaps we're looking at two different Bitcoins. My private keys look like information. So do my public addresses.

[BTC Books]

Not only is bitcoin information, but it's utterly trivial to make the case that all monetary value is information as well.

[keatonatron]

My private keys look like information. So do my public addresses.

What information does your address convey?

It looks to me like it doesn't convey anything more than the fact that your address exists. And that isn't new information.

Ever since the beginning of bitcoin, we've known that there is a range of possible addresses, each one valid. We didn't (and don't) know what each and every one is, but we knew they were there.

You could compare it to Shakespeare if Shakespeare ended at "to be", but it doesn't, it gives a lot more information than that. 

[Severian]

What information does your address convey?

That depends on who you are and whether or not you have a need for it. Bitcoin itself looks like chaos until some work is put into understanding it.

[ElectricMucus]

Every USD is backed by black helicopters and plastic coffins. 

[keatonatron]

Every USD is backed by black helicopters and plastic coffins. 

More bang for your buck.

[thefiniteidea]

BTC is not information. We dont measure the rise in BTC in a rise of information. We measure in USD.

Every USD that is invested in BTC is backed by labor, not by information.

The blockchain is full of very important information. Records of value are in fact a useful measure of value. This is the whole point.

Anyone who thinks otherwise is on the wrong forum.

[mccoyspace]

Please consult "Money is Memory" by N. Kocherlakota
http://www.minneapolisfed.org/research/sr/sr218.pdf

The link between information and money is pretty strong.

[Severian]

Anyone who thinks otherwise is on the wrong forum.

TBH, I'm a little shocked that there are still people able to function in the market that don't know that money is information.

[caiaphas]

People..people.  We're talking about a distributed tamper proof transaction ledger.  It has some utility.  The free market will decide the price to get yourself an entry in that ledger in terms of USD, chickens, pigs or whatever.   It can't be compared to 'rise of information'.  Sheesh.

I personally feel the current valuation is not in line with the utility today and it will require more mainstream adoption before it does.  So I'm on the side of bubble.

I think the current price reflects the following components: 1) gambling addicts circumventing USD regulations, 2) legitimate exchange of goods and services, 3) pure speculation on future value.   My gut-feel weighting is 1: 20%, 2: 5%, 3: 75% = bubble.

This comparison to 'rise of information' is pointless.  Markets are bubbles when prices rise because prices are rising.  It never ends well.

[MashRinx]

A thing has value, because someone believes that it has value, and transactions are the results of disagreements over value.

Great line.  Maybe an old one, I don't know, but I've not seen is put so concisely before.