why can't bitcoin be based on something that has value?

[SirLancelot]

Anyone with particular knowledge can create cryptocurrency. But not anyone can produce gold because it is an natural mineral resource that has limited supply. While this is true, it should also be noted that bitcoin can't just be reproduced easily by copying and renaming. It doesn't work that way. If you will insist on doing so, you will definitely not succeed in renaming it alone. You can do another crypto coin, but it isn't guaranteed that it will be as valuable as bitcoin.

Remember, there are many crypto coins now circulating in the market, but not everyone has a value. Not everyone of it have the potential to rise up or surpass bitcoin too. Because without patronage, a crypto coin is useless.

They can create a new crypto but it will never be the same as bitcoin anymore. Just like a gold, bitcoin supply is also limited but it's already known that its supply is only 21 million. We can't just say that we will increase its supply because that can affect the value of btc.

I am sure that all of us don't want btc to become less valuable or to become less volatile because this is how we earn a profit thru it. @nurilham, I think that gold is backed by governments while for bitcoin, it's only back by its community. You are wrong @OP but bitcoin is already based on something that has a value and that is none other than fiat money or local currencies.

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[larry_vw_1955]

You are wrong @OP but bitcoin is already based on something that has a value and that is none other than fiat money or local currencies.

Bitcoin is based on fiat? That's a new one for me. I never heard no one say that before. If bitcoin is based on fiat then what's the use of bitcoin? who needs bitcoin if bitcoin is based on fiat? the only way bitcoin could be based on fiat is if satoshi would have made it a stablecoin but he didn't do that so... maybe you need to re-read the thread where people are talking about bitcoin being based on people's trust and belief in it as being "valuable" for whatever reason.

[franky1]

7 pages on and larry still asking the same question as his first post

bitcoins underlying value is based on mining cost.
bitcoins PRICE sits above this and is speculated based on different peoples personal costs that are above this underlying value

its very simple.
if everyone on the planet could mine for gold for just $1 of labour, a spoon and a coffee filter. in their own back yard. no one would want to buy gold for $1,700. because they can acquire it for just $2
and so the market would be at the $2 because no one would be foolish to buy it for $1700

however because gold costs hundreds to mine and even more to get access to land to be able to mine, people do speculate in the $1k-$2k window of speculation for the price of gold.

same goes for bitcoin
cheapest mining cost is $13k most expensive is $75k. and so the price speculates in that window

its the mining cost that underlies bitcoins value. and the market price speculates above that underlying value and within the window.

have a nice day

[larry_vw_1955]

7 pages on and larry still asking the same question as his first post

I was just pointing out how absurd it sounds for someone to say that bitcoin is based on fiat. Bitcoin is not based on anything. Except what people think it is worth, what people are willing to pay for it. What you refer to as "mining cost", that's has nothing to do with bitcoin's value or what bitcoin is based on. Bitcoin's mining cost is a direct result of the "difficulty target" in the sha hash. That target is periodically recalibrated to ensure a bitcoin block is mined on average about once every 10 minutes. but that has nothing to do with bitcoin's price. not sure why you would want to convolute the issue by bringing the term "mining cost" into things.

bitcoins underlying value is based on mining cost.
bitcoins PRICE sits above this and is speculated based on different peoples personal costs that are above this underlying value

As I was saying, this "difficulty target" is based on the amount of total hashing power in the network. Over time, that hashing power has grown larger obviously. Thus the software has to make the "difficulty target" a smaller number to make it harder to get a suitable hash. that has nothing to do with what people are willing to pay for bitcoin on coinbase.

what you're trying to do is say "coinbase has btc listed for $20,000 so the cost to mine bitcoin is $20,000" wrong. that's not how it works at all.

its very simple.
if everyone on the planet could mine for gold for just $1 of labour, a spoon and a coffee filter. in their own back yard. no one would want to buy gold for $1,700. because they can acquire it for just $2
and so the market would be at the $2 because no one would be foolish to buy it for $1700

however because gold costs hundreds to mine and even more to get access to land to be able to mine, people do speculate in the $1k-$2k window of speculation for the price of gold.

you can quantify your costs to mine gold out of the ground. i won't argue with that.

same goes for bitcoin

no, i can't agree with that. so lets see why.

cheapest mining cost is $13k most expensive is $75k. and so the price speculates in that window

not sure where you are getting these numbers but i don't think they are correct. bitcoin has not always been $13k or higher.

its the mining cost that underlies bitcoins value. and the market price speculates above that underlying value and within the window.

wrong. mining cost has nothing to do with the value of bitcoin. in fact, we could say that mining cost depends on the difficulty target which is based on how much competition exists among miners, ie, total hash rate. bitcoin could theoretically be selling at $100,000 but satoshi could be the only miner. he would have no competition thus he would be able to mine on his lowly cpu, thus producing bitcoin at almost no cost.

people determine bitcoin price, miners dont. miners do determine gold's base price, that's not how it works for something like bitcoin though.

[Mauser]

i dont understand why bitcoin has to be just base on people perceive value of it. and for someone to just artrarily fix the supply of them at 21 million doesn't make any sense. it should be able to contract and expand the # of bitcoins in existence. but because bitcoin is design very simplistically it is kind of like monopoly money. not backed up by anything.

The world has moved on for many years now to place the value of money on a commodity. In the past countries had a fixed exchange rate between their currency and gold, which was very a difficult issue for the country. They always had to store large amounts of gold in the central bank and could be attacked by speculative traders. UK stopped the Gold standard in 1931, and USA in 1973 after Bretton Woods. Today it is enough for a country to guarantee the value of money. It doesn't make sense for crypto currencies now to go back to an outdated monetary system. First of all, which commodity should the value of bitcoins be based on? Gold? Then Bitcoins would just mirror the gold price and we wouldn't need cryptos. The same effect we could have by buying ETCs on gold. I think we are past the time where we other to tell us the worth of things. Just because there is no big central bank behind bitcoins guaranteeing it's valu doesn't mean it will be worthless.

[witcher_sense]

First of all, which commodity should the value of bitcoins be based on? Gold? Then Bitcoins would just mirror the gold price and we wouldn't need cryptos. The same effect we could have by buying ETCs on gold. I think we are past the time where we other to tell us the worth of things. Just because there is no big central bank behind bitcoins guaranteeing it's valu doesn't mean it will be worthless.

Some people would argue that, in the case where cryptocurrency is to be backed by a physical commodity such as gold or other precious metal, its existence is quite justified since that physical commodity, while being valuable, cannot be transported to another place trustlessly, costlessly and securely. Bitcoin solves the problem of lack of portability. But in my view, this whole concept, I mean pegging cryptocurrency to a commodity, doesn't make much sense, especially from the standpoint of the "finality" of transactions. When you make a regular transaction in bitcoin, you essentially hand over your bitcoin like physical cash because it is, in essence, a bearer instrument where all transactions are immutable and final. When you try to back it by something else (e.g gold), transactions stop being considered final because the underlying asset hasn't even moved. To make a payment, you need to relocate gold physically, but that means we haven't achieved anything, and gold is again subject to centralization and government capture. Bitcoin pegged to a physical commodity is not "real" money, it is a money substitute, questionable claim on something valuable, essentially, it is a form of IOU.

[franky1]

larry
you are now PUREPOSEFULLY
mixing up the word PRICE with value

people have their own individual decisions about the PRICE. correct(both agree)

but the underlying VALUE is where you are getting confused and purposefully ignoring and not understanding

take some time to read the gold example i made in previous post. actually sit back and understand it. like probably step back from the keyboard, have a cup of coffee and truly think about it.
and you will understand better

if everyone could mine gold in their back yard for under $2.. no one would be buying gold on the market for $1.7k
truly think about that


bitcoins bottomline(cheapest mining on planet) cost of 2022 is 13k mining costs which is the underlying VALUE. the lowest people can get bitcoin for any source on the planet.
yes in previous years like in 2009 the costs were under 1 cent.
but understand that the costs have gone up over the decade

now separate that..

and ABOVE that. is the speculative PRICE(dont confuse with value)
the speculative PRICE is more variant and volatile ABOVE value. because of speculation

get it yet

it may only cost a farmer 40cents to produce milk and thats the good value.
however super markets sell milk for $1-$3
thats the speculative PRICE

notice the difference
milk would be free if there were no costs to produce it. .. like oxygen
but its the costs that become the bases of then forming a market price above the underlying value cost

get it yet

once you understand there is a real life cost in creating bitcoin. you might start to see the other layers and umber at play that build up and back the price.
where yes sometimes the price is overly priced way way way above value. where its at such a premium. all the buyers dry up and stop buying which causes the price to max out and then correct down.

understand the real life costs from the cheapest on the planet to the most expensive mining costs of the planet and you start to see the window in which the PRICE plays around inbetween

[BlockchainMentors]

Bitcoin is not real , It is imaginary. You cannot touch it because it is digitally located somewhere but u can see it ... Bitcoin is like assets of future like lots of money you have in your hand.

[Snowshow]

i dont understand why bitcoin has to be just base on people perceive value of it. and for someone to just artrarily fix the supply of them at 21 million doesn't make any sense. it should be able to contract and expand the # of bitcoins in existence. but because bitcoin is design very simplistically it is kind of like monopoly money. not backed up by anything.

It's a common myth.  Bitcoin’s price is not directly caused by subjective perceptions:  It is a result of the market, based on supply and demand.  Perceptions are one factor in the “demand” side of that.  There are other factors to demand; and perceptions do not alter supply.

Ultimately, Bitcoin’s fundamental value derives from its facilitation of productive economic activity, which would be costlier, infeasible, or impossible without Bitcoin.  I know that I have done productive non-Bitcoin, non-market business with Bitcoin, which I could not have done without Bitcoin.  That’s not extraordinary:  It is being an ordinary Bitcoiner who uses Bitcoin as money, rather than a purely speculative buyer who just wants “number go up”.  The more such people they are, the higher the organic, non-speculative demand for BTC.

i'm not saying bitcoin doesn't do that. but bitcoin has weaknesses. you can't deny that. the main weakness being that it is not backed up by something like gold. gold could then be used to measure the value of bitcoin. and gold has real world use. people wear it. it gets used in all kinds of electronics. bitcoin doesn't get used anywhere for any purpose. it's just imaginary.

This discussion of economics is far off-topic for the development forum.  I feel obliged to answer something that is more usually nocoiner FUD or newbie confusion.  If you have further questions about this, I refer you to Bitcoin Discussion or Economics.

ok well, the topic belongs somewhere.

You question presupposes that bitcoin exists. How did you even came to an idea that bitcoin is real? Have you ever saw bitcoin? I never did. When I ask people where are bitcoins that they supposedly bought, they show me just their applications that say: "xx BTC". Then I say back: if I send you, electronically, via some communication system that I came up with,  the following text: "5 Porsche", does that mean that you own 5 spot cars made by German automobile manufacturer? They respond: no. I conclude with this question: so, why do you think that you own xx bitcoins, just because someone electronically send you this text: "xx BTC", via communication system of an anonymous Nakamoto person or group?  They say nothing back.

[virasisog]

You are wrong @OP but bitcoin is already based on something that has a value and that is none other than fiat money or local currencies.

Bitcoin is based on fiat? That's a new one for me. I never heard no one say that before. If bitcoin is based on fiat then what's the use of bitcoin? who needs bitcoin if bitcoin is based on fiat? the only way bitcoin could be based on fiat is if satoshi would have made it a stablecoin but he didn't do that so... maybe you need to re-read the thread where people are talking about bitcoin being based on people's trust and belief in it as being "valuable" for whatever reason.

I will disagree that bitcoin is not based on Fiat because she had currency is different from cryptocurrency when you are looking at the domination of two of them you will see that Fiat currency is centralised currency why bitcoin is a decentralized currency sobo so don't have anything to do in common so therefore I believe that both of them function differently but they're all added via currency which whatever thing you are cheap with a bitcoin we can also achieve it with a Fiat currency

Yes, Bitcoin and fiat are two different currencies. Fiat is regulative while Bitcoin is decentralized. They have different characteristics as well. Fiat is stable while Bitcoin is volatile. The only thing that connects them is when we convert our Bitcoin into fiat when we're withdrawing our funds or purchasing something. Both have different roles and functions but both are important.

[larry_vw_1955]

larry
you are now PUREPOSEFULLY
mixing up the word PRICE with value

people have their own individual decisions about the PRICE. correct(both agree)

but the underlying VALUE is where you are getting confused and purposefully ignoring and not understanding

ok yes, maybe i didn't understand the distinction you're trying to make.

take some time to read the gold example i made in previous post. actually sit back and understand it. like probably step back from the keyboard, have a cup of coffee and truly think about it.
and you will understand better

i have thought about it and come to the conclusion that "bitcoin mining" is not an appropriate terminology if we are going to try and equate that in anyway with "mining gold".

if everyone could mine gold in their back yard for under $2.. no one would be buying gold on the market for $1.7k
truly think about that

bitcoins bottomline(cheapest mining on planet) cost of 2022 is 13k mining costs which is the underlying VALUE. the lowest people can get bitcoin for any source on the planet.

I don't know how you are coming up with this $13,000 estimate of the cost to mine one bitcoin but presumably you're taking the total hash rate of the entire network, figuring out what the power consumption of that is in kilowatt-hours, then seeing how much that costs for doing 10 minutes of hashing based on some average cost of electricity per kilowatt-hour. i don't have a problem with that type of estimate procedure but you have to realize something. you can't just mine as many bitcoins as you want to. there are artificial limitations in place that prevent you from doing that. there's no artificial limitations on mining gold out of the ground.

over 90% of the bitcoins that will ever exist have already been mined. so mining isn't really a viable way to obtain bitcoins anymore. you have to buy them on the open market. now with gold, i doubt that's the case. there will always be gold mining. not so with bitcoin.

yes in previous years like in 2009 the costs were under 1 cent.
but understand that the costs have gone up over the decade

now separate that..

and ABOVE that. is the speculative PRICE(dont confuse with value)
the speculative PRICE is more variant and volatile ABOVE value. because of speculation

get it yet

After looking into it a bit, i came across some information that said this:

"Across the 198 countries included in the dataset, the average cost to mine bitcoin sat at $35,404.03, more than bitcoin’s value of $20,863.69 on July 15, 2022."

So if that statement is true then it kind of casts your theory into doubt.

it may only cost a farmer 40cents to produce milk and thats the good value.
however super markets sell milk for $1-$3
thats the speculative PRICE

that's how tangible goods work like gold and milk. physical things.

notice the difference
milk would be free if there were no costs to produce it. .. like oxygen
but its the costs that become the bases of then forming a market price above the underlying value cost

that's definitely how it works for physical things. but bitcoin is different. they're not really making much bitcoin anymore. and oneday they won't be making anymore of it. none. nada zilch. but they'll still be making milk and gold.

once you understand there is a real life cost in creating bitcoin. you might start to see the other layers and umber at play that build up and back the price.

well it's not like we NEED more bitcoin. we would perfectly fine to not mine anymore bitcoin since over 90% of the total supply is already in existence. once 100% of it is in existence, what's there going to be to back up the price then? because there won't be any "mining cost" for bitcoin because you won't be able to mine it then.

where yes sometimes the price is overly priced way way way above value. where its at such a premium. all the buyers dry up and stop buying which causes the price to max out and then correct down.

understand the real life costs from the cheapest on the planet to the most expensive mining costs of the planet and you start to see the window in which the PRICE plays around inbetween

i would imagine that the price to "mine bitcoin" varies throghout different parts of the world due to electricity costs, hardware costs, maybe even human labor costs, real estate costs, the list is endless. but as i said already, somewhere around 2037 none of that is going to matter at all because there won't be anymore bitcoins being "mined". and then what will people use to base bitcoin's price on? their feelings?

[savetheFORUM]

The world has moved on for many years now to place the value of money on a commodity. In the past countries had a fixed exchange rate between their currency and gold, which was very a difficult issue for the country. They always had to store large amounts of gold in the central bank and could be attacked by speculative traders. UK stopped the Gold standard in 1931, and USA in 1973 after Bretton Woods. Today it is enough for a country to guarantee the value of money. It doesn't make sense for crypto currencies now to go back to an outdated monetary system. First of all, which commodity should the value of bitcoins be based on? Gold? Then Bitcoins would just mirror the gold price and we wouldn't need cryptos. The same effect we could have by buying ETCs on gold. I think we are past the time where we other to tell us the worth of things. Just because there is no big central bank behind bitcoins guaranteeing it's valu doesn't mean it will be worthless.

That type of situation created a bit trust wave where you have to trust a nation that the money has some value, and that means we will have a ton of nations that will fail. At the end of the day if you can't trust that nation then the price will go bonkers. We haven't seen that with USD just yet, even though it did lose a lot of value, it didn't lose that much of a value, and that means we are seeing something that is risky with other fiats instead.

Look at south America, Africa, middle east and even in Asia where fiat currencies became so much less valuable. That’s the risk you take when you base it on nothing at all. But crypto is not the same, because it's limited, not printable.

[larry_vw_1955]

When you try to back it by something else (e.g gold), transactions stop being considered final because the underlying asset hasn't even moved.

but what if the asset is able to move along with the cryptocurrency? unlike gold.

[franky1]

if everyone could mine gold in their back yard for under $2.. no one would be buying gold on the market for $1.7k
truly think about that

bitcoins bottomline(cheapest mining on planet) cost of 2022 is 13k mining costs which is the underlying VALUE. the lowest people can get bitcoin for any source on the planet.

I don't know how you are coming up with this $13,000 estimate of the cost to mine one bitcoin but presumably you're taking the total hash rate of the entire network, figuring out what the power consumption of that is in kilowatt-hours, then seeing how much that costs for doing 10 minutes of hashing based on some average cost of electricity per kilowatt-hour. i don't have a problem with that type of estimate procedure but you have to realize something. you can't just mine as many bitcoins as you want to. there are artificial limitations in place that prevent you from doing that. there's no artificial limitations on mining gold out of the ground.

After looking into it a bit, i came across some information that said this:

"Across the 198 countries included in the dataset, the average cost to mine bitcoin sat at $35,404.03, more than bitcoin’s value of $20,863.69 on July 15, 2022."

So if that statement is true then it kind of casts your theory into doubt.

firstly your again mixing words

i said CHEAPEST..  but you then say "average"
i said value is the lowest cost(cheapest) and YOU then use a stat that says the PRICE(july15ths $20k) being again wrongly called "value"

stop thinking of the market PRICE as "value"

here is the thing..

if you work out the cheapest mining on the planet. the most efficient asic using the cheapest available electric cost that alot can use. and calculate the cheapest mining cost on the planet..
thats the ultimate bottom of TODAYS cost of mining bitcoin today (no need to distract with the costs of last year or 2009)
its todays best acquisition cost anyone can find of getting bitcoin today..
thus bitcoins underlying value

this is not PRICE.. this is the underlying value

you can also do the same for the most expensive of the recent gen asics and expensive regional cost. and find the top amount. that line where if the price reached it. then everyone on the planet could acquire bitcoin via other means cheaper then the price and thus people give up wanting to buy at the market price if everyone can mine or buy form miners off-market cheaper then the market price

yes you can play games with "average" and mis represent words. but if you understand that there are true costs of acquiring todays allotment of bitcoin. then you can work out the underlying value of todays allotment.
which then shows what todays value is.. and then see that its different to the PRICE

[witcher_sense]

but what if the asset is able to move along with the cryptocurrency? unlike gold.

If only we had such an asset that could be moved trustlessly and cheaply across borders, that is, in a peer-to-peer manner without having to have intermediaries or trusted third parties, an asset that would have a provably limited and completely auditable supply, that asset perhaps could be said to be an ideal backing tool to provide some value to a cryptocurrency such as Bitcoin. But. On the other hand, we wouldn't need cryptocurrencies at all since all financial transactions and exchanges could be made using this magical asset. The fact that we obviously have no such asset, let alone that we can't even conceive of a physical commodity that would behave like a digital one, makes "unbacked" bitcoin an important and inevitable thing. In the information age, data or information itself should be used to transfer value between individuals and businesses. The information that is scarce by design is a special class and should be used as money since this kind of information has credible monetary characteristics that will provide efficient and comprehensive economic relations.

[larry_vw_1955]

if you work out the cheapest mining on the planet. the most efficient asic using the cheapest available electric cost that alot can use. and calculate the cheapest mining cost on the planet..
thats the ultimate bottom of TODAYS cost of mining bitcoin today (no need to distract with the costs of last year or 2009)
its todays best acquisition cost anyone can find of getting bitcoin today..
thus bitcoins underlying value

we both know that's not really true though. most bitcoin that is acquired today is acquired by purchasing it at the market price. It's not like if I want to acquire 40 bitcoins I can do that by setting up a mining rig and just pay $13,000 per bitcoin. There's no way of knowing how long it would take for me to accumulate that many bitcoin and it might not ever happen. Fast forward to the next block halving and it just makes it even harder to do any "acquiring" as you define it.

yes you can play games with "average" and mis represent words. but if you understand that there are true costs of acquiring todays allotment of bitcoin. then you can work out the underlying value of todays allotment.
which then shows what todays value is.. and then see that its different to the PRICE

So 90% of the bitcoins that can be mined are already mined. But you want to base bitcoins value on the other remaining unminded 10%. Good luck.
Are you gonna say the same thing when we get to 99% already mined that the value of bitcoin is what it costs to get ahold of the unmined 1% ? does that really make any sense?

[franky1]

if you work out the cheapest mining on the planet. the most efficient asic using the cheapest available electric cost that alot can use. and calculate the cheapest mining cost on the planet..
thats the ultimate bottom of TODAYS cost of mining bitcoin today (no need to distract with the costs of last year or 2009)
its todays best acquisition cost anyone can find of getting bitcoin today..
thus bitcoins underlying value

we both know that's not really true though. most bitcoin that is acquired today is acquired by purchasing it at the market price. It's not like if I want to acquire 40 bitcoins I can do that by setting up a mining rig and just pay $13,000 per bitcoin. There's no way of knowing how long it would take for me to accumulate that many bitcoin and it might not ever happen. Fast forward to the next block halving and it just makes it even harder to do any "acquiring" as you define it.

yes you can play games with "average" and mis represent words. but if you understand that there are true costs of acquiring todays allotment of bitcoin. then you can work out the underlying value of todays allotment.
which then shows what todays value is.. and then see that its different to the PRICE

So 90% of the bitcoins that can be mined are already mined. But you want to base bitcoins value on the other remaining unminded 10%. Good luck.
Are you gonna say the same thing when we get to 99% already mined that the value of bitcoin is what it costs to get ahold of the unmined 1% ? does that really make any sense?

you keep on trying to push the thought of the value being the price to explain the price..

please separate them as 2 different numbers

forget the price for one moment.

the value is the bottomline. the underpinning. the base. the number no one can get any lower than..
so on the whole planet right now the cheapest someone can acquire bitcoin for .. is the value line
and only a few lucky people get to acquire bitcoin for that.

no one can get bitcoin for less right now. and thus thats the value line right now..
emphasising the underlined words above. they are important and the point

the point of the lack of people able to get bitcoin for less. becomes the very thing that sets the line that no one can get for less. thus becomes the safety zone.the security blanket,  the lock. the bottom. the deadend. the wall.. the metal fence. that keeps all other users above and thus. its the thing that people see as the security assurance and backing bitcoin value because if no one can get it for less. then the risk of it going less is negligible

above that is all the random speculations, the volatility. where different people have different costs of acquiring coin. where by in japan if they wanted to mine. it would be about $90k a coin. so they prefer to buy at anything below $90k..
some lucky people with good contacts with miners at the cheap end dont have to mine themselves to get btc nearer to $13k they just buy asic farms daily/weekly allotment of reward at a agreed/negotiated amount close to $13k that they can both accept off-market. and others buy at the whims of the volatile market depending on the speculative circumstance of whatever the price is (right now between 13k to $9k window) the price is ~$24k

in short the current price is in that speculative area above value. and below the premium

now when you look at the 4 year cycle of bitcoin. where the price moves crazy up and down in random zig-zag
you will see that the value(not seen on a market price graph) has a more steady incremental rise
..
as for the whole 'circulation is 90% complete..
bitcoins price and value is not based on all coins in circulation.
bitcoins price is not based on the 19m coin.
its not even based on 5m coins
the price is based on a small subset of coins that are deposited into an exchange. where by even the deposited coins are not all attributing to the market price because some coins are just balance in a custodian..
a smaller subset of the deposited coins that actually sit on the market order book of active orders attribute to the market price. not the entire 19m circulation

as for the value
i personally have coins from 2012 acquired for about $6 each.
yet as time goes on and i shift coins around or spend them . due to the price and value changes over time. i no longer consider my old coins valued at $6 still. because as i spend or move them i am seeing the current values along the time change, and the price change where i can get more for my coin or it costs me more to acquire more coin which changes the value of them

there are many charts around not based on the cost at mining where it keeps the value at the mining cost of the coins creation throughout. but instead it alters the 'realised value' each time a utxo is spent because logic and economics shows and proves that when funds are moved peoples valuation of that spend/receipt move. as time passes value and price change

EG
imagine you(if old enough or your parent earned $10 for 3 hours work in 1981 (min wage $3.35/hour)
and it could buy them 377 loaves of bread at that time..
now imagine its 2022 and he found that same bank note under a sofa cushion. that exact same physical bank note

is that bank note still valued as 3 hours of labour, if they were to pay some landscaper to mow his lawn.. nope
they might only get 10minutes of freelance professional lawn mowed or a hour of minimum wage guy

can they still buy 37 loaves of bread with it if they went to a grocery store, nope

and so although that physical bank note was worth 3hours labour/37 loaves.. today its not

[larry_vw_1955]

you keep on trying to push the thought of the value being the price to explain the price..

please separate them as 2 different numbers

forget the price for one moment.

the value is the bottomline. the underpinning. the base. the number no one can get any lower than..
so on the whole planet right now the cheapest someone can acquire bitcoin for .. is the value line
and only a few lucky people get to acquire bitcoin for that.

so if only a few lucky people can acquire bitcoin for that then it's not really the true value of bitcoin. say part of the bitcoin protocol was to send 1 bitcoin every block to some random person's bitcoin address. so they acquired it for free. would the value of bitcoin then be zero since one lucky person got to acquire bitcoin for free?

no one can get bitcoin for less right now. and thus thats the value line right now..
emphasising the underlined words above. they are important and the point

so i asked this question previously but no one answered so i'll ask it again. once the block reward goes to 0, and all bitcoins have been mined, what's the value of bitcoin going to be based on then? how will you determine the "value line"?

i do understand all the things you're saying but i don't necessarily know that the miner's cost to acquire bitcoin is always below the market price. for example:

The market price has only fallen below the average mining cost on three occasions — in 2016 to 2017, end 2018 to May 2019, and early 2020, each for less than half a year at a time. Each time, the Bitcoin price rallied strongly, sending it to a temporary peak where market price is several multiples of the mining cost.

can you explain why this happens?

[franky1]

you keep on trying to push the thought of the value being the price to explain the price..

please separate them as 2 different numbers

forget the price for one moment.

the value is the bottomline. the underpinning. the base. the number no one can get any lower than..
so on the whole planet right now the cheapest someone can acquire bitcoin for .. is the value line
and only a few lucky people get to acquire bitcoin for that.

so if only a few lucky people can acquire bitcoin for that then it's not really the true value of bitcoin. say part of the bitcoin protocol was to send 1 bitcoin every block to some random person's bitcoin address. so they acquired it for free. would the value of bitcoin then be zero since one lucky person got to acquire bitcoin for free?

in that situation. a currency that does that would have a 'zero-bottom-value'

thankfully bitcoin doesnt give away coin which is why people know and trust bitcoin cant just fall to zero via a market sell, which is why people deem it a good store of value because its value isnt zero

no one can get bitcoin for less right now. and thus thats the value line right now..
emphasising the underlined words above. they are important and the point

so i asked this question previously but no one answered so i'll ask it again. once the block reward goes to 0, and all bitcoins have been mined, what's the value of bitcoin going to be based on then? how will you determine the "value line"?

i do understand all the things you're saying but i don't necessarily know that the miner's cost to acquire bitcoin is always below the market price. for example:

not all miners are below..
there is a speculative range.. a window that is recently between $13k-$75k
where different people in different places have different price points in between

but in all economics. the VALUE is at the bottom of all that stuff
(its where the mindset if when something is really cheap its good value)

The market price has only fallen below the average mining cost on three occasions — in 2016 to 2017, end 2018 to May 2019, and early 2020, each for less than half a year at a time. Each time, the Bitcoin price rallied strongly, sending it to a temporary peak where market price is several multiples of the mining cost.

can you explain why this happens?

your using "average" cost!! (facepalm)


now hopefully you get the concept that there are some lucky people on the planet that can mine real cheap and some unlucky people ~(hawaii/japan) that have really high mining costs
and then there are people inbetween

maybe this will explain it better.. and yes there are pictures
https://bitcointalk.org/index.php?topic=5382937.msg59075174#msg59075174

its basically when the price moves above or below a certain regions cost that region change their speculative minset about the price. where by if the price goes up they realsie they can mine locally thus stop buying and instead acquire coin via mining or off market . and then become sellers on market.
and if the price is below their regional cost then they become on market buyers

where as because no one can acquire coin via any means below the planetary lowest cost.. EVERYONE  is then a buyer
which protects the price from falling below the value line because no one wants to sell at a loss and everyone wants to buy coins cheaper then they can mine for.

again protecting the value from going to zero. thus ensuring bitcoin has a non-zero value

[goldkingcoiner]

I am so tired of people claiming that Bitcoin has no intrinsic value.

Some people seem to think that things like electricity, rented room, mining rigs, internet costs and so on are provided for free by some socialist government entity or something? All those things cost money. You can't mine Bitcoin for free. If you want to mine Bitcoin, it will cost you money.

That potential cost of mining Bitcoin is what gives Bitcoin its minimal, base value.

Unless you steal your neighbors electricity. But in that case your neighbor would be paying for your Bitcoin mining.

But thats a short term solution.