Utility Uses of Bitcoin in General

[caroasi]

1. Investing: Speculation on increased value and arbitrage.
2. Store of Value: No intent to sell at higher price or higher price after inflation accounted for.
3. Business contract payments including regular bill or invoice paying
4. Retail and service/virtual purchase transactions
5. Banking: Transmitting value overseas among different banking jurisdictions
6. Banking: Temporary holding for banking needs, or acquiring to sending money to others without a specific bill or retail transaction involved.
7. Tokenization of assets by tying Bitcoin ownership to ownership of another asset.
8. Public Statements using Bitcoin's comment feature.

Do you think this list is in the correct order of most to least likely uses of Bitcoin? How would you rank or change this list?

[glendall]

There is no order in my opinion but all are true about the uses of Bitcoin in general, depending on each individual's point of view, their perspective on BTc itself.

[legiteum]

"When your problem is a nail, every tool is a hammer."

This list looks fine, albeit somewhat redundant ("speculation instrument" and "store of value" amount to the same thing, etc.).

But the correct what to make a list like this is not, "what can Bitcoin do", but rather "what can Bitcoin do that nothing else can do".

For instance, while you can pay for a coffee at Starbucks with Bitcoin, why would you?. A plain old credit card would that job much better, and a high-speed digital currency like a Haypenny currency would be even better than that. A lot of the other features you mentioned can be handled better with other technologies as well.

So in short, you are asking a question in a way such that the answer is not helpful.

The correct question to ask is, "What are Bitcoin's unique features that allow it to do things better than existing alternatives". That list, you will probably notice, will be much shorter. Basically, Bitcoin's only unique competitive feature is its use as a speculation instrument that is safer (better governance) than other meme investment instruments--and Bitcoin's brand name itself.

[SquirrelJulietGarden]

1. Investing: Speculation on increased value and arbitrage.

Investing is different than trading which includes arbitraging.

2. Store of Value: No intent to sell at higher price or higher price after inflation accounted for.

Bitcoin is actually inflationary, not deflationary like many people think it is. The good thing from Bitcoin is its inflationary decreases with time,  and it can not be changed to be faster or slower by anyone. After 210,000 blocks, Bitcoin block subsidy will halve and it is coded in the Protocol.

How is the 21 million bitcoin cap defined and enforced

7. Tokenization of assets by tying Bitcoin ownership to ownership of another asset.

Bitcoin is Bitcoin and it does not need to be tokenized. There are tokenized Bitcoin tokens, Wrapped Bitcoin tokens but those tokens are not actual bitcoin.

If you want to own bitcoin, buy bitcoin. If you buy wrapped Bitcoin tokens, you don't have actual bitcoin and those tokens can lose in value if they fail to maintain their pegs to Bitcoin price.

[Saint-loup]

"When your problem is a nail, every tool is a hammer."

This list looks fine, albeit somewhat redundant ("speculation instrument" and "store of value" amount to the same thing, etc.).

But the correct what to make a list like this is not, "what can Bitcoin do", but rather "what can Bitcoin do that nothing else can do".

For instance, while you can pay for a coffee at Starbucks with Bitcoin, why would you?. A plain old credit card would that job much better, and a high-speed digital currency like a Haypenny currency would be even better than that. A lot of the other features you mentioned can be handled better with other technologies as well.

So in short, you are asking a question in a way such that the answer is not helpful.

The correct question to ask is, "What are Bitcoin's unique features that allow it to do things better than existing alternatives". That list, you will probably notice, will be much shorter. Basically, Bitcoin's only unique competitive feature is its use as a speculation instrument that is safer (better governance) than other meme investment instruments--and Bitcoin's brand name itself.

A plain old credit card would do that job much better... if you have a credit card and a bank account. Cryptos are the best solution against unbanking, so being able to pay goods and services without using a bank account and having to make a request to anyone to create a wallet is an important use case IMO. Besides that, when you say that speculation instrument and store of value amount to the same thing, they are the exact opposites for me, that's why I don't think one asset could be both of them. For me the store of value thing is a maximalist narrative. Such volatile asset can't be used like that, because its price needs to be the same or at least not lower than the price you bought it, once you need to use it.

[legiteum]

A plain old credit card would do that job much better... if you have a credit card and a bank account.

94% of US adults have a bank account:

https://www.statista.com/statistics/1386867/us-adults-with-bank-accounts/

I don't know what it is in other developed countries, but I suspect it's a similar number.

And I also suspect that easily 90% of the world's money is held in bank accounts, so the "don't have a bank account" market is an extreme niche.

And even more of a niche would be the intersection of, "has no bank account, but has consistent access to the Internet". We're talking a pretty small portion of the developed world here.

Besides that, when you say that speculation instrument and store of value amount to the same thing, they are the exact opposites for me, that's why I don't think one asset could be both of them. For me the store of value thing is a maximalist narrative. Such volatile asset can't be used like that, because its price needs to be the same or at least not lower than the price you bought it, once you need to use it.

There is absolutely no asset known to mankind that does not have the ability to diminish in value. If somebody says they asset will never ever diminish in value, they are lying to you because they cannot possibly know that.

Every asset you hold is a speculation instrument, and could go either up or down in value as compared to other instruments.

Some instruments are very volatile, historically, and some are more stable. But there is no magic force making them stay that way. There is no asset that you can just leave there "without thinking about it", as much as people wish there was.

[PrivacyG]

No.  The order is very subjective.  For me, the best Utility of Bitcoin is definitely not the arbitrage and Investment but that I can use it to my liking and with out having to explain to anybody what, where from, how, why, when, to whom.  Arbitrage is of course an advantage because after all our lives depend on Money but that is not the strongest point.  The strongest points are still the ones it has been created for.

[Yatsan]

1. Investing: Speculation on increased value and arbitrage.
2. Store of Value: No intent to sell at higher price or higher price after inflation accounted for.
3. Business contract payments including regular bill or invoice paying
4. Retail and service/virtual purchase transactions
5. Banking: Transmitting value overseas among different banking jurisdictions
6. Banking: Temporary holding for banking needs, or acquiring to sending money to others without a specific bill or retail transaction involved.
7. Tokenization of assets by tying Bitcoin ownership to ownership of another asset.
8. Public Statements using Bitcoin's comment feature.

Do you think this list is in the correct order of most to least likely uses of Bitcoin? How would you rank or change this list?

What can i say here, basing on current features and practical applications is that the use of Bitcoin can be reconfigured, definitely controversial if being the most common due to its popularity as a high-risk, high-reward asset and investing in Bitcoin to provide insights into value appreciation and arbitrage. Most people now recognize Bitcoin as a store of value, very much like "digital gold", where one holds it to preserve wealth from inflation. The next one is retail and services trade, where more and more merchants and websites selling goods started to adopt Bitcoin. Commercial contract payments, like regular fees and premiums, are less frequent in occurrence but still dominate. If there is a use case where Bitcoin shines, it would have to be in banking transfer of value and temporary storage of money. Asset tokenization is a new concept linking Bitcoin ownership to other assets and is possible but not widely adopted. In general, Bitcoin's speech in public discourse remains an inefficient tool for other use cases. This graph shows the current state of usage and prevalence of Bitcoin in the market.

[peter0425]

Do you think this list is in the correct order of most to least likely uses of Bitcoin? How would you rank or change this list?

Is there any study regarding how much people are using bitcoin for investing and for transactions? Due to its decentralization, it is difficult to come up with accurate numbers so we would not know for sure just how much are using bitcoin for this or that.

We all use it for different reasons depending on our needs. Some really do use it for transactions while some use it to hold and only plan on retrieving their funds when they are in retirement already.

[fuguebtc]

Do you think this list is in the correct order of most to least likely uses of Bitcoin? How would you rank or change this list?

Is there any study regarding how much people are using bitcoin for investing and for transactions? Due to its decentralization, it is difficult to come up with accurate numbers so we would not know for sure just how much are using bitcoin for this or that.

We all use it for different reasons depending on our needs. Some really do use it for transactions while some use it to hold and only plan on retrieving their funds when they are in retirement already.

It is true that everyone has different needs so they will use it according to their needs but you need to admit that most people use bitcoin as an investment more than any other use case . Right on this forum or other social networks...do you see how many threads talk about the use cases of bitcoin or do people mainly just discuss the price, volatility , and profitability of bitcoin? Or are you and your friend using bitcoin as an investment or do you just consider it a currency and don't care about its fluctuations?

Of course , you can both use bitcoin as an investment and turn it into a store of wealth, currency...you can combine but your priority is still investment , right? Bitcoin's volatility is a great gift so there's nothing wrong with people taking advantage of it to make a profit .

[Dr.Bitcoin_Strange]

Bitcoin can be used for many things depending on what the holder chooses to do with it. You can decide to give someone Bitcoin as a gift, which make it acceptable as a gift, you can use Bitcoin as a form of collateral to acquire loan and Bitcoin can be used by scammers to carry out their Shaddy  activities. So, a Bitcoiner actually decides what he or she wants to do with their Bitcoin.

[caroasi]

"When your problem is a nail, every tool is a hammer."

This list looks fine, albeit somewhat redundant ("speculation instrument" and "store of value" amount to the same thing, etc.).

But the correct what to make a list like this is not, "what can Bitcoin do", but rather "what can Bitcoin do that nothing else can do".

For instance, while you can pay for a coffee at Starbucks with Bitcoin, why would you?. A plain old credit card would that job much better, and a high-speed digital currency like a Haypenny currency would be even better than that. A lot of the other features you mentioned can be handled better with other technologies as well.

So in short, you are asking a question in a way such that the answer is not helpful.

The correct question to ask is, "What are Bitcoin's unique features that allow it to do things better than existing alternatives". That list, you will probably notice, will be much shorter. Basically, Bitcoin's only unique competitive feature is its use as a speculation instrument that is safer (better governance) than other meme investment instruments--and Bitcoin's brand name itself.

Speculative investment would be someone buying Bitcoin for the explicit purpose of trying to get more value out than they put in when they trade later on. A store of value usage would be if someone just wanted to preserve their wealth, so they buy Bitcoin with intent to trade for similar value without the intention of relative appreciation of Bitcoin relative to other assets. There is something fundamentally different about purchasing something to sell it for a higher price later on, as there is from purchasing something to sell it for an equal price later on.

It seems in this thread some people are claiming that speculation is not a type of investment at all, though I would disagree with that definition. I think speculating is a type of investment. However, I don't think that buying something to trade it for equal value later is investing... the idea of investment is growth. I would call that saving but not investing.

[legiteum]

Speculative investment would be someone buying Bitcoin for the explicit purpose of trying to get more value out than they put in when they trade later on. A store of value usage would be if someone just wanted to preserve their wealth, so they buy Bitcoin with intent to trade for similar value without the intention of relative appreciation of Bitcoin relative to other assets.

But there is absolutely no guarantee your wealth will be preserved with Bitcoin or any other investment instrument.

When you say, "investment XYZ will preserve my wealth", you are speculating that is the case since, not being God, you cannot predict the future.

No matter what, you are predicting the future: you are speculating on the future value of Bitcoin (or whatever investment). This is true for US dollars as well (if you choose not to decide you still have made a choice, etc.).

There is something fundamentally different about purchasing something to sell it for a higher price later on, as there is from purchasing something to sell it for an equal price later on.

There really isn't. Any professional investor views them as exactly the same, because they are.

For instance, perhaps many here believe that Bitcoin will preserve your wealth forever and ever--it will maintain its value or increase no matter what. Other people would point out that Bitcoin's value is extremely volatile and has dropped in value by 80% in the recent past, and may drop again and stay that way.

Some of those people may be right, and some of them may be wrong. Only God knows who. But both are speculating.

[Saint-loup]

A plain old credit card would do that job much better... if you have a credit card and a bank account.

94% of US adults have a bank account:

https://www.statista.com/statistics/1386867/us-adults-with-bank-accounts/

I don't know what it is in other developed countries, but I suspect it's a similar number.

And I also suspect that easily 90% of the world's money is held in bank accounts, so the "don't have a bank account" market is an extreme niche.

And even more of a niche would be the intersection of, "has no bank account, but has consistent access to the Internet". We're talking a pretty small portion of the developed world here.

I've rarely seen someone showing such bad faith as that, to be honest. You're this kind of guy arguing for hours when he knows he's wrong I bet.
Do you know how many people represents 6% of the USA population exactly? That is to say 6% of 340 000 000 people? That's just 20.4 millions of americans. While it's one of the richest country in the world. So you can guess how many people are actually unbanked in poorer countries...
1.4 billions of adults around the world are unbanked according to the World Bank. That's what you dare to call an "extreme niche", sincerely?  
 

There is absolutely no asset known to mankind that does not have the ability to diminish in value. If somebody says they asset will never ever diminish in value, they are lying to you because they cannot possibly know that.

Every asset you hold is a speculation instrument, and could go either up or down in value as compared to other instruments.

Some instruments are very volatile, historically, and some are more stable. But there is no magic force making them stay that way. There is no asset that you can just leave there "without thinking about it", as much as people wish there was.

I'm sorry to say that, but it's the same kind of bad faith argument as above. Highly volatile and risky assets are well known, and Bitcoin is one of them, low-volatility and risk-free ones, and therefore safe for storing value, are well known too, gold is the most famous of them. You're very unlikely to lose any substantial portion of your initial investment at any time with those assets.

[legiteum]

Do you know how many people represents 6% of the USA population exactly? That is to say 6% of 340 000 000? It's just 20.4 millions of americans bro. While it's one of the richest country in the world. So you can guess how many people are actually unbanked in poorer countries...
1.4 billions of adults around the world are unbanked according to the World Bank. That's what you call an "extreme niche", sincerely?

Yes, when something is less than 5% of a market, I think it's fair to call it an extreme niche.

That doesn't meant the market doesn't exist, and it doesn't mean that you can't make money serving such a market, it only means that most of the market is somewhere else.

I really don't see why this is particularly controversial to the point where you had to start in with the personal attacks... This is just dictionary definitions here...

Highly volatile and risky assets are well known, and Bitcoin is one of them, low-volatility and risk-free ones, and therefore good for storing value are well known too and gold is the most famous one. You're very unlikely to lose any substantial portion of your initial investment at any time with those assets.

There is no such thing as a "risk free investment". Gold in particular has varied wildly in the market at different times.

You can certainly say that, based on a particular timeframe, a certain instrument might be "higher risk" or "lower risk", and there are obviously a lot of investments out there that many would feel comfortable believing "won't lose value" because it's very unlikely, but technically-speaking everything has a risk.

I'm really missing what it is I wrote that has made you so upset.

[Saint-loup]

I don't understand why you're talking about markets now? The topic is about the "Utility Uses" of Bitcoin, not about how you could try to make money with Bitcoin. Besides that, Bitcoin doesn't belong to any company, it's a free, open-source and decentralized tool, the goal of Satoshi Nakamoto has obviously never been to try to make profits with it. Helping unbanked people, is maybe not what you care about the most, but Satoshi wanted to build something allowing to transact without the need of using banks.

[tabas]

1. Investing: Speculation on increased value and arbitrage.
2. Store of Value: No intent to sell at higher price or higher price after inflation accounted for.
3. Business contract payments including regular bill or invoice paying
4. Retail and service/virtual purchase transactions
5. Banking: Transmitting value overseas among different banking jurisdictions
6. Banking: Temporary holding for banking needs, or acquiring to sending money to others without a specific bill or retail transaction involved.
7. Tokenization of assets by tying Bitcoin ownership to ownership of another asset.
8. Public Statements using Bitcoin's comment feature.

Do you think this list is in the correct order of most to least likely uses of Bitcoin? How would you rank or change this list?

There is no need to rank them and they are correct but you can simplify it by saying that Bitcoin's use is payments and as an asset. If you're going to summarize all of it, the categories that I've mentioned are where Bitcoin is going to fall and it is not a hidden use case anymore. Everyone is aware that Bitcoin can be used mostly with those use cases. I want to point #7, tokenization means that you'll have to convert your bitcoin asset into another one. Bitcoin is the asset and there's no need for any tokenization of it, you're making me remember about the crazy ordinals and brc20 tokens.

[legiteum]

I don't understand why you're talking about markets now? The topic is about the "Utility Uses" of Bitcoin, not about how you could try to make money with Bitcoin.

Making a profit from Bitcoin is what perhaps 95% of Bitcoin users do with it today. This is not what Satoshi envisioned, but that's the reality of Bitcoin circa 2024.

Helping unbanked people, is maybe not what you care about the most, but Satoshi wanted to build something allowing to transact without the need of using banks.

No, he made Bitcoin for people who could not safely use a bank or other institution for fear of government prosecution or persecution. Surely most people who use Bitcoin--now, as well as in the beginning--already had some kind of bank account. They merely wanted to put... certain assets... out of the reach of their government, and/or wanted to be able to trade in such a way that could not be traced by their government.

If you wanted to make a developing world solution, it would be rather strange--especially 15 years ago--to create something that requires the internet and a computing device in order to use.

I'm not saying Bitcoin can't be used this way--it can, and is--but it wasn't made for that in mind anymore than it was made for what Bitcoin is mostly used for today e.g. an investment instrument.

Anyhow, the original point I was making in my OP (such that we can reel the conversation back on track here ), is that it's important not to look at what Bitcoin "can" do, but rather what can it do that nothing else can do. Bank cards etc. work well for much of the world's daily transactions, and Bitcoin was never intended to replace those transactions. Monero works correctly as a government-proof means of value transfer. Haypenny currencies are far faster and cheaper than credit cards. Bitcoin's only meme is "Bitcoin". Etc. etc.

We're trying to answer, "what can you use Bitcoin for", and... I think we're answering that, right?

[SamReomo]

I guess in current times the best use case of Bitcoin in my eyes and in the eyes of most hodlers is that it works pretty well as store of value and can grow in value overtime as more investors start investing money in Bitcoin.

Although, it can still be used as a payment system and it's used that way on daily basis but the best one can do with Bitcoin is by holding it for long term to gain some profits from it.

[Dave1]

There is no order in my opinion but all are true about the uses of Bitcoin in general, depending on each individual's point of view, their perspective on BTc itself.

Yeah, I don't think that there could be an order there, although if we go back to the roots o Bitcoin, as per whitepaper it was designed to be used as micropayment scheme. It's that it has evolved since it's inception, becoming an asset.

And it has grow even more, now one of the best if not the best asset in the world. People are obviously making money out of it, and we even have a country that legalized it (El Salvador). And it even proved itself as a hedge against financial and economic disaster like in the Covid-19 lockdown.