People always ask "What is Bitcoin backed by?" and "What makes Bitcoin valuable?" The answer is never an easy one to pin down. Some say, "it's backed by computer power! Millions of computers!" and some say, "It's backed by the energy used to produce them!" But none of these are correct.
In essence, what gives bitcoin it's value is that it is a viable medium of exchange divorced from any central authority. It is the fact that we can have money that is not a means for some powerful individuals to control the masses. What makes bitcoin valuable is the knowledge that if it becomes usable in the way that we now use the dollar we the people will have won a war of power over the so called "elites" and "rulers" of the world. The fact that Bitcoin frees and gives power to the people by taking it away from any central authority figure, is what really makes it so valuable.
There are other things. Like the ease of use on the internet, the fact that it's world wide, the fact that's deflationary rather than inflationary. All of these things can be replicated in other crypto currencies. The true value is in the promise that it will eliminate the need for central banks and government issued money that can be manipulated and maneuvered in ways that make the masses the slaves to the master's who control the money's whims. Bitcoin makes us our own masters.
"Give me control of a nation's money and I care not who makes it's laws" — Mayer Amschel Bauer Rothschild
Bitcoin eliminates this threat entirely by taking the control away from everybody. There is no single person who can control Bitcoin, it is DECENTRALIZED, and there is the value.
Brock Pierce is afraid of being free. There are a lot of slaves out there like Brock Pierce. Brock Pierce is afraid of the people being their own master's. And so he has created "real coin" which is backed by the dollar. This is laughable. "real coin" lacks any value other than being stabilized by and convertible back into dollars, that which Bitcoin get's it's value from eliminating the need for. Real coin's value is dependendent on that which we are desperately trying to move past and away from. It is doomed to failure from the very start.
It's like after the car being invented, Brock Pierce has come out with a new improved car that is pulled by horses to avoid that pesky engine noise and dependence on gasoline!The volatility will go in time. We all know this. "real coin" is not the answer. Have you ever looked into how to start a Model T? It will blow your mind how complicated and how many steps were involved in just turning the thing on! And Bitcoin is in a similar situation now, volatility is just one of those pesky quarks that come with being a brand new invention, but it will resolve itself just like all of the other difficulties that bitcoin has right now.
I test drove a Tesla the other day. You don't even have to take the key out of your pocket… You sit down in the driver seat and it's already on, you just drive away… and it's so silent you don't even know it's on… and it's completely gasoline free. We can only wonder what Bitcoin will be like in 100 years...
To innovation!
