Topic: A simple proof that Bitcoin has zero value - page 8. (Read 1425 times)

You have to realize that in 21th century virtual things have value too, it's part of real world. Bitcoin is as usable as paper notes you have in pocket. You just transfer that notes into bitcoin and oppositely, transfer bitcoins into notes. Bitcoin isn't like an air, it has it's advantages to mine so it's not freely created, something was wasted for it and it's electricity + components of equipment.

Bitcoin is a number in a database, not a thing. A thing is some entity, object, or creature that exists outside the database which contains some data about it. I explained this already.

The fact that lots of people put numbers into a database when they give their stuff for free has nothing to do with "value". Value is the feature of a thing which resides outside the database, while entry in a database is just an abstract mathematical object without value.

Bitcoin is a "thing" just like the others, which is why it's generally treated as property or currency. The fact that you can only fathom bitcoins as "numbers" is just a function of your own limitations.

And bitcoins definitely can't be created out of thin air. You can spin up another new cryptocurrency out of thin air, but not bitcoins. People across the world run Bitcoin nodes that enforce the protocol. They completely ignore any attempts to print BTC out of thin air.

fxsurfer: or one more time very shortly - value of Your "database" is, that Your given names use exactly that database and not the ones of competitors...

fxsurfer: You actually harm crypto-sceptics, by telling weak arguments and sticking to them, when You are not right...

OK, for sake of simplicity, I leave everything other aside: does at least  user base have a value in Your eyes?

It does not even matter, if BTC is legit or scam, it does have value due to its user base alone already. Doesnt matter if that value is healthy or criminal. It still does have value for at least many people, if not all. If You say You would not pay 1 dollar for BTC, then You could say, that BTC has no value in Your opinion. I know, how to earn from BTC, I dont buy it, because I also know its  a scam and being responsible of what I do, has more value for me, than earning opportunities from BTC.

A song  - for e.g. "I Just Called to Say I Love You", indeed has value. But, numerical symbols that represent the order of this song in the Love Songs database have no value.

Binary digits also have value, except if they are quantifiers in a database. Microsoft Word is a computerised thing (just binary digits) and it has value because it is used as a word processor. Microsoft Word is not an entry in a database.

Sure, some objects are just combinations of atoms without value, like Bitcoin or dirt for e.g. Point?

Regarding the big picture. Costs of brute force cannot chage the fact that the result of the brute force is a number in a database, which has zero value. Utility and function are abstract terms that cannot create value. Value is created by agents or machines.

Finally, I do not deny that the binary digits that make up the bitcoin ledger have an actual function - they provide numerical evidence that someone gave its iPhone or money for free. If I gave you iPhone as a gift and as a result I enter a number into some excel database, for e.g. "1.25", and than give name to it - for e.g. ExcelCoin, that does not mean that ExcelCoin has value. ExcelCoin is just a numerical evidence that I gave you a thing for free.

i think fx surfer is trying to look smart. but is not looking outside of the box.
its like them blonde women you meet that are philosophy majors...

its as if he is saying that a song is just vibrations on the eardrum and has no value
anything computerised is just binary digits and has no value
objects are just organised combinations of atoms and has no value

and i dont think he will see the big picture about cost, utility, function that creates value
so he might aswell lock his topic and live in a no value world of atoms, vibrations and binary

maybe, just maybe
one day he will learn that the binary digits that make up the ledger has an actual function.
that creating the database has a cost.
and for people that want and need that function are happy to pay the cost of its creation.

if he wants a zero cost database then he can go make a PoS coin and go hand out free coins like all the other crapcoins about.

A piece of paper is not a share, but a medium. An entry in a digital database is also not a share but, either a symbol which quantifies the number of shares (150) or a symbol that identifies a share (IBM). Share is the ownership in the company (International Business Machines)  - which is an actual thing - outside the database. Bitcoin is not an actual thing - outside the database - but a number in a database. So the difference is huge.

So, the argument falls flat when you look at actual IBM shares. It is just a piece of paper or a entry on a digital database and

nothing different to Bitcoin. You can also transfer bitcoins onto a piece of paper (Paper Wallet) and have a physical

representation of the value you own in the digital world. The good part about bitcoins is that the database is stored in a

decentralized Blockchain and not on some centralized (outdated) database that can be shutdown or manipulated by these

centralized authorities.  

Scarcity means the limited availability of a thing. Hence, you cannot 'own scarcity', only things can be owned. But, as I have shown, Bitcoin is not a thing, but the name for the number in a database. If this number needed to be mined before put into database, it is still a number - it  didn't magically become something outside the database.

If we both agreed, that BTC (a number in a database) holds value then we are simply ignorant of the truth that number is not the same as value. Number (entry in column B of our database) is symbol that quantifies a thing outside the database ( iPhone, Dollar or IBM share), while value is the feature of that thing. Since bitcoin is just a number in a database that quantifies nothing outside that database, it cannot have value in principle.

Regarding potatoes and iPhone, they are actual things and not entries in a database, regardless of what we both believe.

By the way, I buy iPhone for dollars its the same - You get amount of scarcity, plus its backed up with reasonable expetation, that I can buy something else tomorrow for those dollars. If You were able to print out dollars, I would not buy Iphone for dollars, right?

Yes, but You got ownership for some amount on scarcity, because BTC coins needed to be mined and that mining is claimed to be proof of Your asset transferred to me. That of course is not same as usefulness. My saliva is scarce as well, but not very expensive.

In theory: if we both agreed, that BTC holds that value (at least invested energy) and we both are willing to pay approximately that amount, then it could serve as currency. You may also pay me in potatoes for Iphone, if we both believe, I can get another phone tomorrow for these same potatoes.

Overall: if BTC technology was possible for usage in wide and long term money transfers, it would indeed have value. But it is not. It is a scam.

But, when you "traded" iPhone for bitcoins you didn't become an owner of a certain amount of kilowatts of energy (a thing outside the database/blockchain). All that has happened is that a number in a database has changed without you becoming owner of something outside the database. Hence, you gave your iPhone for free to someone.

While, I say, BTC is a scam, no more, Your logic is not quite correct here.

"outside value" <-- this could be for example used energy and hardware costs. Lets assume for second, BTC is a viable product (which it is not) and accounting in this manner (decentralized blockchain) is needed. As mining is crucial operation for this product and BTCs can be added only via mining, we can say, that "outside value" is at least spent ressources on mining. Future shows of course, it was wasted, but at least by now, we need to accept, that "mining is needed and therefore has value".

But when we talk about the demand and supply of iPhones, Dollars, and IBM shares, we are talking about things of value which exist outside the place(database) where the information about these things exists. There is no demand for number 5 in a database, where this database represents the number of iPhones in a warehouse for e.g. The demand is for things(iPhones) which are actual devices, and which exist outside the database. So, the demand is for an actual thing, while number in a database is just a symbol that quantifies that thing. The same is true for Dollars or IBM shares.

Bitcoin on the other hand, is not an actual thing outside the database. It is just an entry in a database that points to another entry in the same database. One entry is a number written in numerical symbols — 2 for e.g., and another entry is the same number written in alphabetical symbols — bitcoin or BTC. And of course, there is no such thing as a demand for symbols in a database. What you have in the world of Bitcoin is not demand and supply, but the modification of an entry in the database when someone gives things (iPhones or Dollars) for free. On the other hand, when supply and demand meet in case of iPhones and Dollars, the modifications in store's or bank's databases are just numerical evidences that people exchanged actual things (iPhones for dollars and vice versa). And of course, these things exist outside the databases. So, there is no such thing as demand and supply in the world of bitcoin, but instead, all there is is giving your stuff for free and recording that fact into a database/public ledger/blockchain in the numerical form.

its actually deeper than supply and demand.
when you take in the cost of acquiring bitcoin. and then thats the underlying value no one would be willing to sell below because they wouldnt ever dream of selling for less then they acquird if for.

its then where people speculate a profitable PRICE above bottomline costs which they would sell for. and thats the speculative PRICE above value.
read my post above to explain that part known as 'value' (bottomline acquisition cost)

You gave us a very good example. But there is one point that is overlooked. What determines the value of iPhone, Dollars, or IBM share? You have to think about it. There is an issue in economics. Demand and supply! The value in the market is where these two meet. So, you can handle the value of Bitcoin in this way. For example, I will not sell my Bitcoin without $ 50,000. If everyone thinks so, the price rises until the buyer offers $ 50,000.

I give you a different lookout. Whatsapp doesn't produce anything and when you look at it, there's nothing material about it. But they are making huge profit year by year. After Facebook purchased, their profit getting smaller but there are so many example like Whatsapp.

what you dont understand is this

1. if the database was secured using a signature, (PoS) then the costs to secure it is zero. but bitcoin actually has a real hard cost to secure the database (PoW) which is commonly called mining.
in 2009. mining could be done by one persons PC and he would broadcast the database out to other and the costs were negligable.

2. over time the security increased, it became difficult to secure it with single machines. people started to calculate that the electric required to secure it was as such
if electric was 5cents an hour. and 6 blocks were created in that hour. and a block contained 50coins in 2009
then a cost per coin was $0.000016666666666667
then it started requiring more power. and thus when 10 people were using their electric only one got to secure it meaning for every 10th block a person got rewarded. thus the cost rose 0.00016666666666667
then it started requiring more power. and thus when 100 people were using their electric only one got to secure it meaning for every 100th block a person got rewarded. thus the cost rose 0.0016666666666667
then people started using GPU's and the costs rose. they started pooling their workload together and sharing the reward and the costs increased.

by 2011 the amount of electric and time put into securing bitcoin got to $1.
by 2012 the amount of electric and time and equipment needed made it cost $6

the the reward halved so that doubled the costs because there was then half the reward. so 2012 had a $12 cost
more people started to join pools and the security difficulty increased. so costs to secure it went up

by 2013 ASICS became a thing and vastly increased the security and difficulty. to a tune of $100
by 2016 the cost went up to $300
by 2017 the costs went upto $900
by 2018 costs went up above $5000

yea the costs dont match the price.. but thats speculation. thats random drama above the underlying value.
it like housing.
it cost $80k to build a house but the builders sell it for a bit more to profit so houses price in at over $100k. and then speculators add on more.

housing has real costs and so housing is not free. and yes when the PRICE hyper inflates above VALUE/COST
that excess is a bubble because the price is "inflated" like a bubble inflates.
the housing market had a 'housing bubble' not because housing is fake but the price was inflated way above value

so yes with bitcoin although we did see a $1200btc in 2013 although the value was ~$100. did not mean btc was worth zero.. its VALUE was $100 and its PRICE was an inflated bubble of $1200

so yes although we did see a $20k btc PRICE in 2017 although the value was ~$2k. did not mean btc was worth zero.. its value was $2k and its price was an inflated bubble of $20k

and now in 2018. by looking at the cost of mining. there is not much of a inflated layer(speculative layer) above value. bitcoins VALUE is actually around the $6k costs and so compared to the very thin % of speculation. is deemed good value as the price and value are close to each other.

bitcoins have a cost
housing has a cost
tulips has a cost
but the price fluctuates above cost.
you can still buy tulips even now.. astonishing right? you would think tulips are fake or not worth anything. but they are worth something.
you can still buy houses even now.. astonishing right? would think houses are not worth anything. but they are.
you can still buy bitcoins even now.. astonishing right? you would think bitcoins are fake/worthless but they they are worth something.