What should the price of BTC actually be? Is there some tangible metric that we can identify as the basis of Bitcoin's value? It seems to me that the only tangible value of bitcoin is it's security- the fact that it can't easily be counterfeited. That's what makes it a reliable ledger of accountability. The security of bitcoin is directly tied to the hash rate of the Bitcoin network so that's what should determine the price, very precisely.
We can set the price to any hash rate but, in order to maximize the adoption of this pricing scheme, we need to set a price that is close to the current market price. According to blockchain.com, the last recorded hash rate was 90M TH/s and before that it was 125M TH/s. We can generalize it to 100M TH/s. The price has also moved around $10k so I'll use that.
(100M TH/s)/($10k) = 10k TH/s - and this becomes our standard unit. Now the price is directly tied to the hash rate.
What's the price of BTC? Simple- (current hash rate divided by 10k TH/s) * $1.
...
at 1M TH/s, 1 BTC = $100
at 10M TH/s, 1 BTC = $1k
at 100M TH/s, 1 BTC = $10k
at 1B TH/s, 1 BTC = $100k
...
Not only is this a fair and stable pricing scheme, it encourages mining, which increases the hash rate, which increases the price. And that's what we want because it will maximize security.
Thing is that even if we consider bitcoin as a security whose value can be measured then also there are a number of things that would effect it's value than merely the hash rate. Which are for example the buzz and demand created around in the market which could be channelized by Economic and political Situation. In case there is a Economic crash in fiat bitcoin could possibly become more popular which could lead to increased prices. Also last I heard someone even tried to value btc based on stock to flow approach but that would only work is an equivalent demand is generated. We can set the price to any hash rate but, in order to maximize the adoption of this pricing scheme, we need to set a price that is close to the current market price. According to blockchain.com, the last recorded hash rate was 90M TH/s and before that it was 125M TH/s. We can generalize it to 100M TH/s. The price has also moved around $10k so I'll use that.
(100M TH/s)/($10k) = 10k TH/s - and this becomes our standard unit. Now the price is directly tied to the hash rate.
What's the price of BTC? Simple- (current hash rate divided by 10k TH/s) * $1.
...
at 1M TH/s, 1 BTC = $100
at 10M TH/s, 1 BTC = $1k
at 100M TH/s, 1 BTC = $10k
at 1B TH/s, 1 BTC = $100k
...
Not only is this a fair and stable pricing scheme, it encourages mining, which increases the hash rate, which increases the price. And that's what we want because it will maximize security.
