Topic: What is the future of bitcoin? Commodity, currency or smth else? - page 2. (Read 671 times)

it all depends on what the influx of new money is suppose to accomplish
take the quantitive easing.

you have to remember. fiat is not intellectual property of a citizen nor the citizens patent or invention. its government property. so they are the true owner and they are the party that decide how they should gain from it.. citizens use of it is the after thought to just service their "customers"   (imagine government as a business and citizens mearly customers")
airmiles are not made to give customers value for flying. its to make airline companies more profit customers just get to use airmiles for staying loyal to the company and keep customers wanting to use the company..


what you find is at the micro level of the economics of different countries. china is actually above america already.. but when looking at the macro levels (the world bank stats) they are showing that america is only just ahead and thus america is deemed the top country in the world.
when certain things happened, america was threatened with losing its top position. it got into debt and had liabilities and china were buying that debt and treating those as chinese assets. pushing china nearly to be the worlds super power. so QE had to be done to push money into american GDP to make "america great again".
again due to the covid thing. china prospered and america declined. so more QE.
and soon it will need to be a regular occurrence.

the 2008 and the 2020 events were funds pushed to the high up elite back end systems of hidden money. which appear on the GDP but never enter the normal citizen circulation. thus it didnt cause an inflation at the citizen level of wages/goods value. but helped keep america in the top super power position

however the upcoming one will caus inflation at citizen level. and the next QE will not be to the elite hidden back end of bankers.. but instead throwing money at citizens. either as tax credits/rebates/grants. or as 'universal basic income'
(US seen the trial of this with their covid income cheques)
(UK too with its covid payments and this year is seeing this with their 'household energy grants')

all of this is to push GDP up to remain in top superpower position on world banks stats reports
it also helps keep the USD-Yuan exchange rate pegged at a healthy level to show that USD is more valuable then yuan
..
QE is like creating a new altcoin of 1 trillion coins and setting the price a $1 each to instantly have a market cap of $1trillion to beat bitcoins stat of market cap to make the altcoin appear as being the top crypto coin. even if the coin is useless of utility.

if only government stooped trying to fake GDP to use such fake stats to pretend to be top super powers. and instead used money/value to help actually build a better country. then that QE funds might be worth something at all levels.

fiat is backed by laws of taxes and minimum wage. where people labour has to by law be measured in fiat and taxes paid in fiat measured in that measure. which helps keep that fiat in circulation for its citizens which reinforces its circulation..
problem is. humans can play around with those 'backed' numbers. by changing and updating min wage and tax % at a whim.. thus its rule backed but not value backed. as the value has become meaningless in fiat.

bitcoin is backed by the rules that enforce it AND its utility AND its function of circulation AND ontop of that its underlying cost of its creation.. after all a bank note or a bank account balance of $10 does not actually cost $10 to create the unit of measure. thus the unit of fiat currency is not in its cost of the unit creation. but only in the atleast minimum labour cost of someones work to obtain the cheap paper bank note or bank balance.


gold did not fail fiat.. fiat failed gold. there was too much fiat promising an allotment of gold. but the fiat creators couldnt honour every promise(to much fractional reserve). the fiat banks just didnt have enough gold in reserves to honour their promises. fiat failed the gold standard.. gold did not fail the fiat standard

gold has value without human laws. it has an underlying real cost to acquire it with no human laws to fake in new value every time they want to tweak a number.

bitcoin has real value in its cost to acquire new coin. the laws are fixed. consensus makes it unbreakable to ensure that no human can change the law and fake the numbers.

The good side is that bitcoin itself doesn't need any approbation of governments to be able to be used as a digital commodity or to be used as a payment system. As a decentralized project it gives these options to anyone and everyone interested. Government approbation just makes it easier and wider but you can use bitcoin without it as well.

It can be a commodity, currency or an exchange asset. It is upto the user who makes use of it. We can't get into conclusion with a specific term for the future of bitcoin. It have got multiple usage which is the best of bitcoin.

Very few countries have considered it a legal tender whereas majority have considered it similar to the gold and other commodity. Nowadays the countries have begun to regulate the usage of cryptocurrency usage, and this assure the future of bitcoin to be good. Because, most of the countries that are against bitcoin are now considering its good and making regulations/policies for flawless functioning.

Beginner mistake:

1. There’s nations with declining populations, yet their money supply is still increasing and not adjusted, because these 2 aren’t correlated.

2. The economic output can also decrease, nothing goes up forever, yet no adjustments will ever be made to the increasing money supply, till it crashes.

3. Resources on earth are actually finite, as well as the lifespan of human life, so why do you have a problem, when the representation of these two things get nominated in something finite?

Every time the money supply increases it actually devalues the time and resources a person has spent/ gathered over the years, and gives it to someone who didn’t work for it. Does it still sound smart?

And to the point by what Bitcoin is backed by, we can also ask what Gold is backed by? The laws of the universe give gold it’s properties. And the same way Bitcoin has certain properties that are valuable, are ensured by the network.

Also when we’re creating money we’re essentially trying to solve a human problem. Taking something from nature(like gold) and trying to make it work for us, can be inefficient. That’s why gold failed. Then came Fiat which is entirely a human construct(had some advantages), but failed too. And now we came up with a better solution that is Bitcoin. Just because something is architected to fit our needs, doesn’t mean it’s bad just because it’s not used for other things.

That is so true. It's more like the governments have adopted the fiat currency so much because they know they are in total control of the money in their country.
This is the main reason why most countries are against cryptocurrencies.
Even if they decide to use cryptocurrencies im future I am quite sure that they will create their own CBDC and hence have more control on it.
For bitcoin to be adopted by the whole world there should be some kind of self realisation that the governments are trying to stay in control of people's money.
This is far from happening and so I think fiat is here to stay forever.

The governments of this world are protecting Fiat currencies, so they will not allow Bitcoin to become a global currency. They started doing that, when they defined Bitcoin as a "Commodity" and not as a currency.

The countries that accepted Bitcoin as a currency (legal tender) has faced severe push back from the IMF and other western organizations that are being controlled by "Puppet Masters" (Super Rich people)

Bitcoin can only replace Fiat currencies when people see the evil forces behind Fiat currencies and how it is being used to control people. (Use your vote to change the status quo)  

I think to replace a fiat, supply won't matter at all but what    important is that it can function like a currency. Cryptos are a perfect example for this. I don't know what unlimited future you are talking about but maybe you mean is unlimited supply? But, you are right that bitcoin is also treated as a reserved commodity.

We have so many cryptos and not all that that join cryptos are a fan of btc but they can choose other cryptos that they like the most. As long as the cryptos are alive, they can circulate but there is only one main crypto here and that is btc. It is said to be the currency of the future. It's still up to the people if how will they use their btc, either as a currency or a commodity.

I can't imagine any other cryptocurrency as the main cryptocurrency because of Bitcoin's nature and decentralization. Almost all other cryptocurrency isn't truly decentralized. And Bitcoin won't be a national currency of a country by replacing native fiat. Native fiat or CBDC always should control by the government. Everything won't be decentralized in the world. So don't expect to replace fiat with cryptocurrency and replace Bitcoin with another altcoin.

your thinking short term.. widen your vision just a little bit.. dont be narrow minded

also when you say gold. in the final sentence of that paragraph.. you mention the market value (facepalm)..
forget the market price. stop and i mean this stop confusing the volatile market price of short term changes to be what is being discussed.

as you yourself said no one is able to mine bitcoin at GPU rates.. bitcoin value is AS YOU SAY(maybe you do finally understand something) that bitcoin is definitely not feasible to be valued below the GPU rates($0-$6)
so we both agree bitcoins value is not feasible to be $0.. right?

ok move forward a few steps.  and you will see the wide picture emerge that bitcoin value is not TODAYS price nor previous ATH.  but is instead a number far below anything anyone has bought or mined at for a long while

ill emphasise this..
alot has to go wrong and i mean alot, to bring the value back into range of the GPU rate.
its not something you will ever see happen over night nor over a fortnight nor over multiple months.

where even the changes of the last few days/weeks/months of price or hashrate cost of short term or difficulty has not even nudged against the bottomline i stated ($25k) for a LONG WHILE

---

anyway
back to the topic.

bitcoin is a currency by default as is pretty much anything. even sex can be used as a currency in relationships/nightclubs/social events

but bitcoin is more then that. its more then just an economic measure based off fiat. its a utility all of its own with features more easily useful that the fiat world.

in fiat if i wanted to set up a off shore account or a family trust fund. i usually need bank managers, lawyers and legal paperwork and paying fee's to those middlemen to authorise it.

in bitcoin i can self- create a multisig and fund it. and self-decide who to pass the keys too.. and its done. all set up at no cost, no headache and no legal requirements.

..
bitcoin can be used as a token. a visual representation of something else.
EG in schools it can be used as a 'gold star' system. where kids can earn gold stars(xsats) where at "parents evening"(parent,teacher conference) the teacher and parent can see how many sats the kid has earned. and compare it to other students to see if they are the good or bad kid of the class (all without putting a financial value to the sats, nor naming or shaming the least sat awarded kid publicly)..

there are many many more utilities not mentioned.

Yes, but it doesn't change based on the demand, whereas in bitcoin if there's less demand, there's tendency to drop its cost of production too, and dozens of other factors similar to gold. The significant part is that gold's cost is not related with its demand; definitely not directly connected.

Difficulty is rather a long-term parameter. Ten years ago, you could mine a block with a GPU. Currently that's definitely not feasible. That's because of the demand. On the other hand, gold, while not varying much from its 2012's market value, has still the same cost, regardless of its demand.

But, yeah, what does that idiot, alt-girl has to provide to this discussion anyways? 

FTFY

other examples i have seen.
some educational teachers have awarded students with allotments of sats depending on their exam results.
students have not price associated the reward but instead tallied the number of sats as their test score result to compare to other class mates

EG 500sat per % whereby if getting 98% means their address would show as being 49,000sat
which they all see the classes outputs of the teachers tx to see how many people got 100% by seeing how many people got the full 50,000sats. without any names associated with the scores.
thus transparent testing and result sharing without revealing personal information..

later on, these students can accumulate alot of sats the more exams they do. and when the graduate. they can, if they want sell/spend their scores. thus another advantage beyond transparent sharing of test results without identity association

This is what makes Bitcoin very unique, everyone is free to use it according to their needs...

Bitcoin as a currency or Bitcoin as a commodity, essentially Bitcoin is Bitcoin. I have received my customers' payments in Bitcoin several times (I sell women's accessories) and I also frequently trade in Bitcoin (on exchange). Bitcoin is both, cannot be separated.

no one ever said the backed value is fixed forever..
even backed value changes,, just alot more slowly. because its alot more stable compared to price.

the whims of the daily price do not impact the bottomline value as quickly/easily/harshly as you pretend/think it does

anyway more examples of how other things have value and their variance
just like FIAT is backed by pretty much laws about taxes and wages, meaning backed by minimum wage value, which too is not fixed forever..

even in gold there is a variable bottom too..
the main cost for golds bottom is diesel. aswell as labour and that changes too..
the rise in diesel cost and the lack of labour during covid affected the bottomline.. for the cheapest region..

but that is a separate measure from the market price which speculated upto over double+ the bottomline

and in housing there is a variable bottom too..
the main cost for housing bottom is material and labour. and that changes too..
but the housing real estate market price is not the same as the build price.

now.
if you can calculate all the variables. and put them into a spreadsheet.
and then instead of looking at the DAILY bottom.. you widen your vision and open your eyes a little bit more. and look at the variables of a more wider timeframe than you are used to looking at. and then find the bottom of that.. then thats the bottom..
..
here is the thing..
bitcoins DAILY MARKET PRICE.. is volatile.. . the PRICE is not value. its not the thing that is backed.
its speculative.. highly speculative and highly variable..


below the price is a more stable VALUE that alters much more slowly. and is more stable. and its what people use as a base point value to then associate if the market price is near value or highly inflated bubble premium

if you do the math.. at the $0.04/kw and the hashrate now.. its about $29kish/btc..
value is not TODAYS mining cost of ~$28k-$29k in cheapest regions
..
but here is the thing.. even with the hashrate variable and difficulty. the long term stable value for many months now has been around the same 200-210exahash.. for a long while now.
(5%) variance.
where by the even longer term value is below the $28k level.....
yep i said $25k.... not today or this quarters $28k+

i must emphasise this now..
i have coins for years.. i do not associate them to the daily whims of price changes and daily hashrate changes. i use more stable measure. a more stable base point that has existed LONG TERM..
i know you want to cry blue murder about daily and fortnightly variables. but you are thinking short term and only wanting to see short term charts..
look beyond your short term vision...


but there is a big difference between the volatile daily price speculation swing of $30k-$70k we have seen in the prices.. vs the value bottom of $20k-$25k bottom over the last couple years

whereby that smaller variable of $20k to $25k value has seen a more stable and consistent rise from $20k to $25k over the last few years. (give or take a few percent)

again.. for the last time
i am not quoting bitcoins TODAYS price or todays hashrate cost($28k+) to be "value"
nor the mining cost of japan($65k) as value
nor the mining cost of hobby miners on residential electric cost in america as value..

i am saying the ultimate bottom of $25k
becasue.. major asic farms that do massive asic mining do not buy electric at the whims of the day. they have quarterly/year long contracts where they mine the same electric amount(same cost) for months/years)

do not confuse todays(short term narrow vision) mining cost variable with what i have said. as you are just trying to be pedantic and not reading it when i said no one one the planet can mine for less than $25k

there are alot of things that need to go wrong to really push the underlying value down to $0

But, there's not a nearly invariable ultimate bottom in bitcoin, that's what I pointed out. Difficulty adjustments change that temporary bottom every 2 weeks, but difficulty adjustments are affected by demand. It is, therefore, clear that the demand does affect the minimum cost, which doesn't happen with any other commodity or asset.

As you rightly said, there's a bottom value for gold, houses etc., but not for bitcoin. And I think you agree with me here:

Op is saying money should have unlimited future, but I am not so sure that in the future money as such will continue to exist. Humanity, at some point (although unlikely during our lifetime), can get to the point when there are enough resources for everyone and they are distributed in a way that nobody is without food, shelter and medication, and something like reputation, academic performance and things like that function instead of currency.
In the meantime, Bitcoin is money in El Salvador and in some other places around the world (crypto-friendly cities). Many hodl Bitcoin long-term as an investment, but it doesn't mean that Bitcoin can't both be money and investment. And it can coexist with fiat and CBDCs.

i was talking about the bottomline.. the ultimate bottom. (emphasis when i said 'no one on the planet')
yes someone in iceland/kazahkstan can mine bitcoin for $25k/coin. but there is no one below them that can mine for less
where as japans mining costs are like $65k+

houses might sell for $5XX-$2XXX a square metre. but no one can get a house for $5 a square metre
if you can work out the bottomline square metre cost of the planet you can establish a new bottomline for the real estate market VALUE..
where by you can then tell if a house is priced well or at a premium against value.
even in just america.. it may cost more in california to build a house than it doe sin ohio.

it may cost more in texas to mine for gold than alaska.. but the ultimate bottom is the important thing. the number no one no where can acquire for right now

by taking the most absolute bottomline on the planet no one can get for less.. that becomes the new "zero"
because no one can get it for less at the time.

if there was no demand. its not an instant $0 of the coin.. its a process.. the $25k minimum slowly drops as people drop out. and like i explained this slow drop is not a certainty of being $0 short term because the drop itself slowly going down can infact re-energise some desire/demand and thus keep the price active longer or re-birth a new demand.

and as i said the value line is not based on all mining cost of the planet. its the bottom line cost no one on the planet can get for less.. all things above the bottom line is the speculative stuff based on regional variances, sentiments, supply and demand stuff.

..
personally i have coin from 2012 ($6 a coin) . but i do not value it at $6 anymore.. but i also do not value it at the current price. nor value it at the top ATH potential recently of $70k

i see my coins VALUE is a minimum of about $25k right now because right now. there is no way that i can lose because all prices around the planet being offered are above $25k, whether it be mining, market exchanging, or purchasing/selling goods or services. no one is valuing bitcoin at less than $25k.

in short
bitcoin is backed by atleast $25k of bottomline value and ~$5k of unbacked volatile speculation

..
lets take someone in japan..
their mining cost is $65k. but thats not japans "value". because in japan. they can still acquire bitcoin for $30k on an exchange or OTC deal with a iceland miner for $25k+
so japans value again is ~$25k as thats the ultimate bottom

the numbers above this bottom is the SPECULATIVE PRICE. which is variable

(emphasis. when i say mining cost and i say no one on the planet.. im talking about the minimum cost.. not the variable per region..)

Isn't it more proper to say that there's cost? There's no "hidden value line", it just costs $X to mine gold, it costs $Y to make a house, it costs a frequently variable amount of money to mine a bitcoin.

But, the mining and acquisition costs in bitcoin depend (although not solely) on the demand. Difficulty does change according to the demand. Mining bitcoin isn't the same as mining gold, and therefore not a good example of the "minimum price", which is, as said, the cost.

basic economics class here for the two people quoted above

imagine there are instead 2 measures..
VALUE and price..

people never want to sell at a loss.. in housing, stocks, shares. bitcoin.

no one on the planet can currently mine for less than say $25k a coin..
no one on the planet can buy a house for less than $XX a square foot
no one on the planet can buy a share of Tesla for less than its business collateral

this is the hidden value line.
EG it costs people atleast $900 to mine an ounce of gold. this is golds value line

above this value line. is the speculative more volatile fluff. the moving price.
some people think its worth more then others due to MANY factors. like their local/regional costs of acquiring it being more then other regions. or the usability/features.
this premium above value is where the price sits.

EG golds speculative price might be like $1.8k. but its store of value "backed" by about $900

so when gold is say $2k people think that its price is way above value and a premium and thus wont buy it when its too high. just like bitcoin peaked at $70k/coin when its value was more like $25k

bitcoins value is backed by the mining and acquisition costs.. the price is speculative amount above value and is the "supply/demand" game. of many factors or personal sentiment, regional costs and functionality


even if there is no new investors.. the current community might still see value in its utility.
its not a scenario of bitcoin drops to zero if no one new jumps in.. its already an active community of people using it.

EG do fiat currencies go to zero if their net import/export shows they have less imports than exports. or the opposite.. no

because the currency continues to function if all currency is just stirred around domestically(current comunity) without imports/exports happening.
..
if there was no demand at all. even from current users. first you will see the hashrate drop because miners will give up. the remaining miners will get more reward. which might then re-energise some demand as they can get more reward meaning get more incomes while the price is not yet dropped too far.
then this may cause the price to drop due to those sells. and yes eventually it could drop more and more if the desire fades..

but bitcoin has more function and utility than just "hoarding". its actually a useful currency in of itself. its function is not to just be a bridge to fiat. it can be a function currency without having to ever return to fiat. i personally have coins from 2012 and in that decade most of my transactions have not been back to fiat. but buying goods and services in btc.
i have also used btc to do other practical things unrelated to fiat too

Everything, by the same reasoning, is backed by demand. Houses, stocks, bonds, metals, food, guns, vehicles, goods etc., everything.

Again, that's true for everything. If there's no demand for a thing, it has no value.

It's already treated as currency.

Bitcoin isn't always exchanged for fiat. As said, it's a currency.

What does back bitcoin? It is more or less a game to consider that it is backed by demand. If new demand is "0" then the value of bitcoin may be "0" and it will be difficult to consider it as an investment or currency. If we imagine that all bitcoins are sold then new demand could appear only if bitcoin has been already treated as a currency, got its environment and law regulations (taxes, etc). Today fiat is used to buy bitcoin on the market, then bitcoin circularizes in buy/sell process, then it comes out to be changed for fiat. Bitcoin seems to be a method. Method does no need to be baked. Method needs areas for implementation. Otherwise the method is useless. That is why the bitcoin´s implementation as a currency could keep it safe.