Topic: Would crypto gain full intrinsic value? - page 2. (Read 572 times)

Does crypto really to have a "full intrinsic value" that you are talking about? I don't see any issue with crypto being traded and valued in fiat currency. The volatility isn't because of this. As more people start using and accepting bitcoin, the less volatile it will eventually become. We can't deal with the price fluctuation. No one controls this fluctuation. Just give it few more years (or even decades) and you will see that the price isn't as volatile as it is.
You mean the volatility is making business not accept crypto? Well then they can use crypto gateways that will instantly convert their crypto to fiat currency.

I do not really know for cryptocurrencies in general cause there are so many of them, but the one I trust and believe in its network is Bitcoin and when I talk about crypto, more often than not, I talk about it alone, I believe Bitcoin will continue to grow, as the years keeps coming, until it gets to mass adoption, and I think at that very time it's very possible that we'll see a lesser case of volatility than what we're currently experiencing at the moment.

Having said that, tbh, I don't expect volatility to completely go away, but we could get to a time when it becomes lesser, but even if it doesn't, it's not too much of a problem if you ask me, as long as its users have freedom of their funds, are their own bank and the investors can get ROI, then there is no problem that needs to be solved.

It is not "outdated", it is just not something that works in most places and in regards to most things. For example if you checked Tesla for instrinct value only then you would not buy it, but then you lost so much profit from not buying it. However there are still a lot of insurance companies and banks that could be bought based on that and you would make a lot of profit from it. Same goes for many other things, you could make a lot of profit if you want to, and that is not going to really change the fact that IV works in some cases and not working in other cases.

So, you need to find a way to understand what it works on and what it doesn't work on. Obviously it is "outdated" like you said in things like crypto, if you are looking for Bitcoins IV then you are going to not end up with something that is profitable, because it doesn't really have any at all.

^S2F fanboy

Anyway, the concept of "intrinsic value" is outdated. What does it mean? The value in itself? The labor? The cost?
Even in stocks, the concept is flawed since it's the present value of all future cash flows. It means that you must forecast the firm future cash flows. Except you are Nostradamus, you just can't calculate it correctly. In the end, it's more of your belief of the firm's future cash flows.

Belief is a nice segue to the subjective theory of value. Basically, scarcity and utility are the best predictor for valuation.

The price is determined by stock and demand, bitcoin has 2 things that make bitcoin valuable, bitcoin stock is fixed and the number of users or high demand makes prices continue to skyrocket and this is the basis for bitcoin's value.

What happens is that to give a value, it is something very subjective, in terms of appraisals this is usually seen as an appraisal of firms that is very difficult to do, because a value must be taken into account (which is calculated based on the offer- demand on average with the value that the devs can give in the project) from there get the total to determine how much it can be, and that has to be accepted in almost everyone, and the maximum that can be given is that, just a security because the price is determined by supply and demand, the market is very volatile.

In NFT games it is something like luck, as it happened in the Squid's NFT, in 5 minutes it reached zero, it is very difficult to predict that this would happen.

It is kind of odd but the reason people are not using bitcoin for their everyday transactions and instead keep their bitcoin and prefer to use their fiat is simply because bitcoin is that superior to fiat as a currency.

It may seem counter-intuitive but it is not, if you give people a choice between spending a form of money that losses purchasing power and one that gains it, which one do you think they will spend and which one will they keep? It is obvious people will spend their fiat and keep their bitcoin, which is precisely what we are seeing happening right now.

What we need as data is how many people are using it. The adoption is based on how many people and not how much money. If there are 100 rich people doing 140 billion, that won't be same as 8 billion people doing 20 bucks each or something like that. Which is why I believe that we should be looking at how many people are using it. That is not really the same thing as how many addresses, one person could have multiple address and I have a lot of them just myself as well. Which is why I believe that we should basically try to find the crypto population.

Yeah agreed. Also lots of markets are now being tapped. Artist are now into it through NFT's. Gamers are now into it because of Play-to-earn cryptocurrency games. Aside from decentralised finance that still blooms year by year, lots are happening that getting crypto into far more audiences that could lead to total dominance in monetary system.

And yet, although BTC is still very volatile, they made it a legal tender in El Salvador. Now they are harnessing volcanoes to power Bitcoin mining; buying BTC at the deep, like they did just recently purchasing $25 million worth of BTC at current prices(and they consider it deep! I'm a big fan of these guys.)

I think other countries should learn from El Salvador and start the adoption process instead of waiting for BTC to become a stable coin. Chances are it can take forever.

In my understanding, the total worth of daily transactions may not get us the clear picture but if we are able to find out how many transactions are happening everyday might lead us to figure out how intensively we are moving forward to influence in our nation's economy which might enforce to government to plan up like you have mentioned here.

Now few more countries will follow El Salvador and then some of them will plan up to have bitcoin into their reserve along with gold. Still, like OP emphasized for that we must have bitcoin into relatively stable price ranges. I agree with OP that until being volatile, bitcoin may not be qualified to be used as national reserve.

Crypto users continue to increase and when it has reached more than $140 billion daily transactions, this proves that crypto has a strong influence and of course the intrinsic value of crypto is the ease of transacting at low costs, I'm sure more and more countries will make crypto a national asset.

This one of the sensible answers I have read here. Bitcoin gets its price value depending on the market demand. There are times that the supply is high and demand is low, which is the usual season whereas bitcoin has a low price position. And there are times that the supply is low and the demand is high, giving a high price value to bitcoin. It's just a basic law of supply and demand, which I think most of you are already aware of, that dictates what would be the price trend of btc. But of course, there are also other factors that can affect the chart such as the news about its legality, opinion of a popular and reputable personality, etc.

The price of bitcoin in equivalent to dollars or euro is actually just normal. You just have to have a conversion of something into your local currency to fully utilize it. In this case, the usual conversion of btc is dollar because it is the global currency, and in addition it has become a coin as well in several trading and investing platforms.

Regarding with never ending question about bitcoin to become a global currency, my answer would still be the same. No, bitcoin or any other coin is impossible to be the world's currency. Why do you think the government and the central organization allow such speculative asset to take over? When they could just print money whenever they want and deem necessary? In addition, surely the countries all over the world won't ditch their local currency unless they have no other choice because of economy collapse.

We have already seen it that most countries would prefer to have their own digital currencies that are issued by their central banks. So far it has only been El Salvador that has decided to adopt Bitcoin as a legal tender. We are not sure if other countries are going to do the same thing, and by the way that wasn’t the reason why we have Bitcoin today, so I am not expecting it to become illegal tender in anymore country.

If Bitcoin should become a legal tender in every country around the world, then the government will be prompted to attempt a total control over it, which wouldn’t seem like a nice thing for them to do. Bitcoin was created to be a currency on his own that would be used by people who needs freedom and privacy.  So, I don’t get why some of you are still talking about it becoming a legal tender in countries, if you’re not OK with the volatility of crypto currencies, then I will advise you to just take a break.

When we talk about cryptocurrencies, we have to understand the fact that there are some like bitcoins and Etherum and these cryptos are already integrated with some of the countries on a very deeper basis and in come countries it's also legal tender therefore they are very close to getting an intrinsic value settled down. I do think you have to also address the fact that:
Volatility is decreasing day by day, like before we could have been fluctuating around 5000$ or so but right now if something like that happened the price would bounce back up faster than anything, there are people waiting around to buy at the right time.

Therefore the more it gets famous, the more legal it gets and more other things gets integrated with it, it would attain a faux intrinsic value, for sure.

The fluctuations would decrease for sure if it gets recognize all around the world, if bitcoins and other cryptocurrencies starts becoming a legal tender, it would be more or so like gold but more volatile, but still have enough value to be taken into consideration.

Money itself doesn't really have value, not since fiat was created. Its value comes from trust in it as a reliable medium of exchange, and as for Bitcoin's value being measured in fiat, I think it's simply done for reference purposes. What it really tells us is the coin's purchasing power, and lots of local fiats are also weighed similarly against the dollar or other major currency to determine its stance. Regarding the fact that most people sell Bitcoin for fiat to actually use their profits, I think it's simply due to the lack of options of spending Bitcoin directly, and it doesn't mean that these people don't think that Bitcoin is indeed worth $60k or anything.

That does not seem like a reasonable expectation. It's the other way around. If everything is measured in terms of a certain crypto currency, then there would be NO fluctuations because the rate of exchange to fiat currencies won't be of any relevance. All that matters is what can you buy for 1 BTC, and that won't fluctuate if it becomes a globally accepted tender, since the items sold directly for it will pin its price to their value (all other factors aside).

I highly agree.

The problem with BTC stems from its inherent supply of 21 million in which it will inevitably yield to inflation in the following years. Though El Salvador has accepted and viewed it as legal tender, I highly doubt that countries would shift to cryptocurrency as a form of legal tender ALONE. Fiat will always be the currency that all countries would use even in the far future.

Yeah, OP is referring that being lesser volatile means cryptocurrencies will hit main stream adoption. I agree with that conception still I personally do not need and I am not seeing the possibilities for that to happen for next 50 to 80 years of time frame. Yeah, bitcoin and most other cryptocurrencies will remain volatile for prolong period from here and which may get into stable state only most world population adapt and use on day to day life along with bitcoin gets all its supply into circulation. As of now, it is time to enjoy the volatile nature cryptocurrencies because our next generations definitely cannot get a such big opportunity.

If feel like if crypto stopped being looked at or have value from fiat, it would start to lose its popularity at least in the current state of the finical systems, the may reason why so many people have started using and get interested in it is because it has a real high value when exchanged to fiat and its highly volatile which means that a lot of people see it as a way to make a lot of money fast, and that idea has become more and more the mainstream, and people forget what crypto is based on and what it is about, and to be honest i don't think there is a way to control this volatility and it has to stay that way otherwise there will be no difference between it and other currencies controlled by governments.