Quote:
Originally Posted by xpl0sive
They aren't anything physical from what I understand like gold or diamonds, for example.
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if you can get over this idea, then you will understand it... you'll understand a lot more beyond bitcoin actually.
thing's dont have to be physical to be real. or to be worth something. things don't have to be tangible or "real" to be real.
just like how world of warcraft money is worth money. or items you find in game.
as long as there is a supply, and there is demand, then it is real, and worth something.
things don't have to be backed or anything.
sure bitcoin aint backed. but it's limited, and people can exchange it for stuff, it's in demand, and there's less of it than there is demand.
why is it any different than... USD? sure USD is backed by the govt.
but that's NOW. what if the US govt dissolves into nothing? another great empire takes over and USA is just a memory of the past.
you think USD will be worth anything?
u think it's worth something cuz it's backed NOW. when it's not backed, then it will have no demand and drop.
same as BTC. when people decide they don't want it any more for whatever possible reason, then demand will drop and the worth will go down.
like anything.
you're saying it doesnt make sense to invest cuz there's nothing backing it. yeah, maybe in the future, but it hasnt happened yet, and we don't know if it will happen.
all that matters is that there is demand NOW, and right NOW there is opportunity to make money off of it.
what happens LATER, is something for LATER.
like i said, you can invest in some government backed product X, but if tomorrow it suddenly isn't backed any more, or there's something better, you can be damn sure you'll dump it, because you feel it's got no value any more.
value isn't determined by just numbers and math. it's determined by individual humans.
you think snapchat is worth 4billion? is it real? it isnt even tangible. it could be worth nothing next week if everyone switches to something else. what "assets" does snapchat have? the program itself? ok... they probably have an office with office equipment... that's worth next to nothing. so what is the real worth? what makes it worth something?
ya get my drift?
another example can be intellectual property, that's not tangible, and yet it is worth something. why? there is demand for it. the technological/intellectual patents are WORTH something cuz people WANT it (for whatever reason, any reason will do).
you can say the same for art. art is even more "useless" than bitcoin. why is some picaso painting worth 10's of millions? what's it backed by? the material it's painted on isnt even worth 5 bucks.
it's just cuz people want it. and if i want it more than you and i have more money than you, then I make it worth that much more. and if the world agrees with me, then it is.
economics is subjective. non tangible. determined by human elements which are chaotic and unpredictable to a certain degree... nothing is "real".