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Bitcoin is a bubble, but not in a bad way. All monetary goods display a "bubble" phenomenon. Their price cannot be explained by their use demand alone but by a monetary premium. This is true for gold and it's true for the dollar (which has no use value at all, unlike gold). This idea is explained best by MM in his bubble theory of money:

http://unqualified-reservations.blogspot.com/2013/04/bitcoin...

Also see: http://unqualified-reservations.blogspot.com/2011/04/on-mone...



And approximately at the same time the bitcoin bubble ends, and the so called experts and analysts are proclaiming the death of crypto currencies, that's when you will know that crypto currencies are finally on their way toward the mainstream. At least that's how things typically work when bubbles form around new technology (eg the internet).


Seems like extreme confirmation bias. Many just die.


For someone of low access to capital, a dollar probably has substantially more use-value than the same value (less than 25 mg) of gold. The dollar can serve as insulation, can be burned for heat, can stuff a pillow... there's better substitutes for all these things, of course, but the values of these things are so far away from their use value it's amusing that we consider use value much at all. None of which undermines the point that "use as money" can give things value, of course.




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