Bitcoin is Not Backed by Nothing - Unchained Capital
What Is Bitcoin Backed By?. Hint: The correct answer is ...
What is Bitcoin Backed by or When Will the Bubble Burst ...
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What is Bitcoin backed by? Asking what Bitcoin is backed by is akin to asking what the kilometer is backed by. As much as there is utility for having standardised units by which we measure distance, the same goes for units that measure value. Humans have allowed despotic governments to impose dictatorships over money. The closest thing we had to money was gold. Gold’s utility as a monetary instrument derives from its scarcity. The confidence that we can’t easily inflate the stock of gold is why gold was useful for communicating value. In the same way that it’s hard to plan a road trip if the unit of distance fluctuated, the economy cannot make sound business decisions if money was unpredictable. Bitcoin is the first metric unit for communicating value – amongst other features, Bitcoin is backed by its confidence in monetary policy. This will not happen overnight. It'll take several generations. When the unproven benefits of changing financial systems outweigh its enormous costs, the pieces fall into place. My eyes are on Venezuela
“Bitcoin seems to be gamers currency. How does mining on the computer add to the value? May as well sell your cyber character from your favorite game, it’s about the same value. If you don’t get out, the ride will stop and you’ll be stranded. Governments are responsible for currency values, With Bitcoin, you own stardust.”
maybe i can post my poorly written amateurish train of thought here...What is Bitcoin backed by?
It has been said that Bitcoin is backed by math. Opinions may differ on the value of that math but to sum it up... Bitcoin backs up its self with its own properties and its own characteristics. What backs up USA dollars? Dollars are created by a bank when it assesses a borrowers ability to pay back the dollars to be lent and then lends those dollars. The loan is a promise by the borrower to pay it back. How does one obtain dollars in order to pay back the loan? One usually works to obtain dollars or one may find a way to use other peoples work to pay back the loan. So dollars are work. Dollars are backed by a promise to do work. Work is a useful product and when you can have work performed only your imagination and the laws of reality are your limits. Truely valueable indeed. Possessing dollars allows one to determine what type of work will be done by the worker in order for the worker to obtain the dollars. The bank accepts dollars as loan repayment not work. Thus the possessor of the dollars can choose to pay someone to work towards a cancer cure or pay someone to create an exciting movie. Why should one want to perform work? Motivations such as hunger, shelter, entertainment, and the ability to provide these things to loved ones are te reasons why. Also the repay the debt. At this moment I lack in none of these motivations die to my tiny taste of money from selling of some of my small amount of Bitcoin. Thank you newcomers! As a result my motivation to perform work for these things is greatly diminished at the present moment. Thus I am performing no work. Money or at least the amount of money that I could obtain by performing work is of little motivation to me. Money has become worthless to me and has no value. Without motivations money has no value and is worthless. Motivations provide value to money. What are motivations again? Food, shelter, entertainment, and the ability to provide these things to loved ones. So motivations to work are a lack of these things. What are a lack of these things? Misery and suffering are what result from a lack of these things. Thus the value of money depends on varying degrees of misery and sufering. For without misery and suffering there is no motivation. At best a balance can be achieved but certain amounts of misery and suffering can never be eliminated. Possible solutions. 1. An automated workforce which does all of the work shifting the need for motivation to the machines. 2. Change the humans in some way so that they are not afflicted by the motivations. 3. Accept the balance. Accept some misery and suffering. Currently some might argue that misery and suffering are unevenly distributed among humanity. Do we really want Bitcoin to be money? Being money entails misery and suffering. So what backs Bitcoin? At present Bitcoin is not backed by a promise to perform future work such as dollars are. Bitcoin is entirely dependant on its own properties for its value. What are the properties of Bitcoin? weightless, invisible, has no volume, very hard to steal, and can be sent around the world in minutes in large or tiny quantities Even someone in the middle of nowhere beyond the reach of the internet can still recieve Bitcoin. They can hash their own address and key on paper, send some product of work out with the public address and recieve Bitcoin to it. Im done ive got nothing and might never had had anything to begin with. here is what people who edit wiki think https://en.m.wikipedia.org/wiki/Money_creation
Question: Is Bitcoin backed by Gold, Silver, Platinum... etc?
If not, it's no better than the toilet paper we call money. And therefore is probably being used to build a "bubble". Saying it's backed up by currency is also invalid if ANY of the currency it represents is Fiat Currency. So I want to know.
Besides the usual "where is its value from?" (broadly speaking: theory of supply/demand, scarcity, real applicable uses) I commonly am asked what is bitcoin backed by? Usually in a comparison to their USD backed by the "good faith and economy of the US government". Lately I've been answering this with, "Bitcoin is backed by a global distribution of stability and good faith of mathematical certainty." What do you say? Any suggestions to improve on mine? Edit: Wow, I had to come back and say all/most of your answers are truly terrible. Maybe I should have explained that I don't need the answer, I wanted a critical discussion of how we answer this to new users. There is a lack of understanding of several subjects and the concepts themselves and I'm very disappointed by the worthiness of feedback here. I'll give the exception of Garrand. The belief that it will be accepted as monetary value is a core necessity of any currency. Still a weak response to what is it backed by, though.
I am tired of reading troll posts on news sites where gold whackjobs and brainwashed fiat slaves argue bitcoin is backed b nothing. Let me dust off my old unused economics degree here. Golds was used for economic activity because it did not deteriorate. It held up as a savings. It was rare but not easily divisible. That is why silver was used asss well. Silver and gold are hedges in modern times. They are the best store of value IF CIVILIZATION IS WIPED OUT BACK TO THE DARK AGES. SO I agree having a little is good but it will not grow your wealth. Fiat/dollars are backed by DEBT. It is not made by the government but by private banks. The government could issue currency tomorrow backed only by belief.. but the fed backs their dollars on the debt owed by taxes on labor and land and commerce. A citizen owes the government money every year. If they hold land, worked to eat or sold assets. So fiat is exchanged for someone e's effort. And the fed decides what value that bldholds. The fed borrows that right from the people. Bitcoin is backed by a concensus of people who retained their right of money for their efforts. Unmaniputable. If some people find it worth a lot and some find it worth nothing then the value meets in the middle. Even non participants affect the price. Because if they bought the value goes up. It I'd not decided by a central bank. Pardon spelling. Typed from phone.
Like most modern currencies bitcoin is not backed by gold or other precious commodities. In a sense, bitcoin’s value is derived from our common belief that bitcoin has value. The same is true of the American dollar, the British pound, and the European Union’s euro, as well as nearly every other modern currency. Historically speaking, up until August 15 th 1971 most currencies were backed ... Contrary to popular belief, bitcoin is in fact backed by something. It is backed by the only thing that backs any form of money: the credibility of its monetary properties. Money is not a collective hallucination nor merely a belief system. Over the course of history, various mediums have emerged as money, and each time, it has not just been by coincidence. Goods that emerge as money possess ... Each loan is Bitcoin-backed, meaning we don’t need to run a credit check. You can pay off your loan whenever you want, or you can continue to pay monthly. CoinLoan automatically calculates repayment amounts for you. For example, to get 100,000 EUR with a Loan-to-Value (LTV) ratio of 65%, you'll need to deposit ~16 BTC. Start Borrowing Is Bitcoin backed by mathematics? Like the US dollar, Bitcoin is not backed by a physical commodity, and instead derives its value in other ways. Since Bitcoin doesn't have a centralized entity that enforces its value and it isn't backed by any commodity, many people mistakenly believe that this means Bitcoin doesn't have any value. However, Bitcoin currently has an individual unit value of ... But if Bitcoin is not backed by anything, what it is backed by? Before we answer that question, there is an elephant in the room we must address first. The myth of fiat currency. If you ask anyone ...
Join us every Wednesday by tuning in to 1100 AM KFNX radio station in Phoenix, Arizona for our weekly cryptocurrency talk show. We cover various topics such as Bitcoin, wallets, hardware, etc. Is Bitcoin Back we will be taking your questions LIVE @ 2:30 Central on Dallas Trading Floor #158 Bitcoin is backed by a computer network, encryption, people who have or support bitcoins, time, energy, notoriety, the demand for a sound digital currency, the free market, etc.. Is there anything ... Bitcoin was going down for a few months now, but it stopped going down making a support line. Now it is moving up. Is it a new trend for this crypto currency... The Bitcoin protocol is backed by math and energy which is processed through super computers called miners, they verify all transactions on the network are a...