Ignore that fact and you risk misunderstanding Bitcoin completely.
BorisPoff
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“I reject your reality and substitute my own”
Bitcoin was originally intended to be primarily a cash system. It did not turn out that way over time. Same thing happened with gold. Originally circulated as cash, it has lost its utility in that fashion - nobody buys milk with gold for hundreds of years now.
Gold is a store of value these days as far as INVESTORS concerned. Bitcoin is actually better than gold as cash (fungible unit of account). It’s far easier to buy milk with bitcoin if you REALLY want to do that than with actual physical gold. Bitcoin is far easier to move around, both as cash and as a store of value.
Bitcoin doesn’t have to be as good as fiat for milk purchases to be successful. There are tons of investment assets that you can’t buy milk for nor can you make fancy dentures or necklaces with. US treasury bonds are the simplest example that neither gold, 100 US dollar bill or 1 BTC can be directly compared to in utility. So what? Bonds are doomed?
The most fascinating part of Bitcoin and other crypto assets are the applications that we aren’t aware of yet.
Bitcoins utility IS being a store of value at this present time. It may change in the next 10, 50, 100 years but that’s what it is now. And it’s enough to be successful.
The reason why it will succeed is because of the very first sentence in the quotes - there are enough people around the world who create this new way of thinking and hence it will become over time a self fulfilling prophecy. Bitcoin is a store of value because it is. (No, it’s not tulips or beanie babies as those analogies have been thoroughly debunked).
Bitcoin is a far better store of value than many fiats of the world TODAY, and have been for over 10 years now. This UTILITY of Bitcoin is slowly but surely is spreading around the world.
Even in US the institutional investors ARE coming despite the funny claims by some technophobes that it’s only “mental institutions are coming”. How about that Bakkt volume that came “out of nowhere” this week on a moderate price growth ? All that are institutional drug users? No, most certainly not.
I would not be so cocky as to simply dismiss them as fanatics whose tears you would be able to convert to YOUR dollars. A far more plausible explanation is that institutional investors were not in a hurry to start trading just because a channel was created for them. Once the conditions were more favorable they started buying. Does it mean that we reached the bottom in this current cycle and it’s the Moon/lambo next? Of course not. That’s not how this works. It takes time. Years. A lot of work.
Cheers.
lentus
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@BorisPoff, "Bitcoin is a far better store of value than many fiats of the world TODAY, and have been for over 10 years now."
Tell that to people who bought at 19K. Great store of value, yeah.
In all fairness, there is another use for bitcoin and that is it's a wonderful vehicle for speculation. Which is really the reason institutions got involved. So I adjust my description: drugs, ransom and speculation.
BorisPoff
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@lentus, I heard same thing over and over “tell that to people who bought at BLAH. Great store of value, yeah”.
I heard it in 2014, 2016, 2019. The only thing the BLAH number changed.