Whilst governments as a matter of deliberate policy destroy the value of fiat currency, then individuals will always be looking for alternative means to store value in an attempt to be one step ahead of the thieves.
Peter Schiff: Bitcoin is a Digital Risk Asset, Not a Currency
- Thread starter SilverDJ
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Whilst governments as a matter of deliberate policy destroy the value of fiat currency, then individuals will always be looking for alternative means to store value in an attempt to be one step ahead of the thieves.
Ilikemetals
Member
Expending energy, labor and capital though doesn’t install value in something, e.g. gold’s value doesn’t come from the cost of mining it.
It is definitely a factor in terms of having properties of 'money'. If something can be produced for free then it can be produced in unlimited quantities. Bitcoin's mining protocol is called 'Proof of Work' (PoW) and as the name suggests, you literally have to "work" to create new bitcoins via mining. Just as you have to work to mine gold, otherwise gold wouldn't be scarce and have value of money if every man on the planet could telepathically extract gold from the soil for free with their mind.
Money has the following properties, a store of value, it must be fungible, durable, portable, divisible, uniform and acceptable. Note that expending labour or capital are not properties of money. And as we all know, we usually have to work in order to get money, but it's not the work that is valued by others that gets us rewarded with money, it is the good or service we provide. So no matter how much effort is involved in mining cryptos, the amount of labour involved is not a factor in terms of them having any properties of "money".