The Underlying Value of Cryptocurrencies

Official subreddit of KayoCredits Platform

What is Kryptonium? Kryptonium is a digital asset constructed on what is commonly referred to as the blockchain. Designed to be a peer-to-peer decentralized electronic system used to transfer value from one asset to another. Built on a version of the underlying technology behind Bitcoin and adapted to create an enhanced level of anonymity.
[link]

Can someone please explain to me the underlying value of Bitcoin without some sensationalist bullshit?

I just want to know why it has value and what the source of that value is. I can't tie it to anything I understand, and I'm more than happy to understand, I just need it to make sense without someone Trumpslaining why my lack of understanding doesn't matter.
submitted by ApertureBear to Bitcoin [link] [comments]

Can someone please explain to me the underlying value of Bitcoin without some sensationalist bullshit? /r/Bitcoin

Can someone please explain to me the underlying value of Bitcoin without some sensationalist bullshit? /Bitcoin submitted by BitcoinAllBot to BitcoinAll [link] [comments]

[uncensored-r/Bitcoin] Can someone please explain to me the underlying value of Bitcoin without some sensationalist bull...

The following post by ApertureBear is being replicated because the post has been silently removed and some comments within it have been silently removed.
The original post can be found(in censored form) at this link:
np.reddit.com/ Bitcoin/comments/7lfhtc
The original post's content was as follows:
I just want to know why it has value and what the source of that value is. I can't tie it to anything I understand, and I'm more than happy to understand, I just need it to make sense without someone Trumpslaining why my lack of understanding doesn't matter.
submitted by censorship_notifier to noncensored_bitcoin [link] [comments]

Understanding the Underlying Value of Bitcoins

Understanding the Underlying Value of Bitcoins submitted by kyletorpey to Bitcoin [link] [comments]

A talk about Financial Risk and Bubble trend. Hope it is useful to someone. Warning[long read]

Firstly a little background about me
spring 2018 I will be graduating with a bachelor degree in Finance, I have invested in the stock market for 4 years now. My interest, hobby, and education I would fairly say that I know more than the average man on the field of finance.
In 2011 I started mining bitcoins, due to just seeing it on 4Chan I believe? I was young and did not understand a shit about what I was doing. However after mining 2 BTC I just meh...
A couple of years go by the hype comes and hit global news coverage. And we see huge price increases, my first reaction was too much risk for my taste, fair enough.
 
THEN old friends start messaging me about bitcoin,lightcoin,etherum and what not, Simply because I was the investing geek back in high school. I recommended they should not invest because of the risk associated with it and they could not afford to lose it. Of course I couldn't have been more wrong, but still, some part of me cant grasp the underlying value of bitcoin.
 
As an investor with a finance background, certain things just screams red flag for me. And just so we all are on the same plan returns works in a fantastic way, higher returns just compensate for the risk, finance 101.
1) I am a member of a certified investor group in some way you could call "experts", they have been trading and investing their whole life. NONE of them have touched cryptocurrency because of the risk and BUBBLE trends we are seeing. that made me a skeptic.
 
2) Tons of "common" people talk about getting rich, investing in crypto. THERE IS NO SUCH THING AS A FREE LUNCH at the same time experts in finance says KEEP THE FUCK AWAY. Example
 
3) Looking at Reddit/facebook forums makes me just baffled, people, talking about 1MIOTAS going to 1000$ like how in the fucking math. Just some simple here if we where to reach half of the market cap of bitcoin ( that is already crazy high) that is $182 771 118 802 /2 = $ 91,385,559,401 we get: 2,779,530,283 MIOTAS times ish $30 = $83,385908,490 probably $33. I think that proves my point.
 
4) People that should not invest, are investing.
 
Further, on let's say some criteria for BUBBLE trends that are based on history
Definition:* An economic bubble or asset bubble (sometimes also referred to as a speculative bubble, a market bubble, a price bubble, a financial bubble, a speculative mania, or a balloon) is trade in an asset at a price or price range that strongly exceeds the asset's intrinsic value.[1][2][3] It could also be described as a situation in which asset prices appear to be based on implausible or inconsistent views about the future.*
Source
 
5 steps of a bubble (Displacement, Boom, Euphoria, profit, and panic)
Displacement: A displacement occurs when investors get enamored by a new paradigm, such as an innovative new technology or interest rates that are historically low. Check
Boom: Prices rise slowly at first, following a displacement, but then gain momentum as more and more participants enter the market, setting the stage for the boom phase. During this phase, the asset in question attracts widespread media coverage. Fear of missing out on what could be a once-in-a-lifetime opportunity spurs more speculation, drawing an increasing number of participants into the fold. Ultra check
 
Euphoria: During this phase, caution is thrown to the wind, as asset prices skyrocket. The "greater fool" theory plays out everywhere. Valuations reach extreme levels during this phase. Ongoing right now
 
Profit Taking: By this time, the smart money – heeding the warning signs – is generally selling out positions and taking profits. But estimating the exact time when a bubble is due to collapse can be a difficult exercise and extremely hazardous to one's financial health, because, as John Maynard Keynes put it, "the markets can stay irrational longer than you can stay solvent." Note that it only takes a relatively minor event to prick a bubble, but once it is pricked, the bubble cannot "inflate" again. Yet to start
 
Panic: In the panic stage, asset prices reverse course and descend as rapidly as they had ascended. Investors and speculators, faced with margin calls and plunging values of their holdings, now want to liquidate them at any price. As supply overwhelms demand, asset prices slide sharply. Yet to start
Source
And there is so much more theory on this field, but my checklist is checked out.
 
Conclusion
 
I love everything behind IOTA and the technology, there is a limit to how much I can understand. But I can grasp the major differences between IOTA and bitcoin as such. I am myself invested in IOTA but that's mainly because I believe that I can be wrong, I would say that it is naive to conclude this is a bubble. So I have a put a portion I can afford to lose and that's it, and I am well aware of the risk. But my point here is that so many others are NOT.
Humans learn slow and keep making the same mistakes, few people manage to earn money from crises. As a fun fact, financial crises occur every 8-10 year, our last one would be the financial crisis in 2008. Source
My conclusion from this: DONT PUT YOUR SAVINGS IN CRYPTO if you cant afford to lose it get the hell away. There has been too much crisis based on tulips, real estate, fake companies and the list goes long.
This post was made because I feel there is much hype and not so much reality, people live different lives and struggle more with money than others. So please warn accordingly, don't hype things you don't know jack shit about in reality.
Peace Fellow Iota members, sorry for the long read.
submitted by FeelTheEarporn to IOTAmarkets [link] [comments]

What is the true value of bitcoin?

I've seen a lot of posts and comments to the effect of, "bitcoin is working fine, no absolute need to make changes right now." I think this reflects a fundamental misunderstanding of pricing and where the true value of bitcoin comes from.
Bitcoin has real value based on its utility to preform secure, fast, cheap, pseudonymous transactions (among other things). Bitcoin's true value makes it worth owning and gives legitimate backing to its price (of course, nobody knows the exact true value of bitcoin so the price may always bounce around, but no real problem there--a little volatility never hurt anyone). Here's what some people don't seems to get, bitcoin needs real value to maintain its price, and bitcoin needs users to sustain real value. The price won't magically keep rising forever.
I'm concerned that stake holders (miners, exchange owners, devs) are ignoring the fact that the current price of bitcoin is predicated on the belief that steps will be taken to scale the transaction volume. Bitcoin needs users--lots of them. If you shit on users/merchants, they will go away. You may say, "fine, we don't need them." Eventually, the value will drop and the price will follow. Bitcoin is a brilliant open source decentralized technology, but that means nothing without users/exchanges/merchants/etc.
There is no guarantee that the status quo (1MB blocks, no SegWit) will maintain ~$1000/BTC. In fact, I would argue that the current price will significantly drop if the expected network capacity increase is not realized soon.
What is the vision for bitcoin? From Satoshi's white paper: "Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments...The cost of mediation increases transaction costs, limiting the minimum practical transaction size and cutting off the possibility for small casual transactions, and there is a broader cost in the loss of ability to make non-reversible payments for nonreversible...These costs and payment uncertainties can be avoided in person by using physical currency, but no mechanism exists to make payments over a communications channel without a trusted party..."
If we throw out one of the primary motivations for the existence of bitcoin--small, fast, low cost transactions--we lose lots of users, and therefore reduce the underlying value of bitcoin. Is bitcoin a real currency, or just an academic exercise in cryptography? This should be of major concern to miners, unless they think they can maintain operations at $80/BTC or wherever the price settles after it becomes clear that the expected scaling isn't going to happen. I realize how silly I sound considering the current exchange rate, but ask yourself, What is fundamentally holding the price up? Can speculation maintain high prices forever? Remember that in 2011 $31.91/BTC was considered a speculative bubble. Without a large, growing user base bitcoin is nothing.
Essentially, this comes down to the economics of the situation. We have lots of technical savvy in the community, but people need to think about the economics too. I contend, 1) The status quo (failure to scale) is going to yield a steady decrease in the true value and utility of bitcoin. 2) I have no idea if the price will go up or down in the next 24 months, but a continued increase in price without network scaling will indicate we have a price bubble which will eventually burst. 3) Scaling of the network can lead to increased usemerchant adoption and new bitcoin based tech. This would create value to back the current price of bitcoin so we can see actual price growth reflecting value instead of just speculation.
tl;dr Much of bitcoin's real value comes from its widespread use and from people creating bitcoin based technology. The current exchange rate of $1000/BTC prices in expected future growth of the user base. Continued failure to scale the network will result in a significant price correction to adjust to reduced underlying value of the currency. This will be problematic for miners, investors, and businesses, and should be concerning to anyone excited about the future of bitcoin.
submitted by biggestblitz to Bitcoin [link] [comments]

We should start the work of arriving at a mathematical value for Bitcoin

Hearing Andreas talk about the superpowers Bitcoin democratizes shook something loose in my mind...
Bitcoin affords superpowers like anonymity, privacy, censorship resistance for transfer of value as communication, freedom from tyranny, and even tax evasion.
How have these superpowers been valued in the past? What products, legal or otherwise, provide access to these superpowers in one way or another? How are THEY priced?
For instance, moving money borderlessly is a power that has a finite number of enabling products and services with associated costs/prices. Since all wealth held in Bitcoin can be moved borderlessly, can we add the cost of doing such a thing without Bitcoin to the "underlying value" of Bitcoin?
What does it cost to make your transactions or wealth private? Well, offshore finance comes with transaction fees, account fees, and more. Can we add that to the "value" of a Bitcoin?
When I read articles of old FUD-y duddies scratching their heads as to how you could possibly value Bitcoin, I start to think of this equation.
How could we crowdsource this equation?
submitted by circansm to Bitcoin [link] [comments]

I feel like the underlying idea regarding the value of bitcoin is just wrong. Will someone enlighten me?

So I’ve been reading and talking to people trying to get a handle on this. There seems to be a general consensus that money has value because in essence it is an exchangeable and lasting ‘placeholder’ for lack of a better word, for work done. You do the work to plow someone’s field, they give you money for your work, and then at another time you can exchange that money representing your work for the product of someone else’s work such as a loaf of bread. The product of the miners work that he exchanges with the world for stuff is gold, etc. So how do we digitize currency? We get the computers to do the work, of course! What work will they do? They will solve increasingly complex math equations. Here is my problem. What the fuck can you exchange a math equation for really? Ultimately the value behind any money is the actual work performed behind it. If that work is something as useless and arbitrary as a math equation I just don’t see how any true value can accumulate?
submitted by AaronSharp1987 to Buttcoin [link] [comments]

Forbes- Bitcoin: 'Blood Diamonds' Of The Digital Era. The majority of Americans who trade in Bitcoin are likely breaking the law. The only reason Bitcoin has value to anyone is because of the underlying value as a medium of exchange for lawbreakers.

Forbes- Bitcoin: 'Blood Diamonds' Of The Digital Era. The majority of Americans who trade in Bitcoin are likely breaking the law. The only reason Bitcoin has value to anyone is because of the underlying value as a medium of exchange for lawbreakers. submitted by Barkey_McButtstain to Buttcoin [link] [comments]

[uncensored-r/Bitcoin] We don’t know if bitcoin is a bubble

The following post by zaghie is being replicated because the post has been silently removed.
The original post can be found(in censored form) at this link:
np.reddit.com/ Bitcoin/comments/7g2eck
The original post's content was as follows:
First, bubbles are characterized by a disproportionate relationship between price and value. Second, society is yet to ascertain the underlying value of bitcoin and blockchain technology Thus, we do not, at the moment, know if bitcoin is a bubble or not.
Thoughts?!
submitted by censorship_notifier to noncensored_bitcoin [link] [comments]

We have found that what started as investing in cryptocurrencies, has turned into a much bigger phenomenon. The underlying technology behind bitcoin is a revolutionary set of rules coded to allow people across the planet to exchange value.

We have found that what started as investing in cryptocurrencies, has turned into a much bigger phenomenon. The underlying technology behind bitcoin is a revolutionary set of rules coded to allow people across the planet to exchange value. submitted by FutureCoinClub to u/FutureCoinClub [link] [comments]

An investor should think like a business owner, not a renter

I was reading the WSJ this morning about financial advice. I thought this investment advice from Joe Mansueto, CEO of Morningstar would resonate well with Bitcoin investors.
An investor should think like a business owner, not a renter. Most businesspeople don't get up in the morning and ask whether they should sell their business that day. If they own a pizza shop, they don't think about whether what they really should own is a shoe store instead. They show patience and persistence and try to understand their underlying business better so they can earn the greatest return for the longest period of time.
So investors are in many ways misled by stock-market volatility. The values of the underlying businesses just don't change as quickly as stock prices do. You really don't have to watch those changes hawklike day after day.
It is in a lot of people's interests to get you to do something. Advisers and brokers earn commissions, fund companies want you to bring your assets to them. There are a lot of forces at work in the investment industry to get people to move, and there's not really a countervailing force to encourage you to do nothing. But you should.
Source: The Best Financial Advice I Ever Got (or Gave)
tl;dr: don't get caught up in the volatility if you believe in underlying value of bitcoin
submitted by LinxuSx to Bitcoin [link] [comments]

The biggest problem of Bitcoin is that people simply do not understand cryptocurrency.

Whether or not Bitcoin will succeed is a hotly contested subject without a clear answer; what isn’t a matter of conjecture is that cryptocurrency is here to stay. Cryptocurrency essentially allows numbers to be identifiable, secure and easily transferable - it also allows for distributed risk and distributed security; this is extremely important. It is entirely different to the current state of affairs for the numbers that appear on your digital accounts are merely an illusion in many respects; there is nothing special about them, they are not unique, they are merely a representation of a centralized ledger; a single point of failure without any inherent security within the numbers - numbers which you do not directly own.
Cryptocurrency and specifically Bitcoin at its core is a global network of numbers which are identifiable, secure and easily transferable. This network protects those numbers with cryptography and shared security; there is no single point of failure. A bank can be robbed remotely, it can be robbed directly and the government can if it so desires claim its wealth to name but a few of the risks. The network of Bitcoin protects against these problems which are inherent within traditional forms of currency & wealth.
Individuals, media and financial analysts all love to talk about mining Bitcoins yet such a perspective does no justice to the greater implication; mining is the network, a network which allows for distributed risk and distributed security. This point cannot be stressed enough for it is the future of commerce on a global scale for it is inherently superior to traditional forms of storing and transferring wealth. Your bank allows you to access your funds via the internet; the numbers which appear on your screen are essentially being copied and pasted from a balance sheet; they are not unique or secure.
As the old saying goes; united we stand, divided we fall. It is this network which gives Bitcoin value; the network provides the ability to store & transfer wealth wherever you are in the world and defends against whomever wishes to acquire that wealth be it the government or an individual. Moreover, it removes the third party; you have direct ownership of that wealth, there is no intermediary. Understanding the above is the key to understanding the underlying value of Bitcoin. The debate surrounding Bitcoin fails to understand this point which is the most important point of all and its a damn shame.
submitted by toomanynamesaretook to Bitcoin [link] [comments]

@Stratfor: As investors start to question the underlying value of cryptocurrencies like #Bitcoin, #Ethereum and #Ripple, markets will turn to a different class of digital assets: security tokens. Stratfor contributor Ashwini Anburajan explains. https://t.co/xi9MbwzYrS https://t.co/zwIMiBmC0k

submitted by Mukhasim to UMukhasimAutoNews [link] [comments]

"The intelligent investor never dumps a stock purely because its share price has fallen; they always asks first whether the value of the company's underlying businesses has changed" /r/Bitcoin

submitted by BitcoinAllBot to BitcoinAll [link] [comments]

What is the rational behind the greater than 100% value difference between the price of a bitcoin derivative GBTC and the underlying asset.

My point is this : If bitcoin fails and it's value goes to zero, GBTC's value also goes to zero except that investors in GBTC loses twice as much. So either GBTC's value drops towards the 'real' btc price or btc rises to reach the price of GBTC which is the REAL price.
I think that bitcoin's price across all exchanges are manipulated by vested interest and it takes a derivative like GBTC to show this out. So I would expect the price of bitcoin to rise towards it's indicative GBTC price. Gold back tokens trade close to the gold price so why not bitcoin.
GBTC also points to bitcoin's killer app being a store of value - ie a reserve currency rather than a currency in itself. GBTC has no other uses other than being a store of value.
submitted by phanpp to Bitcoin [link] [comments]

On 1st of January 2017, Each Bitcoin Was Valued At Under $1000

Currently each Bitcoin is worth $8,085, & the market cap of Bitcoin is $145,522,197,770
The Market Capitalization of Bitcoin is greater than the rest in Top 50 added together.
And to top it all off, we are currently in a bear market, and many people are claiming that Bitcoin is a useless store of value, as it was much higher than current price, in December 2017!
What a strange crypto world we live in!
https://coinmarketcap.com/currencies/bitcoin/
submitted by FluidAttitude to btc [link] [comments]

I feel like bitcoin is overvalued and Litecoin is under valued. Litecoin is cheaper and faster but bitcoin just has more popularity as of now. I just sent an LTC payment and it costed me 10 cents that’s nothing and it’s fast!

I feel like bitcoin is overvalued and Litecoin is under valued. Litecoin is cheaper and faster but bitcoin just has more popularity as of now. I just sent an LTC payment and it costed me 10 cents that’s nothing and it’s fast! submitted by legitcreed444 to litecoin [link] [comments]

The concepts of sound money, free trade, and voluntary association is one of the most under-appreciated values in the human race... Bitcoin is the embodiment of these concepts.

Until these ideas become more engrained into our collective consciousness, the wars won't end, the American Consumption Machine will get locked in overdrive, and we will continue our insatiable appetite for low quality goods and services that do not actually enrich the human experience much less our global ecosystem and natural habitat, which is under assault.
submitted by the420chronicler to Bitcoin [link] [comments]

Relativity speaking what is the price difference between a bitcoin and the cost of mining a bitcoin. Is it over or under valued

If it takes $1000 of hardware and $100 of electricity to mine a bitcoin then it's over valued. If it takes $50000 to mine a bitcoin then it's under valued. How much money does it take to mine a bitcoin?
submitted by Brassidius to Bitcoin [link] [comments]

BCH is now clearly under 5% of Bitcoin's value. In fact 0.049 to 2 s.f.

(and by Bitcoin, I mean the real Bitcoin.)
submitted by Dontrun_glide to btc [link] [comments]

The economic and value benefits of falling under 5% of Bitcoin's value.

There are numerous benefits. You can now buy over 20 BCH with one Bitcoin.
In the same way, rather than buying a steak for my dinner, I could buy 20 tins of dog food.
The choice is obvious.
submitted by Dontrun_glide to btc [link] [comments]

How to value a bitcoin - YouTube The Real Value Of Blockchain And Cryptocurrencies How the Heck Do You Value a Bitcoin?! (w/ Raoul Pal) - YouTube Value of Bitcoin - YouTube Factors that Determine the Price of Bitcoin?

Furthermore, the market has witnessed the rollout of many financial products that use bitcoin as an underlying asset, such as exchange-traded funds (ETFs), futures, and other derivatives. This can ... What Is The Underlying Value In Bitcoin Today's Bitcoin Gold News. BITCOIN is finished, according to one of the industry's most influential the block size is based on blockchain – the underlying technologyWhat The Experts Are Saying To appeal to the SEC, the share price would be too high for the average investor. While debate of bitcoin's legitimacy as a long-standing form of currency continues, general consensus asserts that the underlying blockchain technology has applications that extend far beyond its ... So the ultimate underlying value is going to be from the central banks, they’re going to preserve the value, not of Libra but of what Libra can be exchanged into.” Rajan’s comments may seem ironic for the cryptocurrency community, as the idea of Bitcoin at least, was for the redundancy of third parties including authorities. In aggregate, our estimate for the global value of stores of value comparable to bitcoin, including savings accounts, small and large time deposits, money market funds, and gold bullion, come to ...

[index] [34907] [10018] [7014] [24980] [21558] [6311] [26428] [16997] [4354] [16130]

How to value a bitcoin - YouTube

Enabling a dialogue about Bitcoin The VoB is a dialogue event that brings together skeptics, advocates, entrepreneurs and inquisitive decision makers. It is ... While the Bitcoin price has risen sharply this year, we will explain how Bitcoin the underlying Blockchain technology works and help you get a better picture of what lies ahead for Bitcoin in the ... In the first episode of "the bit," FundStrat Global Advisor co-founder Tom Lee explains different methodologies for valuing bitcoin. Lee shares his short-ter... Is there any way to make sense of bitcoin’s incredible rally? Raoul Pal asks Paul Brodsky, Chris Burniske, Nick Colas, Peter Brandt and Thomas Lee to lay out... We all know Bitcoin is a roller coaster of price changes, but have you ever wondered what determines the value of Bitcoin? Today Maria walk you through how the value of bitcoin constantly changes ...

#