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by ceejayoz 3125 days ago
> But as a store of value, it's actually pretty good.

It's got a pretty short, volatile history to be deciding that.

2 comments

also much more difficult for average person or even gigantic corporation to secure than a physical good e.g. gold. And coins change over time with forks n crap, gold just stays gold.
It's very easy to secure. Just generate a private key offline and never tell it to anyone.
Gold is very easy to secure. Just dig a hole and throw it in. Nobody will find it if you don't tell anyone about it.

Seriously! A digital key is NOT easier to secure than a physical one. If anything, it's harder.

Gold only becomes hard to store if we're talking about huge quantities

Print the key on paper and put it in a safe. How is that not easy?

Or etch the key on a piece of metal, seal it in plastic, and throw THAT in the ground, if your are that way inclined!

I don't see the difficulty.

You can do the exact same thing with bitcoin. Write the write the recovery key on a piece of paper and bury it in a box.

The advantage of bitcoin is you can encrypt it and store it offline in as many locations as you want.

Over the past ~7 years, the price has increased by ~10^5. There have been some bubbles, for sure. But all that has paled over the past year. The price could crash, certainly. Still, if futures become available, it could spike a lot higher before it does.
And this is exactly what makes it a terrible store of value. As Wikipedia says, "The point of any store of value is risk management due to a stable demand for the underlying asset." Stable demand is definitely not a characteristic of Bitcoin.
one word: gold

no reason it stores value outside of the fact that we all agree that it does, and we all accept it for curreny. Bitcoin is at that point. It's turning into digital gold.

I agree with the original commenter. Looking at Bitcoin as a currency with terrible UX kept me from investing for the past years. Now it's going past inflection point - it's a store of value that will be acceptable everywhere soon.

You'd do better to spend a minute Googling before saying something so definitive. The use of gold for jewelry and industrial applications outweighs the investment use of it:

https://www.statista.com/statistics/274684/global-demand-for...

Gold has been valued from time immemorial for its unique aesthetic and practical properties entirely aside from its value as a currency.

That's clearly distinct from, say, paper dollars, which indeed have value only because we agree that they do (and because they're backed by the robust efforts of a government, of course).

You are looking at the wrong metric, it seems like they count only transactions, not holdings. Only Fort Knox holds over 4000 of metric tons of gold.
Sorry, I'm not following. The thing that makes a store of value useful is stable demand. This metric demonstrates stable demand. Holdings are irrelevant.

As an example of the difference, look at oil or bananas. Demand for those is significant, but because storage is inconvenient, holdings are low compared with total commodity flow.

Yes, demand has overall increased dramatically since 2010. And it's still increasing. Perhaps dramatically. You can characterize that as unstable, if you like. But given that my mean cost basis is well under $1K, it's stable enough for me.
How much did the value of Peter Thiels Facebook stock go up since he initially invested?
«the price has increased by ~10^5»

Actually more than 10^6: http://bitcoin.zorinaq.com/price/