Hacker News new | ask | show | jobs
by alexasmyths 3118 days ago
Points #1 and #2 are contradictory.

A speculative instrument is the opposite of a store of value.

A 'store of value' is like real estate - low-risk, probably low-return, but you can park your money there and in X years, it's going to mostly be there. US Bonds.

Your bank account, i.e. USD is a decent, though not great 'store of value'. Your USD is not going to go $0 overnight.

Speculative investments are there to generate return almost always involve more risk.

BTC could go to $0 tomorrow. Suppose the US Gov. makes everyone legally declare their BTC assets as assets and they are subject to taxation etc.. That might pull the plug on BTC, but worse, cause a stampede crash in a highly volatile situation. There are many reasons that a rush-to-exit could happen for BTC. So - speculation - not a 'store of value'

These other fetures of BTC may have been important early on but they are not what gives it value.

Because nobody is using BTC as a currency, almost none of those points are pragmatically relevant - yes - in theory, they need to exist to have gotten it off the ground.

4 comments

>BTC could go to $0 tomorrow. Suppose the US Gov. makes everyone legally declare their BTC assets as assets and they are subject to taxation etc..

BTC is ALREADY taxed as an asset. If you buy $4 worth of BTC, price goes up 20% and the next day you buy a coffee for $5 that is a Taxable event that you need to record and submit a record of your 1$ gain to the IRS to be taxed. Currencies like the euro ect have an exemption for low dollar amounts of gains that BTC does not currently have. If you hold for a year, you can get the 15% long term capital gains.

>Because nobody is using BTC as a currency

People used to when there were low fees. We will get low fees again, but until then, it opens up the chance for other coins to take BTCs market share.

They're different narratives but I think they are both in play.

If you ask a Bitcoin investor about why they invested, then they might explain it as a store of value, "digital gold", or etc. With that narrative, Bitcoin makes sense in the world, and isn't just a fad. And the erratic price is just a growing pain, it'll stabilize eventually.

But of course, the real reason many people are buying BTC right now is because of the speculative nature, they want to get rich quick. If someone's investment in BTC is significantly larger than their investment in bonds, commodities, real estate, etc, then "it's a store of value" is probably not the real reason they're buying BTC.

> If someone's investment in BTC is significantly larger than their investment in bonds, commodities, real estate, etc, then "it's a store of value" is probably not the real reason they're buying BTC.

Are there any good articles or blog posts analysing this trend?

It seems real estate is not great example. If we look at 2008, wasn't it because there were people speculating on housing?
Declaring BTC and paying taxes will not bring it down. It will legitimise it as an asset