The point is the manner in which Bitcoin satisfies their needs - ie by being a secure internet-based accounting system. But what does that accounting system count? Nothings.
If you have a secure accounting system for nothings, it will function just as well whether those nothings are claims on disks of pure Bitcoinium or invisible pink orange bitcoin unicorns.
I see the disconnect now.
The bitcoin ledger tracks the movement/ownership of UTXOs which are made up of satoshis and require energy to be produced. Perhaps you believe that goods must be physical, which would be mistaken of course. But even then you can actually have physical instantiations of Bitcoin using tools like Opendimes or Satscards.
Hope this clarifies things
Almost Marxist
Energy theory of value
Machine labor
I see how you might think that, but that is not the case. That Bitcoin units (satoshis) take energy to produce does not imply that their worth is because energy was spent. Every good takes energy to produce. The satoshis produced today take orders of magnitude more energy than the bitcoin produced in 2010, yet they are worth the same. If their value was due to the energy/labor spent then we would expect to see satoshis with different value which is not the case.
What is the value due to? You hope to pass it on to the next fellow. And what does he value it for? He hopes to pass it on to the next fellow.
Better hope you never run out of fellows
I can’t speak for everyone since valuations are subjective and vary from individual to individual.
Undoubtedly, many people don’t care for bitcoin as a form of money and instead hope they can find a fellow that will buy it for more than they did. That can be true for many goods, speculation is not unique to bitcoin. But generally speaking people that hold bitcoin for its use case as money value it because it lets them store value and to a lesser extent (at the moment) it lets them exchange it for other goods and services. The latter varies from place to place. But as we know it takes time for goods to monetize.
And by storing value, I mean purchasing power.
It would be strange to think of the USD as reflecting the "energy spent" on producing it, since this would make it simultaneously nearly valueless in one sense (money just mouse click away), and highly valued in another (the electricity, the labor, social capital, education, technical knowledge infrastructure, markets & networks that support the "full faith & credit of the US Treasury" don't come cheap).
The way some people describe it, hashrate and levels of energy expenditure are more a representation of the security, resilience, & technical capacity of BTC network infrastructure: (i.e. network health) than anything else.
The real cost of hashrate (computational & electrical power) needed to run a technically elegant & super efficient market for commodity money, seems like an emergent (or latent) derivative market of some kind - with BTC's difficulty adjustment auto-arbitraging the whole thing through code 🍄🤯
Or not 🤷
But the network is equally secure whether I own 1 satoshi or 100 bitcoins
So if the value of the currency is derived from the security, why is it value proportional to the number of units I own, which are no more or less secure due to their number?
This is the same root problem with fiat/token money. The $100 Federal Reserve Note is not actually 100x as fine a grade of green cotton as the $1 Note. The relative value of different units is arbitrary.
In contrast specie does not suffer from this problem - 1kg of gold is exactly 1,000x as much gold as 1g, and the material itself is what has value.
The value is not solely a reflection of the security of the network. Certainly people value the network and the asset in part because the ledger is secure. As I mentioned earlier, different people value bitcoin for different reasons.
That accounting system counts cryptographic GUARANTEES of energy expenditure (energy in physics contexts)
Energy expenditure (somewhat) constraints supply, does not provide demand
But I can create a new ledger with the same code, BTC2, which meets all the same needs as Bitcoin Classic
Nobody will care.
You’ll need network effects to dilute the “supply” you’re implying
Also, intrinsic value does not exist
There would need to be some difference in the code; otherwise, you would be running Bitcoin.
By all means you can do that. See BCash and BSV as failed examples. The assumption that your new BTC2 would meet the same needs that Bitcoin meets is that an assumption. Real world examples would suggest it wouldn’t.
I think secure accounting systems (with self-custodial units that can be transferred or brought with the user globally) compete with each other in terms of security, immutability, liquidity, etc.
In other words, now that this technology exists, it serves a need that I and others want. I don’t want to “redeem” bitcoins for anything- I want to take some of my dollars (units of a centralized ledger which don’t “count” anything other than themselves) and some of my gold (scare nature-based units but ones that I can’t really bring globally out of or into ports of entry), and convert them into units that are more portable.
Bitcoin provides a utility that so far nothing else can- I can memorize twelve words and use them to bring money globally. I don’t want to redeem my dollars, gold, or bitcoin for anything, other than goods and services. They are all basically units on a ledger, with different maintainers of the ledger (a central bank, or nature, or miners+nodes).
So if I determine that I want some % of my network to be self-custodial and globally portable, which imo seems to be a no-brainer, I then have to determine 1) what % of my net worth and 2) in which network or networks.
The only three network options at scale are Bitcoin and Ethereum, and then stablecoins which run on those and other networks. Of these, Bitcoin is the most decentralized, immutable, and biggest (which is relevant for salability/liquidity). Ethereum is big but more centralized, so I can’t really know what it’ll look like in say five years. Historically it had difficulty bombs which made hard forks easy to do, and now it uses proof of stake. And then stablecoins are useful but centralized; they are just digital Eurodollars.
So if I want globally portable and rather immutable units on a rather decentralized ledger, that is liquid and that I can self custody, Bitcoin pretty much uniquely offers that utility. And it has a monetary premium on top of its utility because it is scarce and has lots of optionality. So imo it serves as commodity money like anything else.
