Absofreakinlutely!
The ones calling bitcoin a bubble are not understanding one very important thing.
Well actually, them calling it a speculative bubble is right on.
It is.
However, many that say bitcoin is in a bubble are really trying to say that they think it should be valued significantly less.
But who's to say if they are right or not?
You see, bitcoin is worth $0, or $1000, or $10,000, or $1,000,000.
Bitcoin is worth exactly what it's holders say it is worth.
Much like gold, there is very little intrinsic value of bitcoin. There is the cost of mining the coin much the same way there are input costs of mining gold, so theoretically one could say that price is the intrinsic value. Though many could easily make the argument that isn't even a good measure.
So, if bitcoin doesn't really have an intrinsic value, it's value becomes basically whatever market participants say it is worth.
Which means that if enough people think that bitcoin is a good long term store of value, it actually becomes just that.
The fact that bitcoin isn't controlled by governments, is much more portable than gold, is very difficult/costly to counterfeit, and is fairly secure gives it's holders strong incentive to hold it.
That doesn't even take into account what happens if use cases pick up.
There is also the network affect.
Which says that as it's number of users increase, the value of the network increases exponentially.
Instead of a 1 to 1 relationship, there is an exponential relationship.
I actually did a post about this a while back in how this could pertain to Steem and Steemit and why it is important to get as many users on the site as we possibly can.
The post can be read here:
https://steemit.com/steem/@jrcornel/the-price-of-steem-should-currently-be-trading-at-usd2-22-and-here-s-why
What this means:
Basically this all means that if we as collective holders of bitcoin decide that bitcoin is a good long term store of value we can essentially make that a self fulfilling prophesy by holding our coins.
If enough people do that, whala! We just spoke it into reality!
Futures launch in T-minus 25 hours, be ready for some extreme volatility folks.
Stay informed my friends.
Image Sources:
https://squawker.org/technology/bitcoin-gold-hard-fork-simplified/
http://www.mkbergman.com/837/the-law-of-linked-data/
