Cryptocurrencies – Intrinsic Value & Practical Points
Bitcoin and other cryptocurrencies have an opportunity to completely transform the global monetary system, advancing the concept of money to new levels of innovation and transactional efficiency (along with other applications).
Below, I make the case that virtual currencies can have legitimate, inherent value precisely because enough people say they do. I also discuss a few practical limitations of virtual currencies, as they stand today (in early 2018). Specifically: volatility, mining and tax treatment.
Imbuing Value to Virtual Currencies
People frequently describe cryptocurrencies as “not real” and lacking intrinsic value. In other words, people feel the value is “just made up”. This, of course, is true. But it’s also true of all global currencies, including the U.S. dollar.