Bitcoin - I don't Understand

I don't do Bitcoin. As I understand Bitcoin is a digitally manipulated means of creating wealth and I am the worlds biggest digital dummy. But I been told over and over that there is no physical asset tied to Bitcoin... But today I see a Bitcoin token/medal or whatever it may be and it is bid up over 20k! It is struck from titanium, a metal that I can purchase for fifty bucks a pound..... So if there is no physical asset to Bitcoin, what on earth makes these Bitcoin tokens so desirable?


Photo is courtesy of Great Collections

 

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They're valuable because multiple bidders think they're valuable.

I'll leave it to the next poster to explain why the bidders believe that...

 

Btcc makes coins that have digital currency embedded.

https://wiki.coin.community/BTCC_Mint

 

I'm with Randy, but I'll try to answer:

Ponzi.

 

It's the ultimate in the Emperors New Clothes. If you can't hold it you don't own it!
Until Russia invaded Ukraine, one of my daughters worked in marketing representing a digital currency outfit owned by a Russian. She was earning huge sums of money and part of their operation was selling NFT's. They auctioned $100,000 cars "painted" by NFT artists and you could only see them if you bought their key and the prices were in the millions. To her credit she resigned on moral grounds when Russia invaded Ukraine and has worked her way up to managing a company that provides aids to huge corporations allowing accessibility to their products to disabled users.
The huge thing I took from her very lucrative employment was, that neither she nor her senior colleagues accepted payment in Bitcoin. They would only accept Pounds Sterling, Dollars or Euros.
She is a millennial so was never taught history so I had to explain to her about the "South Sea Bubble". Her comment was "yes, just like Bitcoin, a figment of the imagination and who wants to own anything where you lose your wealth when someone switches you off".
The answer is perceived value and people motivated by greed because they don't take the trouble to understand the reality of what they are buying. This coin has no tangible association to the "value" of Bitcoin and intrinsically is worth , as @Randy Abercrombie intimates, $1 and the laughable grading fee.
I love this because it deflects stupid investors from screwing the market for bona fide collectors. Long may they waste their money and time on such stuff.

 

I know nothing about Bitcoin and I plan to keep it that way.

 

Nothin' from nothin' leeeaaaves nothin',
Ya gotta have somethin', if you're gonna be with me.

That's all I got for ya.

 

The physical token just has the symbol and that's only worth the metal.

Now some are funded, that means the address of a wallet with coins is on the token. So that has both the value of the metal (some were made with gold), and then the value of the bitcoin.

 

Yeah, like my 1 square mile of land on the moon a relative bought over 40 years ago as the paperwork reads for me.No oxygen, no water, maybe some metals, etc. In my eyes, such as bitcoin giving paper units for precious metals as equals, who do you think is the fair side and always give precious metal units when asked or gives alternative paper or cheap metal or other and says it is worth it soon or in the future.

 

You've got land on the Moon too? I somehow own a square mile of it, and I've been raking in big bucks from the extraterrestrial visitors. Somehow their checks clear.

 

My parents bought the same, 1 square mile when I was a kid. Turns out it’s the mile that the US landed in 1969 when we first set foot on the moon. There’s a U.S. flag flying on that very spot.

 

This particular token is funded. If you were to peal away the sticker, it would reveal a code that can be used to claim the 5 Bitcoin. And Great Collections shows the current value of the Bitcoin under the title. For now it is still well under the Dollar equivalent (but that should change when the auction ends).

 

Here is the full image from GC, with the sticker on the reverse.
Some of these tokens are collected and have low mintages, so there is a premium above the Bitcoin value (although that tends to happen with smaller amounts-not the ones that are 500k+ in exchange).

 

I'm out!

 

Bitcoin is the dream of becoming rich without doing any work.

 

Money derives its value from the fact that other people and perhaps the legal system accept it as payment for goods and services. So long as others view it as a store of wealth, Bitcoin will have value. I don’t know if the U.S. or any other courts have recognized Bitcoin as legal tender in an isolated case. If they have, that’s a boost for it.

As for high value, that’s because more people have recognized Bitcoin as money while the supply of Bitcoins has remained the same. That was one of the attractions. The Bitcoin money supply remains the same, which prevents increasing it which would cause it to lose value. The physical Bitcoins sell for high prices because they represent the Bitcoin currency.

If people lose faith in Bitcoin, its value will fall. If they start to think that it is a Ponzi scheme, its value could go to zero. That can happen to any currency, including the U.S. dollar.

 

My understanding is that huge amounts of energy, ie- a significant percentage of power production, goes into creating bit coin out of thin air. Then the only practical purpose of it is money laundering for criminals and the elite.

So the bottom line is everyone pays massive utility bills to help the economy function better for those who don't care how high their utility bills are.

 

I think of ice as solid electricity and bitcoin as all the ice in a glacier that will eventually become an iceberg and sink something before disappearing forever in the cloud.

It's equivalent to penny production on a much larger scale. Like all the refrigerators in the world churning out frozen electricity and soaring production of refrigerators.

 

That's also true of precious metals, albeit with a floor based on their value in use.

More generally, the value is what people are willing to exchange for it - my 1 gram of gold for your case of baked beans.

"Our best estimates suggest that around 216,265 tonnes of gold have been mined throughout history. "


If gold were found in such quantities that it was useful only in electronics, it would still have some (small) value.

That's the fallacy of Psyche (the asteroid)... it's "worth" "$10 Quintillion" dollars, except if it were mined, the quantities of "precious" metals would depress their "value".

https://science.nasa.gov/mission/psyche/
https://www.gold.org/goldhub/data/how-much-gold