I never understood what Bitcoin's value is based on. People say it's traded in exchange for work, and while that's technically true in the computational sense, it's pointless work unless it's being done for somebody, for some reason. What are the Bitcoin work units actually for? Curious mathematicians? Corporate or government crooks trying to crack somebody's encryption?
The value of bitcoins is based on there being a finite supply as well as a desire to own them. The desire to own them does not have to be rational for it to be a source of demand. Think of it as owning a share in a company that does not pay dividends -- who'd want one of those? Many do.
The investment side is about gambling on other people being even bigger idiots than you.
The mining work is useless by design, but mining bitcoins is a footnote at this point as it is no longer feasible for the average savvy computer user.
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The investment side is about gambling on other people being even bigger idiots than you.
The mining work is useless by design, but mining bitcoins is a footnote at this point as it is no longer feasible for the average savvy computer user.
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