bitcoin isn't a store of value

[Anonymous No.24756032]

Money is the tool that facilitates the indirect exchange system, which mankind developed as an alternative to the inefficient barter system.

In the barter system, parties directly exchange the goods they want to 'sell' for the goods they want to 'buy'. This system carries with it several limitations that impede economic growth, and therefore human progress. these limitations are explained fully here: https://www.yourarticlelibrary.com/economics/money/5-main-difficulties-found-in-barter-system-discussed/37849

The indirect exchange system addresses these difficulties. In the indirect exchange system you 'sell' your good not for a good that you need directly, but for another good which you can then 'sell' for the good that you need. This interim 'good' becomes the medium of exchange(money).

For this to work, the medium of exchange must, like all the goods we wish to exchange it for, be a commodity with qualities that ensure there is constant demand. The reason being is simple - if we are to exchange goods for another good(the medium of exchange) rather than the good we want directly, we must be confident that the good which is now acting as a medium of exchange will have sufficient 'demand' from someone else who possesses the goods we want to 'buy' in exchange for the good which is now acting as the medium of exchange.

For example: if a farmer wants to exchange some wheat for say, some furniture from an artisan, there must be an artisan willing to exchange their furniture for the wheat in return. But the artisan doesn't want wheat in exchange for their furniture- however there are wide array of goods in the economy that the artisan WOULD want in exchange for the furniture.

This is where the indirect exchange system comes in. The two parties, who both have goods they wish to exchange between each other, can now use a 'medium of exchange' to complete the exchange.

[Anonymous No.24756037]

>>24756032
The artisan doesn’t want the wheat in exchange for his furniture, so therefore they cant barter with wheat. The artisan also isn’t confident that he can exchange the wheat in turn for the goods he wants In the future, so the parties cant use wheat as the medium of exchange. The artisan would however be willing to exchange his furniture for a certain quantity of copper – a commodity which he both has immediate need for AND is confident we will be able to use as a medium of exchange for goods he will need in the future.

The farmer is also able to exchange his wheat for copper, as there is a miner who wants to exchange his copper directly for wheat, and the farmer is confident he will be able to use the copper as a medium of exchange for goods he will need in the future, in this case, the artisans furniture. Thus, the medium of exchange is born, and copper acts as the ‘Money’ which the farmer uses to ‘buy’ the artisans furniture.

We see displayed here one key characteristic of the means of exchange, and that is that is that it is able to act as a ‘store of value’. For a good to act as a ‘store of value’ it means that it can essentially retain ‘purchasing power’, meaning people can be confident that the same quantity of the medium of exchange can reliably be exchanged for the same quantity of other goods throughout the economy. We can now use exchange ratios(prices), to tell us how what quantity of a certain good we can get in exchange for a certain quantity of money. For prices to be stable, and ultimately then for economies to be stable, then it is essential that money to be the best store of value possible. The free market will determine which commodity best serves as a means of exchange, as it is in everyone’s interest to exchange and store their value as effectively as possible.

[Anonymous No.24756057]

>>24756037Through much due process over the course of human history, the laws of supply and demand have deducted that Gold and Silver are the most efficient means of exchange.

We can now clearly see what ‘Money’ truly is, and what it cant be.

'Fiat Money', issued by governments, and ultimately backed by nothing but the commodities in which they are manufactured(in most quantities now, nothing, as they are digital) - are worthless and cannot function as a successful means of exchange over the long term. They certainly cannot be a long term 'store of value', as they are not a commodity, there is no 'value' to store, and there is no reasonable expectation that the fiat money can retain purchasing power over the long term.

'Crypto currency', like bitcoin, despite the common consensus, is ultimately no different from fiat in that it likewise is not a commodity and therefore has no 'value' to store. Despite its superiority in a digital, 'decentralised' sense, it is even inferior as a means of exchange, as it is slow, expenses and difficult to exchange(relative to other mediums).

[Anonymous No.24756299]

>>24756032
didnt read, not selling

[Anonymous No.24756310]

>>24756299
cope

[Anonymous No.24756328]

>>24756310
lmao stay poor you fucking slave

[Anonymous No.24756580]

>>24756032
Literally nobody cares.
Literally nobody.

[Anonymous No.24756715]

>>24756057
>it is even inferior as a means of exchange, as it is slow, expenses and difficult to exchange(relative to other mediums).
You clearly don’t know what you’re talking about. I could send coins to my friends across the world in literal seconds without being bogged down by banking middle men and the only thing making it difficult to exchange into fiat is artificial difficulty introduced by governments and financial institutions which feel threatened by this paradigm shift. If all the merchants decided to implement cryptocurrency in their payment system, exchange into fiat wouldn’t even be necessary.

[Anonymous No.24756917]

>>24756057
>it is even inferior as a means of exchange, as it is slow, expenses and difficult to exchange(relative to other mediums.
Still cheaper, faster and easier than gold. Assuming distance >100m

[Anonymous No.24756975]

>>24756715
Some merchants even accept crypto and have been for awhile. When merchants can just use crypto they've taken out the visas and Mastercard out of the equation

[Anonymous No.24757117]

You just wrote a small essay on what a medium of exchange is, and then deduced that Bitcoin isn't a store of value.

Do you realize that you did that?

If you think that a store of value has to be a commodity, then I suggest going back and sharpening your pencil, as you have much more research to do.