> In contrast, tulips weren't a new technology.

Depends on your definition of 'technology'. From wikipedia:

> The tulip was different from every other flower known to Europe at that time, with a saturated intense petal color that no other plant had. The appearance of the nonpareil tulip as a status symbol at this time coincides with the rise of newly independent Holland's trade fortunes.

In any case, they were certainly new, and there was reason to believe that lots of people would want to buy them.

I'd compare to Second Life. Huge hype, huge investment, but no-one can quite connect it with doing something useful. And that's what I expect to happen to cryptocurrency: no big bust, just a gradual fading from view as it turns out there's no there there.

Still, to extend the metaphor, we may see a world where cryptocurrencies are like Second Life, but the blockchain is like social media in general. Meaning: it's not so much that Second Life didn't do anything useful, the useful functions it performed were just replaced by more suitable systems, while the useless bits were discarded.

Second Life was an attempt to do a full simulation of life online, a clumsy transfer of what it is to be alive directly from reality to internet; as it turns out, the technology of the internet is good at a lot of the fun parts of Second Life (talking to friends, meeting new people) but those can be performed by new systems, unburdened from trying to be a simulation of something else (messageboards, forums, and so on to Facebook/tumblr/twitter etc). The other parts (from raising virtual pet rabbits to the whole concept of walking from place to place) were just sort of fluff, and so the experience faded not because it was a bad idea, but because it could be done better once it stopped caring about the simulated fluff.

Cryptocurrencies may not be that useful, but there's a possibility that they prefigure something larger; they're still mimicking a pre-existing model of currency, economy, and exchange that can itself be disrupted. If we analogize cryptocurrencies to Second Life, it means they'll fade because their functions will be replaced by a completely new way of interacting/handling value, and the blockchain can still be an important technology for that. (For the record, I think it's too soon to tell, and am not that optimistic about any current blockchain ventures.)

Second life wasn't a new technology, it was just a video game by a single company. It wasn't decentralized, it wasn't even made for anything other than entertainment.

If you think cryptocurrencies have no utility at this point, you have your head in the sand. To use money electronically right now, you need a bank, you can't do it yourself.

If I have zero bitcoin at the moment, how do I go about attaining some without a bank account?

Invest in the appropriate hardware and mine it.

Another alternative would be to trade goods or altcoins for fractional BTC.

Is mining still a viable path to obtaining bitcoin?

That's the $64,000 question. Seems Fidelity is interested in the answer, too.

https://www.reuters.com/article/us-fidelity-bitcoin-idUSKBN1...

You can work all the same with billing in Bitcoins/Ether instead of USD/EUR. Either with simple invoices with your wallet’s address or via special platforms as Bitwage [0].

[0]: https://www.bitwage.com

Anyone can use cash to buy pre-paid credit cards at a drug store then sell the code on localbitcoins etc. though I suppose this technically contradicts what I was saying earlier about needing a bank account. Still though, you are dependent on another company who is the one that actually controls your money. If they decide not to let you use it for any reason, that's it.

Tulip bulbs aren't liquid, don't fit in my wallet and only last 12 months.

The last one isn't right. You can get multiple generations out of a single tulip bulb. Thompson's book goes into more detail about how early tulip markets functioned and the role of tulip-breaking virus, but the key part is that specific tulip varieties (created by the virus) would be continually introduced and be grown and spread but each generation was weaker and eventually the variety died out entirely. So they had built-in scarcity, leading to initial high prices (as only a few bulbs existed) and then declines as they became popular and investors cultivated them, eventually disappearing and making room for new varieties.

So not quite money, but not quite individual artworks/collectibles either; maybe more like prints with limited runs? (In a similar way, woodblocks wear out so scarcity for a particular print series is enforced.)

But they have inherent utility unlike Bitcoins.

Really? What is their inherent utility? Looking pretty? I'm pretty sure a stronger case can be made for bitcoin's utility than than.

What's the case for Bitcoin's inherent utility? I could place some tulips around my flat and they would make me a little happier, for a little while - and that's what utility to humans ultimately boils down to.

The difference between Bitcoins and tulips is that someone can like tulips, and assign a value to a really cool tulip based on that. They can weigh the benefits of a tulip versus a rose or a painting of a tulip, and buy one based on whether it gives a good return of enjoyment for the price.

On top of that, you get tulip traders, who seek to buy tulips from people who value them less and sell them to people who value them more, and speculators who acquire and hold tulips on an expectation that they will be worth more in the future. From there the market can explode and the price can rise far beyond whatever the primary users of tulips are willing to pay.

The weird thing about Bitcoins is there is no floor to their value - their value as a unit of exchange or a store of value depends entirely on how many people are willing to accept them. A Bitcoin is not a tulip that some people want to simply admire or a corporation that has revenue or a parcel of land which has potential. With all those things, you might just want the thing for the thing. With Bitcoin, you only ever want it, either as a store of value or a medium of exchange, because other people also want it.

This is where everything becomes weird. With other markets, tulip or stock or real estate, you can speak of the commodity as being over-valued when speculation drives the price above what the people who want the thing itself are willing to pay. With Bitcoin, you cannot. You can't call Bitcoin overpriced or underpriced because it has no grounding, no price that is independent of demand.

Maybe you could point to various ways people try to abuse bitcoin blockchain as the utility. But then you still have to offset the disutility of wasting huge amounts of electricity.

They're edible and a common source of food in the Netherlands during world war 2.

... the Dutch (in northern cities) turned to eating tulips - and everything else - in the desperate "hunger winter" of 1944; that's very different from "a common source of food (...) during world war 2".

(Tulips are obviously not an efficient food source; don't expect to see people eating tulips except in unplanned-for emergencies.)

I get what you mean but for some people, Bitcoin has utility value when it comes to buying altcoins. For the less popular coins, the only way to acquire them is by first converting fiat into either ETH or BTC.

Nothing has inherent utility.

Utility/value is relative - maybe a tulip is worth something to you, but it's not worth anything to me.

I disagree, I mean, food has inherent utility. Food is valuable for everyone and even though you might not like certain foods, you _need_ food in general. Some things are more usefull for us as a society than others.

I do agree with OP that certain things might not be usefull even tough they currently hold commercial value, I just think Bitcoin is usefull. And I also believe that BTC is usefull in an infectious way.

See W. F. Lloyd for a compelling argument that all value is relative.

http://socserv2.socsci.mcmaster.ca/~econ/ugcm/3ll3/lloyd/val...

What if someone is allergic to your food. What if there's a virus that makes everyone allergic to a specific food. The value isn't inherent.

The argument is not that everybody sees the same value in everything, but where that value comes from. I think the value of the food comes from the food (to the extent that somebody eats it). I don't think it comes from a thought.

The value for that speciffic food is nil (for you), but food in general is still valuable and has intrinsic value. There are people alergic to peanuts but peanuts still add value and nurture for lots of people.

Regardless, I fell like you're begging the issue. Not all value is relative, some thing are more practically valuable than others and sone, if you look at them objectively, are almost worthless.

> The value for that specific food is nil (for you), but food in general is still valuable and has intrinsic value.

I'm not understanding this argument. How can value be dependent on the context and intrinsic at the same time?

If peanut allergy spread to the entire population, would peanuts still have intrinsic value?

If the sun exploded and everyone died, would anything still have intrinsic value?

This is a facile line of argument. There are reasonable assumptions we can make about how stable a particular context is.

So value is intrinsic if it meets some vague criteria of stability? How stable does the value of something need to be for it to be intrinsic?

Can you enumerate these "reasonable assumptions"? The idea sounds pretty dubious to me.

And yes, I would say that if the sun exploded, killing all Earth life, nothing would have value, at least not from a human's perspective. This doesn't seem to help the case for intrinsic value.

Sounds like a game of semantics to me. Value is a human concept, so eliminating all of humanity doesn't prove anything with regard to the nature of value, intrinsic or otherwise. That's like saying "poison is not inherently dangerous because without life on earth it ceases to pose a threat". Ok, that's technically true, but you're not saying anything meaningful since nothing has meaning outside of the human context. The point of labeling a quality as intrinsic is to point out that the quality being described arises from the fundamental nature of the thing regardless of how it is perceived. Food has inherent nutritional value because nutrition is a function of an object's physical composition. Nutrition has inherent value because nutrition is necessary for survival. The ability to survive has inherent value because it is a fundamental need of all living things.

I agree that food is pretty darn close to having a constant, stable value to all humans.

However, the edge cases aren't imaginary, and they give us a chance to refine our ideas.

Say there is a huge harvest and a town now has much more food than it can eat. A food merchant passes through the town and wants to sell some of his goods, however obviously no one is interested. Has the merchant's food lost its intrinsic value? Why doesn't anyone want it?

We can also consider the vastly different food preferences found all over the world. And so on...

Being a bit pedantic, food isn't really a specific thing, it's an amorphous category. It's literally defined as "anything people eat that provides nutrition", so it almost feels tautological to say that food has intrinsic value.

Finally, almost any other concrete, specific example I can think is much less universal than "food".

Bitcoin has inherent utility as a store of value that cannot be frozen at the whim of a government agent or a banker.

That's a function that we ascribe. A potato can inherently store (some) value because you can eat it and be nourished. A house has inherent value because it is shelter. A bitcoin has no inherent value, only ascribed value.

What does "ascribed" vs "inherent" mean to you?

I would describe the distinction like Gresham's law. Suppose we have two units of currency, each with identical face value: a real tulip bulb, and a certificate worth 1.0 tulip bulbs, or a silver coin marked $1 and an iron coin marked $1.

In each case, the face value is identical but one of the units has an additional possible area of value, extrinsic to the marked face value. You can melt down the silver coin, eat the potato, plant the tulip. This puts a floor on the value of the item - it's worth min(facevalue, extrinsicvalue). Something worth min(facevalue,extrinsicvalue) should be worth more than something worth min(facevalue, 0).

Bitcoin doesn't seem to be something that can be planted, eaten, etc. It doesn't have another area of value, other than being bitcoin.

Much of the world lives under repressive regimes that can confiscate your assets at the drop of a hat. There is nothing other than cryptocurrencies that can protect them. That's a super valuable utility.

> There is nothing other than cryptocurrencies that can protect them. That's a super valuable utility.

Until the regime gets the private keys, which isn't unlikely. As soon as cryptocurrencies are widely adopted, regimes will learn about them and not only take the cash but also search for the keys.

There's also the question of whether you will be allowed access to the technology to make bitcoin transactions. Take away smartphones and it's "Have fun signing your transactions by hand and thumb-typing the transaction as a text on a flip phone!".

When circumventing government, there's also always the question of "how likely is it I will be caught?" and "what happens if I do?". If the penalty is "you get shot in the back of the head" or even just "you spend a year or two in a comfy minimum-security prison" and the probability is "non-zero", most rational people aren't going to assign a high enough value to "not having some money confiscated" to choose circumvention.

You really think a regime could survive banning personal computers and smartphones? Or even that it would be in their interests to do so? They still need an economy, even if it means they can't catch everyone hiding money.

The question is more about the relative value of Bitcoin against other actions you can take to avoid having all your money confiscated by an oppressive regime. Do you think your government can take the cash from your wallet, the gold from under your bed, and the potatoes buried in your fields, but not your smartphone or personal computer?

Not the potatoes but they can search and find gold and cash easily. They can't search your iphone unless you give them the code, and even then you don't have to store your BTC on your own device, you can easily store it in an encrypted server out of the country.

Customs can easily catch you smuggling cash, gold and potatoes, but they have no idea you are leaving to cash out your bitcoin in another country.

Hiding your private keys is hundreds of times easier than hiding cash or bullion.

Absolutely. You could easily memorize a key seed, and it would be impossible for anyone to even know that you own Bitcoin.

agreed.

Do you disagree that there is no inherent utility in the ability to create a digitally-signed global timestamp?

What is your argument against the inherent utility of owning Bitcoins?