Re:Bitcoin could become ‘worthless’, Bank of England warns
by donatj on Wednesday December 15, 2021 @08:22AM
(#29565527)
Is there a term for something between Metallism and Chartalism for the value of currency coming neither from innate value nor state backing, but rather our belief in it?
That's where I land I guess.
Magicism?
Re:Bitcoin could become ‘worthless’, Bank of England warns
by rjbwork on Wednesday December 15, 2021 @07:21AM
(#29564965)
Chartalism is more of an absolute. I don't claim that money has value only due to this reason, just that it is a significant component of the mass delusion.
Re:Bitcoin could become ‘worthless’, Bank of England warns
by md_ on Wednesday December 15, 2021 @07:25AM
(#29565019)
Agreed, chartalism as the only explanation for assigned value is clearly empirically false. But as one mechanism, or perhaps one of the stable or reliable mechanisms, is somewhat convincing to me.
While these risks clearly _do_ apply to traditional currencies, I do think, as an investor, it's worth considering market cap (as a proxy for "social belief in") and history of stability.
Bitcoin's market cap is probably (factoring in permanently lost coins) something like $750B, which makes it a bit smaller than, say, the Swiss franc, and its history of stability is much, much shorter.