I guess I mean "valuable" in the intrinsic sense, not the financial sense. If, for example, in the model that Stripe outlines, the Bitcoin network ends up powering the Bank-to-Bank side of things (away from the consumer), only a handful of counterparties are going to be involved on the BTC side of things. Millions of consumers may use Stripe/whoever to send $$ to millions of other consumers, but that might all be handled by a (relatively) few BTC flying back and forth in batches on the back-end, which doesn't necessarily require a large per-BTC price.

I know not a perfect example but that's my gist.

I understand but I'm afraid you are being misled by the article.

While I believe it is an interesting scenario. I do not envision something like that will happen. The only reason it might is for its "consumer protection" value.

I appreciate that Greg realises some of the promises of Bitcoin but the true value for "billions of people" is not an optimized "clearing house". I expect Bitcoin to scale to a point where the store of value and liquidity concerns are non-existent.

At this point, high-inflation economies will turn to Bitcoin, and not gateways that will convert their already worthless currencies to USD or whatever. This provided value will ultimately catch on over here at which point some will find it largely preferable to hold BTC and not their "normal currency. Hell, some already do.

> Millions of consumers may use Stripe/whoever to send $$ to millions of other consumers, but that might all be handled by a (relatively) few BTC flying back and forth in batches on the back-end, which doesn't necessarily require a large per-BTC price.

That depends on what you mean by "large per-BTC price". It requires a certain minimum BTC price to move a certain amount of money when settling in bitcoin. You can't move $1M USD in one Bitcoin transaction if a single bitcoin is worth 1 cent and there are only 20 million of them. So the bitcoin price measured in a certain currency limits the maximum transaction volume for that currency when settling in bitcoin.

Secondly, and perhaps more importantly, it requires great liquidity/market depth. One must be able to buy or sell a lot of bitcoins without affecting the price. This is the essence of money: a high-liquidity commodity.

> I guess I mean "valuable" in the intrinsic sense, not the financial sense.

When settling in bitcoins, they need to have value in "the financial sense". That's a requirement.

Agreed. The people who say that don't understand that something that Bitcoin got right (though it can be improved) are the incentives. People looking after their own self-interest will make Bitcoin work. That's why all those clones that tried to remove the currency part failed horribly. Eg: "It's like Bitcoin's blockchain, but for a social network!".

The value of individual bitcoins depends as heavily on how long bitcoins are held as it does on the transaction volume.

If there are 20 million BTC in active circulation and the bitcoin network processes 20 billion USD per day in transactions, than the "intrinsic value" could be $7000/BTC if the average bitcoin is held for a week between transactions (eg, you are paid biweekly in BTC and spend them constantly), or it could be $40/BTC if the average bitcoin is held for an hour between transactions (eg, people hold fiat and the BTC are in constant use by the gateways).

A high intrinsic value really requires adoption both as a payment network and as a store of value.

If one uses BTC primarily for exchange, one doesn't care what the "value" is. The only priorities are the convenience and reliability of the conversions into and out of BTC. These are threatened only a little by volatility, and not at all by actual BTC value.

Agree for the most part, so long as there's sufficient liquidity in the target fiat currency.