There are a lot of things I don’t understand, including things I’m sure you do. But I generally know when I don’t know, and do have strong conviction in my conclusions on this subject.
That part does come down to community, and network effect. Yes, it’s a key component, but by no means the only true value! The open, fair nature of the code does a lot to embolden the confidence of the community. If it was an unfair, non-impartial asset, the community would likely fracture.
But what if someone just clones bitcoin?
Well in fact, people have copied the code, or forked the chain, and it has always ended in failure.
I struggled with this thought myself when I first entered the space in 2017. Either you’re opening yourself up to multiple coins, or for another coin to take over as the one true coin.
If you open yourself to the infinite multicoin theory, there is no scarcity, and wealth bleeds out as value dilutes. Scarcity is essential.
But here is the thought that solidified my conviction in bitcoin:
So what if another coin becomes the one true coin due to better tech, mass promotion, or whatever?
That sets a precedence that undermines the whole space, including the new coin.
King Coin #2 would eventually fall to King Coin #3, and so on.
This might be fine for gamblers, but disastrous for wealth preservation or economies.
Having one true coin is the only way it really works. We’re just lucky to be in a timeline where the first major true coin was also fair and decentralized.
“Why would AI buy into the valuation, when it knows the value of its work is so much higher?”
I think I get what you’re saying here.
Wouldn’t it rather have an asset with established real-world value instead of one that’s as virtual as an in-game currency? I don’t think it makes sense for AI to have a completely secluded circular economy. You’d want something connected to the tangible world, that has value for humans and that humans could pay into.
And unless you have an energy-intensive system of mining, you won’t have an impartial asset; there will be some company or group in charge of the currency.
Interpersonal perception is key to value. It’s not what we like, but what others are willing to trade for.
By logical conclusion, monetary value is in what other people think other people think has value. It does not pay to be a contrarian and hoard shiny glass beads instead of gold.
Abundance of monetary assets is dilution is loss of wealth.
Because scarcity is essential to the preservation of value, it makes sense that we converge on a singular monetary asset. And so the majority will, in their own best interest, continue to flock to what the majority is flocking to, concentrating their wealth.
We could wrack our brains forever with possible scenarios, but the hive mind is going to work like a Ouija board, ending up on the most obvious answer, and that is obviously bitcoin.
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