powmaxi on Nostr: What is bitcoin's value backed by? Bitcoin is valued for the things it can be ...
What is bitcoin's value backed by?
Bitcoin is valued for the things it can be exchanged to, just
like all the traditional paper currencies are.
When the first user publicly announces that he will make a pizza for anyone who gives him a hundred bitcoins, then he can use bitcoins as payment to some extent - as much as people want pizza and trust his announcement. A pizza-eating hairdresser who trusts him as a friend might then announce that she starts accepting bitcoins as payment for fancy haircuts, and the value of the bitcoin would be higher - now you could buy pizzas and haircuts
with them. When bitcoins have become accepted widely enough, he could retire from his pizza business and still be able to use his
bitcoin-savings
Satoshi Nakamoto
#bitcoin #nostr
Bitcoin is valued for the things it can be exchanged to, just
like all the traditional paper currencies are.
When the first user publicly announces that he will make a pizza for anyone who gives him a hundred bitcoins, then he can use bitcoins as payment to some extent - as much as people want pizza and trust his announcement. A pizza-eating hairdresser who trusts him as a friend might then announce that she starts accepting bitcoins as payment for fancy haircuts, and the value of the bitcoin would be higher - now you could buy pizzas and haircuts
with them. When bitcoins have become accepted widely enough, he could retire from his pizza business and still be able to use his
bitcoin-savings
Satoshi Nakamoto
#bitcoin #nostr