May 20, 2021 • 1HR 22M

Ep19 - Does Bitcoin Have Value?

Mentallyunscripted
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Discover how to use critical thinking to tear complex issues down to their simple basics and have productive conversations with friends and family about any topic under the sun.
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You've seen the headlines. Bitcoin is gaining in value, and the sky's the limit. Of course, you're wondering if you need to jump onto the gravy train before it's too late. But you're a logical, thinking person. You've wondered why anyone would pay money for something that doesn't exist? Not in a physical sense, anyway. And what's the likely future for bitcoin? Will it keep its value? What are the risks facing bitcoin and the crypto market?

Those are all excellent questions. And they're questions a rational person should ask in our new financial landscape.

U.S. government spending is through the roof. MMT is growing in popularity. And the political strategy of the moment is buying votes in exchange for promises of free stuff. Add those together, and you get unabated government spending.

Despite protestations from the government, the Fed, and the deficits don't matter crowd, inflation is real. And it's happening right now.

You may be looking at bitcoin as an inflation hedge. But the idea of paying money for a bunch of electronic 1's and 0's is unsettling. After all, you have to save for your kids' exorbitant college tuition. So, what do you do? The answer is that you start by building a foundation of knowledge built on rationality and not hype.

In Mentally Unscripted's second bitcoin episode, Paul and Scott discuss where Bitcoin gets its value. Then they move on to discuss the risks facing bitcoin and the crypto market.

Paul and Scott start by talking about subjective value. Then they discuss extrinsic vs. intrinsic value. For risks, they talk about the adoption of bitcoin and the likelihood of future government regulation.

Resources mentioned in this episode:

Positive feedback loop
Fear of missing out
Grisham's law - good money pushes out good money
Friction
Security - Freedom tradeoff
History of the income tax

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