I get asked, with remarkable frequency, what I believe the fair market value of bitcoin is today and what it will be in the future. I suppose that because I don’t invest in bitcoin (in the sense that when I buy bitcoin it’s not specifically in anticipation of selling for a profit upon its increase in value) I have no idea how to answer the question. And try as I might, I cannot bring myself to care about the answer.
And indeed, part of me feels that those who equate the value of bitcoin with its equivalent price in dollars are missing the point entirely.
When I buy bitcoin, it is for the purpose of having a super low-friction, trustless means of transferring value from me to someone else, anywhere else on the earth, for zero fees, almost instantly. That fact alone — the very utility of such a tool — is what gives bitcoin its value.
I know intuitively that bitcoin works and that millions of dollars worth of the digital currency are exchanged daily. Blockchain.info provides a bitcoin transaction “ticker” anybody can watch. With each tick, the blockchain has been updated to reflect the transfer of value from one bitcoin wallet to another. But this fact really hit home recently when I first saw this mesmerizing blockchain visualization engine.
In it, you can watch transaction blocks emerge from a point of origin and float off into the ether, zooming in and out to see more or less detail. Colored boxes represent senders and receivers, organized around a blue node representing each transaction. Some blocks are simple. Others are complex. There’s something about watching as the trades slowly fade off and make room for future trades, which keep coming and coming, that feels very organic. Tens of thousands of people each day want to transparently exchange value in this way.
So if you ask me what the true value of bitcoin is, I point to this blockchain visualizer and all the people like you or me who want and actively use this tool for value transfer. In other words, that’s the value of bitcoin, which makes it essentially invaluable.