Why Analysts Say Bitcoin Has No Intrinsic Value

Bitcoin is undoubtedly the most valuable unit of currency, even after its value plunged by more than half recently. It is worth noting that all stocks and crypto values have plummeted recently. The feat doesn’t take away the fact that Bitcoin’s price has been a roller coaster. Yet, the pioneer crypto lacks an intrinsic value. A mind-boggling fact, the first question to pop is why do they have value then? Read on to understand more about the issue. What is Intrinsic Value First things first, just what is meant by intrinsic value? The phrase refers to the fundamental and objective value possessed by an object. It should come naturally, notwithstanding any other external additives. A good example of a day-to-day product with an intrinsic value is salt. The value of salt is derived from its salty taste. When looking at an object used as a store of value, one naturally attaches value to gold because of its glittery nature and metallic qualities. Its huge costs of extraction, high scarcity level, and the prestige attached to owning it drive its price further. A product with intrinsic value will normally not be sold at a price far above the cost of its sum inputs. A loaf of bread is priced at a cost that is not far above its cost of production. That is the value of its ingredients like wheat, water, sugar, salt, the labor used, rent, distribution costs, and any others. The difference is the profit for the producer. The same applies t...