'But, what's the underlying value of Bitcoin?'

When introducing someone new to Bitcoin, I’ve encountered many different arguments, some well-reasoned and coherent, and most, not. The most common arguments are - ‘Bitcoin fuels terrorist activities’, ‘It will be banned by the government’ , ‘It uses too much energy’. I consider these to be cognitive barriers to entering the bitcoin rabbit hole, but so long as an argument can be countered with facts and numbers, they’re not so hard to break. ~An hour of honest inquiry into any of these arguments will tell you why they’re wrong.?

The most common FUD I’ve started to come across is about the underlying value of bitcoin. This is a very dangerous idea to be stuck behind, because it will leave you there for years. It really is a pseudo-intellectual question to ask, and makes most people conveniently dismiss bitcoin as having no underlying value.?

Start by asking yourself the basic question - ‘What is value?’, or better , ‘What makes a thing valuable?’ If we go by the most basic understanding of underlying value, the value of a pen is its ability to let the writer lay ink on paper; and the value of a paperweight is its ability to prevent your papers from flying away. But if you think deeply enough, you realize that we don’t trade or price things based on their underlying values, otherwise why would different pens have different prices. There’s something to be said about scarcity. Limited edition pens are much more valuable than regular pens, because of the relatively scarce nature of the former.?

Think about why diamonds are so much more valuable than water, when water is essential to human survival, and diamonds merely have aesthetic value. It’s because water is abundant, and diamonds are scarce, and require time and energy to produce.?

While everything valuable in the world can be produced more of, there is only one thing whose supply cannot be expanded, and that is Bitcoin.?

The absolute scarcity IS the value, my friend!