Is Bitcoin valuable?

 That Bitcoin, Ethereum and others aren't worth anything, that people are just artificially creating its value. And you know what? That's actually true. I also hear that they're not real because it's only virtual money, not physical, and that's true as well. But in this content I would like to put this into context. I'm not trying to convince you to buy crypto, just putting things into context.

 So let's start with the argument that cryptocurrencies only exist in the virtual world, and that if all computers were wiped out, none would be left. That's undoubtedly true, but the same can be said for the currencies that we use in our day-to-day lives. Take the dollar for instance. There are about 14.4 trillion U.S. dollars in existence, but only 1.7 trillion of those exist in a physical form. That is, banknotes or coins. That is just 11%. The remaining 89 percent is just virtual money stored as a number in the databases of financial institutions, so that makes our real money not so different from cryptocurrencies. The second thing I'd like to address is that people seem to be under the impression that paper money is worth something because it is backed by a commodity like gold. We call this the gold standard, a system in which a currency is tied to a certain amount of gold. And this has two implications. First of all, it fixes the value of a currency to the value of gold, which is considered to be a good thing because gold prices aren't very volatile. And secondly, the supply of your currency is now limited to the amount of gold you have. If you want to create more money, you have to acquire more gold. The gold standard was in use for quite some time, but the system was abandoned in 1971 when President Nixon decided to end the dollars convertibility into gold. This meant that the value was no longer fixed to gold and the dollar was allowed to float. It also allowed the government to control the total supply of money by printing more whenever needed. This could be done to limit the impact of an economic crisis, for instance. Other countries soon followed, and the world switched over from the gold standard to what we call Fiat money, a currency without intrinsic value. In fact, currencies only have value because governments have declared them to be legal tender and because we all believe that it has value. That's it.

 Our modern monetary system is only held upright by our belief that money is worth something. We are willing to go to work every day to get paid because we believe that someone else will exchange our hard earned money for something else, say for buying food or renting a home. It's actually a self fulfilling prophecy. We believe that our money has value and therefore it has. If we stop believing in the value of money or the government can no longer guarantee it, we see hyperinflation.

 The value of money drops and the prices of goods increased substantially. We've seen this a few times in history. For instance, in Germany after the First World War, prices of goods doubled every two days. At one point people actually burn their money because it was cheaper than buying firewood. So if our money has no real value, we should all start buying gold, right? Well, we could take it one step further and ask ourselves why is gold considered to be valuable?

 I mean, sure, it says shiny metal with interesting properties, but is that enough? Could we say that gold has no real value either, that we all just believe and agree that it does? Well, yeah, that's completely true. Throughout history, gold has been considered to be one of the most valuable materials out there, probably because of its unique look. But that's about it. The only thing that gold is going for it is that it's relatively rare and that it's crucial for certain industries, like electronics. But other than that, gold is just like money worth something because we believe. All right, time for a conclusion. People are right when they say that cryptocurrencies have no value and are worthless, but they're wrong to think that the euro, dollar, or yen are any different. We created them and each of us is keeping the idea alive that they are valuable. So that was it for this content. I hope this brought some clarity to the topic. Definitely let me know what you think in the comments below.