When people stop using bitcoin, this value will disappear.
That's true for everything. Whale oil was extremely popular for more than a century, now it's barely used. That doesn't mean it wasn't an useful thing at the time.
It is not intrinsic value.
There's no such thing. Value (market or use) is always relative to someone or some group of people. And even if the item is still useful in itself, the existence of better and/or cheaper alternatives may still drive its market value to zero.
It is value assigned by group psychology, like a bubble.
I think you're just not seeing Bitcoin with the right point of view. Instead of thinking of the speculators trading it like a commodity, think of it as a service, like Paypal.
When I want to send money to someone else online, how can I do it? I have to use it some kind of service (bank transfer, Paypal, etc), and those services can be "convinced" to prevent my transaction (like when the CC companies prevented WIkileaks donations), or it can freeze my funds (see Paypal again), etc.
Now, if people are willing to pay Paypal some percentage for that transfer, it means the service has some value. If Bitcoin can do the same, it stands to reason that it must have at the least some value as well.
Now, this is different from the (real or not) value one gets by trading and holding Bitcoins, but that's just part of the whole system. For the record, I have zero bitcoins.
There's no such thing. Value (market or use) is always relative to someone or some group of people.
Yes, but there's an important and qualitative difference between valuing something because it's useful, and only valuing something because a crowd of people value it, only because they know everyone else values it, only because... recursively.
This is what I mean by "intrinsic value": it has a utility value independent of pure psychological value.
Useful things like oil or wheat won't suddenly become useless. (They could be obsoleted, but that's not sudden or unexpected). But it's not that easy to reason about group psychology. Empirically, we know there have been many bubbles where everyone suddenly "agreed" something was actually worth much less than the going price and crashed it. We know psychologically can do that.
I'm disappointed that you seemed to have skipped over half my post, where I tried to reason why I think Bitcoin might have some value besides a shared delusion.
That's true for everything. Whale oil was extremely popular for more than a century, now it's barely used. That doesn't mean it wasn't an useful thing at the time.
It is not intrinsic value.
There's no such thing. Value (market or use) is always relative to someone or some group of people. And even if the item is still useful in itself, the existence of better and/or cheaper alternatives may still drive its market value to zero.
It is value assigned by group psychology, like a bubble.
I think you're just not seeing Bitcoin with the right point of view. Instead of thinking of the speculators trading it like a commodity, think of it as a service, like Paypal.
When I want to send money to someone else online, how can I do it? I have to use it some kind of service (bank transfer, Paypal, etc), and those services can be "convinced" to prevent my transaction (like when the CC companies prevented WIkileaks donations), or it can freeze my funds (see Paypal again), etc.
Now, if people are willing to pay Paypal some percentage for that transfer, it means the service has some value. If Bitcoin can do the same, it stands to reason that it must have at the least some value as well.
Now, this is different from the (real or not) value one gets by trading and holding Bitcoins, but that's just part of the whole system. For the record, I have zero bitcoins.