It’s a common question many nocoiners ask: What is the intrinsic value of Bitcoin?
Determining the intrinsic value of Bitcoin, or any asset for that matter, isn’t as straightforward as it might seem.
While some assets’ intrinsic value are clearer than others, the truth is ‘intrinsic value’ could be different for different people, and people will look for results to suit their cognitive bias.
But intrinsic value can be measured, and Bitcoin’s features make it arguably more measurable than other assets.
What Is Intrinsic Value and Why Does It Matter?
Rather than work out he intrinsic value of Bitcoin, let’s first look at what it means exactly.
‘Intrinsic value‘ is a term often used to estimate an asset’s worth through the use of fundamental and technical analysis.
There’s no universal standard for calculating the intrinsic value of an asset, but determining the qualitative, quantitative and perceptual factors of an asset we can assert value.
Intrinsic value is not a definitive gauge of an asset’s overall value either, and the market value of the asset might not coincide with the intrinsic value.
When this happens and both metrics deviate, opportunities to profit arise for savvy investors.
However, if both metrics are close, investors can use the ‘intrinsic value’ as validation that the market value of an asset is fair. Read More