The Answer to why bitcoin has value can be looked at a couple of ways.
- It Cost to create a Bitcoin so it has to have some value. (Think about how much it cost to create $1 US dollar , then compare how much it cost to create 1 Bitcoin)
- Its Rare. (There is not nearly enough Bitcoin for every person to have one. Think about rare coins or stamps the same applies for Bitcoin)
- There is a demand for it. (Simply put, it has value because "we say" it has value. There is no reason why a Painting that cost a few dollars to create, should sale at action for millions of dollars BUT it happens all the time. As long as the demand is greater than the supply it will always have "value".
Agreed, and will also point out that BTC is some store of value but definitely not a "currency" based on the common definition. Nobody hoards USD as an investment, currencies do not rise in value in fact they usually drop, no currency rises and falls in value like a stock let alone like BTC. People don't get rich holding USDs, in fact they would lose money.
I'd argue against BTC being rare. There's millions of bitcoins for sale in every exchange. i think limited is a better way of stating it. But yeah 21 million supply is no where near enough for 7 billion people. But this is why it's divisible to 8 decimal places!
You have to understand that not all Bitcoin is accounted for... Im sure there is plenty of "lost coin".... but even 21 million BTC : 7 billion People = rare (IMO)
There are "millions" of rare coins and stamps for sale. Just because it for sale doesn't mean its not rare. Just means that it has "value".
There are billions of carats of diamonds and ounces of gold out there too...yet they are rare and valuable. In fact, more diamond can be found at any time than exist in the world today AND the value would still rise because its a corrupt monopoly