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RE: My Thoughts on the Value of Gridcoin

in #gridcoin6 years ago

The currency of Gridcoin will succeed when the node count and local node density gets high enough for merchants to start accepting Gridcoin.

I don't see any reason why this would give gridcoin value. All it seems to have is inflation with no particular reason for people to ever buy it.

free to use, supercomputer

This hits the nail on the head... it is free and therefore has no inherent value. Holding the tokens multiples your tokens reducing the low and decreasing value they already have. AFAICT here is nothing substantial creating demand for this token. Any idealism I might connect with "helping" some scientific projects (which isn't enough) can be undermined by the reality that the system is open to be abused by anyone and everyone.

NOTE: I am totally new to Gridcoin, so please correct me if I am missing something.

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Why do dollars or euros or yen have value, they are just imaginary tokens backed by debt. They have value because certain groups agree to use them to exchange other items of value, that's it. So if any currency gets into the hands of a critical mass of users either locally or globally, it will become valuable. Of course it needs to be secure, fast, and ethically sound for people to prefer using it over a similar competitor.

How a currency is brought into circulation has little to do with its value.

There is a mechanism built into Gridcoin called "rain" that allows a research project to give additional rewards to people doing the work, but as commercial enterprises don't do distributed computing at the moment it's not much used.