Beauty, Bitcoin and Value -Jaffer Ali
The subjective theory of value, when applied to the objects cannot be measured. This concept holds that the value of an object lies in how much people desire it, this desire can however and overtime, causing the value of the object to diminish, according to this concept. — Julia Kagan
She was beautiful, but not like those girls in the magazines. She was beautiful, for the way she thought. She was beautiful, for the sparkle in her eyes when she talked about something she loved. She was beautiful, for her ability to make other people smile, even if she was sad. No, she wasn’t beautiful for something as temporary as her looks. She was beautiful, deep down to her soul. She is beautiful. -F. Scott Fitzgerald
Have you ever looked at a beautiful person walking down the street and explained WHY you thought he/she was beautiful? For ease, let’s assume a man is talking about a woman. As Fitzgerald noted, beauty is multi-dimensional. Someone might like her eyes, some her figure, lips, the ways she moves, her…uh breasts, and so on.
It should be blatantly obvious that the adage, “beauty is in the eye of the beholder” rings true. Plato did more than try to define Justice; he was also interested in “beauty”. He thought it was not only subjective, but potentially transient. The subjective nature of beauty is accepted by nearly anyone who has fallen under its spell.
So, you might be asking what this has to do with Bitcoin and Value.
After studying Bitcoin since 2015, I have come to the conclusion that understanding Bitcoin is a lot like understanding Beauty. Just like Fitzgerald rattled off several attributes of Beauty, many people have a laundry list of attributes for Bitcoin that informs owning the asset. Some use scarcity, transportability, decentralization, divisibility and others outlined here.
Once someone accepts that concepts like Beauty and Value are subjective in nature, it paves the way to understanding Bitcoin. You do not have to agree with my personal taste or opinion that Sophia Loren was one of the most gorgeous creatures ever gracing the earth, but you might have an appreciation for my POV.
There are times that a consensus develops around beauty. But even then, the consensus is culturally developed and can change over time. What is described as beautiful today may not have the same group of attributes fifty years from now. As Plato suggested, beauty can be transient. The same can be said of the value of things. Beanie babies had a short run with its short list of attributes.
“Beauty is no quality in things themselves: It exists merely in the mind which contemplates them; and each mind perceives a different beauty.” — David Hume, Of the Standard of Taste and Other Essays
Making the leap from understanding the subjectivity of beauty and making peace with value’s subjectivity paves the way to a more practical way to understand Bitcoin. I am not saying this is an easy transition but one that makes the most sense.
Both hard core Bitcoiners and Nocoiners seek to objectify Bitcoin’s value. Proponents think developing objective criteria is a rational way to convince more people to join the revolution. Both more often than not use concepts like “intrinsic value” or “inherent value” to lay the foundation for their Bitcoin thesis. Nocoiners pretend they have a profound critique when they point to Bitcoin’s lack of intrinsic value or even more silly, its lack of utility.
I pay very close attention to Bitcoin critiques. Actually, I learned more about Bitcoin from criticisms than proponents dressing up their favorite Bitcoin attribute to have the patina of objective value. An attribute of value is not the same thing as value and each person who *invests* in Bitcoin covets one or more attribute. They unnecessarily feel the need to amplify their investment thesis. My advice is to not use silly criteria to justify your notion of beauty or value.
Nocoiners suffer an even worse pathology. They not only want to tell Bitcoiners that their baby is ugly but seem to believe they have a concrete definitive measurement of beauty, which in this case I mean value. They will say repeatedly that Bitcoin has no use (utility) or intrinsic value. They this have a critique that is utterly meaningless. What could be worse that EVEN IF CRITICS are right, it is absolutely meaningless.
These Bitcoin critics are like animals peeing in the wind. Actually worse, animals are smart enough to pee downwind. If one does not have a sound understanding of value, it would be wise not to pretend they have a critique other than an opinion. Bitcoiners would be wise to understand that BTC attributes appeal to different constituencies and the collection of individual preferences define its value, even if, like beauty, may be transient.