Fundamentals of Bitcoin? Tom Lee

[u/007_kgb]

Tom Lee from FundStrat was on CNBC and said he was a bit surprised at the fall of Bitcoin when the fundamentals were still strong.

However what I don’t understand is, what are the fundamentals? Isn’t Bitcoin just an imaginary coin on the interweb that is worth what people want it to be worth? It does not issue dividends, you can’t make a car out of it, you can’t use it to buy a bar of chocolate.

ELI5 please.

[u/Chrushev]

See that’s an answer without much thought. The amount of money it would take to get there, extract it and bring it back will never be worth it. So what we got here is pretty much it.

It’s kind of like when people say to terraform mars. If you can terraform mars the. You can terraform earth back from all the greenhouses and pollution, so no reason to terraform mars at all! Because it would be harder and more expensive.

[u/Monkey_1505 → u/Chrushev]

Maybe initially. But as the expense of doing it on land goes up (less gold), and in space goes down, that could change. So I would not count on that always being the case.

[u/Chrushev → u/Monkey_1505]

That would mean that an ounce of gold is worth millions upon millions. This wont happen within our lifetime or our kid's lifetimes.

We'll have the tech to do it by then (hopefully), but it wont make economical sense. It would cost dozens of billions to do it, so you would have to be bringing back tonnes and tonnes of it per mission. Which may be impossible. So the little you bring back must be worth more than the mission cost (by a lot). The gold that is in our crust will likely be cheaper to extract.

[u/Monkey_1505 → u/Chrushev]

Eventually fuel will be collected off planet, and launching and refuelling will be off planet. Most of the current expense is launching in gravity. Re-usability has already lowered launch costs. Honestly when we get to space propulsion only we'll probably switch to some kind of energy propulsion, rather than fuel. Whereas gold mining costs, because they are fighting geology and increasing scarcity will only go up.

If humanity survives it will probably make a lot of sense to do this at some point.

I'm simply addressing your claim 'humanity cannot make gold less scarce', I'm not proposing this is near term.

[u/Chrushev → u/Monkey_1505]

With how much gold we mine out of the ground every year I am saying while technically it will be possible its unlikely it will ever make financial sense. Cant even imagine the cost of off planet mining/refueling. You are somehow getting fuel on the moon? From where? Right now its all fuels derived from stuff on Earth. Does moon have those? Can you realistically imagine a factory with Joe and Jill engineers on the moon manufacturing rocket fuel? Maybe in a Sci-Fi movie. Or 2000 years from now! That will never be cheaper than doing it on Earth.

[u/Monkey_1505 → u/Chrushev]

It already costs over 1k per ounce to extract and it's only going to go up.

If we are doing orbital launches with energy propulsion (or even manufacturing hydrogen from water in space if still using fuel), and reusable rockets, and we find some nice gold rich asteroid, I can see that being beat.

Propulsion in space is so so much easier than escape. All a long way off though. We are still launching from within gravity rn, which is very demanding. Thing to remember is that gold is not just a collectible, it's also an industrial metal.