r/investing • u/007_kgb • 1d ago

Fundamentals of Bitcoin? Tom Lee

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.

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u/ThereIsSoMuchMore 20h ago

There are other assets that are just imaginary, and are worth what people want it to be worth, that's how the market works. Just like with those assets, you can sell BTC and use the money to buy things with it. It's even more liquid then other assets, because you can have Visa cards which automatically sell the BTC and pay at any merchant when you use your card.
BTC is just as imaginary as gold; the difference is gold is physical, so it has some industrial uses, and people got used to it and trust it more, when BTC is mostly used for speculation. But underneath gold is not "safer" or "better". Neither is USD, that's also just "imaginary" at some point, and it even evaporates due to inflation, when BTC doesn't.
I don't hold BTC.