London Daily

Focus on the big picture.
Saturday, Jun 21, 2025

Opinion: Another Way to Look At Bitcoin's Value

Opinion: Another Way to Look At Bitcoin's Value

Dr. Bradley Rettler, an assistant professor of Philosophy at the University of Wyoming, discusses the value of bitcoin, and breaks down important concepts related to valuation and how and why we value certain things in the first place.

Dr. Bradley Rettler, an assistant professor of Philosophy at the University of Wyoming, discusses the value of bitcoin, and breaks down important concepts related to valuation and how and why we value certain things in the first place.

In this essay, I want to clarify and respond to a prevalent assertion regarding bitcoin — that “bitcoin has no intrinsic value.” Two preliminary things to note. First, this is not used merely as a normatively neutral descriptive statement; it’s stated as a criticism. It usually appears in the following kind of argument, often with premises elided: it’s bad to lack intrinsic value. Bitcoin lacks intrinsic value. So bitcoin is bad. Or maybe: it’s not worth investing in things that lack intrinsic value. Bitcoin lacks intrinsic value. So, it’s not worth investing in bitcoin.

Second, “intrinsic value” has a particular meaning here — one that’s used in investing. Owning bitcoin is often put in contrast to owning stock in a company that produces a good or service. In virtue of the company producing a good or service and receiving money for the good or service, stock in that company is said to have intrinsic value. Methods of calculation of the intrinsic value of a stock usually involve calculating the value of the assets the company has and/or the expected future earnings. Bitcoin is not a company and produces no goods or services — so it lacks intrinsic value. So goes the criticism.

I don’t want to argue that bitcoin has intrinsic value. And I don’t want to argue that this usage of “intrinsic value” is illegitimate. People can use terms however they want, as long as they explain what they mean when they’re using them.

Instead, I want to offer a different way of thinking about intrinsic value — one that we’ve inherited from Aristotle, Kant, and Mill. This way of thinking about intrinsic value will guide us as we consider what kind of value bitcoin does have, and what gives it that value.

On the traditional way of thinking about intrinsic value, the intrinsic value of a thing is the value that it has in itself — that is, not in relation to anything else. That is, after all, what the word “intrinsic” means. The contrast is extrinsic value, which is the value a thing has in virtue of its relation to other things. It’s easy to think about the extrinsic value a thing has, because you can think of the value it has for you. For example, a bicycle has extrinsic value because it gets me from place to place. Wine has extrinsic value because it tastes good. Money has extrinsic value because we can use it to buy other things. Extrinsic value is easy. It’s much more difficult to determine whether something has value intrinsically.

Maybe bitcoin doesn’t have intrinsic value in the sense that investors use the term. But might it have intrinsic value on this understanding of intrinsic value? And if not, does it differ in this respect from stocks and precious metals? We can start to get a handle on this question by asking: on this classic understanding of intrinsic value, do stocks of companies have value in themselves? No. They are valuable only to the extent that the company and the workers are valuable. Then we can ask: do companies have value in themselves? Even here the answer is no. They are all valuable in virtue of their relations to other things — money, customers, employees, products, and so on. Let’s take it even one step further: does anything that any company produces have value in itself? An iPhone, a watch, an airplane, a massage, a tax return, a database, a baseball card…

One way to answer this question of anything is to ask, why is that thing valuable? If you take there to be a sensible answer to that question, then that means that you think there is some further thing in virtue of which the original thing is valuable. And so you think that the thing isn’t intrinsically valuable. For example, we can ask why an iPhone is valuable. An iPhone is valuable perhaps in part because it connects us to information and loved ones. So, it’s valuable because it brings about something of value — connection to information and connection to loved ones. If it didn’t do that, it wouldn’t be valuable. So, it’s valuable, but not intrinsically valuable. But even being connected to information and loved ones seems not to be intrinsically valuable, because we can answer “why is being connected to information good?” with “it gives us knowledge” and “it helps us navigate the world” and we can answer “why is being connected to loved ones good?” with “it makes them happy and it makes me happy.” If those are right, then being connected to information and loved ones is not intrinsically valuable — it’s valuable in virtue of making us happy.

In fact, many philosophers think that the only thing that has intrinsic value is happiness. There are a few reasons for this. One reason is that if you ask “why is happiness valuable?” it’s hard or maybe even impossible to answer. You might even assume that the person who asked didn’t know what happiness was. You’d be tempted to say, “It just is. It’s valuable for its own sake.” Another reason is that “It makes me happy” is (when true) always a good answer to “Why is X valuable?” — and we don’t feel the need to follow up with “why is being happy valuable?” A third reason is that it seems plausible that everything else in the world — Apple stock, iPhones, bitcoin, friendship, love, etc — is pursued to the extent that it can bring happiness (or bring something that brings happiness, or bring something that brings something that brings happiness, or…).

There is, of course, the further question of what happiness is. That’s much harder to say. Some say pleasure, some say a flourishing life, some say the life of a mind in accord with reason… We won’t get any more into that. There are also people who think there are other things that have intrinsic value — maybe friendship, maybe people, maybe God… There are many candidates. I don’t intend to settle the question here; what’s important to note is that neither bitcoin nor any other investment would have intrinsic value on any of these theories. I’ll proceed on the assumption that it’s just happiness, but you can add to the list anything else you think has value independent of everything outside it and is pursued for its own sake.

So, happiness and maybe some other things have intrinsic value, and everything else is pursued to the extent that it brings happiness either directly or indirectly.

Bitcoin, then, is not intrinsically valuable. But that doesn’t mean it’s not valuable. In fact, bitcoin shares these features with every concrete material object, and many immaterial things as well — if the above is correct, everything except happiness. So it’s no criticism of bitcoin to say that it doesn’t have intrinsic value, since only happiness does.

But is bitcoin valuable? That’s a different question than whether bitcoin is intrinsically valuable, but it’s a no less important one. If bitcoin is valuable, then given that it’s not intrinsically valuable, it’s valuable in relation to other things. In particular, it’s valuable in virtue of its relation to happiness. So, does bitcoin bring people happiness, whether directly or indirectly?

In order to determine that, we should consider the reasons people buy bitcoin. Some people buy it because their local currency is hyperinflating and they lack access to other stores of value, but they have access to bitcoin. (I wrote about this here.) Some people buy bitcoin because their local government censors their transactions, and they can’t buy the things they want with their local currency. Some people buy bitcoin because they want to pay for things digitally but distrust PayPal, Visa, and other huge corporations and they don’t want to give those companies their personal financial information. Some people buy it because they think other people will find it valuable and they’ll be able to sell it for more fiat currency than they bought it for. For all of these people, if you ask them why they are exchanging other things for bitcoin, these people are likely to give a series of answers that ends with saying that they think that having bitcoin is more likely to make them happy than having the other things. And these people number in the millions.

Clearly many people think bitcoin is valuable. They reveal this by exchanging things like their government-backed currencies for bitcoin. Some people think index funds and Apple stock are valuable. They reveal this by exchanging things such as government-backed currencies for index funds and Apple stock. But like bitcoin, index funds and Apple don’t have intrinsic value. Rather, their value depends solely on what people are willing to pay for them, which is based on their features. In that respect, they’re just like *gasp* bitcoin!

So, bitcoin — like everything except happiness — has no intrinsic value. Bitcoin’s value is determined by how it brings about happiness for the people who use it. Just like pretty much everything else.

Source: Opinion: Another Way to Look At Bitcoin's Value – Fintechs.fi

Newsletter

Related Articles

0:00
0:00
Close
Political Turmoil Resurfaces in Belgium Amid Economic Concerns
Fed policymakers divided on timing of interest rate cuts
Trump signals imminent agreement with Harvard University
Inheritance tax referendum alarms Swiss billionaire community
Japan cancels bilateral security meeting amid US defence demands
AI skeptic Emily Bender warns that ‘the emperor has no clothes’
Israel Confirms Assassination of Quds Force Commander in Tehran
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Vietnam Emerges as Luxury Yacht Destination for Ultra‑Rich
Plans to Sell Dutch Embassy in Bangkok Face Local Opposition
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump's $5 Million 'Trump Card' Visa Program Draws Nearly 70,000 Applicants
DGCA Finds No Major Safety Concerns in Air India's Boeing 787 Fleet
Airlines Reroute Flights Amid Expanding Middle East Conflict Zones
Elon Musk's xAI Seeks $9.3 Billion in Funding Amid AI Expansion
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Taiwan Imposes Export Ban on Chips to Huawei and SMIC
Israel has just announced plans to strike Tehran again, and in response, Trump has urged people to evacuate
Netanyahu Signals Potential Regime Change in Iran
Juncker Criticizes EU Inaction on Trump Tariffs
EU Proposes Ban on New Russian Gas Contracts
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
Energy Infrastructure Becomes War Zone in Middle East
UK Home Secretary Apologizes Over Child Grooming Failures
Trump Organization Launches 5G Mobile Network and Golden Handset
Towcester Hosts 2025 English Greyhound Derby Amid Industry Scrutiny
Gary Oldman and David Beckham Knighted in King's Birthday Honours
Over 30,000 Lightning Strikes Recorded Across UK During Overnight Storms
Princess of Wales Returns to Public Duties at Trooping the Colour
Red Arrows Use Sustainable Fuel in Historic Trooping the Colour Flypast
Former Welsh First Minister Addresses Unionist Concerns Over Irish Language
Iran Signals Openness to Nuclear Negotiations Amid Ongoing Regional Tensions
France Bars Israeli Arms Companies from Paris Defense Expo
King Charles Leads Tribute to Air India Crash Victims at Trooping the Colour
Jack Pitchford Embarks on 200-Mile Walk to Support Stem Cell Charity
Surrey Hikers Take on Challenge of Climbing 11 Peaks in a Single Day
UK Deploys RAF Jets to Middle East Amid Israel-Iran Tensions
Two Skydivers Die in 'Tragic Accident' at Devon Airfield
Sainsbury's and Morrisons Accused of Displaying Prohibited Tobacco Ads
UK Launches National Inquiry into Grooming Gangs
Families Seek Closure After Air India Crash
Gold Emerges as Global Safe Haven Amid Uncertainty
Trump Reports $57 Million Earnings from Crypto Venture
Trump's Military Parade Sparks Concerns Over Authoritarianism
×