The True Value Of Bitcoin (The Blockchain) And How It Is More Like Land In Manhatten Than Gold

People seem to have a grant misunderstanding of Bitcoin and the blockchain in general. Whenever I hear that Bitcoin is in a "bubble" I realize that people are looking at it from a financial perspective. That is not how you look at this technology. No where in technological terminology is the term "bubble" used. That is a financial term and Bitcoin is not financial. It is technological.

Let me ask everyone a question: How much is TCP/IP worth?

For those of you who do not know what that is, TCP/IP is the platform that basically the entire Internet is built upon. Everything that we know as "the Web" are just apps. Facebook is an app. Twitter an app. Amazon is an app. Email is an app. While these can come and go, or evolve over time, the underlying platform (or protocol) does not change.

The answer to the question is it is worth trillions. It is basically akin to asking what the entire Internet is worth.

Bitcoin with a capital B is a currency. It is a token that was designed to work on the bitcoin, small b, blockchain. While Bitcoin is subject to whims in the market, there is underlying value to this asset class. That value comes from the underlying technology, the blockchain.

So what determines a blockchain's worth? Basically it comes down to the number of people building on that blockchain; how many developers are creating businesses (apps) based upon the bitcoin protocol. This is the true essence of blockchain valuation. And when we look at the blockchain world right now, development on bitcoin far exceeds that of any other blockchain, including ethereum.

Bitcoin is termed "digital" gold. This, again, is using the financial mindset. That said, it if Bitcoin is "digital" gold then the bitcoin blockchain is akin to land in Manhattan.

What do I mean by this? Land, for the most part, is the same. Sure there are different locations but at the end of the day it is just dirt. Is land in Beverly Hills much different than the land 15 miles away? By the token, is the land, itself, much different that houses the gas station by an interstate compared to that a few blocks down and a couple streets back that has a self storage place on it? The land is the same; the value, however, is much different.

Which brings me back to Bitcoin. When we look at blockchain as land, now we start to understand where the value comes from. There are many different blockchains with more being created daily. What is it that makes on different from the other? As you can guess, the difference maker is what is built upon that blockchain. The lot that houses the gas station was mostly worthless until they decided to put an exit from the interstate there. Suddenly it jumped up in value. A retail outlet sits on land that derives its value based upon what is around it and the traffic flow. The land, itself, has very little inherent value.

Another factor in this is the fact that businesses do not willingly up and move 2 or 3 times a year. Why dont they? To start, it is a major hassle to move. Secondly, a business is located where it is for a reason, usually so that clients can find it or accessibility to potential customers (retail). Entities think long and hard before they open up a location or place an office somewhere.

It is the same thing with blockchain. Businesses are springing up all over the place on bitcoin. Do you think that simply because there is a new blockchain called, let's say, Neptunian, that developers are going to switch over? To take an example closer to home, will DTube, if it becomes a major success, up and move on a whim from the steem blockchain? Of course not. The entire business is built upon that protocol.

The bottom line is the Waldorff Astoria is not going to move from NYC to a field in Kansas. And, even if it did, the value of the land the Waldorff is on isnt going to collapse. Same with bitcoin. Business that are built upon this protocol arent going to just abandon the blockchain.

I think it best for people to remember this the next time you hear the term "bubble" or that Bitcoin has no value. The bitcoin is land and it is emerging as some of the most valuable in the world.

Thank you for reading...you know what to do if you liked this and found it informative.

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