Belief in value is Value while the belief lasts.
Some say crypto needs usefulness to be valuable. I think that usefulness helps build belief, but only belief is really needed to have value. Other things can build belief (value) as well. Speculation is a form of believing the value will rise (or fall) and believing the item is undervalued (or overvalued) in comparison to a future time. Somewhat akin to speculation, thinking other things you might own will fall in value faster is another way to grow your belief that the crypto is worth holding. Inflation (aka fiat-value loss) is the obvious example of that but there are others depending on what you consider owning as an alternatives to a particular crypto..
Some say intrinsic value (like gold and diamonds have) is crucial to market value. I believe it can help as it sets a somewhat reliable "floor value" and people feel better about valuing something above that floor value if it has one. Only belief, however, can make gold and gemstones worth more than their intrinsic value. I would have to agree that the intrinsic value of gold and diamonds goes beyond industrial value as our well-developed appreciation for jewelry does add to the intrinsic value even though this might be considered belief-based value. That said, I think gold is still valued well above all it's combined intrinsic values.
Depending on what the belief is based on, it can be fragile or sturdy. For instance speculative belief can be very fragile. News stories (fake or real) can turn it up or down at any time. Big value changes understood to be based on speculative investing are basically assumed to be at least partly temporary. Things like significant amounts of business adoption, code improvements or related-application development create a more sturdy kind of value/belief. Sturdy (more reliable) value growth tends to take more time to develop.
My BTC (originally the real "Bitcoin") belief-based evaluation.
BTC was the only Bitcoin in the beginning of this story. It was worth very little for years. Belief built very slowly within a small tech-savvy core group that saw the potential early. A controversial and newsworthy use-case developed on the Silk Road darknet marketplace. This proved the potential, tested the security and brought major publicity to Bitcoin. Belief in value began to really grow among a wider audience.
I believe this is when big-money speculators decided to try pumping it and found that that worked like a dream. From then on I believe speculators have been doing cyclical pumps creating massive value peaks and then letting the price fall back down to what may be the more organic (less speculation-based) values. These price spikes created massive public interest and helped develop an ever-growing organic belief that the value could/would go much higher over time.
For most of 2017, many who understood the dream of Bitcoin (censorship resistant peer-to-peer electronic cash for the world's people) began to believe it might really be able to do it. They saw a potential future where Bitcoin created financial freedom for the masses and made any early adopters wealthy. They thought 2017 was still early and belief began to grow at an ever-faster pace.
Sadly, I believe very well-funded dark forces rooted in protecting the status quo from this new better future had also seen what was coming. They secretly captured the BTC development powers and created a massive and dishonest social engineering effort that successfully fooled the public into thinking the dream of Bitcoin was still on track ('except for some short delays that would make it even better'). In truth, they had blocked BTC's ability to fulfill it's dream. To this day, BTC is intentionally broken and most of the public is still fooled (by ongoing price manipulation and dishonest social engineering) into not seeing the truth.
As I type this "belief" in BTC value has never been higher.
My BCH (still working to be a real "Bitcoin") belief-based evaluation.
The BCH (Bitcoin Cash) fork of Bitcoin was created by people who saw BTC was compromised and wanted to save the dream of Bitcoin. The anti-Bitcoin-dream dark forces knew BCH was still a real danger to the status quo and turned their social engineering accounts (I call the troll army) against public support and understanding of the actual dream of Bitcoin that BCH was working to fulfill. BCH was pretty successfully vilified on much of social media using the dishonest tactics of the professionals pretending to be regular people.
As I type this belief in BCH value (the market price) is quite low when compared to BTC.
The future of Bitcoin Beliefs
BTC's massive price manipulation and social engineering should be able to keep it propped up for the near future. I don't think it can spike up as quickly as it used to since it is at it's limit of users per day (that's how it was "broken"), but it can be manipulated upwards more slowly and seems to have a bright future for now. Many would say there are no limits to the future of BTC.
Sadly, one of the truths about all the Bitcoin's is their inability to "scale" up to full-on massive worldwide adoption levels (the dream). In the early days most assumed we could just make code changes as needed to stay ahead of demand. We believed the sky was no limit. Instead, the new owners of BTC development intentionally embraced this limitation (while pretending not to) and so I call it "broken" or "tamed". BCH has always intended to solve this scaling limitation, but thus far has not done so. BCH IS far ahead of demand and some developers suggest the full-sized solution is close.
Trust (belief) in scaling-solution claims now hard to come by
Back when we were irrationally exuberant and thought BTC would always be able to scale as needed many began to invest in the future with that assumption in mind. Microsoft, Overstock, Dell, Tiger-Direct and many big names started to believe. Then in late 2017 the assumptions failed and many hard lessons were learned by those who were smart enough to see their mistake with BTC. I believe the supporters that were "burned" back then are being much more careful believing in any cryptocurrency's claims that is can fulfill the dream today. Like BTC fans in 2016, many BCH fans claim it can scale even though it can't really do so yet. I think businesses are waiting for a full-sized solution to be developed and tested before they fall for the hype again. I don't blame them.
While businesses wait for proof of concept before spreading massive adoption of a real Bitcoin, I believe the "fake Bitcoin" (BTC) will continue to ride high. If a BCH or some other Bitcoin does develop the full-sized scaling solution needed to become e-money for the people of the world, the stage will be set for a massive shift in belief. A real Bitcoin would eventually experience an event that causes it's adoption and use to go viral. Many possible events could cause this and until then the many real bitcoin fans are working to prepare the infrastructure for that future they believe is coming.
If a Bitcoin could scale...
BTC believers think their Emperor is too powerful to fail. It does seem BTC belief is unassailable, but that belief is based on some underlying assumptions that are vulnerable. If a real Bitcoin were to develop the ability to scale for worldwide adoption and go viral, I believe it's use and value would grow faster than the use-limited BTC. Because BTC can't take on massive new users, only a real Bitcoin can invite the masses to join in the revolution again. They would be able to believe in the unlimited future many believed BTC had in early 2017. The intoxicating atmosphere was great and can be again if scaling is actually solved.
According to my theory, viral user growth would lead to viral adoption by businesses and massive belief and market-value growth. This would lead to more security (hash power) shifting to the real Bitcoin. That shift would leave the "more secure" arguments used to make the BTC as a "store-of-value" arguments weaken. Because the real Bitcoin's adoption would make it seem like it was going to actually be usable for regular trade, people would begin to see an actual usefulness on top of the store-of-value the old BTC had. People would eventually realize both usefulness and growing value together are better than just one of those.
Once it looked like a real bitcoin was going to be worth more than the old expensive and slow one, BTC value would drop as investors moved to the Bitcoin2.0 version. The speculators propping up the fake Bitcoin might switch teams and accelerate this shift at any time. If they are part of the anti-Bitcoin-dream team, they can afford to resist this shift and lose massive wealth. If they just sell their BTC to avoid the losses, they will still help support the shift even if not accelerate it. I don't think they can stop the shift in belief if a real Bitcoin can scale and goes viral on a worldwide scale.
BTC would end up as a relatively small and much less important project whose coin has a much lower value. It will never be worthless and will always have a "collector's value". It would actually be inexpensive to use again since so few would be using it. People who are not paying attention or who fell for the HODL mantra (social engineering) could lose most of their life savings during BTC's fall. They may think crypto destroyed their lives (just what the anti-Bitcoin team hopes people will believe). Thinking they were fooled by sophisticated social engineering into believing lies is unlikely to ever seem possible to many.
So, to summarize:
If BTC retains it's dishonest social engineering and massive market manipulation people will continue to believe in it until a real Bitcoin develops the ability to scale and goes viral. After that, BTC it will shrink in value as the world sees a better future again with the faster, cheaper, more secure, unlimited and inclusive potential always dreamed of by the original Bitcoin project's believers. In other words, all the world's people need is scaling to make the dream of Bitcoin into a reality we can all believe in.
I hear the solution to full-on scaling is close. I have heard similar things before and I am slow to believe, but I do hope it is true.
