# Comment: That's true but again that value is subjective

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### That's true but again that value is subjective

In fact if you think mathematically it's a little more clear.

The value V, of a unit of money is:

V = A + C

Where A is the subjective value as an asset, and V is the subjective value as a currency.

In fiat money and crypto currencies A is effectively zero. But in fiat money C is a bubble by definition, it's an artificially elevated value, that suffers the fate of all bubbles. In crypto currencies A is not a bubble by definition. The value placed on each unit is the market clearing value.

Gold has a positive value of A but (because of impediments placed by governments) a much lower value of C.

So lets walk it through historically.

In the beginning gold had A and C as zero.

People found some use for it and A came to be positive.

Because it also had the properties of a good money, durability, divisibility, portability, it came to have a positive value for C.

When C reaches some threshold gold becomes money, and for most people the A value isn't nearly as important as it's C value.

And of course today governments have attacked gold and reduced it's C value to almost zero. Goldbugs hope for a time when it's C value comes back up. I think that's a very plausible scenario.

Right now though, while bitcoins have zero A value, they have massive C value. Why? Because it has the properties of a good money, durability, divisibility, portability.

Bitcoin is also a bubble. Because it is a reaction to statist monetary activity. People are in bitcoins over gold because bitcoin is safer than gold currently and safer than fiat for different reasons. The C value of bitcoin is higher than it should be. But that doesn't mean it doesn't have value, just that we can know it is higher than it would be otherwise.

The collapse of fiat would increase bitcoin C value.

The liberation of gold as money would decrease bitcoin C value.

Which do you think will happen sooner?

Regardless the argument is still that the value of a currency is primarily it's C value, not it's A value. People almost never actually consume their gold. They keep it to trade.