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.
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.
Instead, I want to offer a different way of thinking about intrinsic value — one that we’ve inherited from Aristotle, Kant, and Mill.
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.
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.
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.
One reason is that if you ask “why is happiness valuable?” it’s hard or maybe even impossible to answer.
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.
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.
But is bitcoin valuable? That’s a different question than whether bitcoin is intrinsically valuable, but it’s a no less important one.
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.
Rather, their value depends solely on what people are willing to pay for them, which is based on their features.