This paper going vital on social media. Here’s my take based on Austrian economics theories.
The paper by Thomas Lys argues that Bitcoin has no intrinsic value because it generates no future cash flows. It applies a traditional discounted cash flow (DCF) valuation model and concludes that Bitcoin’s value is zero, or at best highly speculative. He’s not alone. Many out there argue the same.
Hell my wife did so as well until a few months ago.
“Bitcoin has no intrinsic value.”
This claim misunderstands what Bitcoin is.
Bitcoin isn’t a stock. It doesn’t produce cash flows. But neither does gold. Neither does fiat. Neither does land you don’t rent out.
You don’t apply a DCF model to money. That’s a category error.
Bitcoin isn’t an investment security. It’s a monetary asset, a store of value, a medium of exchange, and (increasingly) a unit of account.
It’s valuable because it serves these roles better than fiat:
• Scarce (21M)
• Portable (instant, global)
• Divisible (sats)
• Verifiable (trustless)
• Durable (on-chain forever)
• Resistant to seizure and censorship
He wouldn’t say gold is worthless because it doesn’t pay dividends. Same with Bitcoin. Its value comes from its monetary utility, not yield.
This is the monetisation of a monetary good, not a “bubble”.
If you think value = cash flow, you’ve already missed the point.
