Oddbean new post about login | logout Money needs to hold value. Holding value over time is HODLing.
Without economic activity the value is unknown.
Value is subjective. I value my SATs at over 1 dollar per sat. My values are expressed by me not selling for anything less. The market equilibrium is always made up of just a few trades at any given time. Why would everyone have to spend to express their value?
I agree with your valuation but we aren't interacting with the market by hodling. We are just storing economic value for a future interaction. The market equilibrium is exactly the problem. If there was more use of Bitcoin as a currency then you solve the corruption that can happen to the market by small #s of participants trading on exchanges. You also grow the network by making the underlying asset have more usability. Spending dollars adds economic activity to that market making it more usable to merchants because of wider adoption. We have to break the pattern.
To be clear: When I can, I use Bitcoin to spend. Merchant adoption has little to do with store of value though and store of value will remain the most important use until we reach enough density to have a circular economy. I've personally made a POS station for my work which enables us to accept Bitcoin over lightning for our entire menu. But the average customer here is 60 and nobody has demand for that yet. The time will come for medium of exchange but only when >30% of people value it as a store of value.