Where does Bitcoin get its value from?

One of the most asked questions around Bitcoin is where it gets its value from or what is “behind it”.

Building on the core argument in Yuval Harari’s seminal book Sapiens, we must accept that much of what we consider “intrinsic value” is derived from a social consensus that has developed over time.  So, while gold has some industrial value as a metal, the social consensus around it as a store of value has greatly inflated that value.

Then, Bitcoin has a clearly defined scarcity and rate of inflation. The currency supply is not being inflated at the whims of any government.

Finally, Bitcoin has significant utility and that itself has a value. You can nearly instantly send money now to anyone, anywhere in the world if they have a Bitcoin wallet. No middlemen, low fees. That’s utility with value.

The combination of the above suggests to me that there is a growing trust that Bitcoin is secure, its scarcity is known and has great utility. As result, there is a rapidly developing consensus that it is a store of value just as Gold is.

Whereas gold’s intrinsic value comes from a combination of the scarcity of the metal and the social consensus that has developed over millenia, Bitcoin’s intrinsic value comes from a consensus around precise scarcity, proven security and significant utility.

Partner in reforming land ownership, or step aside

The question of land in South Africa will be critical to the 2019 election. Many will push for a leap toward expropriation and radical reform.

The rest of the political spectrum would do well to accept that any further navel gazing about the need for a drastic change in our approach to land is asking for trouble.
When we talk of land, we’re talking about two things:

1. Farm land, which is farmed, and which farmers make money out of. 

2. The idea of land – of living space – an idea so inherently understandable that many a regime have invested in the idea. Remember lebensraum? Twinned with the idea of land, is the emotion relevance of dispossession. 

In living memory of many, blacks were forcefully disposed of their land. In the generations before that, the vast majority of land in this country was forcefully acquired by the conquering colonial minority.

The critical importance of meaningful and visible land reform is as much about creating black ownership in agriculture as it is about all South Africans feeling a sense of fairness in the ownership patterns of our farming and living space.

The antidote to dispossession of black land is more blacks owning land. Goverment has the key facilitation role here both in residential and agricultural land. 

In the residential space, goverment must support the development of valuable real estate and support middle income earners to acquire property. There are a myriad proven examples of such initiatives from around the work that we can learn from. 

In the agricultural space, the challenge is not simply about transferring land. We need to ensure that the outcome is productive agriculture and more black farmers who are able to build successful commercial operations. 

The challenge is to build fruitful partnerships between experienced white farmers and passionate black farmers. Farming is a generational thing for most. Very few new comers walk into farming and succeed – the benefits of generations of learning and understanding and patience make all the difference to the enterprise of agriculture.

To the end, I would go so far as to say that I would support a position on land reform that targeted for expropriation (with compensation) all farms where farmers were resistant to openly embracing the development of black farming talent and shared ownership of their enterprises. 

The solution lies in partnership – those unwilling to genuinely partner should not have the distinct privilege of owning land in South Africa.