Is Bitcoin Intrinsically Worthless?

23 Pages Posted: 17 Jul 2017 Last revised: 5 Jan 2018

William J. Luther

Kenyon College; American Institute for Economic Research

Date Written: January 2, 2018


Monies are typically categorized as commodity or fiat, depending on whether the item in question is intrinsically worthless. In the case of bitcoin, it is not so clear. I consider the superficial subjective value argument often put forward by non-monetary economists and a more sophisticated payments technology argument. After dismissing both, I argue that there are two reasonable views on the value of bitcoin. One might claim bitcoin lacks intrinsic worth, in which case its value depends on foresight and coordination. Alternatively, one might claim that bitcoin has intrinsic worth, even if no one else accepts it, because some users have peculiar preferences. In either case, the existence of bitcoin calls into question the practical relevance of the regression theorem.

Keywords: bitcoin, cryptocurrency, intrinsic worth, money, payment, payment system

JEL Classification: B53, E40, E41, E42

Suggested Citation

Luther, William J., Is Bitcoin Intrinsically Worthless? (January 2, 2018). AIER Sound Money Project Working Paper No. 2018-07. Available at SSRN: or

William J. Luther (Contact Author)

Kenyon College ( email )

Gambier, OH 43022
United States


American Institute for Economic Research

PO Box 1000
Great Barrington, MA 01230
United States

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