Bitcoin’s Value Reflects 130 Billion ‘Life Years’ of Attention Versus Gold

The anonymous co-founder of ScimitarCapital, Thiccy, presented an intriguing perspective on the rise in Bitcoin’s value by drawing parallels between Bitcoin’s global visibility and that of gold.

What determines Bitcoin’s worth? A fresh perspective

He contends that gold holds its value due to its scarcity, resilience, and a long-standing reputation as a form of currency for millennia. This extensive history fosters trust in its ongoing value, a concept referred to as the Lindy effect, which suggests that the longer something has existed, the greater the likelihood of its continued existence.

In contrast, Bitcoin is relatively young, having emerged in 2009. Initially, this youth led many to view it as “digital fool’s gold.” Rather than simply measuring its age, the author proposes evaluating it based on “attention time,” which reflects how many individuals have been aware of it throughout its duration.

Since its inception in 2009, humans have amassed approximately 130 billion “life-years” of attention invested in Bitcoin, representing the total time all people have had to learn about and assess it.

By comparison, gold has accrued around 1.3 trillion life-years of attention since 700 BCE. This indicates that Bitcoin has already garnered about 10% of the human attention that gold has, despite its relatively short existence.

Interestingly, Bitcoin’s market capitalization is roughly 10% of gold’s ($2.1 trillion compared to $21 trillion), supporting the idea of attention time.

If global demographic trends persist, this “attention share” may expand over time, potentially reaching 12.8% by 2030, 15.7% by 2035, and 18.4% by 2040.

The annual growth rate of Bitcoin’s “Lindy value” is projected to be around 5.5% per year, slower than some trading strategies, yet still significant.

Thiccy asserts that assessing time based on the number of individuals paying attention provides a more accurate gauge of Bitcoin’s credibility and longevity.

Authors like Dan Held and Vijay Boyapati have frequently referenced the Lindy concept but generally consider time in straightforward calendar years. Others have analyzed Google search metrics, Wikipedia traffic, and social media engagement to explore how these trends might predict short-term price changes. Previous research has focused on attention spikes as trading signals rather than cumulative attention over Bitcoin’s lifespan.

Overall, Bitcoin remains a novice in the financial realm, yet the vast number of people aware of it enhances its chances of survival beyond what mere age might suggest.

Thiccy has written a detailed article on this topic, complete with charts and further insights.