Although it is stepping into the mainstream financial circle, as a new type of financial asset, the value of bitcoin is difficult to be determined by traditional valuation methods. From the perspective of market valuation method, there is no similar asset in today's financial market that can be used as a reference for the value of bitcoin. Bitcoin is the most typical and active encryption asset in the current market. Traditional financial assets are not comparable with bitcoin, and other encryption assets are not qualified to provide value reference for bitcoin. From the perspective of income valuation method, bitcoin does not have the underlying assets that can generate cash flow. In fact, the innovation of bitcoin in payment technology and concept is very valuable. Today's digital currency development activities and the wide application of blockchain technology from the official to the private are the embodiment of its value. However, the inventors of bitcoin do not take the innovation benefits as their own, but externalize them completely, so they can't evaluate the value of bitcoin based on them. From the perspective of cost valuation method, mining cost can only be used as a bottom line reference of bitcoin value. According to the calculation of bitfan website, the current "shutdown currency price" of bitcoin is more than $7000, which means that only when the price of bitcoin is higher than this amount, can we "dig" new bitcoin for profit.

Since the traditional valuation method is not feasible, the value of bitcoin can only depend on the consensus of both parties. At present, there are three kinds of value cognition of bitcoin in the market. The traditionalists, represented by Warren Buffett, believe that bitcoin has no value and that they will never invest in bitcoin. The advocates, represented by Michael Saylor and Elon Musk, are loyal supporters of bitcoin and firmly believe that bitcoin will be widely accepted and used. This group is growing in number and is becoming the backbone of the bitcoin market. The idealists, represented by some analysts from JPMorgan Chase, Citibank and other institutions, compared bitcoin with gold and believed that its price could reach hundreds of thousands of dollars in the future. The price of financial assets fluctuates around its value. From the special valuation mechanism of bitcoin, it is not difficult to understand the power behind its high price and sharp fluctuation: the rapid growth of the admirers and the huge differences of views among the various factions.

(2021-4-5)