Do you think scarcity is always creating value? You know we have been made to believe that when things are scarce they have more value, but do you know that that is not always right? Demand is what creates value, even if the supply high or the supply is more than the demand, do you think it’s enough to make it expensive. They are so many things that are scarce but you don’t care or don’t know because you don’t demand them. Let’s talk about Diamonds, why do you think Diamonds are very expensive even though the supply is limitless. Diamonds are natural resources that is mainly composed of carbon and carbon is a natural element found on earth. But it’s very expensive, even though people can make lab diamonds and relieve you the stress of mining.
I was having a bottle of Malta Guinness while writing this content.
Do you agree with me? In crypto we see a lot of coins that have low supply, but the value is really low because the demand is low. Demand is what makes something valuable, valuable because people want it. But when Demand is high and supply is also high, it’s easier for lots of money to be made. If there is only one source though, that’s where monopoly comes to play. Monopoly lets you control the value of something regardless of the supply, as long as demand is high, people won’t have a choice but to buy it.
Value gets created when Demand is high, so we have to rely more on demand, this is why most companies rely more on advertising than producing, advertising helps creates demand because it brings exposure, so we are going to conclude that scarcity doesn’t always create value but more on Demand.