Linking my comment from other thread as that is relevant.
Depends how you distinguish investment from speculation. If you define investment as risking your present purchasing power to possibly have more future purchasing power, then you cannot distinguish the two. As it happens, I do have additional criteria for considering something as investment. For me investment is an activity where money is allocated towards creating something of social utility, that is, it must do something good for the society. If the value that is created is more than the value invested, then that makes a profitable investment.
By that definition, money betting on cricket matches is just speculation, but money going into stock market is investment. Because stock market is a means for business to raise capital, with the purpose of serving its customers better, that is to do something of value to the society.
Good thing is I don’t have to convince you of bitcoin’s utility, you have experienced it first hand. Bitcoin is not like other currencies which require dependence on banking infrastructure. The only question is whether you consider this unrestricted movement of capital across borders, that bitcoin offers, socially good? I do.
Bitcoin is an experiment to put the global economy on sound money - money whose supply is mathematically fixed, limited, and cannot be regulated. If you believe in the Keynesian principles - that money supply must be regulated for stability, it must be increased during recession and gradually decreased as growth returns, then you wouldn’t see any social value in Bitcoin - it is not just another currency but the worst kind of currency which cannot be regulated.
But if you agree with Austrian economics, then Bitcoin may have enormous social value in future, and you see it as an undervalued investment. By buying bitcoin, you are furthering the goal of putting global economy on sound money.
Sound money is a prerequisite for capitalism. Capitalism requires individual to have complete authority over his wealth. It is not the case if government can dilute his savings or even revoke access (think demonetisation). But the governments do want that power, and hence, they have adopted keynesian economics worldwide. Only keynesian economics promises to achieve all - economic growth, stability, welfare state. The politicians don’t have to make hard choices, of cutting government expenditure by making unpopular moves, say cutting unproductive government jobs, in order to fund their promises. The result is swelling government machinery, with its unsustainable expenditure and debt. A sound money will make government unable to do that. Do you consider that socially valuable? I do.
Sound money will have great implications for how individuals manage their finances. Since bitcoin is limited in quantity, it guarantees its holder a constant fraction of authority over entire economy’s resources. If economy grows, his purchasing power also grows at the same rate, to maintain that constant fraction. You no longer have to do index investing just to get market returns. It also changes people’s behaviour, from high time preference, where people prefer to take debt and consume as much as they can in the present, to low time preference, where people prefer to save and accumulate wealth for long term goals. The reason is simple. With unsound money, most people have bitter experience of saving, as they don’t find themselves much better off in terms of their purchasing power. Humanity’s progress rest on the low time preference behaviour, as humans tend to postpone some of their present needs, invest capital and effort in developing better technology, so that they can have more in the future. If Bitcoin’s adoption can increase the low time preference behaviour, then that certainly has great social value, isn’t it?
Lastly if you trust Austrian economist’s theory of business cycles, then you would agree that sound money will make the problems like recession go away. According to them, cycles are a consequence of drastically increasing money supply through fractional banking. When interest rates are cut, it does not immediately raise the cost of economic resources. It makes many business managers, who have access to these low cost funds, see profitable opportunities at present prices. So they go after them. But the actual resources haven’t increased, only the money supply has, and as these businesses compete for these common resources with their fresh supply of money, they find their costs rising until their projects become unprofitable again - as they were before this money was injected. The result is a mass failure of businesses leading to recession. This logic of business cycles does makes sense. The evidence also stands against the keynesian economics, the efforts to stimulate growth by lowering interest rates seems only to keep the world on lowering interest rates trajectory while the business cycles become more extreme, and that cannot go on forever. This problem of misplaning will go away with sound money. That again is a very valuable. The only question is whether you agree with this viewpoint, and what chances you see of bitcoin achieving it?