When there is an economic relationship in which the value of a given good or service decreases as it is consumed on a large scale, it is called a marginal theory: a product starts to cost less from the moment it becomes very abundant, causing its marginal utility to decrease.
The greater the availability, the lower the value given to a product, good or service.
The smaller the quantity of a given good, the greater the tendency to overvalue it, giving it value for its scarcity.
There is a classic example among economists: offered you a bottle of water or a diamond, which would you choose?
In the example of water and diamonds, even though water is valuable because of its usefulness, it is not given the importance it deserves, as there is an abundance available. However, in the desert a bag of diamonds will be of no use! Most likely, the individual chooses water and that it costs as much as diamonds.
Consumption decisions are driven by scarcity and need.
Many marketing strategists use these concepts in their sales planning, attracting the interest of consumers with catchphrases such as: "enjoy, last units".
The Marginal Utility Theory is always used to even voluntarily reduce production to force an increase in value.
Bitcoin, with restricted production, uses this characteristic for its own valuation.
Marginal utility can also be the degree of satisfaction (utility) that the individual has in acquiring an additional (marginal) unit of a particular product or good. Usually products that do not belong to primal needs.
Bitcoin is a virtual currency that has been gaining followers in the market all over the world, and it has a direct link with the Marginal Utility Theory, since its usefulness is not exactly in its value, but in the expectation that it will become a form of payment.
Thus, currency appreciation is directly linked to its utility, as value is formed by scarcity and marginal utility, the tendency is for money to stand out more and more, gaining a more expressive appreciation.
That's why, in this sense, of marginal utility, the Ethereum platform has been advancing, as a value, relative to bitcoin.
Ethereum's marginal utility far exceeds bitcoin due to ethereum's "birth" feature: providing services to the commercial and financial arena.
The Marginal Utility Theory stands out for its relevance in the economy, including when it comes to the valuation of virtual currencies such as Bitcoin.
Understanding these concepts and understanding how people's behavior works helps to better deal with choices and investments, making better decisions focused on good results.
This theory has been used extensively as a tactic to offer tokens and DefI that are, in fact, SCAM, as it has no need and its usefulness only serves those who created the token.
That is, in the same way that theory is used in order to regulate asset value, it also serves obscure purposes that have the sole purpose of raising the instant price, by forming expectations and, after accumulating a certain value, disappear, leaving the investors with giant losses.
Anyway, one must always be careful with the use of this theory within the world of cryptocurrencies!
After all, a glass of water has relative value, just like a bag of diamonds and a cryptocurrency: it depends on what you want to do with these items!!!!
