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Bitcoin is fiat money, too

economist.com

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Re: Bitcoin is fiat money, too

#191

Post by aserafini »

betterunix2 wrote: post #102
vit05 wrote: post #72

Earlier quoted context omitted.

How does Dollar work offline? How much do you have in your pants? Because if the world goes offline, Banks would not have all the "money" necessary to give it back to people.

No different from the situation 500 years ago where a fire could destroy important records and leave countries in chaos. All banks need to do is keep track of how much money is in everyone's accounts and allow people to transfer money somehow. They do not need to be able to "give it back to people." Fiat money could exist on pen-and-paper ledgers too; in fact that was exactly what the earliest known money was (well,…

I'm not sure banks would have an easier time recovering. Bitcoin's entire blockchain history, and therefore the balance of every wallet is replicated on thousands of hard disks in every country of the world. It's the ultimate backup strategy. We could make transactions by hand, based on this information, if we needed to.

Re: Bitcoin is fiat money, too

#192

Post by kijin »

foepys wrote: post #185
KGIII wrote: post #178

Earlier quoted context omitted.

Visas are usually easy to get and there are counties other than the US and aren't Lebanon. Also, Lebanon isn't really all that terrible and you don't need to live there. You can be a citizen of Zimbabwe, if you want. The point is to not have the US government forcing disclosure, per the OP's question.

Roger Ver, who ironically for this thread is a crypto currency investor, renounced his US citizenship to avoid paying taxes and was repeatedly denied entry into the US afterwards. He will most likely never be able to visit his family in the US again.

If you're rich enough, you can fly your family and friends out to any tropical paradise whenever you want. No need for you to visit the US unless you have a strong emotional attachment to some specific location.

Re: Bitcoin is fiat money, too

#193

Post by rblatz »

aviv wrote: post #75
Finnucane wrote: post #20

Earlier quoted context omitted.

Is Bitcoin actually a medium of exchange? It seems to be functioning more as an investment to be hoarded rather than spent.

Right, the same people telling you it's going to $100K are the ones saying this is a digital currency that should be spent. Well, I sure ain't about to spend $100K to buy 2 MacBook Pros.

And that’s why the fed ensures we have a mildly inflationary currency. If it deflated spending would drop, cutting the velocity of money, and cutting out economic growth.

Re: Bitcoin is fiat money, too

#194

Post by kashkhan »

sonink wrote: post #190

Fundamentally, Bitcoin is software eating the Fed-Bank-Retail ecosystem. The Fed governance is replaced by code. The banking utility is replaced by miners. I think the march of bitcoin is actually a better example of how AI is taking over the world. People in AI are fascinated by AGI - but the bitcoin ecosystem is actually a real world example of how AI will take over the world. Specifically, the march of AI won't ha…

it's great that no government is doing the fiat. That by itself is reason enough.

Re: Bitcoin is fiat money, too

#195

Post by rblatz »

mrb wrote: post #158
patryn20 wrote: post #151

Earlier quoted context omitted.

Unless Bitcoin has a fundamental evolution, it cannot be a replacement for fiat currency. I'm super excited about the crypto currency space but I firmly believe we're in the "Diamond Rio" phase of a new technology and not yet to the "iPhone" and "Android" phases.

Bitcoin does not need to, will probably not, and was never intended to completely replace fiat currency. As a cryptocurrency aficionado I think it can achieve great success and high adoption while coexisting with fiat currency. I don't need to pay my cup of coffee in bitcoins, but Bitcoin is very useful for plenty of other use cases.

Like buying drugs, money laundering, and hoarding. So far only one of those is legal.

Re: Bitcoin is fiat money, too

#196

Post by stinkypete »

jdietrich wrote: post #177
ballenf wrote: post #130

Earlier quoted context omitted.

So, it's gold? I don't know if I've ever seen someone buy a Starbucks with a Kruggerand. Gold is hoarded and traded much like bitcoin, from what I've seen.

The device you're using to read this comment couldn't function without gold. It's an incredibly useful element. Investment and speculation might have inflated the value of gold, but industrial demand sets a price floor.

Si is also incredibly useful but requires industrial processing to turn into something useful from an industrial standpoint.

Au is indeed useful, but not so much as nearly indicated by its current pricing. There's a _long_ history of human predilection for gold-as-a-magical-substance versus gold-as-an-industrially-useful-element.

Re: Bitcoin is fiat money, too

#197

Post by ryan_j_naughton »

sonink wrote: post #190

Fundamentally, Bitcoin is software eating the Fed-Bank-Retail ecosystem. The Fed governance is replaced by code. The banking utility is replaced by miners. I think the march of bitcoin is actually a better example of how AI is taking over the world. People in AI are fascinated by AGI - but the bitcoin ecosystem is actually a real world example of how AI will take over the world. Specifically, the march of AI won't ha…

>"People underestimate the amount of resources required to articulate monetary policy by a central bank. Bitcoin can already do that much better than maybe 70% of the worlds central banks."

Bitcoin only has totally clear monetary policy because it's increase of the money supply is entirely predetermined: It is created at an ever decreasing rate approaching a limit.

The result of this certainty in monetary policy is a currency that is naturally deflationary (literally by definition). This makes Bitcoin perfect as digital gold but shit as a functional unit of currency. You don't want to spend an asset that will naturally appreciate in value, discouraging using it.

You could have a cryptocurrency that generally trends at the same inflation rate as regular currencies: 2-3% annual and use that to pay the miners (or just give everyone a wealth endowment through giving any current owners a 1% increase in their current wallets and use the other 1-3% for the miners) and you would have a currency that could stay price stable with out Fiat currencies instead of always increasing in price like BTC has (at least over a sufficient moving average to reduce the volatility from speculation).

Re: Bitcoin is fiat money, too

#198

Post by mirimir »

labster wrote: post #183
mirimir wrote: post #180

Earlier quoted context omitted.

Yes, that's the distinction. With Bitcoin, a codebase prevails if it attracts enough miners, merchants and users. Those parties in aggregate have "fiat power". It's arguable that fiat power for each state similarly reflects preferences of banks, merchants and users. However, some of us doubt that money policy typically favors users. With government fiat, forking isn't really possible, without a revolution, no matter…

So you're telling me that government money, where everyone gets a say in policy through republican institutions, is worse than a system where the most wealthy users get more control of the currency. Um, okay. I guess the oligarchy is more explicit in the cryptocurrency.

I don't think that it's necessarily the wealthiest users. There could be a fork with lots of interest, no particularly wealthy users, and no non-user miners. One could probably impose the "no non-user miners" rule in code.

But even then, I prefer it, because with enough interest, it can always be forked. And that's much easier than changing governmental monitary policy. That is clearly dominated by the wealthy.

Re: Bitcoin is fiat money, too

#199

Post by ben_w »

narrator wrote: post #143
AFNobody wrote: post #141

Earlier quoted context omitted.

A 51% plutocracy is still a form of state governance that qualifies as fiat money and effectively can destroy the value of your coins if you resist. It is really no different than the government fining you for disobedience. There are philosophical theoretical arguments against this, not pragmatic ones.

Why would someone destroy all the value of their money and all the money power to mine just to troll? Sure a government might do that, but they could point a gun to every full node owners head and tell them to stop it just like China did. It would also be much cheaper.

Step 1: purchase, borrow, or steal enough hash power to reach 51% for a short while

Step 2: use this power to force enough transactions to make yourself rich enough to keep 51% power indefinitely

Step 3: profit

Re: Bitcoin is fiat money, too

#200

Post by kijin »

eridius wrote: post #65
SolarNet wrote: post #13

Earlier quoted context omitted.

You must live in: Alaska, Delaware, Montana, New Hampshire or Oregon. (Or be oblivious) States where the sale of a cup of coffee doesn't involve a tax.

Tax just tracks that the transaction occurred, it doesn't track who's doing the transaction. But if you don't like even that much, then replace "cup of coffee" with "lemonade from a neighborhood lemonade stand".

Moreover, most cash transactions at small shops aren't even tracked individually. The merchant will just report the sum of sales for a given period if he's honest, or a completely unrelated value pulled from thin air if he's not.
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