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Fiat vs. Bitcoin

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Re: Fiat vs. Bitcoin

#41

Post by jcranmer »

empthought wrote: post #36
candiodari wrote: post #2

Interesting graph. Of course it's saying a lot more about fiat currency than about bitcoin. The graph would look about the same with almost any commodity, stock, real estate, ... and so on and so forth. It would look the same (exponential shape) for any state, and crucially, it would look the same even if you went back centuries or even millenia. The only real conclusion to draw from this is that governments have alw…

"your" money... Show me the coin used for paying the tax.” They brought him a denarius, and he asked them, “Whose image is this? And whose inscription?” -- Matt 22:19-20

"Render therefore unto Cæsar the things which are Cæsar's" -- Matt 22:21

That story is all about Jesus telling people "religious law doesn't get you out of paying taxes."

Re: Fiat vs. Bitcoin

#42

Post by [deleted] »

candiodari wrote: post #2

Interesting graph. Of course it's saying a lot more about fiat currency than about bitcoin. The graph would look about the same with almost any commodity, stock, real estate, ... and so on and so forth. It would look the same (exponential shape) for any state, and crucially, it would look the same even if you went back centuries or even millenia. The only real conclusion to draw from this is that governments have alw…

[deleted]

Re: Fiat vs. Bitcoin

#43

Post by FLUX-YOU »

wz1000 wrote: post #40
ForHackernews wrote: post #18

By any reasonable definition, Bitcoin is a fiat currency. Unlike commodities like gold or silver, it has no inherent value whatsoever, and no applications for industrial use or jewellery. Bitcoin is a fiat currency because it only has value while some group of humans collectively agree to pretend that is has value. The same as dollars or yen.

No. Dollars have an intrinsic value as long as the IRS and the police exist, because you have to settle your dues with them come April 15, and they only accept USD. Also, you need dollars if you will ever have any kind of dealings with the American Judicial system.

That isn't what intrinsic value means.

Re: Fiat vs. Bitcoin

#44

Post by matt4077 »

baby wrote: post #32
zeroxfe wrote: post #22

Earlier quoted context omitted.

> By any reasonable definition, Bitcoin is a fiat currency. Sure, if you entirely change the definition of fiat currency. A fiat currency gets its value by being declared by government as legal tender, and then required by law to be accepted in a jurisdiction. Bitcoin might share the "no intrinsic value" property of fiat, but that does not make it fiat. It's pretty much the opposite of fiat in every other respect. Ev…

> speculation driven by scarcity which makes it interesting as to why Ripples get "so much" value as a currency that has so many "coins". From Coinmarketcap[1], the circulating supply of ripples is 38,531,538,922 while bitcoin is limited to 21,000,000. The other interesting thing is that Ripples "distribute" its coin as opposed to letting miners mine them. I know nothing about economics so I would be interested to kn…

> because they are currently cheap compared to the market cap they have

This sentence doesn't even begin to make sense...

The absolute value of any of these tokens is completely irrelevant. Same as it is for a US$ or CAD. You can define your own "decadollar", worth $10, get everyone to switch, and it would make absolutely no difference to the economy.

Re: Fiat vs. Bitcoin

#45

Post by lucozade »

ramontayag wrote: post #30
lucozade wrote: post #21

Earlier quoted context omitted.

More specifically, the majority of individuals who control mining. I’d be interested to know how many people would actually need to agree a fork that, say, didn’t halve the coinbase. Also, of those, how many would give priority to the philosophical underpinnings of Bitcoin over making more money in the short/medium term.

Even if miners could change the rules and print more, do you think the users would continue to use it?

Why not? They use it today with the current coinbase. Why wouldn’t they use it tomorrow?

Some will stop using it, sure. And they probably have enough coin to affect the price short term.

But I’d argue that the majority of usage is now not for political/philosophical reasons but for economic ones.

Re: Fiat vs. Bitcoin

#46

Post by hanniabu »

kovek wrote: post #9
vernon99 wrote: post #8

Earlier quoted context omitted.

Which you can, for years now... lots of services provide debit cards tied to your bitcoin wallet. Instant purchases. Some examples: https://www.weusecoins.com/bitcoin-debit-cards/

We were just discussing this earlier with some friends. Don't bitcoin transactions take a large amount of time? A block takes 10 minutes to mine, and there is no guarantee your transaction will be picked up by the currently mined block (or the one after), because there is a limit on the number of transactions that can fit in a block. Are there solutions to this?

An alternative solution are some cryptocurrency loan programs such as ActiveHold

Re: Fiat vs. Bitcoin

#47

Post by baddox »

evgen wrote: post #25
Sir_Substance wrote: post #17

Earlier quoted context omitted.

By that standard, when you use a bog standard Visa card you're not actually paying with dollars[1], you're paying with the artificial virtual currency your bank provides that is pegged to the dollar at 1:1, and merely funding your account with dollars. [1] Substitute your local fiat currency here

No, you are paying with whatever currency the counter-party accepts. What backs the debit/credit card does not matter as long as the issuer thinks you have the assets to cover the loan they are making. If I have a card linked by my brokerage account I am not paying for dinner with shares of AMZN, I am paying in dollars and at some point will be required to convert some asset into dollars to cover the loan.

But this is a pretty inconsequential semantic difference. You could just as easily say that you’re selling dollars and the grocery store is paying you in bread.

Re: Fiat vs. Bitcoin

#48

Post by baddox »

ForHackernews wrote: post #18

By any reasonable definition, Bitcoin is a fiat currency. Unlike commodities like gold or silver, it has no inherent value whatsoever, and no applications for industrial use or jewellery. Bitcoin is a fiat currency because it only has value while some group of humans collectively agree to pretend that is has value. The same as dollars or yen.

> By any reasonable definition, Bitcoin is a fiat currency.

Clearly not by the only widely-used and -understood definition. Which reasonable definitions are you proposing? The key feature of fiat currency is that its usage as money is legally established by a government. That is clearly not the case with Bitcoin, unless you want to play semantic tricks and call the Bitcoin community or a set of algorithms a “government,” but that is very clearly not how the vast majority of people uses the term.

Re: Fiat vs. Bitcoin

#49

Post by analog31 »

The way I understand money is to treat it as a technology. A technology is designed and operated to serve a purpose. The money of countries like the US and Europe is intended to serve as a medium of exchange, a temporary store of value, and a tool of government tax and monetary policy. I think it's expected that people will hold onto a minimum amount of money, and store the bulk of their wealth somewhere else. Most people don't have substantial wealth in the first place.

Bitcoin is intended to serve another purpose: To demonstrate the behavior of a money system that is not controlled by a government.

As with any technology, people use money if it's useful to them. If a country has a poorly managed money system, then people start to use the money of some other country, or barter. If bitcoin has a chance of supplanting government money, it will happen when bitcoin works better for the people using it. I suppose this could happen sooner in countries that have really bad money, or if the use of government money becomes prohibitive because of transaction fees.

Re: Fiat vs. Bitcoin

#50

Post by evgen »

baddox wrote: post #47
evgen wrote: post #25

Earlier quoted context omitted.

No, you are paying with whatever currency the counter-party accepts. What backs the debit/credit card does not matter as long as the issuer thinks you have the assets to cover the loan they are making. If I have a card linked by my brokerage account I am not paying for dinner with shares of AMZN, I am paying in dollars and at some point will be required to convert some asset into dollars to cover the loan.

But this is a pretty inconsequential semantic difference. You could just as easily say that you’re selling dollars and the grocery store is paying you in bread.

No, it is a very significant difference and is not just semantics. The transaction is clearing in dollars and those dollars are moving from buyer to seller. There is no other currency involved in the transaction. The fact that dollars are constant and the seller could be exchanging bread, milk, cars, or bars of gold for the dollars tells you what the medium of exchange is here.

Once the transaction has cleared the seller can convert the dollars into euros, yen, ruble, pesos, or bitcoin and it has nothing to do with the actual transaction.

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