Another example: you can set a contract to release your inheritance upon the registration of your death. No attorneys needed. It will go straight to your children’s wallets.
But you are putting the cart ahead of the horse… You need to solve the intrinsic value problem first… Who cares about giving an inheritance in worthless tokens… You need to solve the value-stable-token before it can ever be used as money.
That is why Bitcoin certainty never will since it has no use cases, and no backing, the only thing backing it is demand for speculation - that is the only thing that gives Bitcoin value - and that works until it doesn’t. If I told you Bitcoin will never go up from here, would you buy Bitcoin? Nobody a part from a small group would give a shit about bitcoin if they didn’t think it would go up… You dont speculate on money, you dont invest in money, you store your economic energy in money. A speculative asset will not be chosen as money…
The USD is nothing but a token that has value because the fed says it does. Yes, the bitcoin price may well be valued above it’s utility although there is the gold 2.0 argument. Ultimately it is worth what people will pay for it.
I buy crypto that I think will serve a future purpose. I think most people buy crypto for that same reason. Cardano, for example, isn’t even a working product yet. Hence, buying it is an investment in the future as the tech is developed and utilized.
That is not true, I will see If I can find my earlier thread on that. The reason you think this, and many others is because you have a limited understanding on what gives unbacked currencies value, it is not just faith. Give me a second.
Yes it does have backing but it also has faith. We had faith that banks storing our money would have that money returned to them from their mortgage loans. The USD could go the way of the Bolivar - but I don’t think it will anytime soon.
No that is irrelevant and is not correlated with each other at all
Irrelevant ? That is how the U.S. monetary system works - on money that doesn’t exist (exists as credit ).
Regardless, this overly complex monetary system will not continue unabated when this new simplifying technology is emerging. That is my firm belief.
I also have no doubt ( but am fearful of ) that the fed will one day issue a USD backed crypto. They will have omnipotence and omniscience over it’s use.
I found it.
Dollar was originally Gold. The Dollar was a claimcheck for the money in the bank sitting in a vault, which was the Gold. We just used dollars as it was easier to carry around and make different denomination.
Now its not, its lost 97% of its value since removing backing, but its still in use, why is this?
The dollar is backed by the force of the Government, as we have to pay taxes in said currency. Regardless of what country you live in. That is where the main demand for that currency comes from, and it forces everyone in that country to transact in it. Its backed by force. CryptoCurrencies cant backed by force, it can only back by choice. Its like if there was a gang, going around saying YOU HAVE TO TRANSACT IN BITCOIN or we will put you in jail. Bitcoin would be backed by force. It wouldn’t need any real backing either then, everybody would just comply.
Many people who dont understand money come to believe these hype things that Dollars have no value etc, Its just faith, and thats not entirely true. Backed by Force.
This is what you are wrong about… Thinking Oh if Dollar can be backed by faith, Bitcoin can too… The only problem is the USD was never backed by faith, but by actual mechanics that gave it a certain “backing” that had intrinsic value.
Right the U.S abandoned the gold standard so there no longer is a commodity backing the usd. Based on your logic - when the U.S. loses it’s world power status, just as Rome did, then the usd will be worth nothing. Besides, the federal government could just as easily back a cryptocurrency with force. That is the whole point of crypto anyway - that it is a borderless currency not backed by one nation’s millitary. It is decentralized. That is the beauty of it.
Bitcoin is accepted by thousands of companies (big and small) worldwide already.
This is one of the Austrian blind-spots I was referring to. “Money” is a confidence game, which means that money is anything that people are willing to accept in exchange for something of value. The Austrian definition of money does not take into account the flow of abstract value in modern economies. No matter how much you fight it, you will see markets accepting Bitcoin because it reduces transaction costs, saves time, reduces charge-backs, enables ~4 billion un-banked and under-banked humans exchange value, enables oppressed humans to avoid the corrupt theft (inflation/taxation) of their governments (see the bail-ins of Cyprus and Greece), eliminates many categories of fraud and commercial corruption, and a long list of other very valuable features.
We can quantify all the benefits above and credibly compute a justifiable value for the global Bitcoin market that is at least 2x the total current value of the $7.5 trillion global gold market. That potential market value represents the potential price increase of Bitcoin from its current price. Anybody can argue it’s a ponzi-scheme based on some narrow and arbitrary definition of money just like we can argue the USD is a ponzi-scheme. But nobody can credibly ignore all of Bitcoin’s use-cases, which means nobody can dismiss the very real utility that it provides to increasingly larger populations on Earth today. Whether we call that utility “intrinsic value” or simply “utility” is irrelevant; what matters is that it creates and/or unlocks and/or preserves value for populations worldwide, which is why it has value.
I could say, “I don’t have time to educate you. . . .” like you did in your first condescending comments to me ;-), but rather than being vindictive, I simply ask that you try really hard to open your mind to other perspectives. You communicate with a very hard-line approach, but you’re missing some important aspects of modern economics. This is caused by the Austrian box, which blinds people from seeing how information-based economies and cryptography create value and ways of exchanging value that Mises and Hayek could never have imagined.
That decenralized nature is intrinsic value
No, even if it doesn’t have the reserve power it doesn’t matter, that only overvalues it beyond what it should be. Every country in the world has a unbacked-currency and they all work by being forced to pay tax or transact in it. Some places it is illegal to transact in anything other than national currency.
and no, if that decentralized nothing has no intrinsic value it will be worth nothing. You cannot trick the market, only for a short period of time, but reality always kicks in. Even bitconnect tokens right now have value, but eventually it will be 0 as that is its true value.
Even if 90% of the world believed in Bitcoin, even if they had faith, it wouldn’t matter, you cannot make something that has no intrinsic value have value. Its impossible else we could just create wealth out of thin air.
You just illustrated all that is wrong with the USD. It is no longer backed by gold. It is only backed by a military saying it has value. That and credit of course. That and banks that only have 10 % of everybody’s money at any given time. It is these problems that spawned bitcoin in the first place
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No it has nothing to do with the military saying it has value … it has nothing to do with ANYONE SAYING it has value… Its backed by Force…There are real world mechanics making it have demand (artificially) that has nothing to do with belief or faith… I dont agree with it, but I understand it…
The dollars main use-case is taxes, overtime it has had several, like also being the worlds reserve currency, that was another use-case since other countries needed dollars for trading oil and other goods.
If you take that force away, then you would be right, The dollar would just be faith based. It only would have value because we believe in it… and then it would just be a Bitcoin… Aka. Worth nothing… I guess at least I would have a piece of paper holding the dollar, maybe the paper has some worth.