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Right, that's exactly my point. Bitcoin's only value is in the transactions it can make. If there are no transactions, there's no way for it to be a store of va

Right, that's exactly my point. Bitcoin's only value is in the transactions it can make. If there are no transactions, there's no way for it to be a store of value, contra the GP. Fiat currencies aren't technically any different, but you can use them to pay taxes and their value is insisted on by armies, which does count for something.

wyager 10y ago
> Bitcoin's only value is in the transactions it can make. Bitcoin's value is that it's * Fungible * Divisible * Verifiable (All qualities that gold has, but Bitcoin does them a lot better) as well as being * Stupidly easy to store and transport * Extremely difficult/impossible to confiscate * Not subject to devaluation due to an as-of-yet undiscovered deposit > If there are no transactions, There are, as of now, on the order of five transactions per second. How many times per second do you think people are trading gold? > Fiat currencies aren't technically any different Well, there's at least one difference; fiat currencies can be easily devalued by inflation. Gold can't be inflated by fiat, but it could be inflated by the discovery of a large deposit (or asteroid mining). Bitcoin can't be inflated at all, period. > but you can use them to pay taxes If you have an asset, you can sell the asses to pay taxes or court-ordered payments. The small friction involved in converting the asset to fiat money is factored into the price of the asset. (Incidentally, one of the benefits of Bitcoin is that it's less beholden to taxation than traditional clearing house/bank-held assets). > and their value is insisted on by armies I've seen this meme a few times, and I honestly don't understand how anyone can say or write this out and not think to themselves "Wait, this doesn't make any sense at all.". I'm pretty people started saying this as a joke. What is this even supposed to mean? If I attempt to sell something for USD above a certain price, is the army going to kick down my door and threaten me until I place a higher value on the dollar?
- matt_wulfeck 10y ago
  > Gold can't be inflated by fiat, but it could be inflated by the discovery of a large deposit (or asteroid mining). Bitcoin can't be inflated at all, period. Is this really true though? Couldn't a leap forward in quantum computing make mining BTC considerably "easier" and thus inflate and devalue the supply of BTC on the market?
  - UncleMeat 10y ago
    Quantum computing has implications for the transmission of coins but has no implications for mining. There is no evidence that QC is going to make it easier to invert hash functions.
    - davidgerard 10y ago
      I thought so too, but SHA-256 should apparently be susceptible to Grover's algorithm, which would make mining O(sqrt(N)) instead of O(N). Of course, a practical quantum computer would also likely break public key cryptography, so you could just take other people's coins instead of doing all that tedious hashing.
  - wyager 10y ago
    Not as far as we know. Even with grover's algorithm, all hash algorithms in Bitcoin should still (probably) be secure. Even if there were a huge leap in processing power, the mining difficulty would increase automatically. Even if someone had infinite processing power, all they could do is mine the rest of the coins more quickly; there is still a hard cap on the total future number of coins.
uncletammy 10y ago
> and their value is insisted on by armies I agree with this. I also think it's one of the strongest arguments for participating in the bitcoin experiment.

wyager 10y ago

> Bitcoin's only value is in the transactions it can make. Bitcoin's value is that it's * Fungible * Divisible * Verifiable (All qualities that gold has, but Bitcoin does them a lot better) as well as being * Stupidly easy to store and transport * Extremely difficult/impossible to confiscate * Not subject to devaluation due to an as-of-yet undiscovered deposit > If there are no transactions, There are, as of now, on the order of five transactions per second. How many times per second do you think people are trading gold? > Fiat currencies aren't technically any different Well, there's at least one difference; fiat currencies can be easily devalued by inflation. Gold can't be inflated by fiat, but it could be inflated by the discovery of a large deposit (or asteroid mining). Bitcoin can't be inflated at all, period. > but you can use them to pay taxes If you have an asset, you can sell the asses to pay taxes or court-ordered payments. The small friction involved in converting the asset to fiat money is factored into the price of the asset. (Incidentally, one of the benefits of Bitcoin is that it's less beholden to taxation than traditional clearing house/bank-held assets). > and their value is insisted on by armies I've seen this meme a few times, and I honestly don't understand how anyone can say or write this out and not think to themselves "Wait, this doesn't make any sense at all.". I'm pretty people started saying this as a joke. What is this even supposed to mean? If I attempt to sell something for USD above a certain price, is the army going to kick down my door and threaten me until I place a higher value on the dollar?

matt_wulfeck 10y ago
> Gold can't be inflated by fiat, but it could be inflated by the discovery of a large deposit (or asteroid mining). Bitcoin can't be inflated at all, period. Is this really true though? Couldn't a leap forward in quantum computing make mining BTC considerably "easier" and thus inflate and devalue the supply of BTC on the market?
- UncleMeat 10y ago
  Quantum computing has implications for the transmission of coins but has no implications for mining. There is no evidence that QC is going to make it easier to invert hash functions.
  - davidgerard 10y ago
    I thought so too, but SHA-256 should apparently be susceptible to Grover's algorithm, which would make mining O(sqrt(N)) instead of O(N). Of course, a practical quantum computer would also likely break public key cryptography, so you could just take other people's coins instead of doing all that tedious hashing.
- wyager 10y ago
  Not as far as we know. Even with grover's algorithm, all hash algorithms in Bitcoin should still (probably) be secure. Even if there were a huge leap in processing power, the mining difficulty would increase automatically. Even if someone had infinite processing power, all they could do is mine the rest of the coins more quickly; there is still a hard cap on the total future number of coins.

uncletammy 10y ago

> and their value is insisted on by armies I agree with this. I also think it's one of the strongest arguments for participating in the bitcoin experiment.