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Except that during crisis Gold is guarantee to fall back at worst to it's "practical" value as a metal being used for jewelry. Even tulips bulbs have a practica

Except that during crisis Gold is guarantee to fall back at worst to it's "practical" value as a metal being used for jewelry. Even tulips bulbs have a practical value as every gardener could tell you. However the practical value of a crypto currency is zero. And no technical small talk was able to contest this truth so far. EDIT: Downvote what you can't contest, how mature!

Akujin 9y ago
Unless said crises is global and the internet is dead world wide you would always be able to sell your cryptocurrency to someone in a stable economic market somewhere in the world. When the local fiat currency inflates to worthlessness cryptocurrencies shine.
- Twisell 9y ago
  I don't say cryptocurrency can't be a thing. If widely supported it can succeed as any other fiat currency. It's just that I think it's nonsensical to apply analogy between gold/bitcoin because of the lack of practical value of BTC. For instance if the Russian ruble lost 30% of it's value during late Cold War. Would you argue that it's like gold and that we should'nt worry? Well actually some people thought that way... and got burned. Again I'm not comparing, I'am precisely stating that we should not compare crypto currency to previous markets. We should embrace the fact that we are totally in an unknown territory.
  - davidgerard 9y ago
    > We should embrace the fact that we are totally in an unknown territory. Well, not really. One, we aren't - hugely volatile charts like this are usual in commodities, which cryptos are constructed so as to imitate. But two, when people start saying phrases like "a whole new form of money" or "the old rules don’t apply any more", people get gullible and the ethically-challenged get creative. And a whole pile of old cons come back into the world. The best book ever written on Bitcoin is still Memoirs of Extraordinary Popular Delusions and the Madness of Crowds by Charles Mackay, and that was written in 1841. Chapter 1 on tulip mania and chapter 2 on the South Sea bubble will seem eerily familiar. http://www.gutenberg.org/ebooks/24518 http://www.gutenberg.org/ebooks/24518
- JackFr 9y ago
  > you would always be able to sell your cryptocurrency to someone in a stable economic market somewhere in the world That's a pretty bold assertion without any evidence or real theoretical justification.
- jorgec 9y ago
  "Unless said crises is global and the internet is dead world wide you would always be able to sell your cryptocurrency to someone in a stable economic market somewhere in the world." Its not true. Dogecoin is an example.
  - Akujin 9y ago
    I have Dogecoin! It's actually worth a few hundred USD at current prices! I mined some for shits and giggles years ago.
yoran 9y ago
* I can buy a new Dell laptop with Bitcoin (https://blog.dell.com/en-us/we-re-now-accepting-bitcoin-on-dell-com/ https://blog.dell.com/en-us/we-re-now-accepting-bitcoin-on-d...). * For that laptop I can buy Windows with Bitcoin (https://support.microsoft.com/en-us/help/13942/microsoft-account-add-money-with-bitcoin https://support.microsoft.com/en-us/help/13942/microsoft-acc...). * I can book my holiday with Bitcoin (https://www.cheapair.com/help/payment-and-billing/what-is-bitcoin/ https://www.cheapair.com/help/payment-and-billing/what-is-bi...). * I can donate to Wikimedia with Bitcoin (https://wikimediafoundation.org/wiki/Ways_to_Give#bitcoin https://wikimediafoundation.org/wiki/Ways_to_Give#bitcoin). Can't really do any of those things with tulips or gold. This is just a small set of places where I can do purchases with Bitcoin. As for currency, sure a tulip has practical value. But does a $100 bill? You can roll it for a cigarette or it can give you 5 seconds of warmth if you burn it. But that's about it. The reason you have all your savings in $ or € or something else, is because we all as a society say "this piece of paper (worth less than a cent in materials) is worth $5, and this one $50, and this slightly bigger one is $100". Same with crypto-currencies.
- klochner 9y ago
  You're agreeing with him. Gold and tulips are commodity currencies, they have value outside of their uses as a currency. The dollar and bitcoin are not commodity currencies, i.e., they have no value or use outside of their use as currencies. Whether bitcoin can be called a 'fiat' currency is debatable because it's not a currency "by fiat", though "fiat" currency has come to mean a non-commodity currency.
  - yoran 9y ago
    I see now that I misunderstood his point.
- quicknir 9y ago
  Buying something with something else is not a "practical use". Practical use means that you can actually build or make something of value with the product in question. The prices for all of these things are almost certainly based on the conversion rate between Bitcoin and the US dollar (or other major currencies). If Bitcoin massively deflates you may be able to still do those things, but it will cost many more Bitcoin: that's the whole point of this discussion. Yes, a $100 has no practical value either. But it's the official tender of the US government, which means that the US government does all of its spending in US dollars. Contracts, paying its employees, etc. The US government (federal, state, and local) spends a significant chunk of US GDP, i.e. a significant chunk of the world's largest economy. A country's currency is understood to be tied to that country's economy and monetary policy. As the economy is larger and the policy decisions are protected from craziness by checks and balance, currencies tend to be volatile only to a certain point in practice. This is even more true when you live in said country: if you live in the US, even if the US dollar is inflating considerably as measured against foreign currencies, the inflation of the dollar on the local economy is generally less. US annual consumer price index inflation has only cracked 10% for the year a handful of times in the last century.
libertine 9y ago
Gold has industrial usage as well - electronics, computers, even in space tech Gold it's used for it's unique properties. I don't get why crypto keeps being compared to a metal.
- astrodust 9y ago
  Even fiat currency has intrinsic value. The Zimbabwe bills that were inflated to hell and beyond, then replaced, which aren't even legal tender any more, still have value as collectible notes. You see them on eBay all the time for a buck or two. Nobody will pay anything for your Bitcoin wallet if Bitcoin fundamentally fails, just as nobody will pay for your World of Warcraft gold when the pull the plug on the last WoW server a decade or two from now. It's just a bunch of useless numbers. If you're "investing" in crypto, that is speculating, then fine. If you're thinking it's a safe and secure way to store money you're mistaken.
- davidgerard 9y ago
  > I don't get why crypto keeps being compared to a metal. Because Bitcoin was literally created to imitate gold, with the idea being to propagate crank goldbug conspiracy theory economics. This is why the price is so volatile - as an imitation of the gold standard, bitcoin wants to be money but actually works like a commodity, with booms, busts and bubbles. https://davidgerard.co.uk/blockchain/the-conspiracist-gold-bug-economics-of-bitcoin/ https://davidgerard.co.uk/blockchain/the-conspiracist-gold-b...
  - libertine 9y ago
    I understand it - even the term "gold rush" could be applied here, where people the get the fever and sometimes do irrational stuff to try to strike the good ol'gold nugget. You can learn a lot from the psychology and sociology side of the Gold Rush event, and surely you can compare it to the crypto event (after all, that's what history is for). But like you've said, Bitcoin was created to imitate gold... still it's not gold.
googletazer 9y ago
Dinosaur, meet meteor.
jcslzr 9y ago
you are right only silver and gold are money. it should not be Bitcoin vs Gold, the real question is Bitcoin vs USD

Akujin 9y ago

Unless said crises is global and the internet is dead world wide you would always be able to sell your cryptocurrency to someone in a stable economic market somewhere in the world. When the local fiat currency inflates to worthlessness cryptocurrencies shine.

Twisell 9y ago
I don't say cryptocurrency can't be a thing. If widely supported it can succeed as any other fiat currency. It's just that I think it's nonsensical to apply analogy between gold/bitcoin because of the lack of practical value of BTC. For instance if the Russian ruble lost 30% of it's value during late Cold War. Would you argue that it's like gold and that we should'nt worry? Well actually some people thought that way... and got burned. Again I'm not comparing, I'am precisely stating that we should not compare crypto currency to previous markets. We should embrace the fact that we are totally in an unknown territory.
- davidgerard 9y ago
  > We should embrace the fact that we are totally in an unknown territory. Well, not really. One, we aren't - hugely volatile charts like this are usual in commodities, which cryptos are constructed so as to imitate. But two, when people start saying phrases like "a whole new form of money" or "the old rules don’t apply any more", people get gullible and the ethically-challenged get creative. And a whole pile of old cons come back into the world. The best book ever written on Bitcoin is still Memoirs of Extraordinary Popular Delusions and the Madness of Crowds by Charles Mackay, and that was written in 1841. Chapter 1 on tulip mania and chapter 2 on the South Sea bubble will seem eerily familiar. http://www.gutenberg.org/ebooks/24518 http://www.gutenberg.org/ebooks/24518
JackFr 9y ago
> you would always be able to sell your cryptocurrency to someone in a stable economic market somewhere in the world That's a pretty bold assertion without any evidence or real theoretical justification.
jorgec 9y ago
"Unless said crises is global and the internet is dead world wide you would always be able to sell your cryptocurrency to someone in a stable economic market somewhere in the world." Its not true. Dogecoin is an example.
- Akujin 9y ago
  I have Dogecoin! It's actually worth a few hundred USD at current prices! I mined some for shits and giggles years ago.

yoran 9y ago

* I can buy a new Dell laptop with Bitcoin (https://blog.dell.com/en-us/we-re-now-accepting-bitcoin-on-dell-com/ https://blog.dell.com/en-us/we-re-now-accepting-bitcoin-on-d...). * For that laptop I can buy Windows with Bitcoin (https://support.microsoft.com/en-us/help/13942/microsoft-account-add-money-with-bitcoin https://support.microsoft.com/en-us/help/13942/microsoft-acc...). * I can book my holiday with Bitcoin (https://www.cheapair.com/help/payment-and-billing/what-is-bitcoin/ https://www.cheapair.com/help/payment-and-billing/what-is-bi...). * I can donate to Wikimedia with Bitcoin (https://wikimediafoundation.org/wiki/Ways_to_Give#bitcoin https://wikimediafoundation.org/wiki/Ways_to_Give#bitcoin). Can't really do any of those things with tulips or gold. This is just a small set of places where I can do purchases with Bitcoin. As for currency, sure a tulip has practical value. But does a $100 bill? You can roll it for a cigarette or it can give you 5 seconds of warmth if you burn it. But that's about it. The reason you have all your savings in $ or € or something else, is because we all as a society say "this piece of paper (worth less than a cent in materials) is worth $5, and this one $50, and this slightly bigger one is $100". Same with crypto-currencies.

klochner 9y ago
You're agreeing with him. Gold and tulips are commodity currencies, they have value outside of their uses as a currency. The dollar and bitcoin are not commodity currencies, i.e., they have no value or use outside of their use as currencies. Whether bitcoin can be called a 'fiat' currency is debatable because it's not a currency "by fiat", though "fiat" currency has come to mean a non-commodity currency.
- yoran 9y ago
  I see now that I misunderstood his point.
quicknir 9y ago
Buying something with something else is not a "practical use". Practical use means that you can actually build or make something of value with the product in question. The prices for all of these things are almost certainly based on the conversion rate between Bitcoin and the US dollar (or other major currencies). If Bitcoin massively deflates you may be able to still do those things, but it will cost many more Bitcoin: that's the whole point of this discussion. Yes, a $100 has no practical value either. But it's the official tender of the US government, which means that the US government does all of its spending in US dollars. Contracts, paying its employees, etc. The US government (federal, state, and local) spends a significant chunk of US GDP, i.e. a significant chunk of the world's largest economy. A country's currency is understood to be tied to that country's economy and monetary policy. As the economy is larger and the policy decisions are protected from craziness by checks and balance, currencies tend to be volatile only to a certain point in practice. This is even more true when you live in said country: if you live in the US, even if the US dollar is inflating considerably as measured against foreign currencies, the inflation of the dollar on the local economy is generally less. US annual consumer price index inflation has only cracked 10% for the year a handful of times in the last century.

libertine 9y ago

Gold has industrial usage as well - electronics, computers, even in space tech Gold it's used for it's unique properties. I don't get why crypto keeps being compared to a metal.

astrodust 9y ago
Even fiat currency has intrinsic value. The Zimbabwe bills that were inflated to hell and beyond, then replaced, which aren't even legal tender any more, still have value as collectible notes. You see them on eBay all the time for a buck or two. Nobody will pay anything for your Bitcoin wallet if Bitcoin fundamentally fails, just as nobody will pay for your World of Warcraft gold when the pull the plug on the last WoW server a decade or two from now. It's just a bunch of useless numbers. If you're "investing" in crypto, that is speculating, then fine. If you're thinking it's a safe and secure way to store money you're mistaken.
davidgerard 9y ago
> I don't get why crypto keeps being compared to a metal. Because Bitcoin was literally created to imitate gold, with the idea being to propagate crank goldbug conspiracy theory economics. This is why the price is so volatile - as an imitation of the gold standard, bitcoin wants to be money but actually works like a commodity, with booms, busts and bubbles. https://davidgerard.co.uk/blockchain/the-conspiracist-gold-bug-economics-of-bitcoin/ https://davidgerard.co.uk/blockchain/the-conspiracist-gold-b...
- libertine 9y ago
  I understand it - even the term "gold rush" could be applied here, where people the get the fever and sometimes do irrational stuff to try to strike the good ol'gold nugget. You can learn a lot from the psychology and sociology side of the Gold Rush event, and surely you can compare it to the crypto event (after all, that's what history is for). But like you've said, Bitcoin was created to imitate gold... still it's not gold.

googletazer 9y ago

Dinosaur, meet meteor.

jcslzr 9y ago

you are right only silver and gold are money. it should not be Bitcoin vs Gold, the real question is Bitcoin vs USD