> People don't move gold around. Precisely, because it's slow and expensive. If you're going to hold out transfers of IOUs in place of actual gold, that can wo

> People don't move gold around. Precisely, because it's slow and expensive. If you're going to hold out transfers of IOUs in place of actual gold, that can work for any commodity; a Bitcoin IOU would function just as well as a gold IOU. As a practical example, most Bitcoin exchanges allow transfers between members instantaneously and without any notable fees. Of course, that reintroduces a trust relationship. The point of having actual gold in-hand, or actual bitcoins recorded on the blockchain, is that the transfer is completed and effectively irreversible. You don't get that with IOUs.