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During the gold standard, did people take payment in gold? I don't think so... They used paper that symbolized "withdrawal rights to gold". USD (or any other

During the gold standard, did people take payment in gold? I don't think so... They used paper that symbolized "withdrawal rights to gold". USD (or any other piece of paper that people agree has a value) is a perfect currency for exchange, it's just not a great store of value.

raesene9 6y ago
The point I was responding to was saying that they wanted to get away from USD and that this was BTC's killer app. My point is that you can't "get away" from USD, while the BTC market is effectively tied to USD. so if the USD supply is massively inflated, and people can use those USD to buy BTC, the tie is still there. If and when people denominate their goods and services in BTC without any reference to a fiat amount, then they are decoupled and BTC loses the tie to USD.
FabHK 6y ago
> did people take payment in gold? No, but prices were denominated in gold, effectively, as the price of gold was fixed. That was the whole point.
Majromax 6y ago
> USD [...] is a perfect currency for exchange, it's just not a great store of value. USD is a fantastic store of value. Since 1982 (arguably the beginning of the modern inflation-targeting era), the USD has lost no more than 6.3% of its value year-over-year, nor gained more than 2% (CPI measured, source https://fred.stlouisfed.org/series/CPIAUCSL#0 https://fred.stlouisfed.org/series/CPIAUCSL#0). In contrast since 2016, Bitcoin has 60% of its value year-over-year (2018) and gained 1700% (also 2018). A store of value is not a story of appreciation and hoping for a gain, it's a story about holding a stable and most importantly predictable value into the future. The USD more than satisfies this condition. Bitcoin does not, no matter its speculative merits. Most importantly, society does not owe people a fictional store of value guaranteed to never lose purchasing power. People don't eat quarters, nor do they live under dollar bills. It strains credulity that a nominal token (however minted) should hold a guaranteed value, without taking capital-like risks required of any productive investment.

raesene9 6y ago

The point I was responding to was saying that they wanted to get away from USD and that this was BTC's killer app. My point is that you can't "get away" from USD, while the BTC market is effectively tied to USD. so if the USD supply is massively inflated, and people can use those USD to buy BTC, the tie is still there. If and when people denominate their goods and services in BTC without any reference to a fiat amount, then they are decoupled and BTC loses the tie to USD.

FabHK 6y ago

> did people take payment in gold? No, but prices were denominated in gold, effectively, as the price of gold was fixed. That was the whole point.

Majromax 6y ago

> USD [...] is a perfect currency for exchange, it's just not a great store of value. USD is a fantastic store of value. Since 1982 (arguably the beginning of the modern inflation-targeting era), the USD has lost no more than 6.3% of its value year-over-year, nor gained more than 2% (CPI measured, source https://fred.stlouisfed.org/series/CPIAUCSL#0 https://fred.stlouisfed.org/series/CPIAUCSL#0). In contrast since 2016, Bitcoin has 60% of its value year-over-year (2018) and gained 1700% (also 2018). A store of value is not a story of appreciation and hoping for a gain, it's a story about holding a stable and most importantly predictable value into the future. The USD more than satisfies this condition. Bitcoin does not, no matter its speculative merits. Most importantly, society does not owe people a fictional store of value guaranteed to never lose purchasing power. People don't eat quarters, nor do they live under dollar bills. It strains credulity that a nominal token (however minted) should hold a guaranteed value, without taking capital-like risks required of any productive investment.