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What is Bitcoin backed by? What commodity could any currency be backed by that isn’t subject to the same volatility?

capableweb 5y ago
A network of nodes who gets rewarded for helping the network process transactions. Not more, not less. The beauty of the network, and also a big problem (in Proof of Work at least).
Graffur 5y ago
Bitcoin isn't backed by anything. It's limited in supply though so no more can be printed. Someone might say that it can be hard forked to change the supply limit. That is true but the fork won't be bitcoin.
- rasputnik6502 5y ago
  So it's a religion. There are many gods but our is the true one.
- kcatskcolbdi 5y ago
  A fork would still be bitcoin if that's what was voted on, no? Or is that just a soft fork? Anything could change if it gained consensus, right?
- babygoat 5y ago
  Why is it good that no more can be printed though? The value of all total goods in existence is not fixed, so why a currency where you don’t know how much you’ll able to buy with it in the future?
  - kcatskcolbdi 5y ago
    Not who you asked and I'm not a fan of BTC, but generally a fixed quantity of measure is helpful when trying to evaluate worth. The fixed value acts as a measuring tape against objects, but instead of measuring length you measure value. When you measure to cut an inch of wood, you need the measuring tape to keep the length of an inch constant. If an inch were to shrink or expand at will it would be difficult to figure out how much wood to cut. Because BTC is infinitely divisible it acts like a retractable tape, allowing for as much room to measure as needed. >why a currency where you don’t know how much you’ll able to buy with it in the future? A fixed quantity helps with this. If your currency is free-floating and relative to others you can enter into different periods of relative purchasing power. Zimbabwe, Japan, Wiemar Germany, and Venezuela are all popular examples of floating currency behavior which can oscillate wildly.
  - Graffur 5y ago
    > Why is it good that no more can be printed though? I can't fully answer that but I can play both sides by holding a position in bitcoin. I still earn and save fiat too.

A network of nodes who gets rewarded for helping the network process transactions. Not more, not less. The beauty of the network, and also a big problem (in Proof of Work at least).

Graffur 5y ago

Bitcoin isn't backed by anything. It's limited in supply though so no more can be printed. Someone might say that it can be hard forked to change the supply limit. That is true but the fork won't be bitcoin.

rasputnik6502 5y ago
So it's a religion. There are many gods but our is the true one.
kcatskcolbdi 5y ago
A fork would still be bitcoin if that's what was voted on, no? Or is that just a soft fork? Anything could change if it gained consensus, right?
babygoat 5y ago
Why is it good that no more can be printed though? The value of all total goods in existence is not fixed, so why a currency where you don’t know how much you’ll able to buy with it in the future?
- kcatskcolbdi 5y ago
  Not who you asked and I'm not a fan of BTC, but generally a fixed quantity of measure is helpful when trying to evaluate worth. The fixed value acts as a measuring tape against objects, but instead of measuring length you measure value. When you measure to cut an inch of wood, you need the measuring tape to keep the length of an inch constant. If an inch were to shrink or expand at will it would be difficult to figure out how much wood to cut. Because BTC is infinitely divisible it acts like a retractable tape, allowing for as much room to measure as needed. >why a currency where you don’t know how much you’ll able to buy with it in the future? A fixed quantity helps with this. If your currency is free-floating and relative to others you can enter into different periods of relative purchasing power. Zimbabwe, Japan, Wiemar Germany, and Venezuela are all popular examples of floating currency behavior which can oscillate wildly.
- Graffur 5y ago
  > Why is it good that no more can be printed though? I can't fully answer that but I can play both sides by holding a position in bitcoin. I still earn and save fiat too.