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Imagine you're Turkish, Venezuelan, Argentinian, etc. BTC might be your best bet. Now guess which 1st world countries are next. Edit: as I think Naval said,

Imagine you're Turkish, Venezuelan, Argentinian, etc. BTC might be your best bet. Now guess which 1st world countries are next. Edit: as I think Naval said, crypto is insurance against politicians.

hiq 5y ago
> Imagine you're Turkish, Venezuelan, Argentinian, etc. > BTC might be your best bet. I can sympathize with this idea, although if the US government just allowed Turkish people to open bank accounts in USD and transact with each other, they might do that instead. Many countries already use the USD as their de facto currency. > Now guess which 1st world countries are next. Why would they be next? I think it's rather the reverse: once a country is developed enough with a working banking system, it tends to rely on it because it's more efficient and provides more guarantees.
- Geee 5y ago
  It's not beneficial to use money from another country. Managing your own monetary policy and being able to spend without limits is important tool for governments. Currencies are one tool which countries use to compete with each other. Those countries which use US dollar suffer from its inflation, but don't get the benefit of unlimited spending. In other words, inflation in Turkey would fund deficit spending in USA. Using US dollar would be better for the people, but their governments don't want to give up this power. That's why the local financial institutions place limitations on foreign currencies or outright make them illegal. With Bitcoin, people can completely opt-out of this "inflation tax" without asking permission from their governments. Another option is to use stablecoins such as Tether USD, which seems to be gaining popularity as a currency in countries with high inflation. This is problematic because Tether gains the power of a central bank without any oversight. Bitcoin is the only currency which has very high guarantees of its expected monetary inflation, and that's why it would be the best choice for individuals.
  - hiq 5y ago
    > Managing your own monetary policy and being able to spend without limits is important tool for governments. Sure, but we're talking about switching to BTC, which doesn't allow this either. > Bitcoin is the only currency which has very high guarantees of its expected monetary inflation. As somebody else pointed out in another thread, bitcoin is either a currency or an asset depending on who you talk to. You mention it is a currency, but it's hard to find it credible in this role given its volatility. Given that its price is a function of supply and demand, but that we can't predict what the demand will be, which strong guarantees are you thinking about?
    - Geee 5y ago
      Monetary inflation is the amount of new money that is created, i.e. how much the supply expands. In Bitcoin, inflation schedule is predefined and there's an absolute limit, and these rules can't be changed. This means that if Bitcoin's demand increases, then the price increases. In other currencies, supply will be expanded if demand increases to stabilize the price. This applies to everything else too, like commodities or real estate. Increased price will increase production, until the price corrects to cost of production. Demand can't really be predicted, but historically we know that if supply expansion is predictably low (like in gold), most people would prefer to save their wealth in that money. Volatility is expected to decrease in time, making it more practical in short-term transactions.
      - hiq 5y ago
        I thought your were talking about price inflation, but you actually wrote "monetary inflation", my bad. But what's the point of taming monetary inflation if that does nothing for price inflation? I thought that price inflation was the practical consequence we have to deal with, isn't that the case? > Demand can't really be predicted, but historically we know that if supply expansion is predictably low (like in gold), most people would prefer to save their wealth in that money. The supply of bitcoins is low, but the supply of bitcoin-like tokens seems limitless. The question is: which pool do we consider? Are BTC and ETH in the same pool? What about other tokens? The same reasoning applies to gold and other metals, but at least you won't come up with a new one on a whim like you can with cryptocurrencies.

Imagine you're Turkish, Venezuelan, Argentinian, etc. BTC might be your best bet. Now guess which 1st world countries are next. Edit: as I think Naval said, crypto is insurance against politicians.

hiq 5y ago

> Imagine you're Turkish, Venezuelan, Argentinian, etc. > BTC might be your best bet. I can sympathize with this idea, although if the US government just allowed Turkish people to open bank accounts in USD and transact with each other, they might do that instead. Many countries already use the USD as their de facto currency. > Now guess which 1st world countries are next. Why would they be next? I think it's rather the reverse: once a country is developed enough with a working banking system, it tends to rely on it because it's more efficient and provides more guarantees.

Geee 5y ago
It's not beneficial to use money from another country. Managing your own monetary policy and being able to spend without limits is important tool for governments. Currencies are one tool which countries use to compete with each other. Those countries which use US dollar suffer from its inflation, but don't get the benefit of unlimited spending. In other words, inflation in Turkey would fund deficit spending in USA. Using US dollar would be better for the people, but their governments don't want to give up this power. That's why the local financial institutions place limitations on foreign currencies or outright make them illegal. With Bitcoin, people can completely opt-out of this "inflation tax" without asking permission from their governments. Another option is to use stablecoins such as Tether USD, which seems to be gaining popularity as a currency in countries with high inflation. This is problematic because Tether gains the power of a central bank without any oversight. Bitcoin is the only currency which has very high guarantees of its expected monetary inflation, and that's why it would be the best choice for individuals.
- hiq 5y ago
  > Managing your own monetary policy and being able to spend without limits is important tool for governments. Sure, but we're talking about switching to BTC, which doesn't allow this either. > Bitcoin is the only currency which has very high guarantees of its expected monetary inflation. As somebody else pointed out in another thread, bitcoin is either a currency or an asset depending on who you talk to. You mention it is a currency, but it's hard to find it credible in this role given its volatility. Given that its price is a function of supply and demand, but that we can't predict what the demand will be, which strong guarantees are you thinking about?
  - Geee 5y ago
    Monetary inflation is the amount of new money that is created, i.e. how much the supply expands. In Bitcoin, inflation schedule is predefined and there's an absolute limit, and these rules can't be changed. This means that if Bitcoin's demand increases, then the price increases. In other currencies, supply will be expanded if demand increases to stabilize the price. This applies to everything else too, like commodities or real estate. Increased price will increase production, until the price corrects to cost of production. Demand can't really be predicted, but historically we know that if supply expansion is predictably low (like in gold), most people would prefer to save their wealth in that money. Volatility is expected to decrease in time, making it more practical in short-term transactions.
    - hiq 5y ago
      I thought your were talking about price inflation, but you actually wrote "monetary inflation", my bad. But what's the point of taming monetary inflation if that does nothing for price inflation? I thought that price inflation was the practical consequence we have to deal with, isn't that the case? > Demand can't really be predicted, but historically we know that if supply expansion is predictably low (like in gold), most people would prefer to save their wealth in that money. The supply of bitcoins is low, but the supply of bitcoin-like tokens seems limitless. The question is: which pool do we consider? Are BTC and ETH in the same pool? What about other tokens? The same reasoning applies to gold and other metals, but at least you won't come up with a new one on a whim like you can with cryptocurrencies.