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If everyone used BTC and magically the transaction rate weren't constrained to make that impractical, wouldn't the fluctuations be much smoother? If everyone w

If everyone used BTC and magically the transaction rate weren't constrained to make that impractical, wouldn't the fluctuations be much smoother? If everyone was using BTC as their primary currency then the basket of goods it buys would basically be the world goods. That would smooth out fluctuations quite a bit.

yakaccount4 4y ago
Kind of a fun thought experiment. I suppose you could reason similarly about it if you just imagined plain old fiat US Dollar is fixed in cap and printed directly to whatever analog of a "miner" would be. My armchair guess is that disaster wouldn't necessarily be around price fluctuations of goods, but rather the perpetual deflationary nature of the currency.
- jasmer 4y ago
  If there was a fixed supply of currency the deflationary thing would be #1 problem. Otherwise, the issue is the loss of regional monetary supply controls. People do not like their salaries changing in nominal terms - that causes riots, but salaries are fluxuating vis-a-vis other national markets you just don't see it, because it's 'hidden' behind currency fluxuations. Having everyone change their salaries and pricing all the time dramatically because of international issues is bad. It's easier to have regional economies have their own currencies, and to smooth out fluxuations between economies vis-a-vis central bank. And of course, major actors would cause all sorts of problems. The notion of a global currency is completely insane - neat thought experiment, but probably a total disaster. The people who are behind most Crypto generally have utterly no understanding of what money is, and this is a primary problem with crypto. "Oh, there is a dollar, I can make a digital thing and also call it a dollar!" Yeah, no. It's why most of the financial world is befuddled with crypto - because they are looking at tech people driving cars off of a cliff by burning 2% of the world's electricity supply. It's just economic populism.

yakaccount4 4y ago

Kind of a fun thought experiment. I suppose you could reason similarly about it if you just imagined plain old fiat US Dollar is fixed in cap and printed directly to whatever analog of a "miner" would be. My armchair guess is that disaster wouldn't necessarily be around price fluctuations of goods, but rather the perpetual deflationary nature of the currency.

jasmer 4y ago
If there was a fixed supply of currency the deflationary thing would be #1 problem. Otherwise, the issue is the loss of regional monetary supply controls. People do not like their salaries changing in nominal terms - that causes riots, but salaries are fluxuating vis-a-vis other national markets you just don't see it, because it's 'hidden' behind currency fluxuations. Having everyone change their salaries and pricing all the time dramatically because of international issues is bad. It's easier to have regional economies have their own currencies, and to smooth out fluxuations between economies vis-a-vis central bank. And of course, major actors would cause all sorts of problems. The notion of a global currency is completely insane - neat thought experiment, but probably a total disaster. The people who are behind most Crypto generally have utterly no understanding of what money is, and this is a primary problem with crypto. "Oh, there is a dollar, I can make a digital thing and also call it a dollar!" Yeah, no. It's why most of the financial world is befuddled with crypto - because they are looking at tech people driving cars off of a cliff by burning 2% of the world's electricity supply. It's just economic populism.