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The difficulty in settling debts directly does not prevent Bitcoin from being the future. The Bitcoin as a currency is not a new concept. Right now, Bitcoin is

The difficulty in settling debts directly does not prevent Bitcoin from being the future. The Bitcoin as a currency is not a new concept. Right now, Bitcoin is almost exactly like gold. You don't pay your taxes with gold but it could be exchanged for your nation's currency to settle debts. Some people exchange gold directly for goods and services but very few things are priced in gold. People price things in their local currency so you must exchange the gold for national currency to purchase. Almost everything about gold is the same as Bitcoin and gold is a very trusted and traditional way to store value.

lukeschlather 14y ago
Gold has intrinsic value. Regardless of how our economic system functions, gold is useful. Bitcoin is useless unless it is intrinsic to our economic system. Bitcoin is absolutely nothing like gold, excepting that people assign value to it.
- lbarrow 14y ago
  Gold does not have intrinsic value.
  - gamblor956 14y ago
    Intrinsic value means the value inherent in the good itself. Gold has intrinsic value: it is one of the best semiconducting metals, and is easily malleable. Gold also demonstrates antibacterial properties. Note that palladium, another precious metal that routinely trades at high prices, also has "intrinsic" value as a catalytic agent. Platinum, which is currently trading at higher prices than gold, is one of the least corrosive heavy metals.
    - trhtrsh 14y ago
      and bitcoin has entertainment value, like a movie DVD. no one would spending $1000/oz on the world's supply of gold for semiconductance -- only a small amount on the margin would satisfy all industrial demand. >90% The price of gold is supported by currency "shared delusion", just like BTC.
      - dragonwriter 14y ago
        > and bitcoin has entertainment value, like a movie DVD. Unlike the intrinsic value of gold (which, certainly, is much lower than its current market value), the entertainment value of bitcoin is unlikely to be retained in the event of the kind of crisis that would occur with the collapse in major internationally recognized soveriegn currencies like the dollar and euro. So, while bitcoin might have similar utility to gold on the assumption that major world currencies are largely, themselves, stable, its not better than gold as an insurance against those systems collapsing. Now, personally, I think that hoarding any type of alternative currencies against major collapse (rather than keeping reserves of simple useful survival items) is foolish, many of the arguments for both gold and bitcoin are premised around a supposedly-inevitable collapse of traditional major sovereign currencies (and, particularly, the US dollar.) And, while I think neither gold not BTC is a good choice to protect against that kind of contingency, I think its pretty clear that BTC is far worse than gold in that role.
    - zanny 14y ago
      Gold is never traded or exchanged for its intrinsic value. It is why I hate how people use gold as a monetary base, because it wastes a perfectly good metal with practical applications on being the shiny rare thing people hoard for money.
      - dragonwriter 14y ago
        > It is why I hate how people use gold as a monetary base, because it wastes a perfectly good metal with practical applications on being the shiny rare thing people hoard for money. I would argue that (among its other problems) Bitcoin has a parallel problem in that it wastes perfectly good computational power (and the resources that go into producing that computational power, both the hardware and the energy inputs) on being the intangible rare thing people hoard for money.
- wyager 14y ago
  What makes gold intrinsically valuable?
  - cwp 14y ago
    It's really good for analog HiFi cabling. Plus it's sparkly.
    - zanny 14y ago
      But that intrinsic value is like saying you can save 10% of your valuation if the market drops gold for its scarcity, whereas with btc you lose 100%. Any way you slice it, you have lost an overwhelming supermajority of your value, and are fucked. Gold is almost never used for its practical use cases because everyone treats it as money and use its scarcity for trade. I hate that facet, because it ruins a perfectly good metal with practical applications that we could be taking advantage of industrially if there wasn't this artificial "hoard gold because its valuable for how rare it is" economic mess. But if the economy fell out and gold stopped being traded as a store of wealth and started being traded as an industrial metal, the guy with all his assets in gold is still devastated.
      - lukeschlather 14y ago
        Personally I'm all for fiat currency, but on the spectrum I'd rank gold ahead of Bitcoin as a value store. (Also copper, steel, and other useful metals.)
- darkxanthos 14y ago
  I used to think this too. The only difference between bitcoin and gold is gold has uses aside from being a currency. Gold is however largely only worth what it is because of its use as a currency. Interesting collection of information here: https://en.bitcoin.it/wiki/Myths https://en.bitcoin.it/wiki/Myths
  - dragonwriter 14y ago
    > I used to think this too. The only difference between bitcoin and gold is gold has uses aside from being a currency. Well, the other big difference -- and one that drives a lot of the interest in physically holding gold against the threat of a general economic collapse -- is that physical gold plausibly could retain some value as a currency in the event of a general economic collapse that disrupts the viability of major social institutions.
    - trhtrsh 14y ago
      why is gold more reliable than BTC? If the USA collapses, bullets may become the new currency. http://en.wikipedia.org/wiki/A_Fistful_of_Paintballs http://en.wikipedia.org/wiki/A_Fistful_of_Paintballs
      - dragonwriter 14y ago
        > why is gold more reliable than BTC? Because in a collapse in which major institutions fail, the gold you have physically on hand will still be on hand, verifiable as gold, and available for exchange, for whatever value it has. BTC, not so much. > If the USA collapses, bullets may become the new currency Sure, bullets may be even better than gold as insurance against a general collapse, but that doesn't stop gold from being better than BTC in that regard.

lukeschlather 14y ago

Gold has intrinsic value. Regardless of how our economic system functions, gold is useful. Bitcoin is useless unless it is intrinsic to our economic system. Bitcoin is absolutely nothing like gold, excepting that people assign value to it.

lbarrow 14y ago
Gold does not have intrinsic value.
- gamblor956 14y ago
  Intrinsic value means the value inherent in the good itself. Gold has intrinsic value: it is one of the best semiconducting metals, and is easily malleable. Gold also demonstrates antibacterial properties. Note that palladium, another precious metal that routinely trades at high prices, also has "intrinsic" value as a catalytic agent. Platinum, which is currently trading at higher prices than gold, is one of the least corrosive heavy metals.
  - trhtrsh 14y ago
    and bitcoin has entertainment value, like a movie DVD. no one would spending $1000/oz on the world's supply of gold for semiconductance -- only a small amount on the margin would satisfy all industrial demand. >90% The price of gold is supported by currency "shared delusion", just like BTC.
    - dragonwriter 14y ago
      > and bitcoin has entertainment value, like a movie DVD. Unlike the intrinsic value of gold (which, certainly, is much lower than its current market value), the entertainment value of bitcoin is unlikely to be retained in the event of the kind of crisis that would occur with the collapse in major internationally recognized soveriegn currencies like the dollar and euro. So, while bitcoin might have similar utility to gold on the assumption that major world currencies are largely, themselves, stable, its not better than gold as an insurance against those systems collapsing. Now, personally, I think that hoarding any type of alternative currencies against major collapse (rather than keeping reserves of simple useful survival items) is foolish, many of the arguments for both gold and bitcoin are premised around a supposedly-inevitable collapse of traditional major sovereign currencies (and, particularly, the US dollar.) And, while I think neither gold not BTC is a good choice to protect against that kind of contingency, I think its pretty clear that BTC is far worse than gold in that role.
  - zanny 14y ago
    Gold is never traded or exchanged for its intrinsic value. It is why I hate how people use gold as a monetary base, because it wastes a perfectly good metal with practical applications on being the shiny rare thing people hoard for money.
    - dragonwriter 14y ago
      > It is why I hate how people use gold as a monetary base, because it wastes a perfectly good metal with practical applications on being the shiny rare thing people hoard for money. I would argue that (among its other problems) Bitcoin has a parallel problem in that it wastes perfectly good computational power (and the resources that go into producing that computational power, both the hardware and the energy inputs) on being the intangible rare thing people hoard for money.
wyager 14y ago
What makes gold intrinsically valuable?
- cwp 14y ago
  It's really good for analog HiFi cabling. Plus it's sparkly.
  - zanny 14y ago
    But that intrinsic value is like saying you can save 10% of your valuation if the market drops gold for its scarcity, whereas with btc you lose 100%. Any way you slice it, you have lost an overwhelming supermajority of your value, and are fucked. Gold is almost never used for its practical use cases because everyone treats it as money and use its scarcity for trade. I hate that facet, because it ruins a perfectly good metal with practical applications that we could be taking advantage of industrially if there wasn't this artificial "hoard gold because its valuable for how rare it is" economic mess. But if the economy fell out and gold stopped being traded as a store of wealth and started being traded as an industrial metal, the guy with all his assets in gold is still devastated.
    - lukeschlather 14y ago
      Personally I'm all for fiat currency, but on the spectrum I'd rank gold ahead of Bitcoin as a value store. (Also copper, steel, and other useful metals.)
darkxanthos 14y ago
I used to think this too. The only difference between bitcoin and gold is gold has uses aside from being a currency. Gold is however largely only worth what it is because of its use as a currency. Interesting collection of information here: https://en.bitcoin.it/wiki/Myths https://en.bitcoin.it/wiki/Myths
- dragonwriter 14y ago
  > I used to think this too. The only difference between bitcoin and gold is gold has uses aside from being a currency. Well, the other big difference -- and one that drives a lot of the interest in physically holding gold against the threat of a general economic collapse -- is that physical gold plausibly could retain some value as a currency in the event of a general economic collapse that disrupts the viability of major social institutions.
  - trhtrsh 14y ago
    why is gold more reliable than BTC? If the USA collapses, bullets may become the new currency. http://en.wikipedia.org/wiki/A_Fistful_of_Paintballs http://en.wikipedia.org/wiki/A_Fistful_of_Paintballs
    - dragonwriter 14y ago
      > why is gold more reliable than BTC? Because in a collapse in which major institutions fail, the gold you have physically on hand will still be on hand, verifiable as gold, and available for exchange, for whatever value it has. BTC, not so much. > If the USA collapses, bullets may become the new currency Sure, bullets may be even better than gold as insurance against a general collapse, but that doesn't stop gold from being better than BTC in that regard.