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I like to think that Bitcoins are much more similar to gold than dollars, and yet everyone makes comparisons with modern currencies.
by Heliosmaster 13y ago
I like to think that Bitcoins are much more similar to gold than dollars, and yet everyone makes comparisons with modern currencies.
- notahacker 13y agoSure, because people don't buy and sell things with gold, they buy and sell things with modern currencies. They do so because well-established legal frameworks ensure future demand for the currency to pay taxes and meet debt obligations, and also keep the supply in line with demand. Sure, Bitcoins are similar to gold in being relatively, rare, but so are tulip bulbs. What matters isn't the restriction in the supply, but the sustainability of the demand. Gold sustained its demand over millenia not just because it was rare, but because people needed gold to meet future tax and debt-repayment obligations, or to purchase things from foreign lands. The number of people needing to receive BTC-denominated income in future, on the other hand, is negligible; virtually anyone [considering] providing real goods or services in BTC can cease to transact in BTC at any point they have doubts about its future value or liquidity.