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It's not just the taxation (which is true), it's the fact that they are backed by a particular entity. In the case of USD, it's the United States government. Do
by mbreese 12y ago
It's not just the taxation (which is true), it's the fact that they are backed by a particular entity. In the case of USD, it's the United States government. Dollars may not be "backed" by anything tangible, but they are accepted because the US is (largely) a trusted entity. That's what makes USD useful to people internationally.
Bitcoin doesn't have the advantages of having a government backing it, but some would probably argue that that is an advantage.
- SilasX 12y agoConsidering how many trillion definitions people may mean when they say a currency is "backed by" something, I don't think your explanation is an improvement. For that reason, I recommend listing the specific things that make the USD valued: in this case, the need to pay USD in taxes, and a very wealthy entity (US government) prefers to trade in that currency, or whatever specific thing you mean with "backed by" in that statement.