Somebody’s never heard of the somali shilling. It’s litterally a paper backed currency, worth the paper it’s printed on. By the way, most fiat is counterfitable and digital, so not all fiat money can be used for personal hygenics or fire.
See, paper IS a commodity. It just has a very low value to weight ratio due to its abundance. Gold has a very high value to weight ratio. Bitcoins have a practically infinite value to weight ratio, because the weight isn’t related to how many you have.
BitCoins are not money because they are not the most marketable good.
I was tempted to try BitCoin mining out, but I decided against it. I don’t recommend having holdings of BitCoins. If they become any threat at all to the dollar, the government will shut them down in like 5 days. They’ve already entered the government’s sights due to Silk Road (BitCoin / drugs exchanging).
If they become any threat at all to the dollar, the government will shut them down in like 5 days.
Remembering that Bitcoin is a global peer-to-peer network it’s not clear that it would be easy for any government to shut it down (just like bit torrent). This is one of the reasons for its appeal.
So I need to buy lots of them and then maybe in the future they can become useful? And you think that’s a good medium of exchange?
The post you’re replying to explained why the specific claim “bitcoin is not good for anything except trading” is false. Your reply doesn’t address this. Instead it sounds like you’re moving the goalposts here.
“It has value as a currency because it is used as a currency.”
Humans care about goods, not about currency for the sake of currency. Just because a tiny group of people cares about currency for the sake of currency doesn’t mean that makes it a reliable medium of exchange for people outside that group.
Possible use neither makes it a reliable medium of exchange. Clayton explained well what requirement a good has to be suitable as a medium of exchange and it’s the opposite of no use / possible use.
“I imagine that if/when Bitcoin becomes widespread, we will see an actual implementation of this where sending an email costs a tiny fraction of a BTC.”
I’d say we need to go back and revise our assumptions about human nature. Why are people doing things that are not in their own interest, that is, why aren’t people pursuing their own ends and how is it possible for an organism to survive which does not seek to attain its own ends?
Let me see if I’m understanding you.
Situation A: Right now, a small minority use Bitcoin and value it because of certain characteristics it has. I’m assuming that you’ll grant that I’m not mistaken when I judge that it is in my interest to use Bitcoin for certain trades.
Situation B: In a hypothetical future, almost everyone uses Bitcoin, and because of the attendent network effect, even original BItcoin sceptics would be fools not to hold and use Bitcoin.
Do you believe that if we observed a transition (however slow) from situation A to situation B, it would reveal that you were fundamentally mistaken about human action somehow?
“I imagine that if/when Bitcoin becomes widespread, we will see an actual implementation of this where sending an email costs a tiny fraction of a BTC.”
That’s right. The poster is explaining how Bitcoin is good for something other than trade. This rejoiner has not yet been addressed (nor has the point been conceded).
So because random user ‘bitcoin2cash’ imagines that if it becomes widespread, there will be an implementation that attempts to compete for value, you think it is a good now? And remember, we’re talking about a good for medium of exchange, for which the standards are much higher still.
So because random user ‘bitcoin2cash’ imagines that if it becomes widespread, there will be an implementation that attempts to compete for value, you think it is a good now?
You’re moving the goalposts again Nielsio. The focus here is on your strong claim that “bitcoin is not good for anything except trading”. At this point you could:
Explain how the use that bitcoin2cash described couldn’t work
Concede that bitcoin may be good for something other than trade and withdraw that claim.
None of the three options i outlined requires you to try that.
Edit: I think the disagreement may have to do with ‘Bitcoin’ being used in different ways–1. to mean the system, 2. to mean a unit of currency–i reckon bitcoin2cash had the former in mind and you were thinking of the latter (which is probably more relevant in this context). I agree that once generated, 1BTC is not useful for anything i can think of except trading, ultimately. I don’t agree that this means bitcoin cannot function as money though, for the reasons Peter Surda has explained.
Bitcoin utilizes an idea from HashCash but it is not HashCash and could not function as HashCash so the people suggesting that Bitcoins have a “fallback use” as a kind of HashCash don’t even understand the technology they’re touting.
Remembering that Bitcoin is a global peer-to-peer network it’s not clear that it would be easy for any government to shut it down (just like bit torrent).
LOL. Good one. This took me like 5 seconds to think up and I’m sure there are people who make careers out of this:
Start a disinformation campaign and make use of or distribution of onion routers / BitCoins a crime. Claim that only terrorist child pornographers would need that kind of technology.
Smear BitCoins reputation by engineering hacks and flash crashes; pay some economist shills to badmouth it or make up fake theft stories
Pick one of many thousands of existing securities / tax laws as a basis to conduct police raids on physical exchanges. Pass extra laws just for the fun of it, preferably complicated and ambiguous ones. Even if they’re innocent they will end up in court longer than they can stay solvent. Anyone who provides ancillary services assisting BitCoins transactions is at risk. Compel people through contempt of court threats to surrender the contraband virtual items so they can be stored in an evidence vault.
Assuming BitCoins are in no government’s interest, do this on a worldwide basis.
Medium of exchange goods require current use (and widespread at that), not hypothetical use, which is obviously what my claim is about.
Ignoring that ‘current’ is ambiguous here, its not at all obvious that it’s true that medium of exchange goods must have non-trade uses in order to exist. I think the language example from earlier isn’t being digested yet.
Can you explain what it is that makes you think it’s impossible to transition from A to B?
A: A small minority value and use Bitcoin as a medium of exchange because it has characteristics that make it attractive to use in that way. As more people adopt it its value grows because of the network externality.
B: Almost everyone accepts and pays with Bitcoin (regardless of whether everyone agrees to use the label ‘money’ or not).
