@jwildeboer Well money isn't a single thing. Multiple things can be money and those can have different properties. Euros and Bitcoin are both a form of money.
Euros are debased around 5-10% a year in order to cause artificial inflation. Bitcoins aren't.
Euros can only be held by banks with special licenses that will borrow out more money than they have. Bitcoins can be efficiently stored by an individual.
There's more differences. Buying #Bitcoin isn't investing. It's saving.
@stevenroose (fiat) Money, in it's modern understanding, is typically three things. Medium of Exchange, Store of Value and Unit of Account. Bitcoin (and IMHO all other cryptocoins) fails on at least two of them since quite some years. The combination of being a Store of Value and a Unit of Account is what you need to make it a good savings option. But it isn't a reliable Unit of Account. So if you use it for savings, the value will be volatile. If you`re aware and OK with that - fine.
@jwildeboer #Bitcoin has historically been a better store of value than any other currency. Even gold. Sure it's volatile. But its volatility has been declining a lot over time, which is normal as the markets become more mature as they gain liquidity. Many country's national fiat currencies f.e. have been way more volatile than Bitcoin over the last 3 years.
Which other function do you think it fails on?
Lightning network is cheaper than VISA and mainnet is cheaper than international settlement.
@stevenroose As I already said. IMHO as Unit of Acoount it fails and as Medium of Exchange, despite all efforts with Lightning etc it also fails. The incentive to keep Bitcoin alive is IMHO not growing over time.
@jwildeboer I'm curious how you think fiat is a better medium of exchange. You have to literally give metal objects or cotton sheets to the other person. Only licensed banks can transfer actual euros directly from one to another.
Any other "payment mechanism" that we use is based on trusted counterparties and those systems can work with #Bitcoin just as easily. The exact difference being that it's not needed to build such complex (and costly!) social structures for Bitcoin.
@stevenroose "I'm curious how you think fiat is a better medium of exchange" Uhm, because it works? It's how we live our lives? Bitcoin is IMHO always meandering between not being really good at two of the three criteria while being a rather bad implementation of the one that works at that moment. In the beginning it worked as a rather curious and limited medium of exchange, now it is more a store of value but it never was good at being a unit of account. So it is not money IMHO. 1/2
@stevenroose And it is too limited to be a new class of money, again IMHO. The PoW is rightfully criticized ATM and the decentralisation has never really happened, it still is a divided "society" between the "nobility" of miners and users with no real influence on the system itself. In sum I think it is being kept alive more based on imagination as on real world effects. Again, IMHO. 2/2
@jwildeboer Well, I have to say I quite respectfully disagree with that opinion. I hope you spend some time thinking about my responses.
About medium of exchange. You say our current system "just works". Do you think it "works" well when for the vast majority of txs in a store, the merchant pays 3-5% in fee? Say about half the time to one of 2 American companies? Not to mention the fact that those companies can also just refuse to execute his txs. Like f.e. for sex workers and journalists.
@jwildeboer Do you think it works that in order to send money from my account to that of my friend in another EU country, we need authority of around 5 intermediary organizations, that each of them employ hundreds of people in suits that need to get paid salaries? Not even talking about multi-week delays for cross-continent settlement. In many situations it's faster and cheaper to take out cash dollars and fly them in a suitcase to your recipient.
@jwildeboer On the topic of store of value, I already made my point. Our currencies are debased with 5-10% every year. And expect that to increase now with our current crisis. Even if (the central bank's own) consumer price indices only indicate 2% price inflation, that means that we're still missing out on an 8% price deflation. Imagine! Technology actually making it cheaper to produce things, how surprising!
@jwildeboer As a unit of account, #Bitcoin is clearly still not mature enough. But volatility only comes from an immature market. And like I said, many country's national currency has been more volatile than Bitcoin over the last 5 years, while Bitcoin's own volatility is decreasing fast with the market growing.
Compare Bitcoin's market size with that of euros and dollars. It's only at a fraction of that yet. The closer it gets, the more stable it'll get.
Thanks for mentioning, for me it is not about “volatile”, it is about concentration of power and much money in few hands and mainly about climate refugees.
I had commented at the other post in the thread already with
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