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Comment by Twisell | Hacker News Reader

Ok just another proof that bitcoin can definitely not be compared to gold. Or maybe it could?

"After the event you might end up with gold or lead it all depends if your banker believe in transmutation or not (and if transmutation is actually achievable which will be determined by the best alchemists of the kingdom that need to agree together).

So all in all the guild of merchants recommend that you don't accept gold as a payement on the last day before new moon (and for a few day after that), because you wil not be able to tell if you are getting real gold or lead during that period.

Well to be honest it won't technically be lead you would get but forked gold, a gold that could be gold but isn't until the alchemists say so. But you shall still be able to use it in a limited way with people who believe in the same alchemists dissidents.

It's totally normal if it's sound complicated, it's magic after all!"

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If you are comparing cryptocurrency exchanges with the real world transactions, stuff like this could have happened quite often in the old times. There is the story of the man working cast away for years with little connection with the rest of the world. After he comes back to a town he finds out that the king has changed, so all the notes and coins he has accepted as salary over the years are useless.

In reality, our banking system is much more chaotic than what the end-user sees it because central authorities are keeping the whole system together. and their authority is just what all of us believe in. Now, some people, for better or worse, started believing in something new.

A little remark - those central authorities have men with guns to enforce their authority (given that governments are backing centralized system as for now)

Although it's hard to make people believe in the value of money they think is worthless -- even with guns. Otherwise we wouldn't have had this many hyper-inflations throughout history. (Nevertheless many governments do not accept this fact and try -- and fail -- again and again.)

Lets say that you buy a bunch of gold and put it in a fortress.

Nobody can steal your gold, but lets say the entire world gets together at once, and decides that gold is worthless and that they are moving over to lead as the new currency. But they are keeping the name "gold". Everyone now uses the name "gold" to refer to what was previously known as "lead".

Your pile of "real gold" wasn't stolen, but it may as well have been, because now it is just a bunch of heavy, worthless, shiny, rocks. (yes, yes, there are industrial uses, but the price is way way higher than what industry justifies alone)

And it really doesn't matter that you are strenuously arguing about how this "new gold" is actually lead, because nobody cares about your opinion.

That is a similar enough analogy to how bitcoin forks work.

Except you get the same amount as leas as you have gold. In fact, now you have gold and lead. One will turn out to be a storage for value.

I think there is a third scenario - both forks become worthless.

I think in the short term it's going to be A or B. But my bet is on within a year you'll turn out to be right that Bitcoin is going to tank.

It doesn't matter how well you protect your gold, you can never protect its value, since this will be diluted if someone else brings a lot of gold to market. That's what happened during the ~1700s: lots of gold was brought to market because of world travel and disrupted local economies. Bitcoin prevents this by automatically adjusting difficulty. Asteroid mining can make gold useless, while Bitcoin would continue to function unless SHA256 is broken. I'm not saying Bitcoin is better or worse than gold, just that they both have advantages and disadvantages when compared.

>> you can never protect its (gold's) value, since this will be diluted if someone else brings a lot of gold to market... Bitcoin prevents this by automatically adjusting difficulty.

It doesn't prevent it. If everyone decides to sell BTC now (including the big whales owning the major portion), it's price in USD will fall, too. How is this different?

If everyone decides to sell now the price will tank. But then people will decide that Bitcoin is now "cheap" and the price will increase.

What I meant was that newly mined gold can cause extremely large flows into the market (much more than all the whales dumping at once), which is what happened ~300 years ago. Gold had large geographic differences in the difficulty of mining it, which Bitcoin solves through adjusting difficulty.

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