Bitcoin Is the New 'Gold' | Hacker News Reader

Bitcoin Is the New 'Gold'

forbes.com

11 pointsca98am7913 comments

Gold will probably still be valuable if society and its infrastructure collapses. What's Bitcoin without the internet? Should something like WW3 occur, can we really assume that there'll still be a unified internet and that it'll be working well enough to allow for bitcoin to work?

One could argue that you could use other ways to share the blockchain (radio waves or even sharing physical storage) but how do you settle transactions that way? You'd have to broadcast your transaction somehow, wait for a miner to pick it up, mine it and then broadcast it to the rest of the network and wait for other nodes to see and accept the new block and then build on top of it. Sounds like a nightmare over high latency networks, you could wait for days until you're sure that your transaction is accepted.

What if a certain region is cut off for a while (say, a country)? They'll make transactions, mine them and then when they're reconnected to the rest of the world their block "branch" is immediately overwritten by the outside chain because it had a greater hash rate. Actually for most countries that wouldn't even happen that way because they probably won't have the hash power required to mine a single block in weeks, effectively making Bitcoin unusable.

I don't think Bitcoin would be a very practical currency for Mad Max. Better invest in bottle caps.

Progress is being made: https://blockstream.com/satellite/satellite/

Does this work for Bitcoin or just Bitcoin Cash?

Other way around: the sat system supports Bitcoin, not BCash.

This is the billion-dollar question: Will digital alchemists succeed where their medieval ancestors failed? Or will you be holding digital Beanie Babies somewhere down the line?

"Or will you be holding digital Beanie Babies somewhere down the line?"

Thanks for the chuckle... good way to start off the day!

Slightly more seriously, it's still not even clear if cryptocurrencies are really functioning as investable assets--thing you buy and hold for appreciation--or actual money--the unit of accounting for economic activity. It will be hard to be both. During the gold-standard era, this was achieved by government price controls on gold. That's basically what the 'standard' was, a price control. And it turns out in practice, this is hard to maintain, which is why it eventually failed.

Gold is valuable because if the world economy collapses, there is still intrinsic value in gold because it's shiny and pretty and I can hold it.

IF the world economy collapses, bitcoins are useless. The internet would fail, people wouldn't have computers to use them any more. You can't do anything with bitcoins if you don't have a huge network of computers to sustain the system.

With the same reasoning, you could also say that traditional money (wether electronic or paper) is useless.

If your country is conquered by war, then your fiat goes to zero, and your gold is confiscated (or very difficult to transport). There are extremes where Bitcoin goes to zero, but there are also extreme events where it has a lot of value.

If your country is conquered, you are ordered at gunpoint to open the safe full of gold. The same thing would happen with bitcoins - you're ordered at gunpoint to send them to the winning party.

To be honest, if your country is conquered, the last thing the winning party wants is a couple of bits and bytes on a hard drive. What's far more valuable is the natural resources, workforce, factories, etc.

I'd just like to point out that the price of gold doesn't vary by 2000% on a daily basis, and there isn't a "Gold 2" or "Doge Gold".

I think this is right, but Bitcoin is also showing the rather classic bubble/irrational exuberance chart. That is to say, it may also be outperforming gold because people are piling into, rather than it being a reaction to uncertainty.

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