All money is based on faith. At least Bitcoin has a cap. Dealing with inflation, even moderate amounts is annoying and risky. I'm sure you'd rather have Bitcoin if you lived in Germany, Zimbabwe, or Venezuela (to make a few hyperinflation events).
I'm anti shitcoins, but at least Bitcoin has trust and scarcity.
Bitcoin's scarcity creates an incentive to get in early and hoard your spot on the blockchain. I don't get how that's productive or helps anyone unless you really manage to convince other people that having a spot on the blockchain is something extremely important.
Not enough
I know those crazy libertarians who had 100+ Bitcoin. They mostly sold.
I think you could also argue that infinite supply currency is bad for the lower class.
This is not a universally accepted truth. In the next decade or three, we may find out that you can’t run an economy on printing presses.
I'm not sure how many of the people advocating for fixed-supply currencies actually understand history, economic cycles, inflation-deflation and the role of monetary policy. A lot of the argumentation comes from a surface-level understanding of these concepts and knee-jerk reactions that get repeated by the hivemind.
I don't mind if you want a steering wheel, but given that we seem to be driving something of a money printing train I'm not sure what you expect the wheel to do. They're following an exponential curve of money creation. The only surprise is that they keep pretending that at some point they will be able to stop printing.
Hell, they can legislate that 2 + 2 = 5. It won't make it accurate, right or even make sense, but they can.
They'll get charged with tax fraud on the theory that their lump of rock is worth more now than it was when they bought it so they should be paying some amount in capital gains tax.
Now I'll accept an argument that we should have some sort of transaction tax, fair enough if you want to believe that.
But the theory that the gold is becoming worth more over time in real terms is blatantly silly. It doesn't change, the supply of gold is increasing faster than population and the arguments that its value is changing are frankly a bit forced. It isn't increasing in real value at a rapid rate like the official numbers suggest it is.
And the US dollar is, by policy, losing value - so the same basic argument will hold for any asset even ignoring the fact that the inflation numbers are wilfully ignoring asset price inflation.
Question, in the gold scenario is your issue with the idea of capital gains, or an issue with how it's accounted (given that you think the gold *hasn't* appreciated)?
The key point there is the implementation of capital gains tax. It isn't so much that I have issues with CGT. CGT is ok, if we're going to tax things we may as well tax Capital Gains. But, if someone tries to avoid fiat, they're going to be imprisoned because they can't comply with the IRS when they come to collect the fake capital gains caused by inflation. Ditto income tax now that I think about it.
The point here is that the "[you don't understand] history, economic cycles, inflation-deflation and the role of monetary policy" counter is patronising and pretty obviously wrong. It isn't for our own good, it is because they want to put more of the burden for keeping the country running on savers. That isn't good for savers. And they're doing it that way because if they implemented an equivalent but obvious policy people would point out "hang on, taxing disproportionately from savers seems like it might be a bad idea" and probably carry the debate.
1. This is simply not true. The gold standard did not fail. It became inconvenient to political agendas. There were no economic deficiencies in the gold standard era.
2. The crypto world is multi-currency, so you can't draw lessons from a uni-currency past that apply to it.
And if you "grow" an economy by increasing the number of monetary units, you can't create wealth, because wealth is not money. It just splits the same goods and services into more units.
Printing money benefits whoever gets to spend them first, before the consequent inflation hits (all other things being equal). It re-slices the pie by making all pieces smaller (including the ones people have saved up for, say, retirement).
Paradoxically, a good economy should drive prices *down* ( Moore's law should apply everywhere). As technology and processes improve, it should become easier to offer the old products and services, allowing for more sophisticated ones to appear.
Economic and wage growth rates during the gold standard were excellent, so no, it did not fail, regardless of what this widely disseminated and overly simplistic model, that you're presenting now, claims.
I recommend George Selgin's debunking of common myths about the gold standard:
https://www.alt-m.org/2015/06/04/ten-things-every-economist-...
— https://www.moneyandbanking.com/commentary/2016/12/14/why-a-...
And this is especially impressive given the auto-catalytic nature of technological progress, which has steadily caused the pace of technological innovation to pick up. That the gold standard era was able to outperform the fiat era in GNP growth rate, despite occuring during a more primitive technological era where these autocatalytic effects were less pronounced, would suggest that era's policies were exceptionally conducive to economic development.
The rest of the claims in that paper are debunked in the article I linked above.
"Between all of the gold sources in the world, current estimates suggest that roughly 2,500 to 3,000 tons of new gold is mined each year. At present, experts believe that the total amount of above ground gold in the world stands at just over 190,000 tons."
Paradoxically, what got people to get in early was the *early inflation*.
People would not have joined the project if it were released pre-mined, and just sold by its creator. But the fact that it was given away to newcomers (at a symbolic processing power cost) distributed it throughout the world.
What attracts people now is, sadly, the expectation of quick profit. That will burn them - a lot of people have heard of Bitcoin by now, and have invested as much (or as little) as they wanted. There is limited growth left; the returns are diminishing.
Personally, I believe the best use case of crypto is as a hedge against inflation.
After the last halvening, the supply is increasing by 1.8% year-over-year ending July 18th [1]. Contrast that to fiat supply increase: 13.8% year-over-year ending May 2021. [2]
And the fact that one has been the de facto world currency for the better part of the last century, but that's just a detail for crypto enthusiasts
> At least Bitcoin has a cap
btc is slow as fuck and nowhere near fast enough to even remotely come close to replace any other system
No, the differences are that people denominate prices in USD, there’s a gigantic and mature financial services industry around USD, and finally I have recourse to the courts for most USD transaction.
Nope, it's the US military.
Armored bank vehicles are bad for the environment too.
If this conclusion sounds absurd we should reconsider the premise that Bitcoin deserves any kind of place in our society.
> Armored bank vehicles are bad for the environment too.
A negligible part of the traffic on the road are bank vehicles, and they don't carry a large part of global wealth. Dollars can be efficiently transferred over the internet now, because the banking system, however slow and fossilised, actually has incentive to reduce waste, unlike Bitcoin.
https://www.vice.com/en/article/pkby7z/a-fossil-fuel-power-p...
Namely that "Bitcoin incentivices renewable energy": https://assets.ctfassets.net/2d5q1td6cyxq/5mRjc9X5LTXFFihIlT...
* Bitcoin incentivises _cheap energy_. If burning coal is 10 times cheaper than renewables, shitcoiners will burn coal
* The renewables that may be built are not built for the greater good, for public usage. Only to mine more coin, to make more money, to make more solar panels, to mine more coins, etc. The carbon cost of these renewables is abysmal.
* The only positive point it _may_ bring would be making renewables cheaper, but considering the shitcoin vultures are trying to go waste electricity from any source, including attempting to screw Iceland over, the likelihood of this happening is close to zero.
"Without bitcoin mining, solar - an intermittent energy source - could supply only 40% of grid power before utilities would face the need to fund significant investments with higher electricity prices. With bitcoin mining integrated into a solar system however, energy providers - whether utilities or independent entities - would have the ability to play the arbitrage between electricity prices and bitcoin prices, as well as potentially sell the “surplus” solar and supply almost all grid power demands without lowering profitability."