And if you owned all the dollar bills?
You can't pay taxes with worthless money.
The actual concern with this argument is that "You can only pay your taxes in US dollars" is a backing that is contingent on the policy of the US Government. The strength of that backing depends on your view about the likelihood that such a policy will stay in place. (Edit: granted, if all USD were owned by a single entity, the likelihood that such a policy would be revoked is much, much higher.)
If all of USD were owned by a single entity, the US Government just prints more. They will always have that power. That may cause inflation effects that they would be concerned about in the long term, but they have an immediate reaction lever to increase the monetary supply in such a (weird) hypothetical. (Though the correspondence between monetary supply and long-term inflation has always been much more theoretical "cause-and-effect" rather than showing practical, real world correlation much less "cause-and-effect". Especially this side of the Gold Standard the practical relationship between monetary supply and inflation is incredibly complex, and while you will find many people still presume an inflationary relationship the practical effects have been much weirder. [There are times in recent US history where USD monetary supply was at all time highs and inflation at all time lows.])
(Unless you hypothesizing an even weirder hypothetical where the monetary supply is increased by the US Government just handing the dollars to the single USD dollar holder and hoping that provides incentive to "trickle down" dollars back to everyone, but there's very little anyone can do with the onion of dumb in that weird hypothetical.)
1) You don't need bitcoin to pay taxes in El Salvador. You need dollars to pay taxes in the US.
2) Why would people in El Salvador give you their USD for bitcoin when you can pay taxes there in USD?
As a centralized currency, the power flows from the Government. If the US Government loses power, of course dollar bills lose value. But generally speaking, the trust in the dollar is one-and-the-same as trust in the US Government.
DOGE is -53% over the last year, which means its _actually inflated_ by 212% vs the Dollar (or really like 233% in real terms, after accounting for the 9%+ inflation of USD).
DOGE inflating by 233% in a single year is horrific policy.
As far as things with inflation, we should be discussing why Cryptocoins are so terrible at it.
Since you brought it up, YoY returns are not really relevant for a long-term investor. If you're speculating/gambling on short-term volatility, then USD/VTSAX/BTC have done poorly--but I'm not much of a speculator. I'm very happy with my 10-year returns.
As long as you keep wildly changing the subject (this applies to your next reply as well), I'll assume you have no counterpoints and agree with everything I say. I'm glad we can agree!
You literally said this. Honestly, I'm not sure what subject you want to discuss anymore. But you were the one to first bring up inflation.
If you got something to say about my root post, feel free. But you're changing the subject more than I am: https://news.ycombinator.com/item?id=33789831
Everything else's value is determined by the market and not the government, so how does Bitcoin have trouble finding value if the market thinks it has its utility, which is a storage of value without any third party intervention which is its unique capability that people can't seem to figure out after 10+ years of its existence.
The only thing a currency needs is widespread community coordination. US Government forces this through taxes and bonds/lending, so our system is largely built on top of the dollar and a centralized bank.
Other systems can be made however you wish. But solving the coordination problem is the fundamental issue.
If you produce something of value in return for Bitcoin, you must still acquire dollars to pay your taxes. If you refuse, men with guns will escort you to jail. That is what ultimately backs Buffet’s preferred currency.
I get your point, but they are really not the same.