People continue to use cash in the physical world, even though it's less convenient than cards, because it is private and the merchant gets 100% of the money. Bitcoin has the same virtues online.
FWIW, you can't actually pay your taxes with cash.
You most certainly can pay taxes with cash. But that's not the point. The point is that you have to pay your taxes in US dollars.
That doesnt make sense. The dollar has extrinsic value too, which comes from the legal requirement of governments to accept it as payment. Unless you feed on paper, it doesn't paper money has less intrinsic value than digital, the latter is more divisible and easily exchangeable worldwide.
The value from satisfying legal requirements is extrinsic.
It looks like John Quiggin is basing his views upon his extensive prior research[1] into Bitcoin, and he is not simply jumping onto the bandwagon like so many other economists.
PS. "intrinsic" value does not exist in anything. Value is something that people put in things. Nature itself has no meaning, values or purpose. It's we, the actors who make the choices and valuations.
* I put "intrinsic" in quotes to broadcast that I am aware of the philosophical and semantic difficulties the word introduces into a conversation. Do apples have intrinsic value because people can eat them? What if I'm allergic to apples? What if the human race goes extinct?
> advances the idea that the value of a good is not determined by any inherent property of the good, nor by the amount of labor required to produce the good
This is what most economists agree upon.