Quote:
Originally Posted by Avulon
Promises can be (and are) broken - often by government. Currencies can be devalued easily (e.g. 'Quantitive Easing') as we've seen so recently. Currency is just a promise between people to honour a nominal 'value' for something which is otherwise (essentialy) worthless. The value of currency can also be affected by other economic forces beyond the control of the man in the street (the cause of our recent quantitive easing). The illusion of currency having true value is one which is convenient to maintain for those that would 'rule'. Just think how much more interesting and decentralised life would be if without currency and everything having to be bartered for with real goods and services of value.
My point is that Bitcoins are not dissimilar in these respects to other currencies.
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I take your point about the short termism and volatility of governments but the whole basis of Bitcoin is peer-to-peer lending which is just about OK when you fully know the peers to whom you lend or borrow. It is based on illicit money transfer and by its very nature depends on the autonomous and unidentified players on keyboards.
You say a currency is essentially worthless whereas in fact it is backed up by globally published stats which are evidence of standing. This standing is underpinned by internationally approved rating agencies such as Standard & Poors etc.
The value of a State currency is not 'nominal', it is supported by the entire financial stability of the issuing State and is hugely susceptible to the ebb and flow of international confidence in that State. It's true the said currency has no value in itself, it is merely an indication of the State's trading stature as seen by the rest of the world - a far wider audience than the narrow spectrum of bitcoin traders.
I for one wouldn't like living in the 'decentralised' dystopia you envisage, it's too risky by half. Which is my reason for likening bitcoin to pyramid selling.