The denominator that determines value is really the amount of goods and services for which people are willing to pay dollars, just like for Bitcoin.
The economic real value for which currency is used can grow, as can the money supply (in the case of fiat, as well as in the case of Bitcoin until we reach the 21 million BTC cap). Both fluctuations change the value of the individual unit of money.
Yep, and more generally ‘money’ is the proxy that is accepted as equivalent for said goods and services.
karnage doesn't understand supply and demand
Slight correction:
...for which people are willing to "accept dollars", not "pay dollars".
My labor, in other words, adds value to the dollar because I will accept payment for my work in dollars. I can purchase groceries and gasoline with dollars.
There are many fiat currencies that already have less value than Bitcoin (like the Bolivar or the Leone) because people would prefer payment in Bitcoin than whatever they are.
The dollar is still the Currency King 👑 but it's value is slowly declining. Same goes for the Euro, the GBP, Ruble, Remnibi, etc.
