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Who wants to reply to my colleague about bitcoin vs fiat? 💭 I’ll send sats to the responses of course!

“I don't think it's worse, I just don't think it is particularly better. I think that the idea of deflationary money being inherently better is based on a narrow scope of what money is and how deflationary currencies have worked (or not worked) in the past.

The gold standard was incredibly volatile, or at least no less than its absence.

With a Bitcoin standard, credit would be difficult if not impossible. And I doubt that if Bitcoin had mass adoption in a year that the powers that be would redistribute ownership of land/housing etc. Now those things would be permenantly out of reach, more than they are already.

The ability for governments to respond to crises (like during the pandemic with monetary stimulus) would also be completely hampered.

Money that can be backed by debt is better at responding to these things, but is more prone to control, less suitable for international p2p, etc. Btc, at least rn, also has the role of serving as a hedge (kinda) for when shit hits the fan.”

karo 2y ago

Money is a storage of time and work. In perfect, sound money it is neither inflationary or deflationary.

Saying gold is incredibly volatile begs the question, "compared to what?" If you're comparing the volatility of gold to a manipulated fiat currency, then yes, of course gold is volatile because what you're comparing it to is artificially controlled.

Bitcoin's function is to be sound money, not to redistribute wealth. By having sound money, people will be paid what they are valued and will pay the correct value for things that they can't produce themselves. A person doing 8 units of work earns 8 units of money to buy food that is worth 8 units of money.

There can be debt with Bitcoin. That just comes down to whether there are those who are willing to be lenders. The closer we get to bitcoinization that kind of financial instrument will naturally arise.

And, the government not being able to respond to crises? heck, if everyone had a Bitcoin wallet, you could just zap the stim check. The problem is that governments today don't actually have money, they just make money up. When they're able to make it up, they don't have to be accountable to the citizenry. With sound money, they have to provide actual value and be accountable.

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