The US dollar isn’t “real” either. The green paper rectangles are used as a means of exchange. Their only value is in the fact that we all agree it has value, and one can reliably exchange it for something of that approximate value. We could just as easily use blue seashells, plastic noodles, or electronic records.
What makes money viable is the controlled creation thereof. Sure the Fed prints more money, but does so at a predictable rate balanced with economic & population growth, and with just one reliable issuer and difficulty (and active severe prosecution) of counterfeiting. Gold works as money because, while anyone can go mine gold, the process & difficulty & rate tends to parallel the needs of a stable currency, and the material is easily verified.
Bitcoin is similar to gold, in that computing valid new “coins” takes considerable computing power and (between Moore’s law and available resources) tends to parallel needs of a stable currency. The coordination of exchanges establishes an equivalent to sovereign control, assuring no undue behaviors.
Insofar as there are problems, I’m sure digital, paper, and coin currencies went thru similar problems early on (and still do at times).
Exactly.
I will say that as easily as the Dollar is exchanged electrically today, I’m a little fuzzy on why a product like BitCoin is necessary.
Now, I will admit that it could be a safe haven should the Dollar go sub-orbital. Fact is, that could tank a whole lot of other currencies, and perhaps even an electronic version like BitCoin.
You need stable economies for something like BitCoin to exist. If international currencies are impacted negatively seriously, something like BitCoin won’t be the savior IMO.
Speculation considerations were all that was driving it IMO. Those considerations couldn’t sustain it. Either the structure was flawed, or something else caused BitCoin to go down in ashes.
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