> bitcoin possesses far more credible monetary properties than the dollar<p>Sorry this is complete BS. Inflation makes the dollar more useful for exchange. Not only that, the dollar is great for consumer goods as it is pegged to a basket of them unlike Bitcoin. Then on top of that, the liquidity available for trading and moving USD across markets is at least 2 orders of magnitude greater than BTC.<p>I sold all my btc a long time ago for better cryptocurrencies, and the price appreciation of those relative to Bitcoin proves the point further.
The problem with any asset purporting to be money is that the final requirement for it to truly be <i>money</i> is <i>belief</i>.<p>Bitcoin can be the best technical alternative for money, which I believe it currently is, but if people in general do not believe it is money then it simply is not money. But in fact, the bar is even lower than that for Bitcoin (or any alternative money's failure) - if the government(s) decide that you cannot accept Bitcoin (or any money) easily in trade, then it loses dominance as money (and thus is not really).<p>When people say Bitcoin is not backed by anything, the intuition they are trying to communicate is that Bitcoin's value relies on people believing and accepting that value (of course so does the US Dollar, but look who is in the ring fighting for it).<p>What people truly want out of a crypto-currency is value which is more objective, which is not reliant on the belief of others; it is the difference between a monetary chain, like Bitcoin, and a commodity chain.<p><a href="https://mukdde.substack.com/p/a-monetary-blockchain-is-less-secure" rel="nofollow">https://mukdde.substack.com/p/a-monetary-blockchain-is-less-...</a>
> Governments tax what is valuable; a good is not valuable because it is taxed.<p>The difference is that, if you earn something valuable that is not US Dollars (e.g., Bitcoin), the US Government (the most powerful organization in the history of civilization) will tax you on it in US Dollars, and project global power towards collecting it. The reverse is not true.
> It is backed by the only thing that backs any form of money: the credibility of its monetary properties.<p>The “credibility” of the US Dollar, or any government-backed currency, has a lot to do with the amount of power that government has.<p>If, in America, an American citizen has a bunch of USD stolen from them, they can go to the government. In an ideal world, the government will find the thieves, get the money back, and dole out justice.<p>If that same person gets Bitcoin stolen from them, there’s nothing they can do.<p>Similarly, if the USD starts to lose its value, you can bet the government will do everything in its power to stop it from losing value. The US government has a lot of power to make changes that will actually effect this change, too, such as raising interest rates to fend off high inflation.<p>If the value of Bitcoin starts deflating, however, no one can really do anything.<p>So yes, sure, in a philosophical, pedantic way, Bitcoin is backed by something. But it’s worse than any major currency. In fact, it’s worse than the worst stock, because if market sentiment changes, there’s quite literally nothing _else_ propping up its value.
It is backed by nothing and that's ok. It's a money, it doesn't need to be "backed". Gold is not "backed" by anything, the notion doesn't even make sense. Backing implies a debt or a promise to convert currency into money by a counterparty, and that backing can be taken away.
Bitcoin is based against the wisdom that "all that glitters is not gold." It abuses the "shiny object" trigger in our animal brain. The minute it looks shiny, its price goes up, and vice versa.<p>It's become a way for people to manage their anxiety around the state of the economy, pumping money into Bitcoin whenever it looks shiny relative to the fiat currency, and getting out when it doesn't, or when it stops going up (no more shiny attraction.) You need a sustained campaign of lies and deception to keep polishing that turd, so to speak.<p>We're better off without it, but you can't take away some people's psychological safety blankie.
Bitcoin and crypto have demonstrated one great strength, and I don't mean crime and fraud (which crypto does excel at facilitating).<p>Crypto has demonstrated an unbelievable ability to survive repeated failures, debunking, scams, fraud, and even government bans. What other technology has failed to deliver on any of its promised benefits for over a decade and survive in "any day now" mode for so many people? What other technology has enabled so much fraud and financial ruin and evaded regulation for this long. As a meme crypto shows more tenacity than COVID does as a virus.
> Bitcoin is out-competing its analog predecessors on the basis of its monetary properties. Bitcoin is finitely scarce, and it <i>is more easily divisible and more easily transferable</i> than its incumbent competitors.<p>This seems false to me. I can tap a piece of plastic to pay for all kinds of things and then pay that off in turn with a few clicks on a web site. And it's all pretty secure and safe and has well established rules for when things go wrong that do a pretty good job of protecting me.
Not quite:<p>Bitcoin is backed by greater fools trying to pump the price up and other fools trying to buy into the pyramid scheme.<p>But seriously it is backed by entirely nothing but speculation.<p>History will not be kind to Bitcoin and its delusional supporters. It will definitively and inevitably end up on the scrap heap of other failed experiments and bubbles like Tulip Mania and Beanie Babies.<p>For a more intellectual deconstruction of web3, bitcoin and all other crypto arguments this is a fantastic resource debunking every point on crypto:<p><a href="https://web3.lifeitself.org/guide#claim-bitcoin-will-and-should-become-the-new-gold-standard" rel="nofollow">https://web3.lifeitself.org/guide#claim-bitcoin-will-and-sho...</a>