Topic: Bitcoin, Gold, USD (Read 242 times)

Doubtful whether 1 satoshi is going to be any significant fraction of an ounce of gold...ever.  That would be way too dramatic a redistribution of wealth for those who own even a tiny amount of bitcoin.  It just won't happen.

And what would network fees look like in such a case?  You would have to be able to send bitcoin for free, because even 1 satoshi would be too much.  Am I wrong there?

Actually the problem is more fundamental than that. Doesn't matter if you "back up" the USD with more gold, or go back to pre 70ies gold standard. Do you honestly think the State would, under any and all circumstances, fulfill their promise? Do you think if every US citizen back then went to reclaim their gold for their dollars, they would have actually had them or willing to give it? The whole "coin backed in asset" idea is flawed in the first place, it think breaking with it was more honest.

You say they have 8000 tonnes, did you yourself went and audited that? Are you sure every single ingot is pure gold and not tainted? Are they in perfect condition, all same weight size whatever? Sure trust a third party to certify that, everyone has to "trust" someone at some point.

Bitcoin is based in a trust-less model, you don't have to trust anyone. There is a source code, it follows that, period.

Going back to a gold standard? I don't think so. Main problem i just explained to you, and perhaps there is not enough gold to back everything anyway, they would resort to fractional reserve, so in short it would be going back to lies, just bigger lies.

Yes some countries want to end the USD supremacy, because it gives a terribly unfair leverage to the USA, they can print some more money than others without being caught. But make no mistake, all fiats are in the same "basket", its just that a few are managed better than others. In the modern world, the backing of each fiat is the economy they represent, no assets in a vault nobody is allowed to see, ever (the vault might as well be empty fwiw).

Federal Reserve? Pff. Want to sanitize the economy? Kick the Chicago boys and summon the Austrians, first thing they'll tell you is to close that and eliminate fractional reserve banking (which is the only reason Central Banks exist). They also want to end fiat and go back to gold, unfortunately actual gold can be tampered. That is the beauty of Bitcoin, no one can fake it. Bitcoin and the Austrian proposals fit very well together, even is some Austrians don't think that way and stick to the original idea of using actual gold as money, because they haven't grasped Bitcoin yet.

Do note there is a huge difference in using gold directly, than a paper that claims can be exchanged for gold. Because the latter, is a promise, that is supposed to be fulfilled by someone, again, the trust model. Trust your government? Your bank? Your company? To redeem those? Hope they never go broke, or a revolution sweeps them away...

Do you think your bitcoins would lose value if a revolution happens where you live? Now think about your national currency. Can you spot the difference yet?

yes of course this is very crazy, if bitcoin and cryptocurrency offer accountability, it might help us to know the gold smuggling that so far the government and gold miners are manipulating their communities because they don't create transparency systems with gold supply if they use the blockchai system as in bitcoin, maybe this can help people find out the amount of gold currently being obtained by the government.

not much alike. I'm pretty sure that government can still keep track of bitcoin through technology develops over time. Especially to monitor bitcoin transactions for everone. But in terms of replacing the fiats, custom country currency can be implemented.

Seems like the value of gold is kept artificially low, when the 250+ trillion of USD liabilities are considered.
If gold was being manipulated by the cental banksters it would likely valuate at 150 million  an ounce, maybe more.
It's all a bit complicated as the central bankster fraud has been evolving not just with the federal reserve but back to Roman Empire days when they manipulated thier currencies.
Bitcoin is something humanity has never seen before, a currency both immutable and permissionless.

indeed the value you mentioned is fantastic but I think it is very difficult to be able to bring the price of bitcoin to such a high price, because if the price of bitcoin can reach such a high price then many will be trapped at high prices when prices are high, there must be a very high demand and clear legality in all countries to be able to make the price of bitcoin stable at high prices.

Especially because fiat is a terrible store of value while gold stock to flow ratio is not as good as Bitcoin. We should expect that to happen, if and only if we can survive crackdown from the government.

I hope it won't take too long. Can't wait to see that I can use 1 satoshi to buy a pair of jeans.

On a very optimistic point of view I do think that in time 1 Satoshi will be equal to 1 ounce of gold because I expect that the value of Gold to decrease as we become more educated about what a true store-of-value is. The numbers in the OP thread are very interesting. So I made a calculation and if the federal reserve of USA of $250 trillion would consist of Bitcoin then the price of BTC should be around $11 million dollars in purchase power today. And that is a fair value, I didn't even take into account what happens if more big countries make national reservers denominated in BTC.

Also when you have to trade in virtual gold you have this time limit set up by the company itself where you need to encash in like 2 months , it is really hard for the people to go with their trading and all like this , therefore  bitcoins is something that is solving this issue you have freedom over your assets , and you can do whatever you want with them , whenever you want .. this is in turn a good thing , USD is stable but it lacks the opportunity to grow .

To estimate great transformation is not the mistake but putting a future situation in current dollars is where it may be incorrect.   In the 1960's thirty dollars could buy an ounce of gold now it can barely buy a pair of jeans, we cant sensibly estimate the future dollar pricing.   At some point they will struggle to control the yearly inflation and then it will be obvious but we already know the prices in future will appear ridiculous by present perspective.
   Bitcoin is transactional and thats its strength really, secure confirmation of payment far more quickly then gold which relies on trust.   Gold has the advantage of requiring no work to hold its value where Bitcoin must constantly confirm its relevance to various transactions.   Theres no need to tie gold to Bitcoin, they dont have a direct relation and the ratio between the two will always alter as gold is fixed in its purpose where as Bitcoin must grow and should not stand still or 'do nothing', gold value rises because it does nothing which in comparison to the mess we make of politics or money or trade is often useful as a guide point for value over time and across nations.
  USD will be replaced, its foundations have been betrayed and undermined.    They might replace it with another currency of the same name, thats a neat trick that sheds the old liabilities.   The speculation really is only in what will replace or what system supersedes the global reserve system set since ww2.

i don't think the problem is all about "what" is being used but rather in "how" it is being used.
in other words, despite what you may think, bitcoin may not change a thing if it is not used right. for example even if bitcoin were used instead of gold, it could still be used in a custodial form without leaving any traces on the blockchain. they could take everything off-chain and still be shady about it.

Well, Bitcoin can increase "accountability" in government if they use the transparency of the Blockchain. We know there are lots of speculation that the actual Gold in vaults, does not reflect the amount that is shown on their electronic ledgers.    Most of these vaults are not accessible to the public, so we will never know if this is true or not.  

The Bitcoin Blockchain reflect all bitcoins in circulation and none of the coins in circulation can be manipulated or faked. That is the accountability that the public needs. 

Truth is no it can't. You know how things would work? Once again we will begin to use Cryptocurrencies and after a few years we will go into a Deflationary spiral with no economic growth and after which we will decide to use paper money which will be backed by Bitcoin and then after a few years we will go into a Deflationary spiral because people would require more money and after that we would once again move to fiat to feed our needs of money. This is how it will work even if we choose bitcoin today.

Bitcoin can really resolve the issue on accountability and transparency in the US Treasury as well as the Federal Reserve. Though it is impossible right now for bitcoin to replace the US dollars but what if bitcoin is the one that replace the US dollar and it will represent the 400 billion$ worth of gold. Then because bitcoin can be monitored through a blockchain the government cannot increase its number. The only negative thing is that bitcoins value will be stable and the price will decrease since the US treasury has only 400 billion dollars worth of gold assets.

Honesty and accountability can best be addressed by the blockchain technology and we are already seeing many platforms and projects getting into this concern. Now, with Bitcoin, I think the route taken by gold will also be possible with this when we are trying to entice institutional money into it...and Bakkt can be the start for this trend. Right now, gold is rising and there is a big chance that it can be pumping months from now. With Bitcoin, there remains the issue of volatility which gold already addressed successfully.




Yes, crazy for now but we just don't  know what can be years from now. Certainly, there is that bigger chance that Bitcoin will be growing in the years to come in terms of price and adoption. We just know yet the developments that can influence for Bitcoin to reach that level you mentioned. Will Bitcoin be able to overtake the marketcap of gold? I am hoping so but definitely this is never an easy ride. Maybe if some central banks start to hoard Bitcoin then it can be the catalyst for the rise of Bitcoin to a different level...a level enjoyed by gold.

Yes, that's a crazy idea. But that still doesn't rule out the possibility that the idea will come true.
Bitcoin is an electronic currency that uses peer to peer networks that are not managed by groups, institutions, or countries and without centralized storage. Bitcoin can be traded by anyone anonymously, prices cannot be determined and are entirely based on the demand of buyers and sellers and that can be considered as honesty on bitcoin, in my opinion.
USD and Gold will not be separated from government regulations, they regulate and may also be able to manipulate circulation and availability. But bitcoin doesn't seem like it, all transactions are recorded and can be found in history. Limited inventory allows bitcoin to continue to be valuable from year to year, increasing the number of adoptions will also make it more valuable than gold investment.

I do not quite understand what problem of honesty and accountability can Bitcoin solve and how can this affect a possible sharp increase in its price?
Now I don’t think that Bitcoin will ever be able to have a price even of one hundred thousand dollars.
Now we will expect what kind of reaction will follow regarding the latest report of the G7 countries and the Bank for International Settlements regarding bitcoin and stable coins.

I've never liked people using a single Satoshi to compare it to other items (1 USD, one ounce of gold/sliver, for example). It's way, way too far fetched.

As for your idea. Let's assume the price of Bitcoin is at 10,000 right now. It would need to go 15,000,000 times in value for your idea to become accurate. So, it's pretty impossible, but anything can happen mate.

I've always liked using the measurement of mBTC to compare it to other units, eg comparing it to the US dollar or gold, it's way more achievable and fun to think about.

I think that estimate is way too high. The reason why many people don't want to hedge against inflation with bitcoin is due to its volatility. Look at what happened in the last few years. It started at $1000, went to $20000 then down to $3000, then up to $14000 and now sittin at $8000. This is a very volatile digital asset which has huge price swings in a manner of weeks and not years.

For this reason is why many would just either buy stocks with their fiat. If there is some recession there are other things you can buy to hedge your money like real estate. There are even collectibles you can buy like a vintage Ferrari which probably won't ever lose it value (unless it gets stolen).

Hence its why not everybody is buying BTC which would make us reach $100K or $1 million by now. It offers great security but the issue now is its not a good way to keep your fiat hedged.

Bitcoin offers accountablity and honesty.
Gold is a tangible asset, but difficult custody issues, easily confiscated and historicaly manipulated by government.
The USA gold reserve is about 8000 tonnes, or roughly 400 billion $.

The US federal reserve is leveraged to the tune of 250+ trillion $. Making the USD a joke as the world is edging toward a return to a gold standard.

Question: can bitcoin resolve the honesty and accountability issues which haunts gold transactions?

If so then 1 Satoshi to equal 1 ounce of gold seems realistic...
Which would translate to 1 Bitcoin equals $150,000,000,000.

Is this so crazy?