Bitcoin vs. the Dollar (Traditional Money vs. Digital Innovation)

justdimin

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Quote from: BVeyron on September 20, 2023, 05:53:15 AM

Quote from: Sinzu_ on August 14, 2023, 09:49:08 PM

The US Dollar (USD) and Bitcoin (BTC) are two separate but interconnected forces that have been reshaping the financial and economic landscape. These two organizations stand for opposing ideals—one rooted in conventional financial institutions, the other a forerunner of the digital age. The conflict between the dollar and Bitcoin has prompted discussions about the future of money, investing, and the role of technology in forming financial institutions as the global economy continues to change. My question is this, why does the value of BTC decrease when the value of the dollar rises?

I think that it happens due to the fact that at the moment both currency systems are global, so they are rival, BTC is quite hard to use for direct purchases (especially for small everyday purchases) while dollar is highly centralised, strictly controlled by "the few richest" and is vulnerable to inflation. So this rivalry is visible if you take a look at BTC and USD price fluctuations. Also, in case of dollar inflation there is a chance to save money via cryptocurrencies (however, only a chance, not guarantee)...

I would say that they both have their places and they could co-exist together. I understand that some people may not like that, but I feel like it can be done and we are going to end up being a lot better on the long term. Think about it this way, if we could end up with something that will make a lot of profit, why wouldn't we do that?

We would be able to use them both at the places they are good at and we should be able to make a profit based on that. This will allow the situation to grow a lot bigger and could be important on the long run as well. I know that life is not that simple, and we could end up with a situation that is a bit more specialized based on what you are going to do, and then use that one.

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Quote from: Sinzu_ on August 14, 2023, 09:49:08 PM

The US Dollar (USD) and Bitcoin (BTC) are two separate but interconnected forces that have been reshaping the financial and economic landscape. These two organizations stand for opposing ideals—one rooted in conventional financial institutions, the other a forerunner of the digital age. The conflict between the dollar and Bitcoin has prompted discussions about the future of money, investing, and the role of technology in forming financial institutions as the global economy continues to change. My question is this, why does the value of BTC decrease when the value of the dollar rises?

I think that it happens due to the fact that at the moment both currency systems are global, so they are rival, BTC is quite hard to use for direct purchases (especially for small everyday purchases) while dollar is highly centralised, strictly controlled by "the few richest" and is vulnerable to inflation. So this rivalry is visible if you take a look at BTC and USD price fluctuations. Also, in case of dollar inflation there is a chance to save money via cryptocurrencies (however, only a chance, not guarantee)...

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Quote from: mendace on August 17, 2023, 05:46:50 PM

The value of Bitcoin (BTC) can be affected by a variety of factors, including supply and demand, adoption, market news, and global economic conditions. When the value of the US dollar (USD) goes up, it could impact the price of Bitcoin in a number of ways.

There are still many who really need $ [traditional money] because many transactions are still mastered by rotating $ and can't get rid of this habit because the environment also influences it, even though Bitcoin [digital innovation] has started to be known and has also been used.I agree with you that the existence of Bitcoin is very much influenced by many factors that can affect its movement; the same goes for movements in the value of the dollar.In principle, both of them must acknowledge that they really need each other to be able to be used as a transaction between them and other needs. At this time, it must be admitted that both have the same role, are used equally, and are equally needed, although $ is still the best, although maybe in the future it will be different.

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Quote from: Mauser on August 20, 2023, 01:15:16 AM

Quote from: Sinzu_ on August 14, 2023, 09:49:08 PM

The US Dollar (USD) and Bitcoin (BTC) are two separate but interconnected forces that have been reshaping the financial and economic landscape. These two organizations stand for opposing ideals—one rooted in conventional financial institutions, the other a forerunner of the digital age. The conflict between the dollar and Bitcoin has prompted discussions about the future of money, investing, and the role of technology in forming financial institutions as the global economy continues to change. My question is this, why does the value of BTC decrease when the value of the dollar rises?

The short answer is that because these two currencies are being traded against each other they tend to move in opposite directions. Many crypto investors who hold Bitcoins and want to take profits from their portfolio will switch back to Fiat money. We can see that alt coin investors tend to move into Bitcoins and Bitcoin investors move back to USD or Euro. For them to take profits, they sell their Bitcoins and want to have USD, so there is selling pressure on BTC and more demand for USD. The exact opposite happens when people want to buy Bitcoin and do this from their Fiat saving account. This is of course only a small effect, because the US Dollar is such a huge market with all the major countries in their world trading with it. There are a lot of more factors that go into the rise and fall of the Dollar. The long term trend for Bitcoin is upwards, we are going to see more price increases in the future. While on the other side the US government doesn't want a strong Dollar. A strong Dollar would make their exports more expensive and with their large spending and printing programs of the FED the value of the US Dollar should decrease over time.

Isn't it interesting how humans, who are always trying to get control, use monies to dance around power? Your point about BTC and the USD is just a small part of a much bigger game of tug-of-war on a world scale. People trading Bitcoin for fiat money is just a small wave in a huge ocean of lies, power struggles, and desperate attempts to stay on top.

You're right that the long-term direction for BTC is up. This is because Bitcoin is, for once, a way to do business that isn't controlled by the government. It is clean and unspoiled! The dollar? A simple tool used by a dying power. The US doesn't want the dollar to be strong because they know they are going down. Their endless printing of money and financial strategies are just bandages on a gunshot wound. A crash is coming, so wake up and smell it

WatChe

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Quote from: Cryptomultiplier on August 19, 2023, 11:31:29 AM

Firstly, I do not think there's a conflict between the dollar and BTC. Both are distinct in usage and application.
Many countries have their legal tender backed by the USD reserve banks and as long as USD is one major currency for trade and commerce round the world, we would keep seeing the demand for the USD rising. Unless, more countries like the BRICS countries adopt the Yen as speculated, then the price of USD will keep rising still.

Am sure you are also aware that 1 BTC is equivalent to almost $26, 203 USD currently, and without much disparity, this price will always fluctuate depending on market volatilities at the time.
The value of BTC will continue to decrease if more of the users/customers don't demand it. If more customers do demand it for investment or trade, we would see the value of BTC increase. Simple.

We saw two massive bull runs of Bitcoin in 2017 and 2021 when Bitcoin touched its ATH of 19k and 68k respectively. In both these bull runs there is no connection with price of USD. One thing we need to understand is that USD along with other fiat are backed by governments and will continue to exists for real world monetary system. While Bitcoin is a decentralised monetary system that is backed by its community and is never created to replace USD.

Mauser

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Quote from: Sinzu_ on August 14, 2023, 09:49:08 PM

The US Dollar (USD) and Bitcoin (BTC) are two separate but interconnected forces that have been reshaping the financial and economic landscape. These two organizations stand for opposing ideals—one rooted in conventional financial institutions, the other a forerunner of the digital age. The conflict between the dollar and Bitcoin has prompted discussions about the future of money, investing, and the role of technology in forming financial institutions as the global economy continues to change. My question is this, why does the value of BTC decrease when the value of the dollar rises?

The short answer is that because these two currencies are being traded against each other they tend to move in opposite directions. Many crypto investors who hold Bitcoins and want to take profits from their portfolio will switch back to Fiat money. We can see that alt coin investors tend to move into Bitcoins and Bitcoin investors move back to USD or Euro. For them to take profits, they sell their Bitcoins and want to have USD, so there is selling pressure on BTC and more demand for USD. The exact opposite happens when people want to buy Bitcoin and do this from their Fiat saving account. This is of course only a small effect, because the US Dollar is such a huge market with all the major countries in their world trading with it. There are a lot of more factors that go into the rise and fall of the Dollar. The long term trend for Bitcoin is upwards, we are going to see more price increases in the future. While on the other side the US government doesn't want a strong Dollar. A strong Dollar would make their exports more expensive and with their large spending and printing programs of the FED the value of the US Dollar should decrease over time.

Cryptomultiplier

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Quote from: Sinzu_ on August 14, 2023, 09:49:08 PM

The US Dollar (USD) and Bitcoin (BTC) are two separate but interconnected forces that have been reshaping the financial and economic landscape. These two organizations stand for opposing ideals—one rooted in conventional financial institutions, the other a forerunner of the digital age. The conflict between the dollar and Bitcoin has prompted discussions about the future of money, investing, and the role of technology in forming financial institutions as the global economy continues to change. My question is this, why does the value of BTC decrease when the value of the dollar rises?

Firstly, I do not think there's a conflict between the dollar and BTC. Both are distinct in usage and application.
Many countries have their legal tender backed by the USD reserve banks and as long as USD is one major currency for trade and commerce round the world, we would keep seeing the demand for the USD rising. Unless, more countries like the BRICS countries adopt the Yen as speculated, then the price of USD will keep rising still.

Am sure you are also aware that 1 BTC is equivalent to almost $26, 203 USD currently, and without much disparity, this price will always fluctuate depending on market volatilities at the time.
The value of BTC will continue to decrease if more of the users/customers don't demand it. If more customers do demand it for investment or trade, we would see the value of BTC increase. Simple.

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Quote from: dlightag on August 19, 2023, 08:55:48 AM

Bitcoin and USA dollar are two currency together, because Bitcoin is a digital currency that is only trading online or online purchasing of good's and services as the case maybe, but US dollar are seeing as a traditional money that we make use of it every day by day to buy or sell anything including online and offline transaction respectively, therefore come to talk about Bitcoin price increase and dollar price decrease during Bitcoin price pump, is a simple something all together, which is work of demand and supply in the market, when supply is high and demand will be less that affect the price of Bitcoin or dollar depreciate in price value.

Talking about the dollar specifically now, dollar depreciation is not entirely as a result of demand and supply, and this is not peculiar to the us dollar alone but to every fiat currency out there.
For bitcoin, we could say that the driving force for its ups and downs in price is as a result of demand for it, and not supply because we all know fully well that bitcoin is very limited in supply unlike fiat, that is, bitcoin supply is already fixed, so demand alone is what drive the price of bitcoin up or down, when demand is high, price goes up, and when demand is low, price goes down.

For fiat, several factors drive the price up or down in the market and in the short term, but In the long terms, fiat currencies are always losing value due to their unlimited supply nature, and for the fact that central banks even have the ability or monopoly to go on printing more fiat when governments need money, not minding the consequences of this..

So for me, bitcoin will always be a better money than fiat, though I still want both to co-exist together.

dlightag

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Bitcoin and USA dollar are two currency together, because Bitcoin is a digital currency that is only trading online or online purchasing of good's and services as the case maybe, but US dollar are seeing as a traditional money that we make use of it every day by day to buy or sell anything including online and offline transaction respectively, therefore come to talk about Bitcoin price increase and dollar price decrease during Bitcoin price pump, is a simple something all together, which is work of demand and supply in the market, when supply is high and demand will be less that affect the price of Bitcoin or dollar depreciate in price value.

Sinzu_

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Quote from: NotATether on August 15, 2023, 01:19:14 AM

They are not 1 - to - 1 correlated.

Nobody really pays attention when the dollar goes down during inflation, because everything is denominated in dollars. Therefore, when you see BTC price go up, that can mean either two things - the market demand of Bitcoin is increasing, or the US dollar is losing value because of inflation while Bitcoin stays at the same demand.

Same is true in reverse - when BTC value goes down, it doesn't necessarily mean that dollar is also going up, perhaps the dollar is remaining at the same value while BTC's own demand diminishes.

Hmm this is truly helpful.... When do you feel is the best time to buy?

fullhdpixel

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Quote from: 348Judah on August 17, 2023, 09:09:44 AM

Quote from: Ucy on August 16, 2023, 11:18:33 AM

In regards to why the price tend to be inversely proportional to the other, it's simply the principle of demand & supply. Once one has higher demand than the other, its price may be allowed to increase.

Many could have wondered as well that why has it been in this way whereby we see the value of dollar depreciating over time whereas bitcoin is increasing, this alone should significantly tells us that there are factors that are running underground which could not allow the USD value to increase over time than to decrease, inflation in many ways have affected the relevance of fiat and reduced it value with because there are policies not working right with fiat monetary system which doesn't exist in a decentralized network with bitcoin.

Those who wonder are lacking of knowledge on how financial system works. Money won't move just like that without a reason. Dollar depreciates due to inflation while Bitcoin can be a good counter to it due to its limited supply. We only need to be honest and say that Bitcoin doesn't increase at all times. Inflations are normal and it doesn't happen because there are anomalies happening around.

Despite of an inflation, most people still use fiats because this is where they used to, and there are still times where we can experience a relief in which inflation rates can decline. People can also do something to help them survive a high inflation period.

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Quote from: Sinzu_ on August 14, 2023, 09:49:08 PM

The US Dollar (USD) and Bitcoin (BTC) are two separate but interconnected forces that have been reshaping the financial and economic landscape. These two organizations stand for opposing ideals—one rooted in conventional financial institutions, the other a forerunner of the digital age. The conflict between the dollar and Bitcoin has prompted discussions about the future of money, investing, and the role of technology in forming financial institutions as the global economy continues to change. My question is this, why does the value of BTC decrease when the value of the dollar rises?

Bitcoin is way more than its counter value in US dollars because there is no inflation, there is no central bank printing more, there is no bank freezing your funds, and you are completely free to send funds to whoever you want whenever you want, without any need of documentation and permits. If you are into bitcoin of course you are because its value will increase but that shouldn't be the only reason.

usekevin

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Quote from: Agbe on August 16, 2023, 11:40:43 AM

Op Bitcoin and Dollar are not organization but Currencies please use the correct words. This discussion will not be different from others which we have discussed before. Okay let me put it in this way. Bitcoin is the Messiah that came to save mankind from the financial bondage and bitcoin did not come to destroy the fiat dollar who has been assigned to use all goods and services in the world. Bitcoin came to support the Fiat Currency to do well. Bitcoin can't be use physical and it is use only digitally so if you want to use fiat and you have BTC, you must convert it or sell it with p2p so as you said, BTC and dollar (any other fiat currencies) are moving simultaneously.

The bitcoin and USDT are now most traded cryptocurrency,the people buy USDT for holding the crypto to buy some good coin using the steady price USDT.The bitcoin was long term coin now,the good time to buy bitcoin is the bear market.Now we are facing the bear market,So you can buy some bitcoin for now.If you want to buy USDT for your local people,it's better to buy the USDT in P2B.Some people will get scam by sending FIAT to his fellow country people without getting any dollars.Don't believe any one in the online blindly.

mendace

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The value of Bitcoin (BTC) can be affected by a variety of factors, including supply and demand, adoption, market news, and global economic conditions. When the value of the US dollar (USD) goes up, it could impact the price of Bitcoin in a number of ways.

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Although the US dollar (USD) and Bitcoin (BTC) are opposite in all characteristics where the dollar is centralized and bitcoin is decentralized and bitcoin maintains privacy while the dollar does not, they are actually two separate and interdependent forces despite being opposite.

Determining the price of bitcoin is directly related to the dollar, so it is natural to see a decline in the value of bitcoin when the strength of the dollar rises, as they are opposite, while if there are factors affecting the price of the dollar negatively, this will reflect positively on the price of bitcoin, although this rise could be imaginary due to inflation. And the dollar lost some of its purchasing power.

This mechanism can be understood through the example of gold because gold and the dollar are also interrelated but opposite, for example when the value of gold rises, this rise is in fact a result of inflation and the dollar losing some of its value and purchasing power while the real value of gold is fixed.

lionheart78

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Quote from: Sinzu_ on August 14, 2023, 09:49:08 PM

My question is this, why does the value of BTC decrease when the value of the dollar rises?

As the earlier reply stated, they are not 1 - 1 in proportion. The moment the value of the dollar rises, the purchasing power of the dollar increases. Unless there is enough demand for the Bitcoin market to uptrend, in a normal calculation, the amount of BTC being able to purchase will become higher thus it makes Bitcoin looks like losing its USD value. The opposite reaction will happen when the value of USD becomes lower.

In other word considering the other factor is the same, USD is inversely proportional to BTC in terms value.

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Quote from: hugeblack on August 17, 2023, 09:00:06 AM

-snip-
The difference between the more stable price and the more volatile bitcoin price is what makes bitcoin sometimes fall against the dollar and sometimes rise.

It is because of Bitcoin's volatile characteristics that the price moves significantly against the dollar every second.
Bitcoin is also a relatively new digital asset and looks small when compared to traditional currencies that have existed since the era of world economic growth.

Many market sentiments will affect the price of Bitcoin and Bitcoin is also traded 24/7 and has never stopped until now.
Whereas traditional currency stock trading during the weekend is closed and completely stopped.

The ups and downs of Bitcoin prices are common and can provide quick profits and vice versa.
Bitcoin is decentralized, not regulated by anyone so unilateral regulations will not be able to affect it.

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Quote from: Ucy on August 16, 2023, 11:18:33 AM

In regards to why the price tend to be inversely proportional to the other, it's simply the principle of demand & supply. Once one has higher demand than the other, its price may be allowed to increase.

Many could have wondered as well that why has it been in this way whereby we see the value of dollar depreciating over time whereas bitcoin is increasing, this alone should significantly tells us that there are factors that are running underground which could not allow the USD value to increase over time than to decrease, inflation in many ways have affected the relevance of fiat and reduced it value with because there are policies not working right with fiat monetary system which doesn't exist in a decentralized network with bitcoin.

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The value of Bitcoin is subject to supply and demand factors, and these factors change every second with an increase in demand or supply, and when an imbalance occurs, the price changes, so you find that the price of Bitcoin changes every second and sometimes it is fixed, while the dollar is the global reserve currency, and the Federal Reserve guarantees its value, so it is tied With the value of the dollar and with promises that the United States will protect its currency, therefore, a more stable price.

The difference between the more stable price and the more volatile bitcoin price is what makes bitcoin sometimes fall against the dollar and sometimes rise.

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The USD is not interconnected with Bitcoin. Others pointed out that there's no strong correlation between the two, and that they are incomparable by the scope of usage and influence. I see various explanations in the thread, but honestly, I think that the op might just be confused when asking about the decrease of BTC value when the USD value rises. We measure the value of Bitcoin in the USD for convenience, it doesn't mean that they're literally connected with one another. And the value of dollar doesn't really rise. That would be deflation, and the USD is slightly losing value most of the time, just as fiat is meant to do (inflation).

Topic: Bitcoin vs. the Dollar (Traditional Money vs. Digital Innovation) (Read 375 times)