Topic: if fiat money is bad, we could escape them easily even before bitcoin (Read 1551 times)

There are a bunch of community currencies in the USA.  Individual citizens and companies are not prohibited by this law, only the State governments are so prohibited.
There are Disney Dollars, all sorts of coupons, and many private currencies.  Some of these are voluntary only (like bitcoin) some are intrinsic, gold/silver/labor (Ithica Hours).

Fiat means force.

Fiat does not mean money without intrinsic value, though it is typical that if it is fiat, intrinsic value can be dispensed with.
For example, the US Dollar was fiat even when there was silver in the coins (up to the early 60's).

Fiat money is money that has the force of law.  The Legal Tender law means that the fiat currency discharges a debt when offered.
This means that you can eat at a restaurant, and the restaurant is free to accept any sort of payment that you agree to, but if you are in the US and offer them dollars they can not then say "no we only accept payment in live rabbits" and hold you for non-payment in rabbits.  You have a debt for the food you ate, and legal tender will discharge that debt.

You don't want to use gold certificates, as there is significant counter-party risk. You want to use intermediaries you can reasonably trust, such as VIA MAT, Brink's, and G4S (although all of them are exposed to government risk), through GoldMoney and BullionVault.

Bitcoin is however inherently superior.

Thank you for that important quote of the constitution. I had to dig into old newspapers to find out where I read about local provincial currency, and I found it took place in England, not in the U.S.

So from that news leads back to the wikipedia article:
http://en.wikipedia.org/wiki/Totnes_pound

Totnes Pound is issued by Totnes, a town in Devon, England.

Quote from wikipedia:


I wonder why British government not act agressive and ban it outright. Even if it is pegged to pound sterling it may shift through time.

Further digging into wikipedia reveals there are other community currencies:

This page lists 6 community currencies in the U.K.
http://en.wikipedia.org/wiki/Category:Community_currencies_of_the_United_Kingdom

I further wonder if they are required to follow governmental fiscal policies.

Thank you alll. Thank you to freigeist for showing me the documentary. I watched the first one and is really really enlightened. Thank you mechanikalk for pointing out the case that people is actually not allowed to compete with governmental fiat money. These are all very helpful and valuable!

Me too.

For those who would like to learn something about money and financial system
i would suggest to watch a cool documentary searies which I found on internet few years ago.

The title of the 3 free movies are:
1) Money As Debt
2) Money Ad Debt - promises unleashed
3) Money Ad Debt - evolution beyond money

I'm not sure if I'm allowed to post external links here  as a newbie user
anyway you can find them on you tube or vimeo.

I find them very informative and easy to understand.
I hope you will like them too.

Dictionary alert: as bitcoin is a very different class of instrument than paper money, it's useful to distinguish between the two. Many now use 'fiat' to refer to that second type. You might be right according to the dictionary, you may be wrong according to developing use

Considering the nature of Bitcoin, I am absolutely stunned that not a single person has spoken about the history of money and the tactics used to force people to use "their" fiat currency, hence "Satoshi Nakamoto".  Bitcoin is FAR from the first alternative currency in history.

No, bitcoin was invented to work alongside fiat money. Anyone who wants to keep using fiat, can. This is about choice.

Fiat money=money without intrinsic value.

who is forced to use bitcoin?

Bitcoin is fiat money, just not a government controlled fiat money.

Isn't the bitcoin network and clients running on TCP port 8333?
You think is not possible for them to create a law that will impose to all ISP
companies in USA to close the ports used by bitcoin protocol
and put bitcoin out of use in this way?!

It means that it is a currency whose use is imposed on the population by force.  That is the whole story of Bernard Von Nothaus.  He tried to make a currency to compete and the government threw him in jail.  Hence they are making you use the currency by force...  Trying to use a non-federal currency see this article, http://www.newswithviews.com/Ryter/jon120.htm  Again the only reason bitcoin has worked so far is the government is too impotent to stop it, go cryptos!

Bitcoin was invented to democratize money, fiat or otherwise.

Bitcoin exposes and teach a lot of people about what money is used for by governments and global banking, by not needing either.

Before I knew about Bitcoin, I really believed that currencies served a mere practical purpose. How important they are as a political and financial weapon for governments and others globally really escaped me.

Thank you for that Bitcoin. So you are right, we could have done all that before Bitcoin and some countries do have a tradition for  stuffing gold in their mattresses not trusting either their government or bank on that matter.

And what is fiat to you??

I don't think that people have previously had a choice when it has come to money.  The best options were gold and silver but you could not actually trade it in daily life. For example see http://www.duffminster.com/times/node/255">this article about the liberty dollar which the US attorney made the following comment "Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism," U.S. Attorney Anne Tompkins said in a statement.  Therefore, we have not previously had the tools because the government knows that with its current degree of inefficiency and socialistic policies very few of the tax paying public would pay taxes if it could be avoided without punishment.  The only reason Bitcoin or any of the cryptos have lasted this long is the government hasn't found a way to stop it.

From the US Constitution Article I. Sec. 10:


I think that means that the States can't create their own currency.  If I remember my history correctly, one of the problems after independence was that all of the States issued their own currencies, making the central government's treasury and interstate trade difficult.

Oh, this is very important to know. This means, although U.S. allows autonomy government to issue their own currency, that money need to peg its value to gold or USD, and if it succeeds competing with USD, it eventually would begin to float.

A few other posters explained gold is not easy to carry. At the moment, Gold is not any harder to carry than bitcoin. A gold certificate is just paper. few are stupid enough to take the gold out of the bank and carry with him - think about the anti-fraud validating process to go through when you store the gold back to the bank. It is not harder to trade neither, because it is easier to find someone who would accept a piece of gold certificate than someone to accept bitcoin. You may say in the future this may change, but it as well can be changed by having a bank issuing gold certificate as a currency - the condition for this to happen has been met long before.

Guess I have to put a bold statement to inspire some really meaningful argument. So here is one:

Bitcoin is invented to replace fiat money, but if people don't trust fiat money, they don't have to wait for the invention of bitcoin to start replacing it. Thus:

Not true: The popularity of bitcoin is because: People distrust fit money always, now they finally have a tool to fight fiat money.

Perhaps true: The popularity of bitcoin is because: people speculate without knowing fiat money is a bad thing. Some others think they are fighting fiat money and sing praise of them.

The difference is non-trivial. Whether or not people consider alternative to fiat money is good, is going to be tested when bitcoin value plummet. Only those who believes in its value would keep trading them, preventing a sudden death of bitcoin. Speculators don't believe in value of anything.

The question that I would pose with all of the recent volatility in price, is this volatility hurting the bitcoin as a fungable unit of commerce.  The whole point of having bitcoin is to replace fiat currencies.  This will not happen until:

1) the price is stable enough that goods can actually be priced in bitcoin
2) the stability of fiat money decreases such that bitcoin becomes a reasonable alternative

One of the things that I think was overlooked was that every currency that has been successful in the passed that is fiat has done so by having some mechanism by which to initially peg a value to that currency.  In the case of the dollar it was gold and silver and in the case of post WWII europe it was the dollar.  Only in the seventies did the currencies begin to float with nothing backing them at all.  I am wondering how price stability will be achieved for bitcoin overtime.