Topic: What if the Satoshi (Sats), became the foundation of our economy? (Read 305 times)

Bitcoin and its structural particles - Satoshi - cannot become the basis of the world economy simply because states will categorically not accept it. The economies of states operate on completely different principles than decentralized cryptocurrency. According to general rules, the amount of state currency should be equal to the amount of goods in circulation by the state. With an increase in the quantity of goods, that is, an increase in GDP, the state has the right to increase the amount of money supply by the magnitude of the increase. Based on this, the development of the economy of each state is planned. Bitcoin and other decentralized cryptocurrency cannot function depending on the growth or decline in the level of the economy, therefore planning the development of the economy in Bitcoin is impossible.

A decentralized cryptocurrency can effectively exist alongside the fiat of states, complementing it with its useful features, but it cannot replace fiat.

0. A state/world currency cannot exist and fulfill its role, without additional issuance. This is the key problem why a cryptocurrency like bitcoin will never become a currency of account, whether of a single state, whether of the world.... This is the key problem with cryptocurrencies with limited issuance. Why is there a need for additional issuance ? That's how economics works - money itself has no value. Their value is formed by goods, resources, services that are created by society.
1. The indivisibility of the satoshi, with its high value, will not allow you to make transactions with goods/services costing less than 1 satoshi.
2. Stability can theoretically be realized, but the problem is that the economy cannot exist without additional emission and controlled inflation. And this contradicts this point
3. No. Value is not formed by the monetary unit, but by the economy, technology, the power of the state and government,... Money is a projection of the power of the state. And again - without additional emission, there will be wild deflation, because the volume of goods/services/.... will constantly increase. And in the absence of additional emission, it will lead to collapsing deflation

We don't know who Satoshi is. Maybe it's the world government itself. There is a very close connection between economic fluctuations, crises and bitcoin. All people have been prepared for the CBDC for a long time - and bitcoin has served as a good testing ground for this. People are used to smart contracts, so they will accept CBDDC more easily. Maybe that's the plan?

What I'm saying is that Sats are cheap. We've seen people jumping on xrp, doge and so many other printed-out-of-thin-air tokens (that have no real intrinsic value) only because they believe they can afford it. Sats-first approach would allow the masses to join the massive bullrun that bitcoin continues to deliver.

And I agree, we are far away from sats being able to be money but I believe it's time for sats denominated markets.

wow. I just wanted to share and quote this tweet I just saw:
https://twitter.com/bitcoin__apex/status/1691886458578079945

"In about 8 years, a little more than 1 Satoshi per person is created every day"

- to @rikybrosh:
I agree, familiarising people with satoshis is cruical for this to happen;

- to @lionheart78
If largest economies (countries) would ever hold any bitcoin, I can clearly see people being able to transact in sats. And the thing with ideas is that somebody has to work on them for them actually to come to reality

- to @Fortify
from where I stand, The bitcoin network is a settlement layer, and technically speaking there will be derivatives circling around all the other networks. Like is usdt actual USD if it's running on ethereum or polygon? There are thousands of centralised and decentralised networks where any asset can flow. Bitcoin network provides us with security, scaling can be done in so many ways.

I think that foundation was wrong and that is why everything that followed afterwards became wrong as well. When someone says "capitalism doesn't work", that doesn't mean socialism works, two things could not work at the same time. But when you tell people that capitalism doesn't work, they always go on defense and say "so what we should be socialist???" and no, that is not the solution neither, I do not have the solution and brighter minds than me tried and failed so why would I give it a try.

But, I know that this isn't what works, we need something different and from foundation as well, we need to change everything from bottom up and make it all a new thing. What? I have no idea, it could be anything, someone should figure it out, but it's obvious this doesn't work.

it is just my opinion but maybe people will more familiar with satoshi rather than bitcoin if in the daily life people mostly say some satoshi rather than say bitcoin as 1 bitcoin maybe only can be owned by very rich people only. i think when that time happen, bitcoin is already spread evenly and not so volatile but only tend to rise just like gold.

Hmm Sats or you can simply say that Bitcoin was not introduced to provide economic destruction backup to the powers and was not supposedly introduced to achieve any type of stability. The main target of Bitcoin was to machine the P2P payment mode and non-controlled demand to supply in the market to prevent Inflation on some instinct.

Secondly, in today's perspective, the narrative which is most popular with Bitcoin and its identity is the Long term valuation or you can simply consider it as the store of value or the digital gold term whatever you like where some people want to prevent the inflating crisis while on the some them being greedy from judging the future capital want to make extra gains. Some want financial freedom etc etc. point is BTC is an entity in the financial world that can be justified by any narrative whether it suits to you or not.

I do have the same preference as others but I am open-minded for the possibility of your ideas.  It is that it is too early for your ideas but I believe somewhere in the future when Bitcoin is globally accepted by each country and the prices of Satoshi is noticeable enough that a pint of beer can be bought from a few satoshis (as what @rat03gopoh stated).  At the end of the day, Bitcoin still needs to be adopted by more than 60% of the global population in order for some seems-impossible ideas to start realizing.

To put forward suggest a suggestion shows that you don't understand the scale of monetary exchange that is taking place each day, because bitcoin makes up an almost insignificant amount of transactions in the grand scheme of things. The bitcoin network simply cannot support it at the same scale, in the same time frames and at a reasonable cost, so it's never going to happen. Nor should it, bitcoin can find and be happy with taking a certain niche of money activity, like transferring larger sums across borders while avoiding extortionate banking fees. All of your other points are already achieved and were possible before bitcoin came along, so it's maybe not as ground breaking as some people make it out to be, but it's decentralized nature is a nice thing.

This is something that Bitcoin is opposite of and cant really accept it. Bitcoin is Bitcoin for the reason it has its current characteristic. I think most of them are opposite to what you have mentioned up here. Bitcoins volatility is because of its decentralised nature so it can not be changed. If you do then it is most likely because it has become centralised one and thus it is being controlled. What happens when something is controlled with single entity? Well, it becomes weak in terms of its public power and becomes more predominant with the decisions of that single enormity. Bitcoin already has fair value since it’s equity lyes in the public hands. The more they adopt it the more valued it becomes, and vice versa is also true. I don’t think we need to give another type of qualification to Bitcoin.

Yeah, and for 4,5 IDR (1 sat) you'll still get nothing today in Indonesia. As a general practice in minimarts, they mostly replace the 500 IDR cash back with some sweets.
To summarize my previous point, you can't just have 1 to 5 countries of reference to make this transition, especially if you also expect 1 sat to be a fair value. Developed countries where 1k satoshi isn't even worth anything yet. Economic standards are'nt the same for every country, and that needs to be improved, bitcoin can't do anything.

I think sats become main currency will happen only if we are not using USD or any other currency to value bitcoin, the value of 1 Bitcoin is just 1 Bitcoin, meaning that the majority of people using Bitcoin as the main currency. Only then we can also use sat as form of money. As long as people still use USD value to determine the Bitcoin value, using sat as form of money is impossible

If BTC value gets high enough, it might get convenient to focus more on the value per satoshi, but we're far from that for now. Also, since this is just a smaller denomination of the same currency, I don't think it would change anything in terms of stability and fixing economic disparities.
We live in the world of variety, in a world that tends to value diversity. So having a single thing as a foundation of global economy seems highly unlikely to me, unless humanity dives into a much darker era of unification and control.

All these were just like having a nightmare because if we are to go back to what the reality says, it's obviously impossible for now, am not talking as against bitcoin from the context here but the word sats that was used, atleast let see how the overall adoption first goes with bitcoin before moving to it smaller value in sats, we have to see the government in larger percentage in support of the use of bitcoin, accepting it as a legal tender before something like this begins to come up, when bitcoin itself has the government established support, every other things can be achieved, but now we could see clearly that we the people are the ones in need of bitcoin and in use of it, while this is only possible in an economy which fully support bitcoin.

I think that the Sats-first approach would make it easier for people and small businesses to accept it as a form of money. It's almost impossible to sell a lemonade at a stand for 0.000036 BTC, and it's much easier to say it costs 360,000 sats.

And I agree to your remarks about all the values that Bitcoin as a network holds.

what if Sats are streamed through all the available networks?

Bitcoin starts this revolution but the banking industry will not let this to happen easily and that's why Bitcoin is still cheap simply because it can be controlled by those institution by just holding more Bitcoin and even on spreading news that can affect the cryptomarket. Satoshi had a great work towards this revolution and what we are seeing now is the fruit of his work. Satoshi becoming the world wide accepted currency is a big thing already, but again crypto is far from ruling the economy because fiat currency will still prevail the only question is, what currency will lead the market in the next generation?

I don't understand why you're need to separate between Satoshi aka Bitcoin's fraction (not the creator) and Bitcoin when it's still a same thing.

Form of Money: To proceed a transaction, you need to pay fee. If something cost for 1 Satoshi, you might need to pay 10,000 Satoshi for the fee.
Stability: Bitcoin is always been stable, 1 BTC = 1 BTC.
Fair Value: You're talking about borderless transaction, fair value is discuss about the value of Bitcoin, not the price. Bitcoin has many values: decentralization, security, privacy etc.

Bitcoin network's minimum tx fee is way higher than 1 satoshi, so 1 satoshi is unusable on mainnet. LN also has a problem with mass adoption - you need to open a channel by sending transaction on mainnet, Bitcoin can only process 0.3M transactions per day, while there's 8 billion of people in the world - it would take many years for all people in the world to open a channel, and channels might be closed from time to time. So the solution would be to use banks to store Bitcoin and send satoshis through Visa. But that would mean that the system won't be too different from what we have now.

Satoshi is just a small portion of the bitcoin only, and it doesn't make too much impact if you are just a small investor, else you are one of the whales who hold a large amount of bitcoin this every action you make will affect the market people can sell their coins too or grab the opportunity to buy but if just a small portion of satoshi only seems not have an impact at all. Another thing is economy may vary depending on the current state of the world if the transaction or trades of a different country is good or not that may affect the economic growth. Each country that is connected into it have a changes or decisions in their it may affect the people who transact to them.

In my opinion "the a reason why dollar isn't pegged to gold anymore" and its implications, is exactly why Bitcoin was created.

And I'm not even suggesting that countries should adopt Sats as the form of money but people could. One of the foundations of "money" is to be a store-of-value because you want to save it for the later day. In today's environment people are being stolen from via inflation.

If governments would want to spend more they would pay people and businesses a decent interest on their sats deposits.

I agree we are far away from being able to pay salaries in sats but getting paid for a small good or service makes a lot of sense to me.

My apologies if I'm biased. Truly appreciate your feedback!

There's a reason why dollar isn't pegged to gold anymore. And for that same reason no country that actually has their economy working, would use bitcoin as their nation's currency. Money is good for fast liquidity, for something that holds it value rather stable. It is inflationary by design as if it would grow in value like bitcoin, or even just cutting the inflation, could break the whole economy. People would spend and invest less as it would be way safer just kept hoarding money, so there wouldn't be healthy flow of money that brings jobs and keeps economy alive.

Governments wouldn't have any buffer if for some emergency they would need it. And buffers like ability to print money, can prevent troubles, that without it could bring the country to total collapse. Nor governments have as much, or if any control as monetary system that they handle would be handled by someone else.

With growth of value, wage adjustements would be a mess, and hiring could end up being just too expensive There would be trade imbalance, mostly imported goods as producing anything in that country would become very expensive compared to anywhere else. And god knows what as i haven't really thought this trough. I am not an expert of any means yet i see more problems then upside.

Thank you all for sharing your opinions! I understand that most of the feedback is negative, and I accept that perspective. It's worth remembering that many groundbreaking ideas initially sounded crazy or unjustified.

Since the inception of Bitcoin, I believe that many of us have deepened our understanding of the theoretical and practical aspects of money.

Now, what intrigues me the most is the comparison between a sats-first economy - where sats are deflationary by nature - and the current system, where currencies are inherently inflationary. it seems that by the nature of it, people would tend to be saving more. Because tomorrow on average these sats would provide one with greater purchasing power.

That made some sense to me. In our local board (Spanish) we have talked about that possibility more than once (I mean, about satoshis being the norm, not Bitcoins). In Spain, before the Euro we had the "Peseta", and a beer at today's exchange rate would've costed back in the old days like 300 pesetas; but in other countries not too culturally far, in Latam, the national coins are worth even less, with a Columbian Peso with a value that would make that beer cost 8,000 COP, which is 1,000 units more than if we compared it with the same price in sats (around 7,000 sats).

In fact, I think that a coin with such a low value could be helpful to stop the inflation. So, I wouldn't mind to pay in sats, in fact, I find it more natural than to say "0.0000684 BTC, please".

The idea of using cryptocurrency, like Bitcoin's smallest unit known as Satoshi (sats), as a foundation for an economy frankly speaking, at this age and time, it won't be a great idea for several reasons, though it will be an interesting concept. However, I might be wrong, but there are several practical and theoretical considerations to take into account:

1. Volatility:
Cryptocurrencies, including Bitcoin, are known for their price volatility. This volatility could pose challenges for the stability of an economy, as the value of the currency can fluctuate significantly over short periods. This could affect people's purchasing power and confidence in the currency.

2. Adoption and Acceptance:
For a cryptocurrency to become the foundation of an economy, widespread adoption and acceptance are crucial. Businesses, governments, and individuals would need to be willing to use and transact in the cryptocurrency.

3. Infrastructure:
Building the necessary technological infrastructure to support an economy based on a cryptocurrency would be a significant undertaking. This includes creating secure and efficient payment systems, wallets, and other financial services.

4. **Regulation:** Governments and regulatory bodies would likely play a role in overseeing and regulating an economy based on cryptocurrency. The regulatory environment for cryptocurrencies varies widely by country and could impact the feasibility of such an economic system.

5. Scalability:
As cryptocurrencies gain popularity, they may face challenges related to scalability. Current blockchain technology has limitations in terms of processing a large number of transactions quickly and efficiently.

6. Privacy and Security:
Cryptocurrencies raise concerns about privacy and security. Transactions on a public blockchain are visible to all, which could have implications for personal privacy and security.

7. Inclusion:
Ensuring that an economy based on cryptocurrency is inclusive and accessible to all segments of the population, including those without access to technology or the internet, would be a significant consideration.

8. Global Implications:
 If a cryptocurrency-based economy were to gain traction, it could have implications for the global financial system, trade, and monetary policy.

However, the ongoing development and evolution of cryptocurrencies could potentially shape the future of financial systems in ways that are difficult to predict. I look forward to this concept in perhaps, the next century or more.

For now, I don't want to speculate like that. Because for now it is very unlikely to happen. So the most important thing than all of this, is to think realistically that currently bitcoin is not accepted by everyone and is even still a very minority, if we look at the comparison between the number of people in the world and bitcoin users this year.
Bitcoin fractions (satoshis) have no physical form, they are just data. So if satoshis are made into fractions, and for example change the foundation of the world economy, in my opinion it will end badly. Because for now, satoshi is still very cheap. 1 bitcoin is equivalent to 100,000,000 satoshi. So if for example satoshi are used as currency fractions, maybe the amount is too much.
To be honest, if this is done, I think it will be a bad foundation too. Because seeing the price volatility that occurs with bitcoin, it is certain that if satoshi is applied to the economic system, it will definitely be unstable too. So at this point fiat money is indeed superior to bitcoin fractions (satoshi).
I think it will be difficult. Because creating a financial system that is truly fair and equitable, it will definitely be difficult. Because the financial system that is managed by every country still tends to be unfair, especially since this is global in nature and is only based on one system, namely satoshi.

- Form of money. There are countries in the world where the local currency main denomination is worth less than a satoshi. Like 1 satoshi = 4.45 IDR (a pint of Beer would probably cost >50,000 IDR);
- Stability. I think that transacting in sats for day-to-day transactions would improve Bitcoin's stability because real value of bread or a service is not that volatile.

And I believe that at points there are many other currencies that are more volatile than Bitcoin.

Hopefully, Bitcoin will get to the where it will be generally accepted by the majority of the world's population. Just like we have other fractions of currencies such as pence and cents,  sats will also be accepted as a fraction of Bitcoin. The worth of Bitcoin will affect the purchasing power of sats. Sats might be able to buy some items if the price of Bitcoin goes very high.

I doubt of Bitcoin will ever be free from its speculative nature. But if it ever becomes less volatile, it will create a more stable economic foundation than fiat because it is decentralization. It will be difficult to manipulate compared to other currencies.

Bitcoin is not issued by any country and its worth is the same everywhere. The disparity faced by some countries will be reduced because Bitcoin is decentralized. It will be unlike the dollars that dominate other currencies, meanwhile, they are the same printed fiat as other nation's currencies.

The current price of the dollar is 1 USD = 3429 satoshi, and this number may change during the period of writing this response or you reading it. Therefore, such volatility makes the use of satoshi in financial services useless due to high volatility in a short period.
The economy depends on the stability of the exchange rate with the possibility of fluctuation by 2% or any reasonable percentage during the year, which makes the cost, profit and loss calculations more reasonable and stable.
Satoshi does not provide this option, but Bitcoin has a good chance, especially if it reaches a market capacity close to gold, as there is a good chance that it will be a currency for international trade.

- Form of Money: Satoshis are too small a fraction for a while to make people think it is "money" without a dispute. Maybe one day if the exchange rate becomes more reasonable, let's say for just 5 sats you can get a pint of beer.

- Stability: You know that with limited supply, it's impossible to convert bitcoins into a stable value. I can't imagine bitcoin even being accepted around the world, maybe by doing so it can just reduce unnecessary small levels of volatility.

- Fair Value: I don't think so, unless you can eradicate economic inequality around the world.

Greetings fellow Bitcoiners,

We live in a time where traditional financial systems are constantly being challenged, and Bitcoin is at the forefront of this revolution. But what if we take this a step further? Imagine a world where the most granular element of Bitcoin, a Satoshi, is not just a fractional part of Bitcoin but a fundamental building block of our entire economy.

Here's what I'm pondering:

- Form of Money: How might the transition from thinking of Sats merely as a fraction of Bitcoin to accepting it as a distinct form of money change our economic landscape?
- Stability: What would it take for a Sats-driven economy to achieve stability, considering the highly volatile nature of Bitcoin? Could it provide a steadier foundation than existing fiat currencies?
- Fair Value: Could Sats provide an equitable value system that transcends borders and economic disparities, creating a more just financial world?

I would love to hear your thoughts, ideas, and even reservations about this concept. Your insights may not only fuel an ongoing research project but could be part of shaping a future that we all have a stake in.

Remember, the most extraordinary ideas often seem unimaginable at first. Let's explore this together and see where it takes us.

Looking forward to your perspectives!

Best,
jspree