Topic: What’s the nature of currency? (Read 947 times)

States do not have to accept them as what they are but only what they can be. If we are talking about a situation where it is not a legal tender but it is allowed for people to accept it and pay with it then we could still technically achieve what we want.

We won't have governmental backing with us when we are doing it, but at the end of the day people all around the world would accept it and that is as good as it gets for us. Plus, if people all used it everywhere then we would be doing fine, it would like legal tender but would be globally. We are still seeing a few places accepting it, that is not rare but that doesn't mean that it is common enough neither unfortunately.

As far as I know, money in the state (cash and non-cash) should be issued as much as there are material values in civil circulation that can be commodities. There is no room for any consensus here, this is pure economics.
It is still difficult for me to say how bitcoins and other crypto-currencies will flow here. States are unlikely to take them into account in general economic processes, but the capitalization of the cryptocurrency is growing and something will need to be done about it.

With the success of El Salvador it will not guarantee all countries adopt Bitcoin, there are certainly countries that still refuse. Since not
all leaders of countries have open minds, there are some countries that have leaders who are selfish and self-absorbed. It's true that no matter
how good Bitcoin's achievements are, there are always those who hate Bitcoin.  Because it is impossible to make everyone in the world like Bitcoin.
But it's not a big problem, the most important thing is that the Bitcoin adoption process continues, and I hope that in the future most countries
in the world adopt Bitcoin. For now we as Bitcoin supporters really can't expect too much, and must admit that there are still few countries that
are willing to legalize Bitcoin as a legal tender. Because it requires a long process, for the government to consider legalizing Bitcoin as a legal tender.

but this will not make other countries adopt bitcoin, adoption will certainly occur even though it takes an unpredictable time and not all countries do that.
but I'm sure it's gradual adoption of bitcoin globally will be possible someday.
and indeed this bitcoin will not be controlled by anyone at any time and this is what makes the government think again and again because it will be very risky when the government sets bitcoin as a legal currency without them being able to control it because the policies they make later will have no effect on bitcoins.
and it would be better if using bitcoin adoption but on the other hand adding bitcoin as a legal tender but not removing other currencies or fiat in payments as well, and bitcoin being one of the only options not the main one

The adoption of Bitcoin is certain, at least by most of the people if not all. A small and more people continues to adopt the use of Bitcoin, those who doesn’t want to make use of it will  also be encouraged  to make use of it. Although I still know that there are people who are going to kick against it.

It’s just like it is in El Salvador where there are people who have chosen to adopt Bitcoin and there are  also those who are against it. In a case like this I believe people should be free to use whatever they want to make use of: if you choose to make use of Bitcoin then it is up to you and also if you choose to make use of fiat it’s also up to you.

el salvador became the first country to legalize bitcoin, indeed fluctuations became an obstacle for bitcoin to be used as a currency. especially with the pros and cons in the country, until some bitcoin ATMs were damaged by the masses, then this became a big decision by el salvador. but in my opinion if it is used as an alternative currency instead of fiat I don't think it will be a significant problem

Just the lack of control over the pricing of bitcoin is its main distinguishing feature, its advantage and disadvantage at the same time, depending on which side to look at it. This is what will serve as the main obstacle to the adoption of bitcoin as the main means of payment in any more or less stable state with a strong economy and strong public administration. Because it is difficult or almost impossible to build a normal state economic policy on the basis of a currency that you cannot have any influence on. Therefore, in any case, fiat currencies will remain the main ones in the states, and bitcoin and other cryptocurrencies as add-ons or assets with a number of restrictions in a good scenario.

You are absolutely right because Bitcoin price is very volatile and cannot be controlled by anyone, that is the barrier why most countries in the world
still reject Bitcoin as a legal payment. Therefore, when I found out that El Salvador legalized Bitcoin as a legal tender, I was very surprised, because
it was a very brave decision. Now El Salvador is in the spotlight of all countries in the world, if what El Salvador is doing goes well. I believe
in many countries following in El Salvador's footsteps, although indeed in the country of El Salvador itself the population there are pros and cons.
I also actually support if Bitcoin is legalized as a legal tender, but not to replace fiat, because after all fiat is still needed its existence.

this is a problem that has always been debated from the start when a country or government wants to make bitcoin a legal means of payment.
it is not surprising indeed because the main topic when bitcoin will be used as a legal currency, there are pros and cons, especially the volatile problem itself.
The unpredictable nature of bitcoin and the uncertain market that makes it very difficult, that's why there are still many countries that prohibit bitcoin from being used as a legal currency, even though there are already several countries that have carried out large-scale adoption, such as the current Elsavador and Paraguay's plans. which will follow the direction of elsavador

Power doesn't just justify the usage of a currency, but it enforces it and values it as well. No matter which nation you are living in right now, the most powerful politicians decide how much your currency will worth, they could make it awesome or they could make it horrible, all they have to do is rule the nation properly.

However let's face the reality, people are ignorant and if the politicians do the 100% perfect method of ruling then they would lose the next elections for sure, I have seen truly good politicians, which is a very unique and rare thing, yet they ended up getting criticize beyond measure because what they are doing is spending money on people who need it, instead of back to tax payers who paid the most taxes. Long story short any nation could have a very strong currency, even if you empose it on another nation like Japan did, all it depends on how you want to manage it.

 The nature of currency valuation and payment as both the unit of account and the generally acceptable medium of exchange.Money is a medium of exchange, store of value, and unit of account.Monry is economic activity which circulates in the economy as a medium of exchange and also money fulfill our needs.

I think if bitcoin wants to be like USD which has a strong consensus then the most important thing is to increase the number of users, based on the data of btc owners it is found that more than 50% of bitcoins are owned by around 5000 people, of course this is a big problem because USD may be owned by more than 2 billion people in the world.

This is a good explanation of how currency, while still being an abstract concept, continued to persist in human society for thousands of years, spanning the Mesopotamian Civilization onwards. That being said I would also believe that the value of a coin is directly related to that of power. During WW2, the Japanese imposed a new monetary system on the Philippines, currently at their subjugation within this time period. With this, they also introduced a new form of currency out of the blue. The currency was in use until the end of their regime and this shows for me that power will determine usage and value for a currency, at least when put into this example. Shared agreement, that's all after all. Just everyone agreeing that this piece of paper we pass around has some sort of value and the more you have these, the more powerful you are on the societal ladder. When you put it this way, things stop making sense and currency is revealed for what it is. be it shared agreement or shared delusion however, we can all agree that without money we'd still be banging sticks on rocks til now.

The value of BTC, like gold, is determined on how many people are willing to purchase it at a given price. So basically, the law of supply and demand primarily determines it price on the market. With all the investment opportunities that most people see, they fail to understand that the true value of BTC is the technology that powers it- which is the blockchain technology.

With this in mind, by applying such technology to our transactions, this has the potential to convert our modern currency into a digitalized one due to a ledger that exposes all public transactions.

however consensus is not a single condition for bitcoin to become a currency, there are many conditions that must be met for bitcoin to qualify as a currency. One of these conditions is to have a stable value. of course bitcoin can not meet that requirement because the value of bitcoin is not stable.

The essence of currency is consensus. Because currency has the consensus of the people, it can be circulated. Because the U.S. dollar has the consensus of various countries, it can circulate in the world without it,Now Bitcoin is the same, because people's consensus on Bitcoin is increasing,The stronger the Bitcoin price, the higher the price of Bitcoin,I haven't heard the term consensus before, but after reading this article, I think it makes sense.

Just I want to add one point hare If anybody Hacked his secret key then I can tell he will lose his own all of the asset its a very bad nature of BTC or ETH if anyone wants to to reserve his own asset just need to more security I think to need BTC wallet 2fa key and also need to 2FA for Eth wallet if anyhow hacked her wallet he can recover everything.

I do agree that legal tender is way too much and we should not be going towards that, but I do think that there is a good chance crypto could be an alternative that we should all be supporting and using. Think about it this way, can you spend bitcoin or other altcoins to buy something? Obviously we can, it is not just for investment, it is for sending/receiving, earning/spending and all of that, this is why we should be very happy about what we have right now. That doesn't mean that we need something bigger or we do not need it, we should definitely look to grow but we could always be something alternative without being an alternative.

Let's see what companies will end up accepting bitcoin, if there are many companies that accept bitcoin then we could potentially get a good result from that without ever being legal tender.

In my opinion, the future must not be Bitcoin itself becoming legal tender, but a legal tender built around Bitcoin. For example, in the construction of any legal currency, bitcoin must be anchored and the bitcoin can be mortgaged to issue the corresponding currency. Because in the future, the majority of people only believe in the credit of Bitcoin. Just like the over-collateralized stablecoins that are now issued. This is the direction in which I think humanity will evolve in the future currency system.

To become a legal currency it must meet many conditions, one of which is having a stable value. The value of bitcoin which is very dependent on supply and demand certainly makes the price of bitcoin unstable. besides that there are still many requirements that bitcoin cannot fulfill in order to become a legal currency.

Cryptocurrencies and money can all have value if agreed upon.  The nature of other assets such as stocks, gold, silver, debt securities and others will also be valuable if one party and the other party have an agreement that it is valuable.  Can bitcoins be abandoned?  It's very possible if there are no more miners and people using it.  Likewise with money if the state/organization that issued it is no longer trusted by the public.  It's a very simple world.

Bitcoin is at the top of the pyramid. The community has put it there and they are keeping it there. It leads the race in market capitalization and trading volume, so people are obviously OK with what they get when they use bitcoin. If a time comes where the community decides to shift to something else or a majority of users abandon bitcoin for some other asset, the devs can ask themselves why that happened. 

In the beginning this may have been true, but bitcoin today is more of a self-fulfilling prophecy than anything else.  It has value simply because it has reached a critical mass of people who believe it has value.  It's not the decentralization and security that keeps the value either, it's just that there are enough people who bought into the premise to keep it there.  Now it's just a speculative asset, relatively few people actually use it for its intended purpose (actual commerce), which is where decentralization and security would actually matter.

If we hope that in the near future cryptocurrencies can become legal tender it seems impossible,
for sure there are many factors that make the government in every country have not legalized it,
maybe it will take a long time for this to happen but it's definitely better to just keep following the progress

To become a valid currency or legal medium of exchange it must be generally accepted and guaranteed by the government in power. if only the bitcoin community accepts it that means bitcoin is not generally accepted. and it seems that there is still no government that has officially guaranteed that bitcoin is legal tender.

There's definitely low hanging fruit here bitcoin can address. Faster blocks and bigger blocks would easily scale the network and allow it to be used for commerce more easily, and would also solve the cost efficiency problem.  For all the promise of lightning network, the implementation hasn't solved any actual issues on a practical level.  Its use-case in practice is a very small minority of transactions, so the bulk of transactions in bitcoin remain neither fast nor cheap.  On top of that, I'm just not convinced the trade off between decentralization and speed has proven either necessary or worth it.  There's not a problem with traditional centralized payment processors to the point where the world needs a decentralized immutable option.  To the extent the world wants one, there are currently better options than bitcoin due to bitcoin's consensus-based refusal to adapt.  In some respects, the consensus system offers benefits, but generally more in what I would call a hypothetical sense as the practical drawbacks at this point continue to heavily outweigh the potential benefits.  (Of course, in my extreme minority opinion.)

Bitcoin changes slowly, yes. But it's not going to change faster if it's threatening any of the main pillars that I mentioned above. Bitcoin changed to incorporate SegWit, we now have the Lightning Network, and soon we will have Taproot and Schnorr signatures.

When you talk about the improvements in altcoins, those changes can make them faster and cheaper, but to they make the networks more secure? Many altcoins have suffered 51% attacks and many others could be subjected to them with very little cost. Bitcoin doesn't do rollbacks, altcoins have. Bitcoin isn't centralized, many alts are + they are premined.     

I don't know if you mean to dispute my point or not, but your post supports the same premise.  Why things are difficult to change isn't as important as the fact that it's difficult to change.  Regardless of why, the inflexibility of bitcoin is why it's still a slow and clunky crypto and why it hasn't been able to incorporate improvements that other crypto's have introduced.

The role as invention was something revolutionary and undeniably transcendental in the economy of the regions that adopted it in its beginnings, something so simple and fragile gave a hard blow to the currency at the time (!?) ... no, both have coexisted over the years.

Yes indeed! When analyzing what the role has meant today in its diversification not only at the economic level is amazing. (Do not confuse the history of paper with papyrus or parchment)

For me the role, papyrus, the parchment were the Blockchain at the time, keeping the technological and ideological distances that exist, the papyrus and the parchment ancestors, but because of its natural configuration to produce them and the cumbersome to store them the paper turned on a change but it occurred in centuries.

For around 500 years ⁽¹⁾ Only the Chinese produce the paper ... Incredible, think about it 500 years!

Eyy! but let's not forget the currency, there are several references of his invention for many centuries before Christ (BCE), but as an officer something like what he did "El Salvador" doing legal to Bitcoin and added in 2021, it was CRESO⁽²⁾ To the Sovereign Lido is recognized the fact of having been the first person to put into circulation an official currency for the first time in the history of humanity.

... In short, the point or better to say the points are:
It should be recognized that what exists today (and what existed) as tools of economic and technological value can not be despised in a (theoretical) breakthrough of Bitcoin to acceptance as a global use currency.

Yes! Bitcoin is a great invention at the 21st century but with a lot of stretch ahead to equate traditional...then "officially" talking we should have a speech and have an afforded community to put the bitcoin In each of our regions and doing something to achieve it, but most only walk philosophically or that Bitcoin reaches the moon.

@RainbowKun nobody loves Bitcoin more that myself, but I think we must have more execution in the action that the word ... By the way to not get out of the subject; Not in several things you say at "OP" , for example:

... Currency Is A Contract Between The Owner and the Market Regarding ... (taken from the OP) Contract? No, really not, the value of the currency is intrinsic in its value, point, in the antiquity there was a phrase that was reference to that literal, it is worth your weight in gold.

Nothing is registered using currency, in fact the invention of it came to overcome in the reason of simple barter.

Other point: Consensus today, is necessary and absolutely necessary in the architecture and development of Bitcoin as a technology to advance to the economic and social future that is intended, we can not continue having breaks on the individual in that consensus in its technological development (scalability) Lee about That, in a certain way although they have not affected Bitcoin those "bifurcations" that have occurred are a brand, a tattoo that as individuals It is difficult to have objectives in common for the good of the collective.

Now imagine achieving the consensus on the global level is difficult, really difficult but it is happening and it has everything to be it but we do not know when?, How? And it is even possible that as a historical reference we are at the coin level, although with what happened with El Salvador, we can advance for a few centuries and start in the Creso⁽²⁾ era.  

And it is here where you put another "cane" as a church shepherd who wants to do miracles by touching the front of the people, saying "... finally it will be accepted by all ..." And then you put the difficult consensus; Bitcoin can become global to be everywhere...
...for Bitcoin being everywhere you do not need that consensus, it is not necessary, in fact "El Salvador" is a demonstration of it, but maybe the best example is the "$" ...

---

Edit:
(1) source:https://en.wikipedia.org/wiki/Paper
(2) Source: https://en.wikipedia.org/wiki/Coin
others sources:
https://en.wikipedia.org/wiki/History_of_money
https://bitcoin.org
bitcointalk.org
OP.
IMHO.

A really good point, it can’t be used for day to day purchases. And moreover if the price should go from something like $30 to 50,000 USD I can imagine so many people using that day spend on a lot of things and buy their dream house and cars, and the price will still dump. And sellers will be the ones to suffer it because when they sell a product and collect bitcoin for payment, the value might drop all of a sudden which will put them in position of loss.

So for something like this, they won’t consider accepting bitcoin or any cryptocurrency as a payment method, because they are more likely to be the ones to face the consequences if they don’t happen to exchange it for fiat immediately.

The policy is nice actually when fast introduce anything one our market we cant reach the main position or main objectives. when we understand the situation we see it's too late for us. I learned something new good from your post thank you.

I do agree that bitcoin should be seen as a thing to use as well as storing it as well. However, I do not think that gold payments are 100% gone all over the world and even if it is, it was not like that back in the day. It means that there was a period where people both used gold to store their wealth, but also used it to buy things as well. Do not think about now, to make it easier think about 2000 years ago, very wealthy people had a lot of gold stored somewhere but they also spent gold to buy stuff as well, Crassus was literally buying whole neighborhoods with gold when it was burning.

Long story short, bitcoin could be digital gold, just not the way gold is used right now, it is the gold that was used 2000 years ago, it is both spent for buying/selling stuff, but if you have excess amount of it, then you store it as well. Not every dollar is used neither, most of it is stored somewhere, same logic here.

In simple words, more merchants are now accepting payments in cryptocurrencies as compared to the early days. Yes a lot of countries are still allowing purchase through Bitcoins directly but there are companies like BitPay who are facilitating it.

Bitcoin to me is more of a currency than an asset and the simple reason is because if transactions aren't made on the Bitcoin blockchain, it would simply signal the end of Bitcoin. The demand is more because adoption is still miles behind where it should be. A dollar in crypto like USDT trades superior to a dollar in PayPal. Now think about it, the dollar value remains the same but still, there's a discrepancy.

If you need $100 in PayPal for BTC, most traders will do it gladly but vice versa is really hard. This tells me that crypto/bitcoin is more a currency than an asset in nature.

I agree with what you listed. These things are all possessed by bitcoin. However, it still isn't counted and acknowledged by the government as a currency. Perhaps because they have their own local currency in fiat in the first place. Since bitcoin and other crypto aren't issued by the central organizations, they aren't accepted as such.

Currency functions as an anchor of value and as a commodity in general. Many countries have their own currency and what they have to do is to sustain, maintain, and boost their economy to retain its face value in relation with dollar. Although the problem with traditional currencies (physical money) is that it is prone to inflation. Meanwhile, crypto is lesser prone to inflation which makes it a better option to store funds.

Hopefully, the countries all over the world will soon notice that bitcoin and other cryptocurrencies are currency because it can also do what fiat can do.

Yes that's right, as long as there is a community that accepts it then it is considered money, bitcoin has a community of up to 150 million and this is a power that cannot be underestimated, the impact is clearly seen that there are many restrictions and banned bitcoin but it does not bring any effect, instead bitcoin users continue increase.

I don't think people should be considering bitcoin as a gold in "digital world". This will just encourage people to use bitcoin as a store of value that will appreciate overtime. If this happens, we will never be seeing bitcoin used as a regular mainstream currency.

I think the second and the third points should be swapped. At first people should start accepting/adopting crypto currencies. This will then force the government and the central banks to make crypto currencies a legal tender.

I would believe that just like how we moved to segwit chain, we could give a consensus that way as well. It is not always miners that get to decide on things, in fact miners were the ones that didn't want to move to segwit and they created their own BCH coin as well just to show you what the real bitcoin should be like, but all of us decided that segwit is a lot better because it is at least that much cheaper and then some.

This is why I believe that if we want to "use" a chain, we use it and then it becomes the real chain that bitcoin is used, right now 90%+ of people all around the world use the segwit chain of bitcoin and that is why it is the consensus and that is how it was decided.

Yes, there are always two most important things in the Bitcoin network. The first is decentralization, and the second is security. This is the basis of Bitcoin's value and the basis of Bitcoin's consensus. If these two points are lost, Bitcoin will no longer be valuable. At present, the Bitcoin technology itself has proven its value, and there is currently no force that can tamper with the data of Bitcoin and crack the private key of Bitcoin. On the other hand, Bitcoin is also becoming more and more decentralized, because Bitcoin is currently being dispersed in the hands of more people.

Full nodes are responsible for overseeing and verifying that consensus rules are being respected. Miners create blocks and include transactions whose validity is again controlled by the full nodes.   

It's difficult to change because you need a huge majority of the community to agree to the change. It's not like when you vote for a new president and the person with 52% comes to power. You need much more than that in Bitcoin.

It's also difficult to change because interested parties will never vote on something that decreases the decentralization or network security of Bitcoin.

Yeah, a currency is something which needs to be accepted by everyone; otherwise it may not serve the purpose of transaction intermediary. So, what is winning in consensus might be sustaining and others may get outdated. This may not be the nature of currency but this is how a currency should be developed. This kind of development is easier for governments but creating something for transaction intermediary without power to enforce to adopt must be a challenging one still bitcoin is winning in consensus due to its characteristics.

Bitcoin doesn't exactly have an efficient way to measure "consensus" and further, there's a major difference between what bitcoin users might think versus a consensus by miners, the vote of which is significantly concentrated the hands of very few relative to the number of bitcoin users as a whole.  Plus, the frequent splits off the main bitcoin chain are instances where there have been major disagreements concerning the "consensus" about the proper protocols bitcoin should use.  All this is a long way of saying that there's no credible "consensus" about bitcoin.  There's a status quo which, for reasons that have nothing to do with consensus, is very difficult to change.

So for now about bitcoin, it is still an issue to have that kind of acceptance that Fiat money has. I think that is the nature of money that every country creates an acceptability for their own currency and bitcoin's nature is that it is decentralized and uncontrollable unlike Fiat legal tender.

The nature of gold and silver whose value is more permanent as currency from time to time is due to their value which is based on their substance, and not on the recognition of groups of people or countries. This makes the gold and silver currency stable in value, anytime and anywhere, almost never changes. This property is suitable for currency criteria as a measure of the price of goods and services, because the standard size must be stable and not fluctuating.

Money is an object that is agreed upon by its users as (means of exchange), even if it is made of a piece of stone or wood.

Likewise with the presence of bitcoin which is predicted to be a currency (means of exchange) and will be accepted throughout the world if an agreement is born to use it.

Bitcoin can be used as Fiat in my county. But unfortunately it's not possible to many countries. In additional here, I am using bitcoin and crypto as assets also. Most of my saving are in crypto currency. I know crypto currency will send it back with 10 times profit. Only think need to done is, just hold till good price.

Can be used as an assets is not the basic nature of the currency and not needed as well but cryptos giving us that opportunity so we can use them for it. The main two nature is it should have a stable value and accepted in the region while bitcoin mastered the acceptance since its accepted worldwide while the consistency in the price has put some barrier towards it.

If bitcoin users and communities continue to grow, without being legalized automatically bitcoin has become a legal currency, the small thing we can do is continue to invite other users to use bitcoin then one day any country will automatically legalize bitcoin.

Volatile is important features of crypto and it was regulated by the market. When their is huge demand, we can expected to see some good rate for bitcoin and other currency. When the coin is listed in some good exchange, you can inverse without fear. Fear make a major role in the price of bitcoin

Yes, the value of everything comes from its adopters, from the recognition of users. If no one recognizes this thing, it will have no value. This is what I call collective consensus conferring value. This law applies to everything in our daily lives. In history, the reason why we used gold, silver, etc. as currency was also because everyone collectively recognized its currency attributes. Why is Bitcoin valuable now? It is also because more and more people have truly recognized it and endowed it with value with collective consensus.

The nature of currency on my own perspectives, it has its specific character pertaining to digital currency because it's volatile and not regulated by government.
Unlike with fiat currency, authority and economic impact of a country depends on how the inflation works for them.
Cryptocurrency can be used in different ways, it can spend on goods and online payment and other spending needs. Also the most common experience that people usually do for it right now is online trading, it can be stocks or cryptocurrency.

Very interesting and thought provoking.

I actually completely agree - no single currency has "intrinsic value" in that nature has deemed it money, but rather the value is derived from adopters who deem it to be valuable. This is true of fiat, bitcoin, gold, you name it.

But what separates bitcoin/gold from fiat is that people's beliefs are justified, as there is no centralised entity that is overseeable the supply of the currency. So that is another dimension to the question.

The nature of the currency will always be freedom, it implies Financial Freedom, no taxes, no third party intervention, that is, no governments, no banks, as governments and banks know that this is what their greatest intention is looking for. It is to speak very badly of BTC, to make it an enemy of people, with the fact of being BTC of a volatile nature it is enough to enter there.
Countries are studying how to participate in the BTC economy, that is why El Salvador is the pioneer in adopting BTC, however most countries refuse BTC.

For me, BTC represents deflationary economy, zero debt and financial freedom where you are the one who manages your own money and the amount you want without the need to request withdrawal permits from banks or the like, and now currently to move very large amounts of money a certificate of origin of the funds must be made.

and here the management of currency printing carried out by the government must really be carried out professionally and as much as possible there must be transparency and should not be covered up because if money printing is in large and uncontrollable quantities this may not be a good thing because it is fast. or later inflation will strike.
and even if this happens, it still cannot be done directly because there are regulations made by the government itself that regulate and cannot be violated arbitrarily

Yes, this is a really deep idea that summarizes the whole article. You wrote more than one article about consensus and I disagree with you about human consensus, but I completely agree with you here. It is the consensus that gives the currency its value. Without consensus, no currency or metal, even gold, can have a value, for example. If there is a global consensus that gold has no value, then gold will become worthless and become like any other metal. On the other hand, if there is a consensus that copper, for example, is more expensive than gold, then the value of copper will become more expensive than gold, and people will store copper instead of gold.
Now what happens if there is a global consensus that the dollar is worthless and the bitcoin has a high value, then the dollar will become a worthless pile of papers and the real value will become in bitcoin. I believe this will happen in the near future.

now the use of cryptocurrencies is still prohibited as a means of payment.

However, seeing the demand for it is getting bigger as an investment instrument.

High prices and the volatility of its value which tends to rise is one of the attractions.

and in the future it is not impossible, if everyone reaches a consensus, then bitcoin will be transformed into a legal medium of exchange throughout the world.

Looks like a perfect place to drop this here:


The nature of currency is to be a medium of exchange. Simple as that! To not ask who is selling a house for 50 cows, you sell 50 cows to people who want cows and then you go and buy a house for that money!
Sadly, fiat currencies got corrupted over time! Now we have a real mess, caused by governments and banks (as the biggest fraudsters) and their actions in the past! I think this system can't be fixed, it can be just replaced! We need some form of currency (medium of exchange) that can be easily transferred across the world, available to all, transparent, trustworthy, etc... and that looks like I talk about crypto, right?

Originally, currency was a means of payment that made it easier for someone to make transactions. with the recognition of currencies in each country, it does not make it difficult to transact in certain countries. Currently, fiat currency is still relevant for payment instruments, but I'm sure that slowly crypto will find a place as well, just like the barter system which is slowly being replaced with money.

Because the currency is the most widely used by the people and is only accepted now, some stores, like gold, will not accept it because the value is so high and they can't change it, whereas before the barter system, you could barter things. Wherever you go, the currency is very flexible, and any country can simply change it to their own currency.

From the beginning the circulation of fiat currency was high but with the advent of cryptocurrencies the demand for fiat has been declining because everyone thinks crypto is more profitable than fiat. Crypto and other currencies have become popular for bitcoin cryptocurrency is a type of digital asset which according to the modern monetary policy of cryptocurrency for asset transactions devaluation means the depreciation of a country's currency against a country's currency in a fixed exchange rate manner. However with the change of time and financial system, the type and nature of devaluation is changing.

Yes, in my opinion, the current consensus on Bitcoin is getting stronger and stronger, and there is no force that can stop the development of Bitcoin. This is the power of technology and mathematics, allowing mankind to re-establish a fairer, free, and equal world currency system based on technology.

Over the years the fiat currency experienced lots of drawbacks and the primary setback is the issue of trust and security of database. And the blockchain industry with the innovation of bitcoin has helped in tackling this issue. The consensus found in fiat currency has been altered severally to suit the personal interest of it's major stakeholders but the interesting thing is bitcoin can't be altered due to it's highly level of how it operates anonymously.

This consensus alogrithim which the blockchain technology shares will some day call for global adoption although some countries has it as a legal tender while some are still fighting against it but I'm sure at the later end it will be globally accepted

Currency must be a symbol of the credit system. It can become a symbol of the credit system. It can be derived from its own use value and physical properties (such as cigarettes and gold), or it may be derived from artificial regulations (such as paper money).

Currency is essentially a social mechanism constructed by humans, which provides a solution to the problem of lack of trust. This mechanism includes at least three factors: money of account, transferable credit, tokens and bookkeeping system

I will just add basically the point of the currency is that it is acceptable to everyone, so we can use it flexibly. on the other hand, there must be approval from the government so that all people must be able to comply.

And Bitcoin education that focuses less on the technology and more on the application. Just like now, if you go to get an Internet education for adults or older people, it doesn't even talk about html or www or http anymore it just talks about how to use it, and how to stay safe, etc.

Bitcoin education needs to follow this style. Act like it's doing mass adoption, not like it's still a nerd's den for tech:)

How do we define the weak and the poor? In fact, in my opinion, people who are really poor are people who are poor in thinking. Everyone’s wealth is tied to everyone’s own cognitive level. The more a person loves to learn and always improves his thinking, the higher his level of cognition, the more wealth he can obtain. On the contrary, if a person does not like to think and learns actively, it is very difficult for him to obtain huge wealth. The same principle applies to Bitcoin. Only those who have a deep understanding of Bitcoin can obtain huge wealth through Bitcoin. People who don't understand the nature of Bitcoin will only oppose and complain about Bitcoin.

The essence of money is value it.
The currency is considered to be the main exercise of three functions: value scale, exchange medium, value storage. Now people think that the core of the currency is trust. Since trust, it slowly formed a consensus.

One of the properties of bitcoin that is very likely to be a currency for the future, because bitcoin can not be counterfeited like fiat currency basically, if a currency can be counterfeited then the supply will increase which can cause a decrease in price, just like bitcoin, bitcoin runs in technology blockchain and blockchain systems are certainly hack-resistant as every transaction has to be verified by the miners.

It wasn't boring for those who are willing and eager to learn for something that was a more helpful and valuable asset in the crypto space. As it was simplified and teaches the nature of Bitcoin, the more it becomes interesting. I know for sure that the plan will succeed, it certainly gains major support from the community like this it helps not only to spread awareness and knowledge to the people around but also it diversify the negative thinking that most people have lived for many years in doubts.

Yes, it is really complicated for novices to operate. This is a completely new monetary system that is completely different from the existing financial system. Need to use and adapt to brand new software. In the future, when I start my Rainbow City project, an important module is Bitcoin education. I will create the simplest learning course suitable for novices on the basis of the existing bitcointalk. This process may be very boring, but I think it is very valuable. Thanks again to every old member of the forum who selflessly helped newcomers.

Yeah, that was my point. I know it's getting easier and easier, but I honestly have to admit it wasn't straightforward at first, and it's almost guaranteed you'll make a mistake in your first few attempts at using Bitcoin, and I consider myself a little bit more educated than average and still I've made mistakes (wrong fee, wrong coin, wrong change address etc. Like you said, the most basic step, private keys, is even missing from most newbies.

Bitcoin still has to find a way somehow to be even friendlier to use.

Why the fuck would you beg someone for accepting your idea, if they aren't getting what you said then leave them rather than begging them.
People like you are a disgrace to humanity who would prefer begging.

To op - Currency represents the value of a country in the world economy.

a medium of exchange can be anything. .. giving vodka to a friend for helping you mend a car.
a currency is more broader. within a community or nation.

a fiat currency is a government currency set by policy and law

as for the value. its not just a community consensus.
EG a rich person values currency differently than a poor person based on value and values.

but the underlying bottomline value normally has some bases on how much it cost to obtain and how much effort cost to pass on.

you can spot differences in values. in fiat.
take the policy law value.. minimum wage. where government in america thought $7.50 was worth 1 hours labour.
but the nation of america think $15 is worth an hour.

as for bitcoin.
in chaina/iceland. they feel thats ~$25k is worth 1 btc. however in germany. its more like $50k
this is why you see different area's have different values(philosophy) china will always mine cheap and value is less and always profit. so always mine. so when price is $45k they see it as OVER VALUE
where as germany cant afford to mine it so will see that when the price right now is below $50k will see btc as great value to buy.

unlike fiat currency with a stable price bitcoin fluctuates and is regarded as an unstable asset using an unstable asset as a literal currency just like fiat will bring up issues of unsatisfied transactions leaving some in profit and others in losses. it would be more preferred if bitcoin is considered more as a store of value more of an investment option just like gold. referring to it instead as a digital asset will make more sense other than a legal tender not minding its decentralized.

basically currency to make it easier to value an item, and this is on the basis of control from the government, but the problem is that printing money that is carried out continuously will reduce the value of the money, so that inflation cannot be avoided. indeed this is more advantageous to the rich because they can control the vital objects that

Currency is a unit of labor and commodity value. It is recognized by the community and has the value of being converted into goods and labor. The current printing of money is an abuse because the government prints it continuously. So money inflation over time and becomes more. That benefits the rich, the poor are brutally exploited as soon as the money is in their wallets.
Bitcoin creates and fulfills community expectations with its security, scarcity, and speed of transactions. Bitcoin is truly the future of money.

Bitcoin operation is indeed not very easy for novices. They are fundamentally different from the original bank payment operation methods, especially the most basic security measures such as the preservation of private keys. Quite a lot of novices eventually lost their bitcoins due to improperly kept private keys. This is a huge lesson for each of us. Bitcointalk has done a great job in the basic popularization of Bitcoin.

It really isn't. For me and for you, it's easy but you can't argue that it's easier than fiat and fintech apps.

And I do love Bitcoin so it's not like I'm attacking it but when I first came to use it 4/5 years ago, the apps weren't great if you want your own open source wallet which was non custodial. It's better today but it's still not as easy and friendly to use as other fintech apps but that's a problem we may not be able to solve if you still want people to set their own fees, have their own coin control, have multiple spend, etc.

It's also an attitude that we have to change a little. Instead of saying to people boy, go stick to mutual funds and shit, I think we can also look inward and make things for the mainstream.

We keep saying mainstream adoption right? So  shouldn't we act it also?

Bitcoin is more suitable for people with independent thinking and continuous learning ability. Not suitable for those who just wait for others to feed. Bitcoin is a brand new thing, only 12 years old. In my opinion, it brings together the best knowledge of various human subjects. This puts forward very high learning requirements for each of us. If we cannot maintain high-intensity learning of Bitcoin, we will not be able to keep up with the pace of development of Bitcoin and will eventually be eliminated by the times.

The essence of the base currency is an organic means of payment, circulated as an exchange of value for goods, if fiat is an absolute consensus on value and generates inflation, then bitcoin has a  relative value. It even transcends the very nature of money - An identifiable asset. That is also the reason that the current legal currency(fiat) is losing economic and social efficiency.

Bitcoin is pretty easy to use. I mean at least as easy as it comes in the crypto world. The usage issue is being solved with the Lightning Network pretty well I'd say. There is almost >2k BTC on LN now. So, the usage is definitely growing and it is more a matter of regulatory convenience now rather than technical convenience.

Same for the Fiat ramps. It is mostly about what regulation will allow which will determine how "adoption" grows. There is another way of looking at it though. Even without much regulation, Bitcoin has done well. People who take the time and effort, eventually find ways. Maybe it is better than bitcoin is for self-starters, rather than for those who need to have their hands held all the time to decide whats good for them financially. Most of those people should probably then just stick to Mutual Funds and shit.

I also talked about this recently in arguing that Bitcoin needs to be easier and more convenient to use for it to truly gain mass adoption. And I'm not just talking about "having" Bitcoin or investing as majority of people who say they do actually just keep it on exchanges or worse, have something on Paypal or similar that isn't even really BTC.

Underlying infrastructure and all that yes, but the interface on top also needs to be very good. And the "fiat ramps" as they say.

Wouldn't it still depend on how much "convenience" Bitcoin could actually provide and whether said convenience is, well, actually convenience to the party using it? Like take, for example, Bitcoin's ability to transact worldwide without borders and problems and whatnot compared to actually using fiat from one country to another, who says that said problem wouldn't be addressed in the future right? The only real way imo for Bitcoin to actually be the main currency to be used is if Fiat was complete. I hardly think that people would suddenly turn to Bitcoin just because others said its good, when in their current situation, Bitcoin and fiat pretty much does the same thing that they always need it to do.

Yes, your supplement is great. Currency is a tool to measure the value of an object and/or to measure the value of human labor. Human beings pay their own labor at work, and at the same time obtain their own remuneration in the form of currency. These remunerations are a judgment of labor. It can also be said to be the value created by our individual. In this case, currency is equivalent to value. However, this kind of value judgment standard needs more people's recognition and endows the power of consensus. At present, this recognition is based on the sovereign credit of the government. Bitcoin creates credit based on technology and algorithms.

All the things that you and the forum members stated are right.
The only which I can add is that currency is a tool to measure the value of an object and/or to measure the value of human labor.The labor theory of value states that the value of most goods is basically the value of the labor,which was used to produce those goods.This theory was abandoned,since labor isn't the only component of value.Scarcity and utility are other components of value.
Technology and innovation can create utility and therefore,it can create value.
Technology can also create scarcity.Bitcoin is scarce and useful,therefore it has value.

Yes, legal currency is now very convenient to use, and it is still the mainstream of social use. But when Bitcoin was born, a whole new choice was given to the people. People can use Bitcoin freely without control. This kind of consensus idea is constantly spreading. As the underlying infrastructure of the Bitcoin ecosystem gets better and better, the consensus of Bitcoin will become stronger and stronger, and the use of Bitcoin will become higher and higher.

Agree and it is clear that bitcoin has all of these properties.

This has been the feature of currencies in the modern nation states. This is also in fact the only underlying "merit" for these currencies. They existed because the governments have the ability to exercise power. In the words of Must himself, "Government is just a corporation with a monopoly on violence".

This is the beauty of Bitcoin. Where the currencies issued by governments and influenced by the rich and powerful need violence to be able to render the first 4 services, Bitcoin needs no figurehead, no central authority, and most incredibly, no violence to accomplish the same.

Anybody who cares about the individual and society will be quick to realize that this is a superpower of bitcoin and bitcoin itself. None of the other so-called energy efficient, corporate coins can even come close to it.

This should well be a post unto itself Kimberl. I don't think its even connected to what the OP wrote or anybody else commented. It is a worthwhile line of exploration though. Would you be kind enough to make a separate, detailed post on this? I'd be happy to merit it. PM me if you do otherwise it may get lost.

And there seems to be quite a few economically and philosophically inclined posters coming up in the last few weeks. A happy development. Lets all keep it up. Always good to learn from the different people.

Given that Bitcoin is created as a reaction to the failure of the government and the central banks to value the trust that the people give to them, it is truly representing the welfare of the people. But since we are talking about consensus, Bitcoin would still be dependent on whether the people would choose to use it or not. Unlike fiat, it is not to be imposed upon anyone. And even if Bitcoin is a fair currency, if the people wouldn't use it because it is still convenient to use fiat, then it will remain simply as an alternative.

There are five risks in the use of Bitcoin:

(1) Policy risks. The decentralized nature of Bitcoin may threaten the traditional monetary system, affect the government's macro-control capabilities and reduce fiscal revenue;

(2) Legal risks. At present, Bitcoin is only protected by the laws of various countries as a virtual commodity rather than a currency;

(3) Speculation risk. Bitcoin does not have national credit or physical assets as protection, and the price may fluctuate sharply, which is extremely risky for investors;

(4) Money laundering risk. Bitcoin has the characteristics of anonymity and freedom from geographical restrictions. It is difficult to monitor the flow of funds, and it will be very easy to circumvent government supervision;

(5) Substitution risk. Bitcoin still has defects such as lack of credit guarantee, poor security performance and easy to cause deflation. At the same time, it has to face the competition of various emerging altcoins, and there is a greater risk of substitution.

Bitcoin has already achieved consensus. It's users are in agreement that the POW-based technology has its use case and can be utilized to transfer value from point A to point B. As the time goes by, this agreement between people will either increase or decrease based on whether or not a new and better payment system will be created in the future. What the government thinks about the consensus that was reached between Bitcoin enthusiasts doesn't really matter. If people come to an agreement that Britney Spears posters can be used in exchange for goods and services, a government agency doesn't have a say in that matter.     

I don't think Bitcoin will ever become the ultimate replacement asset for fiat currencies. At least not one that will be private and help people to not pay taxes. But I do believe that the two worlds can coexist and affect each other in a way to iron out their flaws and shortcomings.

In the future, state institutions will certainly exist, but the issuance of currency will no longer be monopolized by the state. No state agency is willing to give up its coinage rights and monopoly profits. But when Bitcoin was born, everything changed. Bitcoin gives ordinary people another choice, to own Bitcoin and abandon legal tender. In this way, you can truly protect your own assets and allow your assets to appreciate. This trend has now taken shape and is unstoppable.

Do you think that since Bitcoin can be issued without a central bank, cryptocurrency can bypass the state, replace the current legal currency, and achieve denationalization.

This kind of anarchist ideology should have been with mankind since ancient times, but I am sorry that this idea has never been realized in the past few thousand years.

Will it happen in the future? It is necessary to ask whether the country agrees or not.

The lesson of history is that thousands of years ago, when countries began to emerge, they began to monopolize coinage rights. Why? Because coinage itself is not for trading, but for taxation and effective governance.

Therefore, if you want to denationalize currency, you have to deprive the country of its coinage and currency issuance rights. Sorry, you are asking the country’s lifeblood. You have to ask the country whether it agrees or not.

So do you think the country will agree?

There is another question, can you really live in a world without a country?

My answer is that it is not clear what will happen after 100 years, but the country will definitely be there as long as you are alive.

Yes, the current legal tender system, as you said, does not represent the interests of the majority of people, but is controlled by the minority. This is what I have emphasized in the previous article. The current world currency system is the most unreasonable 50 years in the history of human civilization. Therefore, in the end Bitcoin appeared, and Bitcoin represented the interests of the vast majority of the people. As Bitcoin's global consensus becomes stronger and stronger, more and more people will choose Bitcoin and abandon legal currency.

1.The essence of currency is a value anchor. When you pay labor or produce something, the market will naturally give you a price corresponding to your payment (value manifestation)

2.The essence of currency is liquidity. For legal currency, it is done by the bank. His transmission medium is commodity circulation and capital circulation.

3.The essence of currency is credit, which is more effective for world currencies or super-sovereign currencies mentioned in forums.

4.
5.I may also say that the essence of currency is rights. Whoever has a strong fist, whose weapon is advanced, whose technology is advanced, whose country is powerful, is what he says, and everyone must abide by it.

I beg to disagree that the nature or essence of currency is consensus, at least not until Bitcoin came. It may be so in a small and primitive community but it cannot be in an advanced and large society.

The fiat currency is made up of a lot of policies, decisions, changes, impositions, etc which are not out of consensus. Of course it could be argued that it is hard to gather the opinions and ideas of everybody and that the very reason why there is a government is that it would act and decide on behalf of the larger population.

However, this is not really the case about fiat. The decisions of the few persons who decide about the direction of the currency are not really reflective of the people's voices and sentiment. So everything is merely imposed on the citizenry whether they like or not.

I have talked about the nature of value---consensus given by the public. Value is invisible and intangible, yet it actually exists. Value is undifferentiated or abstract human labor condensed in commodities. Such human labor is factually endowed by collective consensus.


About how consensus of human society is formed, some by violence, some by negotiation, some by legal agreement and some by multi-party cooperation.Since Bitcoin was born, mankind got a new way of reaching consensus, that is, technology. This is an innovation based on human civilization.


In the human society before, the formation of consensus was achieved one after another by historical evolution, which took a long time, and value was gradually manifested. However, when Bitcoin emerged, the generation of value is realized by consensus mechanism at the technical level. On the foundation of that, let's look at the nature of currency.

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Bitcoin, in many occasions, is deemed as a currency, which I believe will inevitably become a super-sovereign currency and world currency supporting the entire human civilization. So, what is the nature of currency? Why can Bitcoin become a currency?


Currency is the greatest invention during the economic progress in human society. It rump up the effectiveness and efficiency of economic behavior, leading human society from barbaric to civilized. From an economic point of view, currency is a contract between the owner and the market regarding the right of exchange. Essentially, it is an agreement between swappers, reflecting the cooperative relationship between different individuals in society. Currency is also a consensus mechanism in effect.


Shells are the first to function as currency. Because at the beginning some people felt shells suitable, so they told others about it. When that's accepted by more and more people, a consensus was reached. Later, copper coins took the place of shell and then replaced by gold and silver. Next, it's legal tender's turn. Seeing the weakness of legal tender, humans started to place hope on Bitcoin. Satoshi Nakamoto reestablished the consensus of human society on currency by technology.


In economic behavior, currency acts as a transaction intermediary, which is endowed with value by consensus. Much of the time, value is not objective since whether a thing is of value depends purely on the public. The same is true for Bitcoin nowadays: Bitcoin is becoming a world currency because it's recognized by increasing number of people globally.


People discovered the underlying technology of Bitcoin and approved it. They also recognized Bitcoin's status as gold in digital world. Bitcoin's global consensus is expanding:

• firstly, consensus is reached among Bitcoin believers,
• and then step by step this consensus penetrates different countries and central banks,
• and finally it'll be accepted by everyone.

Now you'll find that the essence of currency is still consensus, and its value is given by consensus as well. The collective consensus will gradually render Bitcoin a world currency. No one can resist this trend but adapt to it.