Bitcoin Forum

Let's face it..As long as we continue to benchmark bitcoin against fiat, we can never reach that stage to independently claim "1 bitcoin is equal to 1 bitcoin" and that is no matter how hard you tried to convince people. Mainly this is what I feel is lacking and what I envision for bitcoin to become a currency of its own.

So here's my thought.

For an Individual's perspective
A person earns his wages in bitcoin (we are there)
A person can spend his earning to fulfill all his daily needs which means he/she can buy anything, and I mean anything with bitcoin (Something we are lacking because not all goods and services accept bitcoin)
If we have goods priced only in bitcoin and accept no fiat for it (that would be the best, but I see this lacking)
At the end of the month, refills back his spending power from his monthly wages paid in bitcoin
A portion of his earning, not spent is kept in the wallet and HOARDED...and yes, hoard all you want

For a business entity
Make available products priced in bitcoin
Accounting ledger and reported earnings all done in bitcoin
Pays workers' wages in bitcoin

So what I'm trying to say here is that as long those two infrastructure or components are there, we are basically on our own enclosed ecosystem

What prevents bitcoin from taking off is basically:
#1 : The spending part where we can't buy all the things we want using bitcoin
#2 : Lack on the number of company/business entity which is bitcoin oriented

Basically we are telling people to spend. But the actual fact or scenario is that we can spend but at the same time, we need to buy back to cover the amount spent or else it will just be a net drain of fund which leads to nothing for bitcoin. However, if we manage to establish the ecosystem here, we are basically on our own. Free from fiat and that is when 1 bitcoin is equal to 1 bitcoin..

But bitcoin is very likely always going to be pegged to fiat. We currently need to be able to buy it with fiat so it is always going to have a fiat value. Remember even the exchange rates for buying other fiats fluctuate daily so the best I think we can hope for is a future with some stabilization.

How do you know the purchasing power of 1 BTC if we don't compare it to anything else?

How do you knwo if you can buy 1 hamburger or 1 mansion with it?

Wrong statement in case of doublespending attack.

You are confusing bitcoins with fiat. Contrary to euros and dollars, bitcoins cannot be counterfeited or doublespent - in fact, Bitcoin is the solution to these problems.

the purchasing power is measured something like this.

In 2015.... 900 btc to buy a house
In 2020.... given the same economic condition, only needs 700 btc to purchase same house on the same location

That means higher purchasing power for 1 unit of bitcoin

why do you need fiat? Isn't that what bitcoin existence is all about?
As long as the age old system is there, we'll forever be bound by fiat

We should peg Bitcoin against Gold. If volatility lets us one bitcoin will become one bitcoin in time.

Thiss. Fiats may come and go, but I dont think Gold will go away anytime soon.

When 1 bitcoin is equal to 1 bitcoin, central banks' fiat failed as an experiment and people finally got to the point of using real money like gold and silver, and bitcoin or [insert favorite alt]

Bitcoin will always represent a value. Could be fixed worldwide on the 'living standard'. So let's say for example a big mac wil cost the same amount of BTC here as it does anywhere else. Not like now where when compared prices of the same asset vary a lot. We could set the BTC fixed on a modal months salary.

How do you know the purchasing power of 1 dollar if we don't compare it to anything else?

Bitcoin can be doublespent if it is unconfirmed or if one entity holds 51% of the mining power and decides to execute an attack. It is relatively difficult unless you have a lot of money. It is quite hard to counterfeit money since there are security features which is hard to counterfeit too.

If you want Bitcoin to be a world currency then there should be an exchange rate. What you're saying is similar to saying you want the euro to be isolated and not traded for other currencies. That's not going to happen anytime soon. Bitcoin is a currency without a country so there is no economy built around it. Currently, it's impossible to say what a loaf of bread is worth in bitcoins without exchanging it to a regional currency first.

I get what you're trying to say. I mean every once in a while some news would report bitcoin's fluctuations in the red and people would be panicking and selling. They think bitcoin's value is dropping. But then most people confuse value with price. Bitcoin's value never changes... because you can't change what bitcoin is, a means of decentralized currency. But what's chaining bitcoin's price on the other hand is fiat, which we have grown accustomed to comparing bitcoin's price with. Sad. Wonder if anyone comprehends my gibberish?

Bitcoin will always fluctuate in value against other currencies, stocks or commodities.

Therefore you must define the value of a bitcoin. A life standard month income, or even a loaf of bread, fix the price of thos assets to 1 BTC and do the math for the other stuff. Still assets will vary, supply and demand still applies and local differences may still occur.

The Euro made paying and prices in Europe more the same, local differences still occur, but they are more on the same level. As the Euro showed in Europe, the BTC might just work worldwide :)

I always have had a similar idea. Maybe a store that offers the products with a fixed BTC price. If the BTC/USD value changes too much, it could be adjusted accordingly, but preferably not more than every week.

I don't know whether this would work, I don't have a store (online or physical), so that will be just an idea for now.

I think the bolded is actually a very good point. All currencies usually have entire countries behind them and bitcoin is tiny compared, not to mention being a revolutionary and experimental new concept. Bitcoin is going to be wild and unpredictable but just think of the possibilities if we could get an economy growing and what would happen if it becomes a bonefide worldwide currency.

I know it because its manipulated to have X price.

In which units is the “X price” represented?

BTC could work worldwide but bitcoin businesses need to recruit and pay in btc.

Bitcoin's territory is the internet, rather than just a country. I'd say there's quite some economy going around on the internet.

Actually, no, it can't. Not in practical real-life situations. Try it, you'll see.

Extremely, extremely unlikely, and it's very difficult and VERY expensive, and by doing so (IF someone would actually manage to pull this off) they would actually undermine their own business as Bitcoin prices would probably plummet.

It's all just theory. And while in theory there's no difference between theory and practice, in practice there is.

Therein lies the rub.

https://i.imgur.com/TxLanOP.jpgl

If it ever was stable, speculators would leave, but if speculators dump then it wouldn't be stable, so they wouldn't leave, but if it isn't stable, you can't price things in a static bitcoin price, so there can't be wide adoption with people holding, and on and on...

ROFL. Bitcoin makes fiat obsolete, it's just going to take X number of years for earthlings to figure that shit out.

The euro was created because a single currency offers many advantages and benefits over the previous situation where each Member State had its own currency. Not only are fluctuation risks and exchange costs eliminated and the single market strengthened, but the euro also means closer co-operation among Member States for a stable currency and economy to the benefit of us all.

Having said that, it doesn't mean that euro needs to be isolated from the rest of the world. Likewise, bitcoin can establish its own niche and exists within its own ecosystem and still traded on the exchange. We substitute country with community/internet/network here. The economy surrounding bitcoin is basically the mining operation. Yeah, we don't have tax, industry to turn raw material into goods, but if you compare the mining concept, its pretty much close to that. If you ask me a question how much a loaf of bread is worth, I should answer 5mtbc (for example) not $1.2 dollar of btc worth.

that is a proces we all need to go throuhg and accept en addapt bitcoin as our daily currency. Same goes for the Euro, in the first years people were all calculating and comparing how much it was in the old currency. Today it is accepted as it is and only on rare occasions would you think back to what the price would be in the old currency, mainly because of inflation it has dropped back to it's old value :P

idiot! every currency is linked to every other currency. 1 btc IS worth 1 btc, but is will never be worth 1usd or 1gpd or 1ruple etc but 1usd is worth 1usd etc, cant you see the stupidity of your comment now?

You obviously didn't understand the point of the original post.

1 EURO is 1 EURO because it is inflationary. (In theory, Currency is stable, Product prices fluctuates).
1 BTC will never be 1 BTC because it is deflationary. (In theory, Products are stable, Currency price fluctuates).
(Products can never be stable, since supply and demand for those products fluctuates).

But, 1 BTC will one day equal 1 BTC, when 1 BTC has been permanently fixed in price.
This can only happen when:
(1) BTC is the World Currency. (Gold, Oil, Fiat, and Etc all valued in BTC). Or
(2) BTC is permanently fixed to an inflationary currency. (Ex. EURO/USD/CNY).

So, to attain Satoshi Nakamotos original goal, we either use bitcoin as is, or we have to supersede all other fiat.

IMO, I consider BTC as a commodity, like Gold, even though it was intended as a currency.

Yep, this is correct. The purchasing power of the dollar isn't measured first against other currencies, but against a "basket of common goods". That's how the US determines it's inflation rate each year.

Purchasing power of bitcoin doesn't need to be in relation to fiat, in fact if it were it wouldn't indicate how much goods or services you could purchase with bitcoin, but rather how much of the fiat currency you could buy with bitcoin. And if both bitcoin and the fiat are declining purchasing power is disappearing but you wouldn't know it by the conversion rate.

bitcoin will need to have an economy of it's own, which will take a while to form, it will probably not happen this decade.

it will help if complete countries accept bitcoin as a currency, or if commodities like gold/oil are priced in bitcoin with prices that are independent of the dollar/bitcoin ratio.

and it also helps if there are some services or shops exclusively priced in bitcoin.

Bitcoin provides a way to look at currencies at a whole different level, if it serves an economy it would be a world wide one. As a commodity it works as a whole in itself, being it's own commodity to determine it's own value, that is te mining limit.