Organized violence (complicity of priests and militant chieftains - aka patriarchy and state) was established 10'000 years ago. That startet collectivism, market, money etc. and ended the anarchy, the self-sufficiency of mankind.

Precisely. What makes bitcoin so much more valuable is the fact that merchants trust them enough to accept them, and more importantly that there is already a big market for them on (trusted) exchanges. My point is that the value of bitcoin comes mostly from the trust that people have in the market. Not so much its intrinsic properties (or the various alt-coins would be of equal value).

First-mover status. 99.9% of the merchants which accept cryptocurrency will take bitcoins and not alt-coins. The public do not want to see dozens of alt-coins which are a confusing duplication. So, basically, the alt-coins are not recognized as currency outside the cryptographic community.

No, money originates from organized violence. Organized violence (state and church, militarism and patriarchal religion) indebted the people with a tax. This started the economy, the market and the money, which is a derivative of owed taxes. No state - no market - no collectivism and instead of it we find the self-sufficient communities. These are the historic facts. A barter economy beyond the state (organized violence) is Science Fiction. In the rainforest, where organized violence (state and church) is absent, you won't find a market/economy. You'll find self-sufficient communities beyond any business.

So government owes money to FED, and FED belongs to government, so the government owes money to himself. If the government owes large amount of the national debt to himself, who cares  

Again, if you loan something that does not exist and do not belong to you to someone else, that is fraud

This has nothing to do with the sequence: After the loan, there is money, and there is ownership, who get this ownership and what did they pay for it?

Don't think in the way of loan, that just make it more difficult to see the simple truth. Loan is just a way to exchange the ownership, it does not CREATE the ownership, if some ownership were created out of nothing after a loan process, something must went wrong

To create ownership for something, either you create it by work(plant a flower/dig out the gold), or you rob it (conquer a country). Never heard about that you can get the ownership of something by loan it  

If you have one ounce of gold, you can issue a note that worth one ounce of gold, and that note get a transaction value of one ounce of gold (backed by your gold reserve). No loan involved here. Same, the government can issue notes that worth their corresponding asset without using any loan process. But unfortunately, they don't have this right today, both of the presidents who ever tried to issue government money have been assassinated
http://www.michaeljournal.org/lincolnkennedy.htm

That's true, by this means, government will not have a debt, their net asset value is positive

But that's begging the question: what makes people willing to exchange something valuable for bitcoins? Answer: the trust that they can trade the bitcoins for debt on exchanges, and that the exchanges are capable of paying said debt.

As the Graeber book explains, the product matching problem only exists in an economist's imagination. A much better explanation for why money was developed is that it solves the problem of a state procuring supplies for its army. It works like this: if a state has an army, it also needs to feed and clothe that army. Without a currency, it would require an additional army just to procure the food and clothes for the first army. To solve this problem, the King issues coins to its soldiers, and then mandates that every peasant pays one coin back to the King as a tax. Through such a coinage, the King has created the workforce needed to supply food and clothes for his Army.

That is not really true. The price of bitcoin is backed by the trust in exchange debt. Here's how: I wire transfer MtGox $100 to buy a bitcoin. Now MtGox is in debt to me for $100. I use that $100 USD to buy 1 BTC (which means now someone else is trusting mtgox to hold $100 USD for them). Now I'm trusting mtgox to hold 1 BTC for me (and MtGox is in debt of 1 BTC to me). Now I can withdraw this 1 BTC, and mtgox is no longer in debt to me. But MtGox is still in debt for $100 to someone else, and MtGox will remain in debt as long they have customers.

Now, you could have bitcoins that are in no way backed by debt. But in order to do so, you have to go back to when bitcoins were nothing more than worthless digital blips in a piece of p2p software: blips without a price, blips without value. The only thing that gives bitcoins real-money value is the trust that people have in exchanges to pay back held debt.

You are putting the cart before the horse.

Money is a product substitute to make commerce easier.

Those immovable stones enabled single product transactions by representing a product on one side of the exchange.

With many food products it is rare to find a buyer with the exact item the seller needs. That is why the concept of money developed - to resolve the product matching problem.

Let us imagine three owners A, B, and C of commodities x, y, and z, respectively, of whom A wants y, B wants z, and C wants x. Direct exchange cannot give those three owners their desired commodities, none of which belongs to whom (x to B) wants the commodity owned by whom (z by C) wants it (wants x).

Debt was originally one of labor, for example, where a tenant performed farm-work in exchange for accommodation and food. Only later did it become monetary. A 30-year mortgage is effectively monetizing 30-years of future labor.

Debt does not require money, but it can be monetized and represented by currency.

Bitcoin is a currency which has no debt component. It is in no way debt backed.

A fundamental of economics is that only products can buy products (labor, goods, raw materials).

A debt is simply a promise of future product delivery.

Money is a place-holder, it facilitates exchange of products by temporarily replacing one product in a transaction. It makes commerce far more efficient because barter relies upon two products in a transaction, whereas money allows for just one. Money needs to be a store of value for future use.

Currency is a structured form of money to make storage, accounting and exchange easier. Government debt can be declared to be fiat currency by government diktat. Bitcoin is a revolutionary currency as it comes with an inbuilt payments system, scarcity, and supports long-distance transactions.

Gold makes good money, as it can't be counterfeited, and might seem intrinsically valuable. However, a kilo of gold can be worth less than a litre of water. It all depends upon the price (desirability) of a product as how much money is needed in a transaction, so products can be arbitrarily expensive...

Now we just need a unit of measure by which to denominate the "debt" and a way to account for past and future debt that is impervious to manipulation.

I think Bitcoin will work well, those who don't have it are indebted to those who have it, problem solved.

And while we are at it let's take an honest look at "Debt" an asset a risk to the lender and a liability to the borrower.

I have seen this video before, the fact that there are so many different versions about how FED works just proved that no one really understand how it works

The most simple way is to look at the ownership of the newly created money

If you don't have the ownership of some money, how can you loan those money to someone else?

That would be crime. I can lend you all the money in the FED if I don't need to have the ownership of those money  

Let's do a step by step analysis: When government sell $1 billion asset (bond, since debt=asset in the future) to FED, FED must first have the ownership of that $1 billion money, then government get the ownership of those money from FED, in exchange they transfer the ownership of their bond to FED. Now the FED owns the bond, means they become the creditor of the government

If government issue money by themselves, they would issue $1 billion money backed by their $1 billion worth of assets (bond).

But there is a HUGE difference here: They would have BOTH the ownership of the issued money and the ownership of their asset. They spend money to exchange for some products/services, and if someone come back to redeem the money, they give them asset

So, if FED belongs to government, then it does not matter who have the ownership of those bonds, government will own those bonds anyway. But if it is really so, how come they could have that huge amount of national debt owed to FED?

one word: Petro-Dollar 

At any given specific time, the money in circulation is always the same, but if you add all those income and spending together through a year, it will be a large number, but that large number only tells how many times the money has been turned over

Spend the same money 10 times won't make people 10 times more rich, just make them 10 times more busy

The root of this question: Does government own FED?

If they do, then money created by FED is backed by government's own bond, no questions

But this has been discussed many times, FED is a private organization and the ownership of the FED lies in a group of regional reserve banks, and none of them belong to the government. They have 3 mandate from the congress: Maximum employment, stable prices, and moderate long-term interest rates. As long as they can achieve this, government have no more control over their decision. They can claim the ownership of the whole country (by printing money) while achieve these 3 goals

http://theunjustmedia.com/Banking%20&%20Federal%20Reserve/The%20Federal%20Reserve%20is%20Privately%20owned.htm

There are many human desire, consumable things and services are just part of them, the demand for accumulating a large amount of saving so that people can retire early is also very real for everyone. Historically recessions happened not because people had less consumable goods, most often it is because that people had produced too much consumable goods but without corresponding consumption (lacking of money)

Actually the demand for money is always the highest due to money's universal equivalence property. You might get bored by eating same bread or watching the same lawn in your backyard, but you never get bored by getting more money. That's the reason money usually hold its value very well even people know that it costs almost nothing to make. As long as other people accept, no questions

Then, since accumulating money itself is a demand, it is important to know what kind of money you will get. You would like to get deflative money instead of inflative money, a money with a production cost instead of a money without a production cost

Gold/silver is more valuable than paper money because even the payment function is totally removed, they can still be used to produce luxuries and tools, and they bear a production cost, which is the fundamental support for their price

it's just a matter of definition, really.

At the end of our day, we trade our work. I mow the lawn for you, so you owe me a favor in return.

How we do this bookkeeping and keep this information reliable is a question of the available toolset.

Gold/Silver coins are just tools to store and transport the information of value, as are ledgers or tally sticks.

We now live in the information age, so tools like time banking or Bitcoin make sense.

All tools have certain advantages and disadvantages, which mostly revolve around the issue of trust.

Gold/Silver coins don't corrode and you don't have to trust a government, that's why some people like them, that's why they make good tools. But they're still tools. They only carry the information of value, they are not the original value itself (of me having mowed the lawn). They underlie external risk, as they can inflate/deflate in value (imagine massive population decrease for example).

Monetary value is a very vague term, same thing can have different monetary value if the money's value changed.

From money creator's view, money is not a debt but an asset, just like gold mined by the miners, and paper notes created by the FED. FED created money, money becomes their asset, and they lend this money to government, they receive government bonds in exchange

Banks always try to disguise the truth with FRB, in fact FRB has nothing to do with money supply, it is just an accounting term (checkbook money), it is the same money deposited again and again and be counted again and again (M1). FRB created lots of fictive deposits that in fact does not exist

FRB won't affect the money's value. The money's value is decided by the value that backed it when the money is issued. So in principle the money's value is still stable even after QE, since all the new money issued by FED are based on the value of assets they hold, and those assets were all valued at a stable price

Someday when those assets get consumed or discarded, then the corresponding issued money will lose their value, that is inflation. Since money almost never get consumed but the underlying assets do, the inflation is a constant pressure, it means the goods for trade must be continuously produced to counter this effect

Graeber is right. Debt is the only real money. All other goods are assets and valued in debt.

With many securities, and money, the ideal value is fixed.
A $10 dollar note is worth a fixed amount of $10 dollars, if it is redeemed.
What changes is peoples' trust that the security will be redeemed for that fixed value.
As the risk of default increases, the value people are prepared to pay decreases, and that is because they have less trust in the issuer than they did before.
You can see this with company bonds and government debts, they each trade a different discount to face value, because of the different level of trust people have that they will be redeemed, and not defaulted on.
Trust (risk of default) determines the price that a fixed-value asset trades at.