Why not peg the Bitcoin to gold?

[bitbit]

Wouldn't a P2P-currency with a built-in peg to gold (e.g. a mechanism that checks the gold price and generates more coins when demand increases and subtracts them when demand decreases) be more stable than the speculation-driven Bitcoin?

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[Matthew N. Wright]

Wouldn't a P2P-currency with a built-in peg to gold (e.g. a mechanism that checks the gold price and generates more coins when demand increases and subtracts them when demand decreases) be more stable than the speculation-driven Bitcoin?

What'd be the point of that? Gold is also almost entirely speculation driven, less the parts that are *artificially* mandated by the governments (in other words, even worse than Bitcoin because the majority decides for Bitcoin whereas a single President can decide the price of Gold over his morning breakfast).

[Gabi]

Today is the day of the retarded ideas? 

[DeathAndTaxes]

Wouldn't a P2P-currency with a built-in peg to gold (e.g. a mechanism that checks the gold price and generates more coins when demand increases and subtracts them when demand decreases) be more stable than the speculation-driven Bitcoin?

Well Bitcoin isn't going to change.  It is a social contract.  The contract said nothing about price fixing against gold.  Still if you can figure out a way to do it in a decentralized manner then go ahead but I think you will find that is pretty tough.  Remember each node needs to deterministicly reach the same conclusion at the same time, always or you will introduce permanent forks.  That is a pretty massive problem to solve.

Making a gold back virtual currency which is centralized is trivially easy.  Spend a couple hours of thinking about it and you likely will realize it may be impossible to do it decentralized.

[empoweoqwj]

Wouldn't a P2P-currency with a built-in peg to gold (e.g. a mechanism that checks the gold price and generates more coins when demand increases and subtracts them when demand decreases) be more stable than the speculation-driven Bitcoin?

Love the idea of "subtracting" coins when demand decreases .... sure the coin owner would be delighted.

I think you posted this idea two days late.

[gtrslayer]

No need for gold. Bitcoin is pretty much the only self-balancing economic trading currency.

[ECore]

The price of gold and silver can be manipulated by the likes of JP Morgan.  They sell paper gold and paper silver that they do not have physically.  They just manipulate the prices in their favor and buy physical while selling paper.  Right now they are selling a load of paper and buying a load of physical.

[Gruu]

Bad idea; its best to just allow the worth of bitcoins to be based on the faith of the consumers & service providers - that's pretty much what any currency is based on. As someone already pointed out, gold is physical and therefore controllable by those who have it. They'd become like puppetmasters of the bitcoin market.

Edit: If you think about it, the silver that goes into making those high performance mining rigs kind-of already ties silver to the system via MINING, but since difficulty goes up over time that becomes less and less valuable.

[GoldBitco.in]

Always fun to compare BTC to gold.  That is the first comparison we drew.  And which is why we started offering a platform for trading BTC for gold and silver.

[JoelKatz]

Wouldn't a P2P-currency with a built-in peg to gold (e.g. a mechanism that checks the gold price and generates more coins when demand increases and subtracts them when demand decreases) be more stable than the speculation-driven Bitcoin?

I anxiously await your whitepaper.

[theta]

No need for gold. Bitcoin is pretty much the only self-balancing economic trading currency.

Self-balancing? How so?

[Keimoasd]

This is so fucked up idea on so many levels.

[dorei]

Wait until JPM and GS create an ETF form of BTC 

[goldNET]

https://gold.net/chart/metal/XAU/?encoded=ZGF0ZXM9MXI6aGJwdnJoYzBfaGY5d2h1MDBfdl9
https://gold.net/media/45788ca83bd355ba7715b0b3670f0316.png

The graph is just more food for thought on the topic but bitcoin gain nothing from pegging to gold. The more predictable bitcoin supply is advantageous.

[DannyHamilton]

Wouldn't a P2P-currency with a built-in peg to gold (e.g. a mechanism that checks the gold price and generates more coins when demand increases and subtracts them when demand decreases) be more stable than the speculation-driven Bitcoin?

I've got a better idea.  How about if we peg the gold to Bitcoin.  Pre-determine a gold/bitcoin exchange rate right now, and everyone with gold can agree to exchange gold at that exact rate from now on.  Why should gold increase or decrease in value if the intrinsic value of it's potential uses as a commodity doesn't significantly change?

[VishwaJay]

+1 to Danny Hamilton for that last comment. 'Nuff said.