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Author Topic: The Bitcoin economy needs about $100,000 a day of new money  (Read 6212 times)
Cluster2k
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July 12, 2011, 11:09:20 AM
 #41

Central bank based economies get closer to complete crash every year. Bailouts get more expensive. National debts accelerate. Taxes increase. The whole system is going toward a global economy crash. Cryptocurrencies, being a new kind of money, are not automatically subject to all the same laws that are bringing down those systems, and have other advantages, so as the existing economies crash, cryptocurrencies are the only way out. Even if Bitcoin crashes to pennies per bitcoin, its still a good investment (if you buy at that time) for that reason. Its going to grow because its not subject to many of the flaws of the existing system.

Cryptocurrencies would crash right along with fiat currencies.  The Internet's infrastructure is not funded by bitcoins.  It's funded by the same fiat currencies that some people deride as being essentially worthless.  Until you can buy Cisco routers with bitcoins, pay your ISP bill in bitcoins, and pay the power bill in bitcoins, the cryptocurrency is very much subject to the same flaws in the system as fiat currency.

The only 'currencies' that would remain are those that have value as assets.  Metal, (iron, copper, gold, silver), food, medicine, alcohol, shelter, weapons.

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July 12, 2011, 11:36:55 AM
 #42

When "crashing" means "you cannot pay in USD anymore" you might be right. But in case of legal tender, a "crash" is more likely hyperinflation / rebooting the currency with a 1/1000 exchange rate (Romania, Turkey all did that in the last decade, Poland in 1995) and you can get around that pretty nicely with Bitcoins.

1YetiaXeuRzX9QJoQNUW84oX2EiXnHgp3 or http://payb.tc/yeti

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July 12, 2011, 11:59:17 AM
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The only 'currencies' that would remain are those that have value as assets.  Metal, (iron, copper, gold, silver), food, medicine, alcohol, shelter, weapons.


That's quite true, but remember that even metals and commodities  have big variances in their values over years: iron ore, for talking of something I know well, in 10 years prices grown steadly from 13 to 170$/ton (due to big requests from asian market), but steel pipes (made from ore and recycled steel) prices grow "only" of 200% in same time range (reaching a top of 400% then dropping down). When most of the steel products will be made from recycling steel the ore price will drops again.
All the commodities are subject to the market law of demand/offer and their value can be cleared by the discovery of new commodities or new technologies: just before the WW II where I live you have to exchange 5/10Kg of rice to obtain 1Kg of salt now 1Kg of salt worths some €cents (that make 1Kg of rice worth about 10/20Kg of salt admitted that someone wants to do a similar exchange). Even the gold, used as main commodities in a lot of places, has his price raise from 461.09$/oz in 1981 to 1526$/oz of today, but it reaching a low 260-290 in 2000-2001; if you had invested in gold in 1981 and try to use it in 2000 you find your value near halved.

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