Bitcoin Forum
October 23, 2017, 06:30:01 AM *
News: Latest stable version of Bitcoin Core: 0.15.0.1  [Torrent]. (New!)
 
   Home   Help Search Donate Login Register  
Pages: [1] 2 3 4 »  All
  Print  
Author Topic: If bitcoin becomes world's reserve currency?  (Read 2849 times)
cuddaloreappu
Hero Member
*****
Offline Offline

Activity: 616


View Profile
May 29, 2014, 07:42:42 AM
 #1

What if bitcoin (XBT) becomes the world's reserve currency and replaces the US dollar both as foreign exchange reserves and petro dollar..

Each and every country will fighting to buy bitcoins..

What will be the value of bitcoin then?
1508740201
Hero Member
*
Offline Offline

Posts: 1508740201

View Profile Personal Message (Offline)

Ignore
1508740201
Reply with quote  #2

1508740201
Report to moderator
1508740201
Hero Member
*
Offline Offline

Posts: 1508740201

View Profile Personal Message (Offline)

Ignore
1508740201
Reply with quote  #2

1508740201
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
1508740201
Hero Member
*
Offline Offline

Posts: 1508740201

View Profile Personal Message (Offline)

Ignore
1508740201
Reply with quote  #2

1508740201
Report to moderator
1508740201
Hero Member
*
Offline Offline

Posts: 1508740201

View Profile Personal Message (Offline)

Ignore
1508740201
Reply with quote  #2

1508740201
Report to moderator
Aswan
Legendary
*
Offline Offline

Activity: 1680



View Profile
May 29, 2014, 08:03:34 AM
 #2

If the bitcoin (BTC!) becomes the world reserve currency, then banks will long have adopted it. They will have scared people because of security issues when holding BTC by themselves and they will have made people deposit and transact via the banks, which in turn allows the banks to work with IOUs instead of actual BTC.
This will result in the ability to massively inflate said IOUs by just issuing more of them as debt which will have to be repaid (plus a little extra). For this to not get out of hand an institution will be appointed bitcoin reserve bank and it will be able to control the creation of said IOUs on a pace they like.
As a result, the rich will get richer and the poor will suffer.

The value of a bitcoin by then? A lot less than now because it has been massively inflated with trillions of bitcoin IOUs everyone is forced to accept as settlement of debt.
Pente
Hero Member
*****
Offline Offline

Activity: 491



View Profile WWW
May 29, 2014, 08:21:35 AM
 #3

If the bitcoin (BTC!) becomes the world reserve currency, then banks will long have adopted it. They will have scared people because of security issues when holding BTC by themselves and they will have made people deposit and transact via the banks, which in turn allows the banks to work with IOUs instead of actual BTC.
This will result in the ability to massively inflate said IOUs by just issuing more of them as debt which will have to be repaid (plus a little extra). For this to not get out of hand an institution will be appointed bitcoin reserve bank and it will be able to control the creation of said IOUs on a pace they like.
As a result, the rich will get richer and the poor will suffer.

The value of a bitcoin by then? A lot less than now because it has been massively inflated with trillions of bitcoin IOUs everyone is forced to accept as settlement of debt.

In that case, a bitcoin IOU won't be worth nearly as much as a real bitcoin. Do you remember gold backed US currency? It use to be a gold IOU.

bangalore
Full Member
***
Offline Offline

Activity: 144


View Profile
May 29, 2014, 08:29:19 AM
 #4

What if bitcoin (XBT) becomes the world's reserve currency and replaces the US dollar both as foreign exchange reserves and petro dollar..

Each and every country will fighting to buy bitcoins..

What will be the value of bitcoin then?
i think it can reach easily 10000$ then

Smiley
Aswan
Legendary
*
Offline Offline

Activity: 1680



View Profile
May 29, 2014, 08:37:48 AM
 #5

If the bitcoin (BTC!) becomes the world reserve currency, then banks will long have adopted it. They will have scared people because of security issues when holding BTC by themselves and they will have made people deposit and transact via the banks, which in turn allows the banks to work with IOUs instead of actual BTC.
This will result in the ability to massively inflate said IOUs by just issuing more of them as debt which will have to be repaid (plus a little extra). For this to not get out of hand an institution will be appointed bitcoin reserve bank and it will be able to control the creation of said IOUs on a pace they like.
As a result, the rich will get richer and the poor will suffer.

The value of a bitcoin by then? A lot less than now because it has been massively inflated with trillions of bitcoin IOUs everyone is forced to accept as settlement of debt.

In that case, a bitcoin IOU won't be worth nearly as much as a real bitcoin. Do you remember gold backed US currency? It use to be a gold IOU.

Thats how it should be in a free market, but even today a $1 note is worth the same as a virtual $1.
If you are forced to accept IOUs as settlement of debt, then it's worth the same as the real asset it's supposed to represent as people can just not pay up in actual BTC and settle the debt later on with IOUs.

An increased value of actual BTC could be the case if people predict the system to fail soon and want to get something they can use even after that happened, but that would take lots of time and by them bitcoin would probably have been replaced.

Personally I value real gold a lot higher than gold IOUs (which I think aren't worth anything as it's well known there not enough actual gold to pay up on them) but most people think it's basically the same as they are told it's backed etc.
Fortunately we are seeing a shift in that mentality. It's slow but it's there. However, if we let bitcoin IOUs become the norm regarding bitcoin payment processing, we won't get out of the system. And it's not like thats far away. it's been done for quite some time by Gox and it's highly likely there are others doing the same as we speak.
Why wouldn't someone print free money if he has the option to do so? This is a scary scenario, I know. But it is what can happen and it is what people will accept as a given if marketed correctly and there is no counter pressure.
We have to be extremely careful in that regard these days. We as early bitcoiners owe our children a system that is a lot less corrupt and a lot more enjoyable than todays system. We have done a great job with the basics, now it's out job to not lose the free currency we all came to love. It has been done once with the Internet, the free speech channel and it can be done again.
greenlion
Hero Member
*****
Offline Offline

Activity: 667


View Profile
May 29, 2014, 08:39:40 AM
 #6

If the bitcoin (BTC!) becomes the world reserve currency, then banks will long have adopted it. They will have scared people because of security issues when holding BTC by themselves and they will have made people deposit and transact via the banks, which in turn allows the banks to work with IOUs instead of actual BTC.
This will result in the ability to massively inflate said IOUs by just issuing more of them as debt which will have to be repaid (plus a little extra). For this to not get out of hand an institution will be appointed bitcoin reserve bank and it will be able to control the creation of said IOUs on a pace they like.
As a result, the rich will get richer and the poor will suffer.

The value of a bitcoin by then? A lot less than now because it has been massively inflated with trillions of bitcoin IOUs everyone is forced to accept as settlement of debt.

That scenario you describe is not what "Bitcoin becomes the world's reserve currency" actually means. The system you describe is just the same system as now, just that banks would be able to hold Bitcoins as assets on their balance sheets. That's not at all the same thing as Bitcoin itself being a reserve currency. Reserve currency implies that parties are actually settling transactions in Bitcoin itself, and the design of Bitcoin is such that that kind of settlement is analogous to settling in a commodity money.
Aswan
Legendary
*
Offline Offline

Activity: 1680



View Profile
May 29, 2014, 08:44:19 AM
 #7

If the bitcoin (BTC!) becomes the world reserve currency, then banks will long have adopted it. They will have scared people because of security issues when holding BTC by themselves and they will have made people deposit and transact via the banks, which in turn allows the banks to work with IOUs instead of actual BTC.
This will result in the ability to massively inflate said IOUs by just issuing more of them as debt which will have to be repaid (plus a little extra). For this to not get out of hand an institution will be appointed bitcoin reserve bank and it will be able to control the creation of said IOUs on a pace they like.
As a result, the rich will get richer and the poor will suffer.

The value of a bitcoin by then? A lot less than now because it has been massively inflated with trillions of bitcoin IOUs everyone is forced to accept as settlement of debt.

That scenario you describe is not what "Bitcoin becomes the world's reserve currency" actually means. The system you describe is just the same system as now, just that banks would be able to hold Bitcoins as assets on their balance sheets. That's not at all the same thing as Bitcoin itself being a reserve currency. Reserve currency implies that parties are actually settling transactions in Bitcoin itself, and the design of Bitcoin is such that that kind of settlement is analogous to settling in a commodity money.

It might not be what it means, but it is what is almost inseparably linked with bitcoin becoming a world reserve currency and since the OP was asking for the price of a bitcoin then, I might as well take into account the major factors for it.
knircky
Member
**
Offline Offline

Activity: 81


View Profile
May 29, 2014, 09:21:46 AM
 #8

What if bitcoin (XBT) becomes the world's reserve currency and replaces the US dollar both as foreign exchange reserves and petro dollar..

Each and every country will fighting to buy bitcoins..

What will be the value of bitcoin then?

That's easy and has been answered a few times by big boys.

If BTC replaces the USD it would be worth roughly 1M each and if it were the only currency it would be around 3M each. At that point we would be dealing in satoshis, which would be worth 1-3 cents each.

I think there will be other currencies and so i think overall if BTC survives the next 20-50 years it should be anywhere between 100k to 1M provided it stays the main currency. So imagine things like ether and other coins holding a key part of the market but BTC staying the main thing 1M is possible with BTC being 30% of the world currency.

But keep in mind that for this to happen our society has to fundamentally change. this won't be quick and this won't happen without major fights.

There is also the chance that better currencies will take bitcoins place and then btc is not worth anything.
cuddaloreappu
Hero Member
*****
Offline Offline

Activity: 616


View Profile
May 29, 2014, 10:34:44 AM
 #9

Okay what i meant was,my country actually buys a lot of dollars and keeps it in reserve, whenever the INR gains against dollar the reserve bank buys even more thus maintaining dollar ruppee at a range of 1dollar =60 rupees.

That reserve is actually to bail out in case a balance of payment crisis arises, which actually happened in 1991 and ever since became trapped with that loan shark IMF.

So i was actually suggesting instead a country throw that dollar away and buy bitcoin as reserve, as the value of bitcoin rises the foreign exchange reserve value also rises, thus greatly to benefit the nation.
Lethn
Legendary
*
Offline Offline

Activity: 1484



View Profile WWW
May 29, 2014, 10:41:06 AM
 #10

What if bitcoin (XBT) becomes the world's reserve currency and replaces the US dollar both as foreign exchange reserves and petro dollar..

Each and every country will fighting to buy bitcoins..

What will be the value of bitcoin then?

If that happens government paper currencies will become worthless so governments will have to do what those of us who don't have mining equipment and bought early have done and offer up services to earn it, like a proper economy does, I expect though if governments become desperate and fail in a 51% attack they will devalue their currency first though to try and destroy it.
jc01480
Hero Member
*****
Offline Offline

Activity: 756



View Profile
May 29, 2014, 12:03:37 PM
 #11

The established system will bring great violence before control is relinquished.  That's a given.

bitcoinforhelp
Full Member
***
Offline Offline

Activity: 154


View Profile
May 29, 2014, 12:25:17 PM
 #12

value will be that high as people want
honorem
Newbie
*
Offline Offline

Activity: 29


View Profile
May 29, 2014, 03:41:12 PM
 #13

It can only happend if they used btc for buying oil
DeathAndTaxes
Donator
Legendary
*
Offline Offline

Activity: 1218


Gerald Davis


View Profile
May 29, 2014, 04:11:37 PM
 #14

If that happens government paper currencies will become worthless

Really.  The US dollar is currently the defacto world currency (although how much longer remains to be seen) so that means all other national currencies are worthless?  Euro? Pound? Yen?  Interesting.
Lethn
Legendary
*
Offline Offline

Activity: 1484



View Profile WWW
May 29, 2014, 04:15:35 PM
 #15

If these currencies are so valuable and doing so well then why is everyone poor? Answer me that, the symptoms we are seeing in the currencies and countries you mentioned are not ones of a functioning economy.
DeathAndTaxes
Donator
Legendary
*
Offline Offline

Activity: 1218


Gerald Davis


View Profile
May 29, 2014, 04:19:38 PM
 #16

If these currencies are so valuable and doing so well then why is everyone poor? Answer me that.

Everyone isn't poor. The net worth of the world is estimated at $223 trillion.
juju
Sr. Member
****
Offline Offline

Activity: 382



View Profile
May 29, 2014, 04:25:29 PM
 #17

I can't imagine Bitcoin will ever become a reserve currency, I just see this as a new protocol for entities to implement within their businesses. Similar to how email's protocol SMTP was built ontop of TCP/IP. This was built ontop of TCP/IP to serve as a protocol for wealth transfer and storage.
cuddaloreappu
Hero Member
*****
Offline Offline

Activity: 616


View Profile
May 29, 2014, 04:31:17 PM
 #18

I can't imagine Bitcoin will ever become a reserve currency, I just see this as a new protocol for entities to implement within their businesses. Similar to how email's protocol SMTP was built ontop of TCP/IP. This was built ontop of TCP/IP to serve as a protocol for wealth transfer and storage.


And goverments use internet, likewise let governments use bitcoin on top of internet to buy oil and foreign exchange reserves.
Lethn
Legendary
*
Offline Offline

Activity: 1484



View Profile WWW
May 29, 2014, 05:10:49 PM
 #19

If these currencies are so valuable and doing so well then why is everyone poor? Answer me that.

Everyone isn't poor. The net worth of the world is estimated at $223 trillion.

Sorry, you're right on the poor thing, not everyone is poor but most are.

Oh and LOL you think that number is real, I'll try to explain it to you though if you're going to actually read my explanation, what's happened is that what I would call the 'real' net wealth is essentially being doubled or tripled through money printing so it's a bit like taking £100 and then printing more money until you have £1,000,000 oh look! I just became a millionaire! They go around telling all their friend and other countries and they actually buy into it.

It's such a simple con that people fall for, but now everyone has realised what's going on and that people don't actually have products and services worth that much, fact is, to pick up that much net worth globally we'd have to either take up asteroid mining or take over Afghanistan completely and mine some giant holes in it to even come close to the numbers these central bankers have made up.

If you're actually bothered about learning how the bond market and paper money works this video explains it perfectly: https://www.youtube.com/watch?v=iFDe5kUUyT0
twiifm
Hero Member
*****
Offline Offline

Activity: 532



View Profile
May 29, 2014, 05:37:44 PM
 #20

If these currencies are so valuable and doing so well then why is everyone poor? Answer me that.

Everyone isn't poor. The net worth of the world is estimated at $223 trillion.

Sorry, you're right on the poor thing, not everyone is poor but most are.

Oh and LOL you think that number is real, I'll try to explain it to you though if you're going to actually read my explanation, what's happened is that what I would call the 'real' net wealth is essentially being doubled or tripled through money printing so it's a bit like taking £100 and then printing more money until you have £1,000,000 oh look! I just became a millionaire! They go around telling all their friend and other countries and they actually buy into it.

It's such a simple con that people fall for, but now everyone has realised what's going on and that people don't actually have products and services worth that much, fact is, to pick up that much net worth globally we'd have to either take up asteroid mining or take over Afghanistan completely and mine some giant holes in it to even come close to the numbers these central bankers have made up.

If you're actually bothered about learning how the bond market and paper money works this video explains it perfectly: https://www.youtube.com/watch?v=iFDe5kUUyT0

Hows that different than BTC being $580?

           ▄▄███████▄▄
        ▄███▀▀
▄▄▄▄    ▀▄
     ▄▄█████████████▄▄  ▀▄
  ▄▀▀██▀           ▀▀██▄▄▀▄
▄▀  ██                 ▀██
  ██       ▀▀█▀▀         █
█▀        █ █ █        ▄█▀▄
▀▄         █ █ █       ▄█  █
 ██         █▄▄▄█      ▄█  ▄▀
  ██▄                ▄█▀  ▄▀
  ▀▄▀██▄▄          ▄█▀  ▄▀
   ▀▄ ▀▀███▄▄▄▄▄▄█████▀▀
     ▀▀▄▄▄▄▄▄▀▀▀▀▀▀▀
.UTRUST.▀████████▄
  ▀███████▄
    ▀██████▄
      ▀██████
       ▀█████
        ▀████▄
         █████
          ▀███
           ███
           ▀██
            ██
             █
             █
●  Download WHITEPAPER  ●
▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬ ▼ ▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬
facebook      twitter      slack
▀████████▄
  ▀███████▄
    ▀██████▄
      ▀██████
       ▀█████
        ▀████▄
         █████
          ▀███
           ███
           ▀██
            ██
             █
             █
Pages: [1] 2 3 4 »  All
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!