What I meant by "Real Money" is that it is backed by some physical commodity that has some kind of intrinsic value, like gold.
One could argue if gold actually has any "intrinsic value".
Agreed: a moot point.
If people say that dollars are backed by gold (which it isn't as you state correctly, but suppose it were) then what does that mean, really? What is gold backed by?
Physical Reality - as opposed to Computer Modeled Reality, where most modern Currencies live.
If people accept that gold doesn't need to be backed by anything, or can act as a means of backing other things, then I don't see why the same wouldn't hold for bitcoins.
Philisophically, I agree there is no fundamental difference.
You might have a harder time, however, those who have not already, at least in part, become Bitcoin Enthusiasts. It is only a small percentage of humanity that thinks much about
the philosophy they use to view the world.
Well, technically, bitcoin also is "created" at the press of a button.
Yeah, but (and I know you know this, but I just wanna clarify this to everybody) there's no difference for a bank to create one million, or ten million, or one billion. Money isn't even printed anymore. They just store a random number in a computer, and that amount of dollars suddenly came into existence. Magic.
Hopefully not random
Hopefully it is the amount they decided to create.
Bitcoin cannot be created at will. Unlike fiat currency (or gold!)
If you know how to create gold ....
... the exact amount of bitcoins in existence is known and public for everybody, and can be predicted for the foreseeable future.
That phrase "the exact amount of bitcoins in existence" can be taken two ways:
* the maximum number that are mathematically possible to ever exist
* the exact number that have been "mined" and moved into the economy
Both are known, public, and predictable.
What interests speculators is the rate (and the stability of the rate) that mining moves BTC into the economy.
Which brings to my mind a tangential question about the "creation" of a new economically active
I have not looked at the source code yet, but the question raised is of the fesability of tweaking the generation code. (without Bitcoin Client noticing, or what would be the point)
As I understand it, a bitcoin is:
* a properly check-summed encoding of ...
* a properly calculated hash of ...
* a properly generated term in ...
* a really scary cryptographic equation series.
And, as I understand it, the job of Bitcoin Client is to:
* validate the encoding and check-summing of the hash.
* validate the transaction chain
* * since the creation of this particular bitcoin
* * if not all the way back to the Bitcoin Epoch(tm)
Which suggests that the "transaction of creation" (if that is a proper phrase) must contain enough information to verify that the data used to create the hash did in fact come from the scary cryptographic equation series.
And that this "transaction of creation" is still in the transaction chain so the client can verify it and all following transaction (that involve the bitcoin in question).
So the question becomes:
* Is it mathematically feasible to build a "transaction of creation", that passes current tests for validity, using less CPU power than the standard mining process?
I suspect the answer is "No" to the best ability of the cryptologists and programmers behind Bitcoin, else there would be no Bitcoin.
( : I seem to have drifted far from my original topic. : )