# Lifestyles & Discussion > Bitcoin / Cryptocurrencies >  Why do so many Libertarians support bitcoins?

## vickersvimy

Why is this? Bitcoins are an unstable, fiat currency so why support something open to manipulation?

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## Madison320

> Why is this? Bitcoins are an unstable, fiat currency so why support something open to manipulation?


Bitcoins are not a fiat currency. Fiat currency is created by a government (by fiat). I think libertarians like Bitcoins because they have been created privately. That being said I don't think Bitcoins are going to last because they fail a critical test of money, they are not a good store of value.

Also I have a hunch that many supporters of Bitcoin are also anarchists.

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## gwax23

> Why is this? Bitcoins are an unstable, fiat currency so why support something open to manipulation?


They bought in early and now have a vested financial interest to make sure it keeps going up, even if it means duping fellow libertarians.

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## specsaregood

> Also I have a hunch that many supporters of Bitcoin are also anarchists.


Indeed.   You hear about the sheep marketplace scam that disappeared with reportedly about tens of millions of $ worth of bitcoin?    What govt had jurisdiction over it?  Was even a legal crime committed?

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## Quark

Fiat Money



> Fiat money has been defined variously as:
> - any money declared by a government to be legal tender.
> - state-issued money which is neither convertible by law to any other thing, nor fixed in value in terms of any objective standard.
> - money without intrinsic value.


So the strike-through don't apply. Let's look at the last "definition." 

https://en.bitcoin.it/wiki/Myths#Bit...ther_things.29




> It is true that bitcoins have no intrinsic value, in the numismatic sense, in other words, value in any realm outside of being used as a medium of exchange.
> However, while some tangible commodities do have intrinsic value, that value is generally much less than its trading price. Consider for example that gold, if it were not used as an inflation-proof store of value, but rather only for its industrial uses, would certainly not be worth what it is today, since the industrial requirements for gold are far smaller than the available supply thereof.
> While historically intrinsic value, as well as other attributes like divisibility, fungibility, scarcity, durability, helped establish certain commodities as mediums of exchange, it is certainly not a prerequisite. While bitcoins lack 'intrinsic value' in this sense, they make up for it in spades by possessing the other qualities necessary to make it a good medium of exchange, equal to or better than commodity money.
> Another way to think about this is to consider the value of bitcoin the global network, rather than each bitcoin in isolation. The value of an individual telephone is derived from the network it is connected to. If there was no phone network, a telephone would be useless. Similarly the value of an individual bitcoin derives from the global network of bitcoin-enabled merchants, exchanges, wallets, etc... Just like a phone is necessary to transmit vocal information through the network, a bitcoin is necessary to transmit economic information through the network.
> Value is ultimately determined by what people are willing to trade for - by supply and demand.


Why do libertarians support Bitcoin? Because you can't centrally plan them, that's how I see it.

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## oyarde

I think they are excited about any currency other than the paper dollar .

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## ctiger2

It's a free market currency. Sure, I wouldn't convert all your $USD into crypto's, but it seems to make sense to have at least some $USD currency converted into Crypto for the coming $USD collapse. It might come in handy, it might not. Think of it as a possible currency insurance. Converting $100USD into crypto might not be a bad idea.

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## muh_roads

> Why is this? Bitcoins are an unstable, fiat currency so why support something open to manipulation?


 - Decentralized P2P network.  Drone strike a node and it doesn't matter because another is always there and ready to go.
 - Mover advantage, most time dedicated to an encrypted money protocol with billions of investment and billions more coming.
 - Open-source. No secrets. Any competing crypto with a cool new feature can just be assimilated into BTC.
 - Hard limit @ 21m, currently 12m.  Currently less than 1% still know about it.  Your share = 12m divided by your holdings.
 - Not just a currency, also a payment processor without the need for a middle man.  Utility value.
 - Blockchain open ledger.  Can't naked short or lie about the supply like COMEX and the mega banks always do.
 - Gets around Government sanctions & currency controls with ease.
 - Encrypted addresses and output tumblers support Agorism.
 - True free market buying & selling.

Bitcoin is not for the faint of heart.  If you can't handle the wild swings then don't play.  It is still in its infancy and ugly, yes.  But Bitcoin is like what the internet was in 1994.  It will probably remain unstable until we are near the top of the S curve.  1 mBTC could very well equal $10-$100 by then.

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## Icymudpuppy

> -
> Bitcoin is not for the faint of heart.  If you can't handle the wild swings then don't play.


"Timid men prefer the calm of despotism to the tempestuous sea of liberty." - Thomas Jefferson

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## Keith and stuff

> Why is this? Bitcoins are an unstable, fiat currency so why support something open to manipulation?


I've seen any evidence that so many Libertarian Party folks support Bitcoins. You are making a claim but present no evidence. I don't get it. Please present some evidence. Thanks.

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## specsaregood

> I've seen any evidence that so many Libertarian Party folks support Bitcoins. You are making a claim but present no evidence. I don't get it. Please present some evidence. Thanks.


Are you just trying to play games and troll the OP because he happened to capitalize the word Libertarians?  I'm pretty sure he wasn't narrowing his question to just LP members.     

OP, don't take the bait.

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## FSP-Rebel

> - Decentralized P2P network.  Drone strike a node and it doesn't matter because another is always there and ready to go.
>  - Mover advantage, most time dedicated to an encrypted money protocol with billions of investment and billions more coming.
>  - Open-source. No secrets. Any competing crypto with a cool new feature can just be assimilated into BTC.
>  - Hard limit @ 21m, currently 12m.  Currently less than 1% still know about it.  Your share = 12m divided by your holdings.
>  - Not just a currency, also a payment processor without the need for a middle man.  Utility value.
>  - *Blockchain open ledger.  Can't naked short or lie about the supply like COMEX and the mega banks always do.*
>  - Gets around Government sanctions & currency controls with ease.
>  - Encrypted addresses and output tumblers support Agorism.
>  - True free market buying & selling.
> ...


Bolded part alone is priceless, add in the rest and it's incomprehensible why any pro-liberty person would not want a piece of the action. This is the most prominent and personal form of secession/nullification that one can't take part in. Free State Project on steroids.

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## FrankRep

> Why is this? Bitcoins are an unstable, fiat currency so why support something open to manipulation?


Some Libertarians forget what real money is and haven't studied history.

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## kpitcher

Bitcoin is one of the most disruptive innovations this decade. There is a vested interest by banks worldwide to ensure bitcoins don't succeed. The bad will be hyped like crazy the good not so much.

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## jclay2

Why do so many libertarians support bitcoin?

Because they have all fooled themselves into thinking bitcoin has value in of itself. Once people realize this pos digital nothingness was just wished into existance by man, it will go down to the zero it was meant to be at. Sure you can transfer/store/divide/transact with bitcoins with extreme ease, but what does that mean if it has no value in of itself?

For the programmers out there, the true justification for bitcoin's value is a recursive function where the end base case is $.0000000000001. Somehow, I am supposed to believe that something valued at virtually 0 is supposed to become the rock that I store my family's wealth in?

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## squarepusher

> Why do so many libertarians support bitcoin?
> 
> Because they have all fooled themselves into thinking bitcoin has value in of itself. Once people realize this pos digital nothingness was just wished into existance by man, it will go down to the zero it was meant to be at. Sure you can transfer/store/divide/transact with bitcoins with extreme ease, but what does that mean if it has no value in of itself?
> 
> For the programmers out there, the true justification for bitcoin's value is a recursive function where the end base case is $.0000000000001. Somehow, I am supposed to believe that something valued at virtually 0 is supposed to become the rock that I store my family's wealth in?


just curious, doesn't gold have 0 value in itself also?

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## heavenlyboy34

> just curious, doesn't gold have 0 value in itself also?


Yes, gold's objective value is 0.  Market value is totally different.

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## PaulConventionWV

> Why do so many libertarians support bitcoin?
> 
> Because they have all fooled themselves into thinking bitcoin has value in of itself. Once people realize this pos digital nothingness was just wished into existance by man, it will go down to the zero it was meant to be at. Sure you can transfer/store/divide/transact with bitcoins with extreme ease, but what does that mean if it has no value in of itself?
> 
> For the programmers out there, the true justification for bitcoin's value is a recursive function where the end base case is $.0000000000001. Somehow, I am supposed to believe that something valued at virtually 0 is supposed to become the rock that I store my family's wealth in?


So any time a "man" invents something that is useful for a specific purpose, its value is meant to be zero?  Can you explain that?  Because I'm pretty sure most of our technology is the result of man-made inventions that you now use and value very much, even though many of them are not tangible.

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## jclay2

> just curious, doesn't gold have 0 value in itself also?


Gold has industrial uses and can be used for jewelery. If Gold was valued at $0/oz, I could still use it for these purposes. That can not be said for bitcoin at all as there is no fundamental purpose for having a bitcoin. It is the ultimate ponzi scheme, just like dollars. 

A true libertarian currency or trading system should have something of backing. Maybe one alternative would be to find a way to hold stock securities off shore and find an easy/secure way to transfer them without any world governments knowing.

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## vickersvimy

> Gold has industrial uses and can be used for jewelery. If Gold was valued at $0/oz, I could still use it for these purposes. That can not be said for bitcoin at all as there is no fundamental purpose for having a bitcoin. It is the ultimate ponzi scheme, just like dollars. 
> 
> A true libertarian currency or trading system should have something of backing. Maybe one alternative would be to find a way to hold stock securities off shore and find an easy/secure way to transfer them without any world governments knowing.


Even dollars are backed by paper and oil.

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## dannno

> Even dollars are backed by paper and oil.


As well as death and maiming.

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## dannno

> A true libertarian currency or trading system should have something of backing. Maybe one alternative would be to find a way to hold stock securities off shore and find an easy/secure way to transfer them without any world governments knowing.


Having something back your digital currency when that thing can be stolen is a liability. In that sense bitcoin is more secure than a gold backed digital currency. Gold and silver have their advantages, bitcoin has its advantages. They are both good to have, and they can both be used as a tool to overcome monetary tyranny.

Edit: I believe stock securities are regulated by the government.

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## specsaregood

> Gold has industrial uses and can be used for jewelery. If Gold was valued at $0/oz, I could still use it for these purposes. *That can not be said for bitcoin at all as there is no fundamental purpose for having a bitcoin.* It is the ultimate ponzi scheme, just like dollars.


I think that is where you are wrong, is not bitcoins intrinsic value its ability to offer privacy in transactions but at the same time easy to transfer.  Paper dollar transactions can offer privacy, but they aren't easy to transfer securely, remotely

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## newbitech

> Why is this? Bitcoins are an unstable, fiat currency so why support something open to manipulation?


Why? A rising tide lifts all boats.

Bitcoin is fiat?  Don't you mean "fiat money"? Sure, it's fiat.  If you use a really broad definition fiat, then computing in general and specifically the internet is also "fiat".  To describe Bitcoin as "fiat" in that sense, you'd only be describing the protocol and not the actual monetary functionality.  In other words Bitcoin protocol is fiat but Bitcon does not function as fiat _money_ in the economy.  Similarly, gold minting can be described as "fiat", or a formal authorization or proposition for creating coins to be used as money. 

I think the use of the term "fiat" to describe Bitcoin is an appeal to emotion argument that attempts to pit libertarian value of free market money at odds with fiat money.  The correct term that libertarians are in opposition to is fiat money, or money that is non-convertible "legal tender" especially when that "legal" authority is anything but legal, aka USD and the US FED.

Bitcoin is unstable?  Metaphor, Bitcoin is as unstable as a baby learning to walk.  Why buy 2 year old Johnny as baseball glove?  Look at him, he has no coordination and stumbles all over the place, he's never gonna make it to the big leagues!  

Folks that are using Bitcoin do so knowing that in the early adoption phase there are going to be swings in the fiat money exchange rate.  This is true with the adoption of any thing into mainstream acceptance, and should not come as a surprise or deter anyone from being interested or even getting involved.  If you look at the price history of Bitcoin, the exchange rate has had 3 distinct spikes.  each spike representing a wider adoption rate, basically more users.  It's economics 101 increase demand, limited supply.  What happens?  "Price" increases.  

Open to manipulation?  What exactly do you mean by "open"?  Anything can be manipulated.  I don't read anything you have said to indicate why Bitcoin is more "open" than anything else to manipulation. 

Anyways, I think Bitcoin is a pretty good example of what the free market can come up with on it's own without government intervention.  Here is a currency that is clearly filling a niche with the prospect to expand into other previously 3rd party fiat dominated niches.  Think paypal, western union, all the various "internet" currencies that already exist.  

You don't have to be of any sort of political or philosophical persuasion to see how this type of technological advancement can be quickly adopted and assimilated into the wider globalization of the communication infrastructure.  

Plus, there is so much more that Bitcoin can do that hasn't even been tapped in to yet.  It's role as a currency isn't even the most valuable property of the protocol.  Once the other uses are discovered and hooked in to, wider adoption will be encouraged.  Take a look at the Namecoin protocol to see some of the more interesting ideas that cryptographic proof of work type protocols are able to implement. 

An honest technological comparison of emerging cryptocurrency technology as money to the standard fair government fiat money debt paradigm (whether backed by something hard or not) will reveal that it is the latter system that suffers traumatically from lack of stability and manipulation.  

Free market FTW!

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## Quark

> Gold has industrial uses and can be used for jewelery. If Gold was valued at $0/oz, I could still use it for these purposes. That can not be said for bitcoin at all as there is no fundamental purpose for having a bitcoin.


Yet this isn't what makes gold useful as money.

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## PaulConventionWV

> Gold has industrial uses and can be used for jewelery. If Gold was valued at $0/oz, I could still use it for these purposes. That can not be said for bitcoin at all as there is no fundamental purpose for having a bitcoin. It is the ultimate ponzi scheme, just like dollars. 
> 
> A true libertarian currency or trading system should have something of backing. Maybe one alternative would be to find a way to hold stock securities off shore and find an easy/secure way to transfer them without any world governments knowing.


*sigh*

The idea that bitcoin is a ponzi scheme has been refuted on here time and time again, over and over and yet people like you STILL bring it up.  What is wrong with you?  Get it through your brain what the definition of a ponzi scheme is.

Also, most of gold's value is based on its demand as a form of currency.  Sure, it can be used for jewelry and a few other things, but not many people would actually use it for that.  If that was all the value was based on, it would be a lot lower than it is now.  The rest of its value comes from its demand as a medium of exchange.

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## Crystallas

Why do so many libertarians support hypertext transfer?

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## FrankRep

> *sigh*
> 
> The idea that bitcoin is a ponzi scheme has been refuted on here time and time again, over and over and yet people like you STILL bring it up.  What is wrong with you?  Get it through your brain what the definition of a ponzi scheme is.


Maybe this is more fitting.


*Ponzi scheme > Similar schemes*

An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value.

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## Seraphim

At this point, mostly death and maiming.




> As well as death and maiming.

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## PaulConventionWV

> Maybe this is more fitting.
> 
> 
> *Ponzi scheme > Similar schemes*
> 
> An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value.


In other words, it's NOTHING like a ponzi scheme.  So just stop using that hyperbolic shtick.  No market bubble can be compared to a Ponzi scheme.  They're completely different concepts.

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## Tod

> Bitcoins are not a fiat currency. Fiat currency is created by a government (by fiat). I think libertarians like Bitcoins because they have been created privately. That being said I don't think Bitcoins are going to last because they fail a critical test of money, *they are not a good store of value*.
> 
> Also I have a hunch that many supporters of Bitcoin are also anarchists.


Bitcoin has the potential for many desirable properties that precious metals lack.  The big thing is that bitcoin is just starting out while gold has an extensive history.  Do you suppose that gold was any more stable in value than bitcoin when it was first discovered and used?

Bitcoin does have a big obstacle to overcome:  the transition from "investment" to the development of its practical desirable use as currency.  The frenzy over buying it in order to see its value increase and then selling to reap those gains is doing two things:  drawing attention to it (pro) and causing a lot of volatility (long term con).

The best thing, imo, to ensure the long term success of bitcoin is to actually USE it to buy and sell goods and services and to use the blockchain for the broader things it is capable of as a public record of ownership.

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## squarepusher

OK here is another question,  Bitcoins is a digital currency, existing on the internet.  Who owns the internet?  Mostly governments or private corporations.

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## FrankRep

*Gary North:*

Bitcoins are anti-Austrian to the core. The fact that libertarian utopians do not see this indicates that they have never understood Mises or Austrian capital theory. This is not surprising. They do not even understand Leonard Read's "I, Pencil."

Ouch. Slam.

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## dannno

> *Gary North:*
> 
> Bitcoins are anti-Austrian to the core. The fact that libertarian utopians do not see this indicates that they have never understood Mises or Austrian capital theory. This is not surprising. They do not even understand Leonard Read's "I, Pencil."
> 
> Ouch. Slam.


Alternatively, Gary North is the one that lacks understanding on this topic.

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## Tod

> OK here is another question,  Bitcoins is a digital currency, existing on the internet.  Who owns the internet?  Mostly governments or private corporations.


Yes, it seems as though most BTC people poo-poo that, saying that the web can never be shut down because it would be too devastating to the world economy.  I agree with Ann Barnhardt (see Danke's post http://www.ronpaulforums.com/showthr...usses-Bitcoins ) in that regard.  However, unlike Ann, I think BTC can still provide a valuable service and has a place, provided one does not put all your eggs in the BTC basket.

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## heavenlyboy34

> Why do so many libertarians support bitcoin?
> *
> Because they have all fooled themselves into thinking bitcoin has value in of itself.* Once people realize this pos digital nothingness was just wished into existance by man, it will go down to the zero it was meant to be at. Sure you can transfer/store/divide/transact with bitcoins with extreme ease, but what does that mean if it has no value in of itself?
> 
> For the programmers out there, the true justification for bitcoin's value is a recursive function where the end base case is $.0000000000001. Somehow, I am supposed to believe that something valued at virtually 0 is supposed to become the rock that I store my family's wealth in?


Nothing has value "in and of itself".  See my recent thread about "intrinsic value".  Value is subjective.

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## vickersvimy

> Nothing has value "in and of itself".  See my recent thread about "intrinsic value".  Value is subjective.


Yes but physical objects such as gold have value because of what you can make them into as well as being a good store of value. Gold can be used for jewelry and wiring. Bitcoin cannot.

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## Neil Desmond

> Yes but physical objects such as gold have value because of what you can make them into as well as being a good store of value. Gold can be used for jewelry and wiring. Bitcoin cannot.


You can also make jewelry and wiring from other material that's not so expensive.  It costs about $1,250 for an ounce of 0.999 pure gold, but it only costs around 20 cents for an ounce of copper.  If gold or any other metal has "intrinsic" value because it can be used for wiring, then the maximum "intrinsic" value would amount to no more than 20 cents per ounce.

Gold has the expense of having to physically store it, protect it, transport it, etc.  How do those expenses match up to that 20 cents?  Gold is a good, and bitcoin is tantamount to a service (i.e., the payment processing aspect), what's the "intrinsic" value of its built in service, and the fact that it doesn't have to be physically stored, protected, transported, etc?

The scarcity level of gold is not only unknown and not fixed (e.g., gold mined from asteroids), but it can even be created synthetically.  We also can't predict the scarcity level of gold.  Bitcoin, on the other hand, has a fixed limit, and it is known what the number of bitcoins in circulation is at any point in the future.

Jewelry doesn't even have to be made out of metal, and what function or purpose does jewelry serve that cannot be achieved by very inexpensive materials?

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## vickersvimy

> You can also make jewelry and wiring from other material that's not so expensive.  It costs about $1,250 for an ounce of 0.999 pure gold, but it only costs around 20 cents for an ounce of copper.  If gold or any other metal has "intrinsic" value because it can be used for wiring, then the maximum "intrinsic" value would amount to no more than 20 cents per ounce.
> 
> Gold has the expense of having to physically store it, protect it, transport it, etc.  How do those expenses match up to that 20 cents?  Gold is a good, and bitcoin is tantamount to a service (i.e., the payment processing aspect), what's the "intrinsic" value of its built in service, and the fact that it doesn't have to be physically stored, protected, transported, etc?
> 
> The scarcity level of gold is not only unknown and not fixed (e.g., gold mined from asteroids), but it can even be created synthetically.  We also can't predict the scarcity level of gold.  Bitcoin, on the other hand, has a fixed limit, and it is known what the number of bitcoins in circulation is at any point in the future.
> 
> Jewelry doesn't even have to be made out of metal, and what function or purpose does jewelry serve that cannot be achieved by very inexpensive materials?


The function of jewelry is to look nice. You are essentially saying that buying a product to look nice serves no function.
Besides bitcoin isn't backed by anything. Even the dollar is backed by oil. Bitcoins also are being bought not to secure wealth but based on the "greater fool" theory.

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## Neil Desmond

> The function of jewelry is to look nice.


I know that.  I didn't ask what function does jewelry serve, and you didn't answer my question.  I'll try again (it's basically the exact same wording): what function or purpose does jewelry serve that cannot be achieved by very inexpensive materials?




> You are essentially saying that buying a product to look nice serves no function.


Nope, I am not saying anything of the sort (essentially or otherwise).




> Besides bitcoin isn't backed by anything.


Actually, it's backed by something more than gold is backed by something.  I somewhat touched on this, and if you look at my other posts, in other threads where I discuss bitcoin, you'll find that in one of them I discuss more extensively and in depth what gives both bitcoin as well as gold their so-called "intrinsic" value.




> Even the dollar is backed by oil.


I'm not sure what you're referring to, here.  What we use are Federal Reserve Notes (FRNs); they're backed debt, and are the product of an interest-bearing fractional reserve system.




> Bitcoins also are being bought not to secure wealth but based on the "greater fool" theory.


That depends on who's buying bitcoins and why.  They're being used as medium of exchange by many people.

The "greater fool" theory also applies to gold: http://newsok.com/taking-stock-great...rticle/3861757

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## vickersvimy

> I know that.  I didn't ask what function does jewelry serve, and you didn't answer my question.  I'll try again (it's basically the exact same wording): what function or purpose does jewelry serve that cannot be achieved by very inexpensive materials?
> 
> 
> Nope, I am not saying anything of the sort (essentially or otherwise).
> 
> 
> Actually, it's backed by something more than gold is backed by something.  I somewhat touched on this, and if you look at my other posts, in other threads where I discuss bitcoin, you'll find that in one of them I discuss more extensively and in depth what gives both bitcoin as well as gold their so-called "intrinsic" value.
> 
> 
> ...


Gold and silver jewelry is regarded as looking nicer than lets say... bronze jewelry and so people pay more for it.

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## Neil Desmond

> Gold and silver jewelry is regarded as looking nicer than lets say... bronze jewelry and so people pay more for it.


It's subjective to say that gold or silver jewelry look nicer than bronze jewelry.  Personally, I think bronze jewelry looks just as nice as gold or silver jewelry.  

People pay more for gold and silver primarily because they are scarce materials.

If it's the color or appearance that's appealing, then this can be achieved by plating (as in surface metal deposition, electrolysis, etc.), or even using material or paint that makes it appear like gold or silver.

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## juleswin

Personally I think bitcoins main attraction is the idea that the free market created it, the people that use this rational to explain their attraction to bitcoins have convinced themselves that if it comes from the free market, it has to be good and moral. The problem with this line of thinking, is that just about everyone can exist in the free market, all sorts of frauds, quackery, scams etc, the free market usually rejects those schemes in time and bitcoins is still in the process of being judged by the whats left of the free market.

I believe in time, it will also be rejected by the free market just like all the other "conjure money out of thin air" schemes that has come before it

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## Austrian Econ Disciple

> Why do so many libertarians support bitcoin?
> 
> Because they have all fooled themselves into thinking bitcoin has value in of itself. Once people realize this pos digital nothingness was just wished into existance by man, it will go down to the zero it was meant to be at. Sure you can transfer/store/divide/transact with bitcoins with extreme ease, but what does that mean if it has no value in of itself?
> 
> For the programmers out there, the true justification for bitcoin's value is a recursive function where the end base case is $.0000000000001. Somehow, I am supposed to believe that something valued at virtually 0 is supposed to become the rock that I store my family's wealth in?


Um what? Value is derived from individual's preferences, not from some innate 'intrinsic' objective value. I can't believe how many libertarians still believe this objective non-sense when it comes to money and currency. Bitcoin offers a lot of appealing properties for a medium of exchange, especially in the world we currently live in. It also solves some of the problems with commodity-based currencies (it can be transacted in infinitesimally small numbers). Of course Bitcoin isn't without its own problems (susceptible to Armageddon, extreme long-run encryption hacking, etc.), but its pro's vastly outweigh the cons. Also, instead of attacking the currency because it 'isn't gold', how about you get with Hayek and the times and diversify your currency assets (COMPETITION!), into precious metals and bitcoins? The more currencies the better.

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## Austrian Econ Disciple

> Bitcoin has the potential for many desirable properties that precious metals lack.  The big thing is that bitcoin is just starting out while gold has an extensive history.  Do you suppose that gold was any more stable in value than bitcoin when it was first discovered and used?
> 
> Bitcoin does have a big obstacle to overcome:  the transition from "investment" to the development of its practical desirable use as currency.  The frenzy over buying it in order to see its value increase and then selling to reap those gains is doing two things:  drawing attention to it (pro) and causing a lot of volatility (long term con).
> 
> The best thing, imo, to ensure the long term success of bitcoin is to actually USE it to buy and sell goods and services and to use the blockchain for the broader things it is capable of as a public record of ownership.


All currencies are bought and sold re: investment. In fact, it is the largest market in the world (FOREX). The price of bitcoins is an idictment against the devaluation of the dollar. As long as bitcoins are primarily priced against the dollar, you'll continue to see the volatility. I'm excited for when more goods and services start to become priced in bitcoin. At that point you'll see the coins start to become less volatile. At this point it should also be noted how we'll eventually hit the bitcoin wall (21million), which means the value of bitcoins will only go up as long as demand doesn't fall. The reason libertarians love bitcoin is not only for its extreme anti-inflationary characteristic, but also because of the ease of transaction, anonymity, outside of State and Banking control, and is decentralized, among a laundry list of other things.

It is also a big $#@! YOU to the IRS.

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## Madison320

> Nothing has value "in and of itself".  See my recent thread about "intrinsic value".  Value is subjective.


So according to your theory, since intrinsic value value is subjective, everything is an equal store of value? We could all start subjectively valuing paper and dirt over gold and silver tomorrow?

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## Shane Harris

Why are the precious metal people so  hostile towards bitcoin. Just ignore it if you hate it so much. Most of us who like BTC also like precious metals. We appreciate all of the concern but it feels more like resentment and bitterness than true concern over our hard-earned money. Take it somewhere else. Many Austrians such as Jeffrey Tucker and Stefan Molyneux recognize the potential of bitcoin. These people also realize the absurdity of some sort of SHTF stone age scenario where two thirds of the population dies and the rest of us start trading silver coins and bartering cows. You can look forward to that dystopia as much as you want but there's a much higher chance of btc being successful than that ever happening.

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## extrmmxer

Because it's decentralized, open source, peer to peer, open ledger, and completely voluntary. You understand that, then you understand the power behind it. Sounds good to me as a libertarian.

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## robert68

> ...
> Gold has the expense of having to physically store it, protect it, transport it, etc.  How do those expenses match up to that 20 cents?  Gold is a good, and bitcoin is tantamount to a service (i.e., the payment processing aspect), what's the "intrinsic" value of its built in service, and the fact that it doesn't have to be physically stored, protected, transported, etc?


If one believes FRB is not economically viable, they may conclude that; otherwise there’s no gold storage and transportation cost to the individual when gold is backing notes.




> The scarcity level of gold is not only unknown and not fixed (e.g., gold mined from asteroids), *but it can even be created synthetically.*  We also can't predict the scarcity level of gold.  Bitcoin, on the other hand, has a fixed limit, and it is known what the number of bitcoins in circulation is at any point in the future.


The production cost of gold is many times the market price of gold, rendering produced gold's affect on scarcity negligible. 
http://en.wikipedia.org/wiki/Synthes...us_metals#Gold

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## mczerone

> So according to your theory, since intrinsic value value is subjective, everything is an equal store of value? We could all start subjectively valuing paper and dirt over gold and silver tomorrow?


Value is subjective. There is no such thing as intrinsic value. A "store of value" is anything that you, personally and subjectively, predict will have value to you in the future, either as a direct consumable, or in trade value.

If you think "subjective" = "everything is equal", then you need a remedial vocabulary lesson.

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## Neil Desmond

> If one believes FRB is not economically viable, they may conclude that; otherwise there’s no gold storage and transportation cost to the individual when gold is backing notes.


So, basically your point is that gold-backed "notes" or certificates are about as good as bitcoins?




> The production cost of gold is many times the market price of gold. Gold is still scarce. 
> http://en.wikipedia.org/wiki/Synthes...us_metals#Gold
> 
> ...


If the market value for gold goes high enough, it would be economically feasible to synthesize gold.  The cost to synthesize gold places an upper limit on its market value; in other words, the price of gold will probably never go far above the production cost for synthesizing it.

If someone somehow comes up with a less expensive way to synthesize gold, one that costs less to produce an ounce of gold than the market value of gold, then that would basically cause the market price of gold to drop down to somewhere near the synthetic gold production cost; for example, if a solar cell is invented which can both harness more energy and be manufactured far less expensively than what's available now, and it makes it possible to synthesize gold at a production cost of say $800/oz, then the market price of gold will drop from its present rate of $1,250/oz to probably about $850/oz (max).

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## PaulConventionWV

> So according to your theory, since intrinsic value value is subjective, everything is an equal store of value? We could all start subjectively valuing paper and dirt over gold and silver tomorrow?


Yes, we could, but we don't.  That's the point.  Anything could happen.  Absolutely anything, anywhere, at any time can be money, but the market only chooses things that are best suited for that purpose.

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## Barrex

HOPE!

People hope that it is part of the puzzle that will free them from government. I too have positive feelings about Bit-coin but I am not investing anything substantial in it because I have too many reservations about it. If (lets keep possibility that things will turn to better) governments keep spiraling into debt and more taxes more and more people will use riskier and riskier ways to run away from government and its "solutions".

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