[empraptor]

With stable national currencies like US dollar, there are debts, expenses, taxes, etc. that are denominated in the currency. And there is a national economy producing products and services for which people can pay with US Dollar. And financial infrastructure and laws to support the economy and currency.

[dilap]

lots of examples of currencies getting inflated pretty badly. agreed the US $ has been stable for the last 30 years, and seems like a fairly safe bet. but it also doesn't seem outside the bounds of possibility that something will flip and we enter another period of bad inflation. (to me, gut feeling, zero expertise in any of this -- just some guy on the internet, thinking about it for fun.)

are contracts being written in bitcoin yet? if so, that'd be some momentum to help keep the bottom from falling out.

and i don't think taxes are really denominated in USD: they are paid in USD, but they are denominated in % of «taxable event», converted to USD, at whatever the conversion rate happens to be. right?

i guess a national currency is a little more "real" than something like bitcoin because you have one more-or-less guaranteed believer in it, the nation issuer. but it still doesn't seem that different to me than something like bitcoin. it basically just has value because it's useful for it to have value, and it's made scarce enough that it can serve for that purpose.

[empraptor]

I see the difference as there being a national economy and government closely tied to USD.

Usually, central bank tries to manipulate supply and velocity of USD so it doesn't become too scarce. Because short supply of money leads to deflation and stagnation of the economy.