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by awt 2915 days ago
Government bonds have been around for hundreds of years but I can't buy coffee with them. Thus they don't do anything.
2 comments

Not a great analogy. Government bonds were never meant to be a currency. Bitcoin was advertised as a currency. Yet its adoption for that purpose, despite the massive network available for its propagation, has yet to materialize.
What it was "meant to be" hardly matters. What it actually is is more important than the misrepresentations presented by various misinformed parties.
> What it actually is is more important than the misrepresentations presented by various misinformed parties

Fair enough. Government bonds let countries deficit spend. They are also a stable store of value. These attributes make them useful.

Bitcoin is neither of these. Like government bonds, it does not behave like money.

Government bonds are stable if you ignore tail risk. Governments tend to collapse eventually, at which point your bonds are not a great store of value.

Bitcoin is however similar to a government bond in that it a) has value, b) is not directly useful for consumer transactions. Also, I dunno that behaving like money can be put in such stark binary terms.

> Government bonds are stable if you ignore tail risk

Nothing is eternal. That doesn’t make everything ephemeral equally risky. Bitcoin is a speculative asset. Speculative assets are volatile by design (you want them to go up).

More critically, government bonds’ role as a store of value is ancillary to their core purpose: to enable public deficit spending.

> Bitcoin is however similar to a government bond in that it a) has value, b) is not directly useful for consumer transactions

My cat has value and is useless for consumer transactions. That doesn’t make him a government bond.

The point is not that Bitcoin is a government bond, if that wasn't obvious, but that just because some people said it's a currency and proceeded to build failing businesses on that faulty premise doesn't preclude it having actual, unrelated uses, such as a store of value with a vastly different risk profile than any other asset ever known.
Bitcoin could be similar to art in those terms. A van Gogh has value and isn't practical for consumer transactions. Your argument has painted itself into a corner and the next step is to knock a hole in the wall.
Saying Bitcoin is like one thing does not preclude it from being like other things. Never the less, it's not necessarily useless just because it doesn't have the use some people mistakenly thought it had.
Government bonds aren't meant to be a currency, cryptocurrencies are.
I don't see the relationship between "meant to be" and "is" here. Doesn't it only matter what it actually is rather than what some people thought it might be?
Well, what are cryptocurrencies then? Besides a hyper speculative "asset" for gamblers of course.