[ubernostrum]

I hate to say this, but at this point when I see someone use the words "fiat currency" unironically, I also expect to hear an argument about gold fringe on a flag, and other similar easily-repeated cargo-cult phrases/arguments against whatever the person doesn't like.

One of the real dangers to Bitcoin is precisely that sort of public image.

[akjetma]

a fiat currency is just a currency without intrinsic value. it's not a derisive term, you'll find it in any introductory economics textbook.

[ubernostrum]

I'm aware of the definition of the term and its origins.

I'm also aware of what happened to the term beyond its origins. And that is the problem.

[dictum]

What is the intrinsic value of Bitcoin, aside from its scarcity?

[akjetma]

I'm not really sure, just wanted to clarify the definition of a fiat currency. I don't think they have intrinsic value.

[tlrobinson]

The intrinsic value of bitcoins is as entries in a global distributed ledger.

[gnaritas]

Bitcoin is a fiat currency.

[NikolaTesla]

If mining additional Bitcoins at present is not economically viable than Bitcoins are not (currently) a fiat currency. The cost for the fed to increase the money supply is $0, the cost to produce a Bitcoin is equal to the cost of the hardware and electricity to produce it. I'm not sure if the definition would change once the maximum limit of Bitcoins is reached.

[gnaritas]

> If mining additional Bitcoins at present is not economically viable than Bitcoins are not (currently) a fiat currency.

Whether Bitcoin can be mined or not has absolutely nothing to do with whether it's a fiat currency or not, so your logic does not follow. Fiat doesn't mean "can easily manipulate". Any currency that isn't backed by (value derived from) a hard asset is a fiat currency. Burning electricity to create bitcoin's is not "backed by", that electricity is gone, used up, wasted. Other crypto currencies like peercoin or primecoin address bitcoins wasted energy, but they are all fiat currencies. Their value derives from confidence, not assets.

[NikolaTesla]

> Any currency that isn't backed by (value derived from) a hard asset is a fiat currency.

(I'm not a gold bug, I could care less about gold, if gold offends, substitute some other tangible commodity)

That's my point that Bitcoin is more of a commodity currency and is not (at present) a fiat currency. The fact that the electricity is gone doesn't make any difference. Mining gold requires fuel and labor which is gone, used up, and what remains is gold. This expense is what limits the production of and correlates the commodity to the underlying economy.

What is really interesting is your assertion that the value derives from confidence and not assets. I would argue that value derives from the fact that its supply is limited by the use of resources and labor.

[woah]

gold is a fiat currency

[gnaritas]

Gold isn't a currency, it's a commodity.

[NikolaTesla]

Gold can be a currency, called a commodity currency, not a fiat currency.

[pretense]

But doesn't your non-ironic use of "cargo cult" permit unbridled use of other meme-like absurdities ad nauseam?

Like, now, I'm free to accuse you of being a secret agent of the notorious hacker group named Anonymous, infiltrating this site under an assumed pseudonym. And worst of all, I could make that claim non-ironically, if I so desired.

Do you see how ridiculous this is all becoming?

[ubernostrum]

The cargo cults which sprang up after WWII were based around imitating the behavior of the airfield staff, in hopes that doing so would summon the airplanes full of supplies.

Use of terms like "fiat currency" is, in my experience, similarly an attempt to mimic the behavior of people they've seen winning arguments, in hopes that doing so will result in winning arguments.

[NikolaTesla]

Interesting that the mere mention of "fiat currency" invokes tin-foil hat. Whether Bitcoins can survive the volatility is indeterminate. If it does survive, however, and becomes an alternative to (avert your eyes) fiat currencies, the impact will be far greater than another obscure fiat currency suddenly being used.

[gnaritas]

A fiat currency can't become an alternative to fiat currencies; it can only become a better managed fiat currency by way of being an algorithm rather than a human. Bitcoin is an obscure fiat currency suddenly being used.