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by olalonde 4455 days ago
Not sure if you are disagreeing with me but in case you are: suppose those assets (stocks, bonds, real estate) could be transferred as easily as a currency (instant transfer/fungible/divisible/liquid/etc.), would people use cash at all? What would be the use case for cash? My point was that Bitcoin would be such an asset.

Perhaps a deflationary currency would have a negative overall impact on the economy, but that's not what I'm arguing about.
2 comments
amscanne 4455 days ago
I was disagreeing, but I don't think you are wrong: just misinterpreting.

I think that a good currency really has couple properties: fungible, no inherent value (i.e. not a good value store).

(This could be viewed as a weakness but I think is actually a strength in this circumstance).

If the currency is a value store, it changes the dynamics of spending it. I feel this is the reason that salt (going back in time) is not a particularly good currency either. Imagine it this way -- if all of a sudden salt was more useful (perhaps it's a hot summer, and meat is spoiling), then all of a sudden there's an extra inertia on all transactions, i.e. the cost of all goods changes.

The point of a currency is to facilitate transactions. If there's any sort of speculation around the inherit value of the currency (as per bitcoin -- the knowledge that demand will increase and supply will be lost) then it increases friction in spending.

I would certainly have to think a lot harder all the time if I were spending stocks or tiny pieces of land.

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olalonde 4455 days ago
> I would certainly have to think a lot harder all the time if I were spending stocks or tiny pieces of land.

You said it yourself: people don't hold cash. They sell their assets before buying something with cash. And it doesn't seem to prevent them from spending. With Bitcoin, it would be the same thing except the whole "sell your assets before you buy" process could be skipped.

Of course I oversimplified a lot here. People don't literally sell their stocks/real estate before they buy something. But I'm sure they would if those assets allowed them to.

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arethuza 4455 days ago
"What would be the use case for cash?"

To pay our taxes?

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