Flobee
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Market absorbed $2.75 BILLION is sell side and stayed above $100k. Thats 100% bullish from a fundamentals standpoint
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Market absorbed $2.75 BILLION is sell side and stayed above $100k. Thats 100% bullish from a fundamentals standpoint
Kirun
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You're mixing up theoretical permissionlessness with practical usability at scale.
Yes, fiat exists because the state authorizes it. That's not a weakness; that's literally why it functions as money. You can pay taxes with it, settle debts with it, run payroll with it, price commodities with it, and every business is legally required to accept it.
Bitcoin not requiring state permission is great for self-custody and personal sovereignty. No disagreement there. If the topic was "can I store value outside the banking system?" - sure, Bitcoin wins that all day.
But that's not the argument.
The question is whether Bitcoin remains usable as money if the state decides to apply pressure. And that has nothing to do with the protocol and everything to do with: On/off ramps, institutional adoption, reporting rules, business acceptance, legal liability, accounting treatment, and banking rails.
Peer-to-peer "I send you BTC, you give me beef" trades are not an economy. They don't scale. They don't build industries. They don't handle payroll, taxation, corporate balance sheets, or trade settlement. A currency is only money if it can operate at scale.
Fiat can, because the state enforces that scale. Bitcoin can only while the state tolerates it.
So yeah, Bitcoin is sovereign-resistant at the personal custody level - no argument. But at the economic-system level, it is absolutely sovereign-contingent:
If governments restrict businesses, banks, exchanges, and ISPs, Bitcoin doesn't disappear, but its liquidity and utility collapse. That's the difference people keep glossing over: the chain surviving is not equal to the currency functioning.
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Tmac
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Disagree with the foundation you're starting from. Fiat, wasn't a foundational monetary system. It exists because in the last 100 years the US government has removed the dollar's underlying tether to value (silver then gold). It's a bastardization of monetary policy that was once tethered to value.
It is technically an authorized thing that has slowly become more and more diluted, due to malfeasance though.
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Kirun
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The "fiat used to be real money because it was backed by gold/silver" framing is backwards. The gold peg didn't give money value - the peg was a policy tool to stabilize confidence in the currency that the state already had the power to enforce.
Money has never derived value from precious metals themselves. Money derives value from what you can buy with it and what you are required to pay with it. That's why taxes, wages, debts, land purchases, utilities, legal judgments, etc. are all denominated in fiat.
Gold didn't create the dollar's legitimacy. Legal obligation and network adoption did.
And when the gold peg was removed, what happened? People didn't stop using the dollar, commerce didn't collapse, and global trade didn't pivot to bullion.
Why? Because the dollar's value wasn't coming from metal - it was coming from enforced economic coordination.
Tmac
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Uh, you're revealing your total lack of education on American monetary history.
The history of the dollar (before the dollar), is that there were originally notes backed by someone's literal gold. Banks had gold and they'd give people "notes" that represented divisible units of their gold, because one of gold's weaknesses is divisibility (it's impossible to divide up into small enough pieces to buy eggs). So, if you gave someone a note from "The Pinkerton Bank" they could go to that bank, turn in that note, and get gold in return. Notes (pre cursor to the dollar) in America LITERALLY STARTED as deriving its value from literal gold and silver, bc the note LITERALLY REPRESENTED the gold/silver that was stored in that bank.
The reason people didn't stop using the dollar after it became fiat is bc the dollar became the standard for buying and selling. There was a hundred years of spending "dollars" and that's a LOT of inertia. And since the dollar, FOR THE FIRST TIME, was not represented by literal gold sitting in a bank it was no longer easy to tell how much that dollar was actually worth. Inflation being a tax on the poor and all, makes it impossible to make buying decisions bc it's hard to know what something is really worth. Is this chicken worth twice as much now or is my money worth 1/2 as much? Did the market change or did the value of my dollar change now that more just got printed? How do you make buying decisions in that kind of market? It's challenging and we've seen how it's impacted American consumers over the last 50 years; more negatively the further away we get from 1971.
WTF Happened In 1971?
https://inflationdata.com/articles/2022/08/10/u-s-cumulative-inflation-since-1913/ "I don't believe we shall ever have a good money again before we take the thing out of the hands of government, that is, we can't take it violently out of the hands of government, all we can do is by some sly...
wtfhappenedin1971.com
The thing about BTC bros is that the rabbit hole typically starts with "hours" of videos on topics like, "What is money?", that speak to the origins of what you're attempting to argue. The major flaw in your argument being that it isn't actually factual.
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Flobee
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Gold was collateral, and dollars were claims on the collateral.
Tmac
is correctEDIT: The system I believe you're referencing is the petro-dollar which was in fact based on violence and threats of violence, but thats a new phenomena and is not how its been done historically. This is only from 1971 to today. You can look at old dollars and they say quite literally redeemable for gold. Might have to zoom in for boomer eyes. Banks and paper money was created to facilitate trade without lugging around physical gold as it was impractical past certain values. This is all money 101 stuff
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Arden
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Since we are on the topic, going to throw this out there:
Strong recommend. One of the best non-fiction books ive read in years. You don’t have to like BTC to enjoy it, either.
Strong recommend. One of the best non-fiction books ive read in years. You don’t have to like BTC to enjoy it, either.
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Flobee
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While we're educating folks throw this one on the list for something less technical but provides all the data required to figure this stuff out.
Amazon.com: The Big Print: What Happened to America and How Sound Money Will Fix It (Audible Audio Edition): Lawrence Lepard, Walker America, Lawrence W Lepard: Books
Amazon.com: The Big Print: What Happened to America and How Sound Money Will Fix It (Audible Audio Edition): Lawrence Lepard, Walker America, Lawrence W Lepard: Books
a.co
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Kirun
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Nobody is disputing that early American banknotes were redeemable for gold or silver. That part is correct. But the conclusion you're drawing from that history is the problem.
Banknotes didn't have value because they represented gold. They had value because people accepted them in commerce, courts enforced contracts denominated in them, and governments collected taxes in them. The gold backing was a credibility tool, not the source of monetary legitimacy. If gold were the actual foundation, people would have simply transacted in gold directly. The reason they didn't is exactly why state-backed currency exists: unit of account, legal tender status, standardization, enforced acceptance for taxes, debts, and commerce.
Those are the monetary primitives. Gold wasn't doing that work. The legal and economic system was.
When the gold peg was dropped, the dollar didn't collapse because the underlying source of its value wasn't the metal, it was the network of obligations and pricing built around it.
You call that "inertia." But it's monetary coordination equilibrium. Once a currency becomes the medium of pricing and settlement, that's the foundation. Not metal.
And yes, inflation erodes purchasing power. Nobody here is arguing that fiat monetary policy is saintly or benign. But inflation doesn't break the function of money, it changes the value of money. Those are different issues.
The funny thing about citing 1971 is that it actually proves my point: When the dollar went off gold in 1971, you're right - purchasing power fell, inflation increased, asset prices decoupled, etc. But notice the one thing that did not happen: The monetary system didn't collapse.
Why? Because the dollar's real foundation was never the metal, it was the state's ability to require taxes, settle debts, denominate contracts, and enforce commerce in dollars. If gold backing were the thing giving money its value, then the dollar should have instantly failed in 1971. Trade should have seized up. People should have refused to accept currency for goods. None of that happened.
Instead: Everyone kept using dollars, contracts stayed denominated in dollars, wages stayed denominated in dollars, global commodities continued clearing in dollars. The dollar became more entrenched, not less.
The question is: What actually makes a currency function as money in a society - backing or enforced settlement? Your argument assumes the former. History and markets show it's the latter.
Flobee
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You write so much and you're mostly wrong. The dollar didn't collapse because the petro dollar was created enforcing global oil trade to take place in dollars, this essentially creating unlimited dollar demand. Yes money is a contract, but gold is, historically, the collateral for trade. If the gold wasn't in the vault backing the currency then the currency means nothing. Just because we live in a blip of history where the money has no backing doesn't change this fundamental fact.
Banking itself is based on storage of collateral and double entry book keeping on ownership of that collateral. Our entire economy is based on this concept from 1494. Just because they've piled a bunch of obfuscated garbage on top that muddies the water doesn't change this.
You're parroting Keynesian economics garbage, must have taken some econ classes in college.
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Kirun
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The petro-dollar system didn’t replace gold's role, it replaced the need for commodity collateral entirely. That's the point you’re missing.
Yes, global oil settlement in dollars created enforced worldwide dollar demand. That's true. But that only worked because the U.S. already had: The deepest capital markets, the most liquid banking system, the legal system others trusted for contract enforcement, and military/geopolitical leverage to back it.
None of that has anything to do with gold.
Gold was a settlement medium before international legal and financial clearing existed. Once there were courts, central banks, sovereign credit markets, and global settlement infrastructure, the metal stopped being the thing holding the system together. The enforcement and coordination structures became the foundation. The U.S. didn't say "hold dollars because we have gold." It said: Hold dollars because you need them to access global trade and the U.S. financial rails. That's network + enforcement, not commodity backing.
You're treating gold as the source of money's value. But history shows gold was just the stabilizing mechanism used before states could enforce standardized settlement. Gold didn't historically act as collateral for trade, it acted as a settlement standard before legal enforcement frameworks and global financial clearing existed. Once those systems emerged, the backing stopped being the binding mechanism.
If gold were the foundation, the system would have collapsed in 1971 when convertibility ended. Instead: the dollar kept clearing trade, contracts continued to be denominated in dollars, and global reserve status expanded, it didn't collapse.
Which means the underlying value was never the bullion, it was the obligation and enforcement network surrounding the currency.
So the disagreement isn't about whether gold-backed notes existed. Everyone knows they did. The disagreement is what actually makes a currency function: You're arguing the value came from collateral (gold). I'm saying the value comes from mandatory settlement and coordinated acceptance. Once states and markets agreed to settle in dollars, the gold became economically irrelevant as "money", which is exactly what 1971 proved.
Yes, global oil settlement in dollars created enforced worldwide dollar demand. That's true. But that only worked because the U.S. already had: The deepest capital markets, the most liquid banking system, the legal system others trusted for contract enforcement, and military/geopolitical leverage to back it.
None of that has anything to do with gold.
Gold was a settlement medium before international legal and financial clearing existed. Once there were courts, central banks, sovereign credit markets, and global settlement infrastructure, the metal stopped being the thing holding the system together. The enforcement and coordination structures became the foundation. The U.S. didn't say "hold dollars because we have gold." It said: Hold dollars because you need them to access global trade and the U.S. financial rails. That's network + enforcement, not commodity backing.
You're treating gold as the source of money's value. But history shows gold was just the stabilizing mechanism used before states could enforce standardized settlement. Gold didn't historically act as collateral for trade, it acted as a settlement standard before legal enforcement frameworks and global financial clearing existed. Once those systems emerged, the backing stopped being the binding mechanism.
If gold were the foundation, the system would have collapsed in 1971 when convertibility ended. Instead: the dollar kept clearing trade, contracts continued to be denominated in dollars, and global reserve status expanded, it didn't collapse.
Which means the underlying value was never the bullion, it was the obligation and enforcement network surrounding the currency.
So the disagreement isn't about whether gold-backed notes existed. Everyone knows they did. The disagreement is what actually makes a currency function: You're arguing the value came from collateral (gold). I'm saying the value comes from mandatory settlement and coordinated acceptance. Once states and markets agreed to settle in dollars, the gold became economically irrelevant as "money", which is exactly what 1971 proved.
Flobee
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Had a think about it and perhaps a better way to approach this difference in understanding is through core differences in belief. You seem to believe that money is downstream from government, that is that money only has value to the degree that it is 'blessed' by the government. You've made this pretty clear. This aligns with Keynes view on economics.
I on the other hand agree more with the Austrian school which would not put money as something subjected to state authority, but rather entirely separate. There are other differences but this is a core principal. Austrian view is Orthodox for most of history beside the past ~50 years.
Everyone reading this has only lived under a Keynesian system so your perspective is understandable, but wrong historically.
Money is time and energy abstracted into something tradable. Keynesianism or the idea that a government has a right to control monetary base is immoral and never been sustainable historically.
Because we disagree on these fundamental points we cannot progress in the conversation.
You argue that currency is only an agreement and I believe it is literally time and energy. If you accept my premise the entire argument your making falls apart on a simple observation. Why does a government (people) have the ability to print time and energy (as debt)? There is no answer to this that doesn't lead to ruin. Reality will reassert itself eventually.
Your entire argument lies on the assumption that governments can create time and energy. Fact is they can only steal it. This system only exists due to a monopoly on violence held by the west, if that goes so too does this economic model.
You're correct on a number of points technically but wrong at the core of your understanding which is why I'm not going to bother arguing point by point.
I hope this doesn't read as me attacking you personally as it's not my intention. You're in good company as your view is largely mainstream, I just believe it's a case where you're unable to see the forest for the trees.
Edit: writing on phone while watching kids. So maybe not being as clear as I would like
I on the other hand agree more with the Austrian school which would not put money as something subjected to state authority, but rather entirely separate. There are other differences but this is a core principal. Austrian view is Orthodox for most of history beside the past ~50 years.
Everyone reading this has only lived under a Keynesian system so your perspective is understandable, but wrong historically.
Money is time and energy abstracted into something tradable. Keynesianism or the idea that a government has a right to control monetary base is immoral and never been sustainable historically.
Because we disagree on these fundamental points we cannot progress in the conversation.
You argue that currency is only an agreement and I believe it is literally time and energy. If you accept my premise the entire argument your making falls apart on a simple observation. Why does a government (people) have the ability to print time and energy (as debt)? There is no answer to this that doesn't lead to ruin. Reality will reassert itself eventually.
Your entire argument lies on the assumption that governments can create time and energy. Fact is they can only steal it. This system only exists due to a monopoly on violence held by the west, if that goes so too does this economic model.
You're correct on a number of points technically but wrong at the core of your understanding which is why I'm not going to bother arguing point by point.
I hope this doesn't read as me attacking you personally as it's not my intention. You're in good company as your view is largely mainstream, I just believe it's a case where you're unable to see the forest for the trees.
Edit: writing on phone while watching kids. So maybe not being as clear as I would like
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Arden
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I mentioned Lyn Alden, she takes it one step further.
Alden argues that money is ultimately an accounting system; a ledger that tracks who owes what to whom.
In primitive economies, this ledger was mental or social (“I gave you a goat, you owe me a favor”). With the rise of markets, that ledger became physical (gold coins, tally sticks, shells). In the modern age, it’s digital and institutional, managed by banks and governments.
So, money isn’t valuable because of what it is (paper, metal, code) but because of what it represents, which is an entry in the collective record of claims and obligations.
Alden notes that when ledgers become centralized- first in temples, then in treasuries, and finally in modern banking systems- the authority maintaining the ledger gains enormous power. The state issues currency (the official entries in the national ledger). It decides who can create credit, typically through the banking system. It enforces settlement, requiring taxes, debts, and contracts to be denominated in that currency.
Thus, control over the ledger = control over the economy. The government doesn’t need to “back” the currency with gold, it simply enforces its ledger entries through law, taxation, and the courts.
Alden contrasts the government-controlled ledger (fiat) with Bitcoin’s distributed ledger. Bitcoin decentralizes record-keeping; the ledger is public, global, and not owned by any authority. This makes it resistant to manipulation, censorship, or confiscation by a state. However, because governments control tax and banking systems, they still wield leverage over where and how BTC can be used or converted- i.e., over the economic layer, not the protocol layer.
In her view, the contest between fiat and crypto is a contest between centralized and decentralized ledger systems.
So government control over money is really control over the shared record of value, and Bitcoin represents the first durable challenge to that monopoly since the rise of the modern nation-state.
Like
Flobee
mentioned,
Kirun
is taking a concept (money) that has existed for a tens of thousands of years, and viewing it only through a lens that considers the last tiny, tiny sliver of its existence.
Alden argues that money is ultimately an accounting system; a ledger that tracks who owes what to whom.
In primitive economies, this ledger was mental or social (“I gave you a goat, you owe me a favor”). With the rise of markets, that ledger became physical (gold coins, tally sticks, shells). In the modern age, it’s digital and institutional, managed by banks and governments.
So, money isn’t valuable because of what it is (paper, metal, code) but because of what it represents, which is an entry in the collective record of claims and obligations.
Alden notes that when ledgers become centralized- first in temples, then in treasuries, and finally in modern banking systems- the authority maintaining the ledger gains enormous power. The state issues currency (the official entries in the national ledger). It decides who can create credit, typically through the banking system. It enforces settlement, requiring taxes, debts, and contracts to be denominated in that currency.
Thus, control over the ledger = control over the economy. The government doesn’t need to “back” the currency with gold, it simply enforces its ledger entries through law, taxation, and the courts.
Alden contrasts the government-controlled ledger (fiat) with Bitcoin’s distributed ledger. Bitcoin decentralizes record-keeping; the ledger is public, global, and not owned by any authority. This makes it resistant to manipulation, censorship, or confiscation by a state. However, because governments control tax and banking systems, they still wield leverage over where and how BTC can be used or converted- i.e., over the economic layer, not the protocol layer.
In her view, the contest between fiat and crypto is a contest between centralized and decentralized ledger systems.
So government control over money is really control over the shared record of value, and Bitcoin represents the first durable challenge to that monopoly since the rise of the modern nation-state.
Like
Flobee
mentioned,
Kirun
is taking a concept (money) that has existed for a tens of thousands of years, and viewing it only through a lens that considers the last tiny, tiny sliver of its existence.- 1
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Kirun
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You're not actually describing Austrian economics here, you're describing commodity-money origins, which is fine, but that's not the same thing as claiming "money exists independently of the state."
Historically: Early barter > commodity > standardized commodity exchange = yes. But the moment societies needed contracts, taxation, courts, armies, and long-distance trade, money became a state-enforced unit of account, not a lump of metal.
Every major economic system after the emergence of states used: Legal tender laws, tax obligations, and state-defined units of account. The metal was there to stabilize trust, not to create value. The value came from the ability to settle debts and taxes.
Your core claim is that money = "time and energy." That's an ethical and philosophical stance, not a historical one. The historical reality is: Money has always been whatever a society is required to settle obligations in.
That's why gold only mattered so long as states and courts agreed to settle contracts in gold. When that stopped, gold stopped functioning as money, and the economy didn't collapse, because the obligation network remained. You can morally object to that. You can prefer commodity money. But the claim that "money is separate from state authority for most of history" is simply not true:
Ancient Mesopotamia: debt ledgers enforced by temple and court
Rome: state-minted coinage and tax obligations
Medieval Europe: royal mints and sovereign coinage rights
Ming China: state-issued paper currency
Everywhere else: state-defined units of account
Commodity money existed, yes, but it did not scale into civilization-level economies without state enforcement. So the real disagreement isn't moral, it's structural. You're treating money as a moral abstraction. I'm treating money as a coordination technology. Those aren't reconcilable worldviews, but one of them describes how societies actually function.
Flobee
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I'm not saying money itself is a moral abstraction, I'm saying the current system is immoral and the ability to manufacture money is theft.
You're saying plenty of things that are true, but missing the point entirely. I'll break it down like this:
Most of history - Gold and silver were collateral for trade, early on exchanged directly, later exchanged with paper IOUs.
1971 to today - Gold was replaced with US Treasuries which act as collateral for the creation of money via debt.
I'm not sure why you're separating trust and value because they are the same thing in this context.
USD system has worked due to a combination of trust and threat of violence since the transition from gold backing to UST backing via the petro dollar system. I'm not sure why you're trying to overcomplicate this.
To expand a bit one of the main reasons I think Bitcoin works is because it is very fit to be pristine collateral in a way that Gold and UST could never be.
Instant settlement that requires no trust alone is massive. Plenty of other traits that are valuable but this thread is largely about exactly that so I won't bother to rehash it.
Trying to sum this entire argument up, the economy at large requires collateral to create trust which allows for trade. Gold has historically been that collateral, UST is that collateral now, and we're moving away from UST playing that role clearly. Bitcoin's value prop is, imo, largely in replacing that collateral layer. I think it can replace a LOT more than that to be frank, but at a minimum I think it will do that.
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Tmac
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Sheriff Cad
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Kirun is being significantly less hostile than usual and its a great discussion IMO, let them cook!
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