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imTony t1_iwcftnk wrote

Reply to comment by mistersmiley318 in D.C.’s bitcoin king: yachts, penthouses, a python — and tax dodging? by washingtonpost

> These entities deal in something that has no inherent value

The US dollar has no inherent value either

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IcyWillow1193 t1_iwcmf1t wrote

>The US dollar has no inherent value either

Utter nonsense. The US dollar represents the backing of the United States Government, a multi-trillion dollar economy, and its status as a global reserve currency. That's pretty much as inherently valuable as it's possible to get.

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imTony t1_iwdfjtj wrote

That doesn’t mean it’s inherently or instrinsically valuable. The USD is backed by public faith but fiat currency doesn’t have intrinsic value.

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acdha t1_iwds666 wrote

Cryptocurrencies are also fiat currencies: the random hashes have no intrinsic value, even less than the paper in a dollar bill. The difference you should be learning about is that in the case of, say, Bitcoin there is no power behind that fiat - nobody is required to use it, pay taxes in it, or receives it without alternatives. That’s why the price is so volatile because at any point a user has to decide whether it’s better to use a different currency (betting that the price will go up).

In contrast, the USD is the default currency in one of the largest economies in the world and millions of people are required to use it to pay taxes, receive payments, or get paychecks from the government, and strong pressure to use it from all of the contracts specifying dollars. That’s a huge amount of inertia and there’s no plausible mechanism where that changes quickly but there’s still a global economy.

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imTony t1_iwekxbt wrote

I’m not talking about Bitcoin or crypto. I know Bitcoin is fiat. I’m talking about USD and the fact that it’s not intrinsically valuable. What you wrote doesn’t change that.

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WealthyMarmot t1_iwck597 wrote

Depending on the definition of value that we're using (and there are a whole bunch of definitions), technically no currency does. But given that the dollar is required to pay taxes and to conduct 99.99% of trade in this country, for all intents and purposes that distinction is irrelevant.

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