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Bitcoin is attempting to BE value better than fiat.

There is a possibility that we eventually achieve a bitcoin circular economy. In such a scenario, Bitcoin does not go up or down against fiat because there will be no demand for fiat.



There's no potential scenario where that happens (only scenarios with no potential to occur in reality).

Governments are not going to give up the critical aspects of economic control and self-determination that come from national currencies, generally. They could already do that with gold, and they overwhelmingly have had absolutely no desire to do it (for obvious reasons). If Bitcoin gets a lot larger and a lot more stable you may see an occasional small nation, in the midst of economic crisis, peg itself to Bitcoin; whenever the confidence crisis wanes, they'll promptly unpeg to regain flexibility and control.

The extreme majority of nations will strongly prefer to control their own destiny in terms of currency and retain the vast flexibility and power that comes with that control.

One might as well expect nations to give up militaries in the name of peace. That's a similar fantasy outcome that no doubt many millions of people believe could possibly happen (it can't).


> There's no potential scenario where that happens

Maybe not in your lifetime. But you’re not practicing long-term thinking here. Global, trustless, decentralized networks allow humanity to fundamentally reorganize. Physical, nation-state borders are ignored by such networks. Cooperation for physical resources still does matter but that may also be lessened by technological leaps in sectors like energy and food production. Humanity, if lucky enough to not be oppressed by ultra powerful governments, will likely render federal/central governments much less important and thus much less powerful. Simply put, the value proposition of central governments is now on the decline.


There is no potential scenario where that happens even long term. People have to physically live somewhere. Nation states continue to hold a pretty effective monopoly on violence. They can prevent you from entering, or put you in prison, or seize your assets by force. Global, trustless, decentralized networks can't control government security forces with guns. The value proposition of central governments will continue to grow, not in the sense of people actually liking them but simply because there is no alternative. That is reality and no amount of techo-utopian fantasizing will change it.


And even if it did, it wouldn't be bitcoin. As bitcoin is capped at a maximum number of units, with some being burned by losing access to them, it is per definition is deflationary currency. That would prevent a normal economy from working.




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