-
thanks Jerome for contributing…..
“Education and culture will let individuals choose the hard money, yes. (He who hoards first the new hard money becomes more powerful over time, and that’s how easy moneys get replaced by harder ones.)”
- some people are willing and able to accept education about hard money some are not (willing or able)
- the question is: how to approach all types and bring them on board?
“But for countries, because it’s about masses of people, I guess stable adoption of harder moneys will be about game theory dynamics?:”
- a game theory approach: probably needs an entire new thread
- one theory is that a hard money world might be mostly borderless
- how to apply game theory to attaining and keeping a hard money world?
“Clearly the fiat (dollar) standard won over the gold standard, so far.
The next money will need be harder than dollar.”
- the dollar is fiat and by definition soft and inferior. gold, harder and superior, lost to fiat but only in the short run. fiat is now imploding…again
- at the core of why gold failed is it’s centralized nature. since gold is not portable we must have, at least somewhat, centralized control of gold where that authority issues portable gold notes. this centralization eventually leads to abuse and migration to notes not linked to the underlying asset (gold), in other words, fiat.
- bitcoin is harder than gold by being portable and decentralized but is it vulnerable to fiat in other ways?
“Imagine a small country hoarding bitcoin early, getting wealthier, then others follow, profiting most the earlier they join.
Some day that small but wealthly country on bitcoin standard feels threatened, needs stronger military capabilities and alliances.
Either it start printing fiat money. Or it makes alliances with other countries bitcoin standard? Or whatever else.
And the superior money will win: maybe bitcoin, maybe dollar, mayber others.
It won’t be one country alone on hard money standard. Because if that money standard is superior, others will follow. If it isn’t, this first adopter will finally abandon it.
It will be all countries moving progressively to the new superior money standard.”
- so far the superior money hasn’t won. that’s why we’re in this pickle
- is the message here that hard money will never win unless the world is dominated by hard money?
“No country is on gold standard nowadays, because gold isn’t the hardest money anymore. (By definition of “hard money”).”
- the reason we’re not on the gold standard is not because gold isn’t the hardest money (up until bitcoin gold has been the hardest money). it’s because gold has two flaws: 1) it’s not portable and 2) therefore has to be centralized. these points make gold vulnerable to corruption and migration to fiat is the result. but bitcoin (and the blockchain) fixes these points. so bitcoin is the hardest money ever, but it still may not win.
Conclusion?
the point of all this, so far, i think, is that to enable a stable hard money world:
- a hard money world is not inherently stable?
- we need to figure out how to gain (and keep) acceptance of all people types of the perils of soft money and the virtues of hard money?
- and we need hard money to dominate?
