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Why Bitcoin Can’t Replace the US Dollar (Fiat)

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Can Bitcoin/ cryptocurrencies replace the United States buck/ United States government and also fiat currencies? Can Bitcoin be the transformation that removes the fraudulence that is central/ business banks worldwide? Have they ultimately gone as well much with absolutely no rate of interest policies and also quantitative easing? Probably, yet believe it or not, that is besides the factor. Bitcoin is not with the ability of applying even a few of one of the most fundamental functions of financial policy.

For one, Bitcoin isn't even inflationary (well, it won't be in the lasting), which would be unhealthy for the economies it sustains (particularly for those driven by intake). Furthermore, credit in a Bitcoin based economic climate would be rather difficult. Monetary policy helps relieve both credit rating crunches as well as overheated economies through influencing rates of interest.
While such activities have actually been controversial, they have worked well for us (actually United States) in time as well as has actually assisted produce a few of the richest nations in the world by strengthening GDP by motivating spending when it is slow and also reducing probability of the economic climate getting too hot.

Bitcoin would certainly have to shed its feature as a store of worth to become a true money that motivated costs, in which situation it would no more really be a financial investment anyway. Rather, Bitcoin ought to operate as a choice to standard payment channels and fiat currencies for remittances as well as general organisation transactions for those that "opt-in." There is a lot of market share here as well as it is reasonable.

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50 Thoughts to “Why Bitcoin Can’t Replace the US Dollar (Fiat)”

  1. Truth Investor

    EDIT: Loving the comments everyone! These are far more constructive than I expected and I am enjoying reading the arguments both for and against inflation / credit driven economies. Keep it coming!

    I hope you all enjoyed the video – bit more controversial this time. I would love your feedback if you like these types of videos that go a bit into the “dark” side that many people who cover cryptocurrencies refuse to go to mainly because the masses riot any opinion that can be considered even partially “FUD.”

    I have a number of other controversial topics in mind too which I’ll likely be delving into in the future. And don’t worry, I got a big idea in mind for a very bullish article / video combination for Bitcoin as well. As usual, likes / comments / subs go a long way to supporting the channel (seriously). Thanks for watching.

    1. Russell Spears

      I would love to have a video discussion on this with you…. you or I can post it uncut…

    2. Conot42

      Crypto Investor I think the biggest problem with your argument is your using fiat economic ideas to explain bitcoins future. What do you think bitcoins deflationary rate with be 100 years from now? Or if it’s used as the worlds only currency? And why would the deflation matter if the whole world is using the same currency.

      You give Japan as an example of a deflationary currency destroying an economy but of course you would save if your money is going up in value compared to the rest of world but what’s the incentive if the whole worlds currency is changing at the same
      Percentage.

      Also people do not believe it will go up in value later simply because it’s a deflationary currency they believe it will go up in value late because it’s use case is so high and the more people using it will cause the demand to increase. That is the main reason people do not want to spend it at this time. Once the demand is maxed out the deflationary rate will become insignificant.

      Also you are over simplifying the US economy when u say inflation and the governments ability to print more money has driven our success. Capitalism and the US governments ability to stay out of our market is the reason it has been so successful.

      Any government manipulation in the economy only hurts the market. Printing more money is just pumping up an economy for a short time but actually creating a bubble that will crash back down below the true economic curve. That’s the exact reason bitcoin was made or did you already forget about the housing crisis?

      It just creating a bubble almost the exact same as over excitement creates a bubble in the crypto economy. You can just look around the world and see the less government manipulation the better that countries economy is

    3. Conot42

      Also if bitcoin is just a system to store value it will die and we all should pull out our money now. Bitcoin needs to bring true value to the world to hold its value. It’s only as valuable as the market makes it and another storage of value is almost useless in the long run.

    4. Conot42

      Crypto Investor By looking at your old videos I have to believe your a banker that’s only investing in crypto to make a quick buck. You have a video about cryptos bubble popping and multiple videos stating the bear runs were going to last a lot longer. You even said the small drop a few weeks ago was going to be a huge correction. Why invest in something you have no confidence in it’s a sure way to lose all your money??

    5. Souli

      I always appreciate as many different opinions as possible so that I can make the most informed and accurate decision or opinion on something.

  2. Brian LO

    You’re gonna rustle a lot of jimmies with this video lol , the cryptosphere is a very idealogical place.

    1. Truth Investor

      Yep – and I’m here to disrupt that! One can only hope for the better.

    2. Joe Antonelli

      if by ideological you mean pragmatic, conservative and fair — then sure.

    3. Longblade13

      found the ideologue.

  3. Rosťa Plachý

    I have to say that I really enjoy all your videos, I like how rational person you are! This gives all of us an amazing insights from both point of views.

    It isn’t just some hyped video that will “promise” 1000%’s returns within a year and basically give no real value nor insights.

    I want to say that I’m really big believer of Bitcoin but despite that I really enjoy getting more information in these controversial topics as it gives me a much broader and educated view to the whole market.

    Thank you again and I’m really looking forward to your next videos!:)

  4. csteviec

    Inflation is the scourge of our broken economy. The narrator has his head stuck in a failed paradigm.

  5. mr fool

    Real inflation is more than 2%

    1. Gage Hafl

      He said healthy inflation is 2% (which is true)?

    2. Makki9119

      yeah but also dangerously close to deflation

    3. Aaron Venema

      Shadow statistics has it at about 10%

  6. Alex Wu

    You don’t need inflation to have healthy economy. Once people save enough, they will spend. Spending money they don’t have is not necessary.

    1. Altie Ku

      inflation encourage me to save more…

    2. K Y

      you should not spend your moeny that you borrowed on consuming stuff. Inflation is there to accomodate a steady growth in the economy. without inflation the wealth gap and development of new technologies or businesses would stop. and only the rich people decide if there is growth and progress. with Credit based FIat money, more people have a chance to use the loan to actually create a business which gives them a larger sahre in the economy and grow the economy with it.

    3. Hamish Littler

      Spending money is defiantly necessary.
      Consumption decreases > businesses retract or go under> Jobs lost, with no recovery in sight unless people spend money.

    4. Dawn

      Alex Wu yeah, people spend what they don’t have anyway. That’s why credit cards exist. Human nature is to live for the short term which is what most people do, and that’s what encourages spending regardless of inflation.

  7. Robert Christian Shaw

    Rising prices “encourages” consumer spending ??? … I must be too old to understand that logic, having experienced an economy where rent/mortgage costs did not exceed 1/5 of an individual’s income, food costs even less; the majority of individual’s income was free for savings & recreational spending … I wish everyone would have had the same opportunity to experience those “old days”

    1. Tha Effin dip

      I remember in 2007 my rent for 2 bedroom was 575 and my rent today is 1200 for two bedroom. Lol. Houses are too expensive to buy also at least in my state/ city

    2. Maxie Earle

      @Tha Effin dip It means buying today is cheaper than buying tomorrow

    3. Joe Antonelli

      no, you’re not too old to understand the ‘logic’ – just too wise to accept it.

    4. Longblade13

      The time value of money is a thing that exists, and has always existed. It is better to have $100 now than it is to have $100 a year from now, because you can spend it now. It is better to buy a $2 gallon of milk now, than it is to wait and buy a $5 gallon of milk a week from now. You’re not too old for logic, you just don’t understand money.

    5. Joe Antonelli

      @Longblade13 I don’t think you understand the difference between “currency” and “good money”. (See gold, Bitcoin, etc.)

  8. DOHCness

    Fiat only holds value because people trust it. Why would anyone care about money if the paper they use works just fine? They won’t ask questions until the banks start their BAIL INS.

    1. Mike Cell

      Excellent point man !!!!

    2. Longblade13

      Fiat money holds value because you have to pay taxes in fiat. If I started spending only bitcoin, I would have to exchange it back into USD when the government told me to pay my taxes, because the government doesn’t accept bitcoin. Therefore, USD retains economic value.

  9. Talu

    thanks a lot for this video, I tried so many time to explains this around me, now i can just give the link of your video.

  10. Nelson Perez

    People don’t need to be incentivized to spend. We NEED to consume things, we need food and water for starters. You cannot possibly save all your income and still manage to survive. And when basic necessities are fulfilled we still have a desire to maintain and/or improve things around us, so the assumption that we need 2% inflation to stimulate this is just false.

    1. Fredric Georgsson

      Couldn’t agree more. Inflation makes loans easier to pay off, so inflation actually incentivize spending on useless stuff – buying stuff on loans that is not really needed. Inflation is a factor in driving stuff to be off lesser and lesser quality since you don’t actually care much about your money and your purchases. If on the other hand you have deflation you won’t buy anything you don’t actually need – since in the future your money will be worth more. Yes the economy won’t grow as much – but we are already using more resources per year than are replenished! Incentivizing growth when the resources needed are diminishing is just insane and unsustainable. I think a deflationary currency will change consumers into investors and clearer thinking citizens. There is no proof that deflation is needed. It might be needed for economies to grow – not for people to live decent lives.

  11. Truth Investor

    Everyone – getting tons of comments, lots of them criticism, some nice ones. I read them all. I’ll likely do a follow-up video for this at some point in future, but not going to throw it together haphazardly. I will likely write an article along with it (which forces me to cite all my sources) and also present the other side of the argument more fairly. Continue on commenting, it helps give new ideas for that video. I appreciate ALL of the feedback everyone, even the trolls.

    1. Verdelufe

      Jmriccitelli – Man you are sending me to another Galaxy, I don´t have enough fuel to reach you.

    2. Jmriccitelli

      @verdelufe……..I was just saying that the US economy went from an agriculture economy, then a manufacturing one, then a service economy, and now today it’s primarily a financialization service economy. Almost 60% of all corporate profits today comes from banking, financial & wall street services. And the game is RIGGED! You are a kind person, and I hope you have a great weekend.

    3. Verdelufe

      Oh ! I see, thanks for all your precious information, have a good one.

    4. Bob Is The Builder

      Crypto Investor

      I think bitcoin and other crypto currency are worth watching at least for now. I do like the concept of decentralized currency and a ledger that can be viewed and verified.

      Unfortunately bitcoin appears to be just like the stock market and other fiat currency with nothing to back it up but as promise.

      If you have sold information you can share with me that doesn’t include a sales pitch I would like to know more.

    5. Matthew Gray

      J I agree and inflation doesnt need more dollars just the cost of things needs to rise. If the items price never change and the value of the dollar went down that would be the same as…the dollar staying the same and the price of things going up. Bitcoin could be used as both because all that needs to happen for inflation it one of the two things (currency or the item price) to go up.

  12. Daniel Toback

    Great video. Keeping it real, love it. I love the crypto community for it’s idealism, but real change happens when idealism meets pragmatism. Keep up the great work!!!

  13. Armin Habibi

    Awesome video man. Love to finally see someone creating pragmatic crypto content! Keep it up man.

  14. Troy AG

    In the long run who knows what is going to happen. I think I will hold a little of both! But Your point is very realistic and down to earth. I assume we can live with a little of both.

  15. Melee Wonka

    “Comsumption driven economy””in the long term you need inflation” And that is when i closed the video. Wealth can only be generated when people save money.

  16. Man Against The State

    Keynesian nonsense. The historical period with the fastest growth – the 19th century – happened with gold, a deflationary currency that also served as a store of value. Inflation is NOT needed for growth or for any other reason; it is a straight transfer of wealth from the poor and middle class to the banks and the government. You’ve fallen for their propaganda. Read Mises.

    1. Zejayt

      Bzzzt wrong. Gold supply has increased by about 2% per year for decades.

    2. Марианна Ершова

      make the best profit by searching in google bitastray then paying some bitcoin the maximum its 10,81 and you will earn 2% every hour

  17. Nomad

    You lost me when you said employers will give more money to employees.

  18. Krzysztof Cygan

    Funny how YouTube works, I got this video recommended as well as “Bitcoin will crush VISA” 🙂

  19. Werex Zenok

    >”this system worked very well for us”
    >20 trillion of debt

  20. Digio

    The Central bank of Amsterdam has researched that a Central bank causes inequility.
    And the results was that they do.

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