Hey, I accept pieces of paper (and now bits in a computer) for my valuable work, and bought a valuable home, car, and computer with those papers and bits.
Money works purely on belief. If we all suddenly disbelieved in the dollar, the value would be zero.
Curiously, most cycles of hyperinflation come more from loss of faith than from money printing. When people lose faith in a currency, they sell it off as a value store.
Elon Musk's net worth is $28B. His faith in a crypocurrency as a value store counts for a lot.
> Money works purely on belief. If we all suddenly disbelieved in the dollar, the value would be zero.
Is this true? Yes.
Are you wildly underselling what "disbelieving in the dollar" means in practice? Also yes.
I believe in the dollar because the United States has the worlds largest nuclear arsenal, spends nearly a trillion dollars on its military every year – and that's only what it puts on the books – and has been proven to have an itchy fucking trigger finger.
That trust isn't going anywhere without massive global conflict.
Also democracy. What if Bitcoin went up to $100M/coin? What is the likelihood that both Trump and Biden are going to be like "Well the BTC people were right and now they can buy all the companies and real estate. The rest of you americans will have to just have fun being poor, there is no way we will tax BTC wealth"
Money works purely on belief. If we all suddenly disbelieved in the dollar, the value would be zero.
Curiously, most cycles of hyperinflation come more from loss of faith than from money printing. When people lose faith in a currency, they sell it off as a value store.
Elon Musk's net worth is $28B. His faith in a crypocurrency as a value store counts for a lot.