Gresham's Law should NOT be applied to Bitcoin.
1412 sats \ 6 comments \ @bitcoincaragua 22 Jul 2023 bitcoin
Gresham's Law should NOT be applied to Bitcoin, as it assumes that the currencies being compared are LEGAL currencies and not a free, competing and DECENTRALIZED currency!
Bad currency tends to drive good currency out of the market. What if the good currency were prohibited in a multilateral agreement as we saw recently in the global health pact? And if people already knew how to use it, would they stop? What if this were done today where nobody wants to use it, just accumulate?
We should, in addition to accumulating sats, have a cell phone wallet ready to use, demonstrate, evangelize. We should always ask the merchant if they accept bitcoin. Waiting for everything to happen organically seems dangerous in our time. I hope I'm wrong!
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21 sats \ 2 replies \ @mudbloodvonfrei 23 Jul 2023
What does decentralization have to do with it? Why use perfectly good sats when I can use easily-printed fiat? I can do spend-and-replace but that's essentially the same thing - I'm converting shitty money to good money to avoid spending my existing stash of good money.
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1 sat \ 0 replies \ @Undisciplined 23 Jul 2023
That's exactly the reasoning behind Gresham's Law. Part of what we're trying to do is essentially destroy the bad currency, so that people will adopt the good currency. Another part though is very intentionally fighting against Gresham's Law, by creating Bitcoin economies, to provide people who don't particularly care about Bitcoin reasons to adopt it.
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1 sat \ 0 replies \ @bitcoincaragua OP 23 Jul 2023
A decentralized currency provokes the wrath of centralized slave owners, to the point of prohibiting the circulation of bitcoin. If today, which is still legal, nobody is interested in learning how to pay, whether out of greed or ignorance of how it works, what will it be like if it is banned?
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0 sats \ 0 replies \ @jk_14 23 Jul 2023
WTF is Gresham's Law?
"Nicholas Copernicus wrote his Law in 1526, when Thomas Gresham was 14 years old kid..." #128857
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0 sats \ 0 replies \ @l0k18 23 Jul 2023
Ponzis always have an exit. Fiat is no different, too many times happened already to say it's not possible for the Dollar.
I am sure after the BRICS meeting next month, gold or not, that a lot of countries are going to stop using dollars. Already agreements exist between numerous trading partners, India and Indonesia are using Rupees. Russia and China are using Renmibi.
It's probably significant that a former commonwealth nation is in the group. One that used to have one of the most trusted gold coins. The host, this year, even!
Just as gold isn't a terrible way to save your purchasing power, Bitcoin is also. Don't be sad it's not the legal one, that's how it works. It may have been all your life there was Legal Tender but that's a very new idea, not new in and of itself but to be so widespread is a fad of the 20th century, one that will die with the coming dedollarisation.
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0 sats \ 0 replies \ @02af5e59bf 23 Jul 2023 freebie
Gresham's law requires two currencies to be a legal tender at the same time. One good, one bad. Legal tender means that all businesses must accept it as money. In that case people think "this first thing is actually better than another thing, but the state forces the grocery store to accept both at the same rate, so I will spend the bad thing and collect the good thing".
So, the business has to be forced to accept both. I think, this is what happens in El Salvador. We can check the statistics on how frequently people pay with dollars and BTC. The business is forced to accept both, as is required for Gresham's law to apply.