391 sats \ 4 replies \ @elvismercury 16 Nov 2023 \ parent \ on: Gold Will Be Physical Cash in a Hyperbitcoinized World bitcoin
Seems like if gold is serving the purpose described in this post, and btc or other monies are serving the more general role of money, then the need for bimetallism would be negligible. Do you have reason to believe otherwise?
My reasoning is just that it becomes impractical to use gold for very small values. That's why silver (and copper) was used in the first place.
It's such a niche situation that I wouldn't be surprised if people just did their gold transactions in those larger units.
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The impracticality was related to needing a transactional money that wasn't so logistically problematic, though. I'm assuming that the dominant transactional use in the future will be in btc and fiat. The slice of "transactional money this is also a sound money and exists in tangible form" will, I think, be pretty small, so I'd be surprised if anyone bothered to split the pie with silver. But I've been wrong before.
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I was thinking about what would replace cash in a world where fiat had been completely eradicated. In that world, if gold fills the void of cash, it would be difficult to have a gold transaction below about $5 of value. There are lots of individual items that cost less than that, so I was wondering whether silver would be used or if transactions would only occur at the values gold could accommodate.
What occurs to me as I write this, though, is that maybe it's just a sign that gold isn't what would replace cash. Silver might just be more suited to that purpose.
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Ah, that's a different premise than I was entertaining. I see 0% liklihood of gold (or really, any metal) replacing fiat, for the same reasons we have fiat in the first place -- I've swallowed the hook on this "velocity mismatch" part of Lyn's "technological determinism" idea.
I can see a role for gold as a physical-bearer-asset hard money adjunct, but in that use case I can't see silver being relevant. It serves no additional purpose. I don't see significant numbers of hard money people caring that much about being able to spend $0.25 or whatever to go to the trouble.
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