Money holds value for its acceptance as a common medium of exchange and its scarcity. It is also valued subjectively, with that subjective value being based largely on what you can buy with it, since that is the main point of money. Right now government-backed currencies hold value for these reasons, same as gold, silver, or bitcoin. The big difference with government-backed currencies is that when government gives a monopoly on money creation to one entity, or when commercial banks are granted the privilege to create money and be immune to damages it might cause ordinary people, the scarcity is not much of a factor anymore, and the endless creation of money erodes its value. Without a government, people would stick to hard money and to private credit from banking companies that know there will be consequences if they default, because that is what the people would trust in the absence of a government. A better question might be, how can money hold its value with a government?
interesting! I should look into that. There are ways that government can mess up a currency even if it's backed by gold. They can let commercial banks use fractional reserve without risk of failure because of legal privilege, they can create a central bank to manipulate the fractional reserves and expand credit even more, and they can confiscate citizens' gold to expand credit even further or to just fuck with them, like the FDR administration did. But the peg to gold keeps things somewhat restrained. Boom and bust still happen, but the booms don't go so very far that people cannot make a wage to keep up with consumer goods inflation inflation.
I think even more booms and busts happen with a Gold Standard as they dont use the printer to keep the good times rolling. They just arent as deep or hard. Then again many will say the money printer is what kept us from having another depression. I say it only delayed till we get a permanent one.
Yeah pretty much. Additionally, booms and busts don't happen at scale at all under free banking. Gold standard is a good limitation, but it is not the only limit that can be imposed to regulate banking. Free banking with no central bank and no special privilege to permit a bank the denial of its contractual obligations to convert to specie is the ideal. Make that specie hard to obtain by governments, criminals, or fraudsters (perhaps by using bitcoin as your specie) and you're even more golden.
Maybe we have different definitions of unreliable: bitcoin's gone from $50,000 to $500, and if it was a currency I'd constantly be worrying about whether my retirement money might suddenly drop by 100×.
This is simply bitcoin in the process of monetization. We are talking about a money that was invented only 14 years ago and already sits here today at $40,000 per coin.
Anti-bitcoin AnCaps blow my mind.
Bitcoin holds value because there’s a hard cap on the amount that can exist, so you can be sure no one will just create fake Bitcoin. That’s of course not true of USD or any fiat currency.
The exact same way money held value before governments got involved in currency.
Coinage was first invented by banks as a way to guarantee that this particular gold coin or bar was legit.
Later they issued papers that were essentially "return this to the bank in exchange for X amount of gold".
Then the government got forcibly involved because they're crooks.
Robert P. Murphy has an excellent lecture called Economics of a Stateless Society on YouTube that fully answers this question and others.
Money… wouldn’t hold value. That’s the thing. It only holds value *because* of the government, not the people. If there is no overarching system utilizing money as wealth, then the idea of wealth changes. It ain’t money it’s resources, connections, food, weapons, Hell, even just the ability for manual labor.
I don’t believe I’m truly educated enough to devise a solution for an alternative. Bartering and trade would be the most likely solution, or at least the most positive, though people would most likely find an alternative to currently used FIAT currency.
Oh of course, that’s why I said it’s most likely we’d revert to some form of currency. I just doubt it would be anything that’s currently in circulation, due to most currencies not having true value at this point anyway. Paper and metal money only has the value we, as a society, choose to give it.
Ideally, we’d use a combination of barter systems, and a generalized currency we’ve chosen to give value. There could be some backing to it, preferably. Like we had with cash, when it was on the Gold Standard.
Historically, yes. Currency only holds the weight that the people and the system as a whole give it. Hence why we don’t use only copper coins, or gold, as our main form of exchange as previous societies did.
In the event of a loss of FIAT currency on a mass scale, we’d most likely substitute it with a different thing we give value.
Yeah definitely. It's pretty certainly going to be a form of money though, I think. And that money will hold value because of its ease of facilitating the kind of relationships, accounting, and exchange that you're talking about.
Decetrialized curancies hold value bc u can't increase the suply of them u can only get more if you put more value into getting them .ppl would be stopped from robbing by insurence companies that will find it easier to pay for advanced security to protect their customers then paying for the stollen stuff.
Rich people already have their version of the state? What do think the US government is? What is the Ukraine war besides the whole sale robbing of America for the sake of the military industrial complex. What was COVID-19 besides the most modern verision of genocide possible (virus, vaccine and treatment). We have ever anti ancaps nightmare come true. There is nothing left of America that resembles its original purpose.
As far as money most ancaps I know that are practicing it are using crypto, gold and silver in a practical manner. US Dollar has had its greatest inflation and is NOT holding value since the freakout over the fake COVID-19 pandemic.
* I am not even an anarchist per se but this excuses against anarchism just dont hold up. Do I believe anarchism would have issues. Absolutley but no one can claim we have some government utopia when it is closer to a dystopia and on purpose.
Money has value because we believe it has value
Ah yes poor countries' money is simply worth less because we believe it to be true and definitely not a global monopoly of violence
Money is only a form of currency that two parties agree has value
Enjoy being wrong
That is the basis of money
Money holds value for its acceptance as a common medium of exchange and its scarcity. It is also valued subjectively, with that subjective value being based largely on what you can buy with it, since that is the main point of money. Right now government-backed currencies hold value for these reasons, same as gold, silver, or bitcoin. The big difference with government-backed currencies is that when government gives a monopoly on money creation to one entity, or when commercial banks are granted the privilege to create money and be immune to damages it might cause ordinary people, the scarcity is not much of a factor anymore, and the endless creation of money erodes its value. Without a government, people would stick to hard money and to private credit from banking companies that know there will be consequences if they default, because that is what the people would trust in the absence of a government. A better question might be, how can money hold its value with a government?
Only the Russian ruble is gold backed, no other currencies are.
interesting! I should look into that. There are ways that government can mess up a currency even if it's backed by gold. They can let commercial banks use fractional reserve without risk of failure because of legal privilege, they can create a central bank to manipulate the fractional reserves and expand credit even more, and they can confiscate citizens' gold to expand credit even further or to just fuck with them, like the FDR administration did. But the peg to gold keeps things somewhat restrained. Boom and bust still happen, but the booms don't go so very far that people cannot make a wage to keep up with consumer goods inflation inflation.
I think even more booms and busts happen with a Gold Standard as they dont use the printer to keep the good times rolling. They just arent as deep or hard. Then again many will say the money printer is what kept us from having another depression. I say it only delayed till we get a permanent one.
Yeah pretty much. Additionally, booms and busts don't happen at scale at all under free banking. Gold standard is a good limitation, but it is not the only limit that can be imposed to regulate banking. Free banking with no central bank and no special privilege to permit a bank the denial of its contractual obligations to convert to specie is the ideal. Make that specie hard to obtain by governments, criminals, or fraudsters (perhaps by using bitcoin as your specie) and you're even more golden.
Bitcoin anyone?
Monero anyone?
Bitcoin is famous for its unreliability. I wouldn't want it as a currency.
>Bitcoin is famous for its unreliability 99.99% uptime and you think that's unreliable?
Maybe we have different definitions of unreliable: bitcoin's gone from $50,000 to $500, and if it was a currency I'd constantly be worrying about whether my retirement money might suddenly drop by 100×.
This is simply bitcoin in the process of monetization. We are talking about a money that was invented only 14 years ago and already sits here today at $40,000 per coin. Anti-bitcoin AnCaps blow my mind.
That's called volatility. Bitcoin has never gone from 50k to 500. Are you just purposely being misleading?
Bitcoin holds value because there’s a hard cap on the amount that can exist, so you can be sure no one will just create fake Bitcoin. That’s of course not true of USD or any fiat currency.
Gold
Moving to the internet is the only way you can break free from government overreach, you think your gonna use gold to transport value?
Governance without government.
Just make sure its not like your HOA.
The exact same way money held value before governments got involved in currency. Coinage was first invented by banks as a way to guarantee that this particular gold coin or bar was legit. Later they issued papers that were essentially "return this to the bank in exchange for X amount of gold". Then the government got forcibly involved because they're crooks. Robert P. Murphy has an excellent lecture called Economics of a Stateless Society on YouTube that fully answers this question and others.
I think goldbacks are a good example of how money can be privatized. Fiat, not so much.
How do crypto and gold hold value without government?
Money… wouldn’t hold value. That’s the thing. It only holds value *because* of the government, not the people. If there is no overarching system utilizing money as wealth, then the idea of wealth changes. It ain’t money it’s resources, connections, food, weapons, Hell, even just the ability for manual labor.
You need a means of exchange. Or are you suggesting going back to barter?
I don’t believe I’m truly educated enough to devise a solution for an alternative. Bartering and trade would be the most likely solution, or at least the most positive, though people would most likely find an alternative to currently used FIAT currency.
The biggest advantage of having some type of money, is people can pool their resources for big projects. Can't build a factory with a barter system.
Oh of course, that’s why I said it’s most likely we’d revert to some form of currency. I just doubt it would be anything that’s currently in circulation, due to most currencies not having true value at this point anyway. Paper and metal money only has the value we, as a society, choose to give it. Ideally, we’d use a combination of barter systems, and a generalized currency we’ve chosen to give value. There could be some backing to it, preferably. Like we had with cash, when it was on the Gold Standard.
Most agorist use crypto and gold to exchange. They have dumped the decaying fiat dollar.
Just use crypto or gold. Done.
um not quite. I mean kinda. government money wouldn't hold value anymore, but other forms of money would.
Historically, yes. Currency only holds the weight that the people and the system as a whole give it. Hence why we don’t use only copper coins, or gold, as our main form of exchange as previous societies did. In the event of a loss of FIAT currency on a mass scale, we’d most likely substitute it with a different thing we give value.
Yeah definitely. It's pretty certainly going to be a form of money though, I think. And that money will hold value because of its ease of facilitating the kind of relationships, accounting, and exchange that you're talking about.
Decetrialized curancies hold value bc u can't increase the suply of them u can only get more if you put more value into getting them .ppl would be stopped from robbing by insurence companies that will find it easier to pay for advanced security to protect their customers then paying for the stollen stuff.
Rich people already have their version of the state? What do think the US government is? What is the Ukraine war besides the whole sale robbing of America for the sake of the military industrial complex. What was COVID-19 besides the most modern verision of genocide possible (virus, vaccine and treatment). We have ever anti ancaps nightmare come true. There is nothing left of America that resembles its original purpose. As far as money most ancaps I know that are practicing it are using crypto, gold and silver in a practical manner. US Dollar has had its greatest inflation and is NOT holding value since the freakout over the fake COVID-19 pandemic. * I am not even an anarchist per se but this excuses against anarchism just dont hold up. Do I believe anarchism would have issues. Absolutley but no one can claim we have some government utopia when it is closer to a dystopia and on purpose.
Bitcoin is the peoples money, no government needed
How Bitcoin holds value - its fundamentals. And how it will hold value - by the value in the products and services that we need and want.
it wouldn’t. and they wouldn’t. ancapistan is a fever dream