this post was submitted on 06 Feb 2026
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[–] Sunflier@lemmy.world 1 points 4 hours ago* (last edited 4 hours ago)

While the dollar is a fiat currency, it is backed by the US economy

In what was is the dollar backed by the US economy? It is backed by the faith in the say of the government. The US economy merely runs on the dollar, just as a car drives on roads.

its certainly more robust than some relatively new virtual currency.

It's more established, for sure. But, the political situation has accelerated what was already happening: the world is de-dollarfying. Add on to that how the administration is alienating the rest of the world, that has accelerated the trend.

Bitcoin is solely backed by faith

True, but so is the value of dollar bills

with the added difficulty of you not being able to go down to a local bank and withdrawing it in cash

I dunno about you, but I don't use cash that much myself.

if you need to and it’s incredibly volatile with it currently being worth 60% of what it was just three months ago.

It fluctuates, yes. But, so does gold. Same with fiat. The way fiat manifests its fluctuating value is through inflation and increased prices. I'm not saying bitcoin doesn't fluctuate, but gold fluctuates too. The bet with gold or bitcoin is that the fiat system will consistently devalue itself (moreso with the isolationism the country is adopting and the lack of taxation on the rich), which will increase the value of BTC against the dollar.

With regard to inflation, bitcoin isn’t immune from this either considering you have to tie it to a local currency to assign it a value so while it may be independent from a single nation’s inflation rate, you’ll still feel it when you cash some out to buy something.

Its value (ad of today) is merely being the hedge. You're right. Can't go to Best Buy and buy a tv with BTC, same as with gold. But, for how long?

I dont think its a bad strategy to hold some as part of a diversified strategy

Wasn't saying otherwise.

but putting all your wealth into it (or gold, or any other single thing) would be incredibly risky.

Didn't say I did. But, I have enough in BTC to restart in another country when my home stops holding free and fair elections, and to serve as an effective hedge against inflation and the crumbling of the Empire.