How Would BTC Be Valued In Runaway Inflation?

[anaconda]

Just curious as to how this might work. I can imagine a few different scenarios. So if the currency crisis hits the U.S. and the world, and the dollar experiences huge runaway inflation (like a loaf of bread is $300,000 on a particular day then $800,000 the next) how do we know what our BTC are worth?

I'm assuming a "basket of goods" valuation would be established pretty quickly somehow. I'm also guessing that those with goods to sell will most definitely prefer cryptocurrencies over bartering and will offer significant discounts off prices to get them, at least until a process of stabilization can occur.Thoughts? Ideas?

[presence]

[LibertyRevolution]

If the dollar collapses and bread is $800,000 a loaf, your bitcons with be worth nothing...
No one is going to trade you any physical asset for useless computer code when they are starving.

Seriously.. I wouldn't even trade you a bic lighter for a bitcon at that point.

[dannno]

If the dollar collapses and bread is $800,000 a loaf, your bitcons with be worth nothing...
No one is going to trade you any physical asset for useless computer code when they are starving.

Seriously.. I wouldn't even trade you a bic lighter for a bitcon at that point.

What if you were in a city and you could buy 10 gallons of fresh clean water for 0.2 bitcoin? Would you trade a bic lighter for 0.5 bitcoin if somebody offered it to you?

Do you really think the person with the 10 gallons of fresh clean water wants dollars at this point?

[LibertyRevolution]

What if you were in a city and you could buy 10 gallons of fresh clean water for 0.2 bitcoin? Would you trade a bic lighter for 0.5 bitcoin if somebody offered it to you?

Do you really think the person with the 10 gallons of fresh clean water wants dollars at this point?

Nope, I wouldn't ever be in a city, and I won't take bitcoins for any of my stash.
Who in their right mind would take bitcons for anything??

Would they want cash at that point? nope.
But at least you can wipe your ass dollars, and stuff your clothes with them and burn them for heat, you can't even do that with a bitcon.

Sorry, bitcon is nothing more than a pyramid scheme. Useless computer code with no inherent value.
All its "value" comes from talking others into becoming a part of it, it is the definition of a pyramid scheme...

[dannno]

Who in their right mind would take bitcons for anything??

I know, economics is hard..

But slow down for a second. I just asked you if somebody was willing to trade something of value to YOU for bitcoin, would you trade something of value to someone else to receive bitcoin to trade? The answer is yes, of course you would. You are not an idiot, I believe in you. If you need a bag of rice to survive and some guy with a bag of rice wanted bitcoin, and you had something that somebody else wanted that you didn't need that much and they had bitcoin, you would be intelligent enough to make that trade so your genes could continue to survive. Your body would literally force your brain to rationalize it and trade bitcoin in that situation. I have full confidence of that.

The point is, you don't know if people will accept bitcoin or not, but what you don't understand is that mediums of exchange are very valuable in and of themselves. Bitcoin works well as a medium of exchange because it has the characteristics of a good medium of exchange.

If people have access to electronics and can transfer bitcoin while the paper currency is hyper-inflating, they WILL, and depending on how widespread the usage is it could become HIGHLY valuable beyond your wildest imagination.

A much better argument you could make is that electronic devices or network infrastructure may not be available to transfer bitcoin.. but as long as that exists, there is a huge potential for bitcoin to be used as an alternative currency during a currency crisis.

[oyarde]

Just curious as to how this might work. I can imagine a few different scenarios. So if the currency crisis hits the U.S. and the world, and the dollar experiences huge runaway inflation (like a loaf of bread is $300,000 on a particular day then $800,000 the next) how do we know what our BTC are worth?

I'm assuming a "basket of goods" valuation would be established pretty quickly somehow. I'm also guessing that those with goods to sell will most definitely prefer cryptocurrencies over bartering and will offer significant discounts off prices to get them, at least until a process of stabilization can occur.Thoughts? Ideas?

Yes , I think a " basket of goods valuation " would happen quickly . I doubt though there would be any advantage to cryptocurrency over physical barter items with that realm .

[oyarde]

If the dollar collapses and bread is $800,000 a loaf, your bitcons with be worth nothing...
No one is going to trade you any physical asset for useless computer code when they are starving.

Seriously.. I wouldn't even trade you a bic lighter for a bitcon at that point.

If the dollar collapses I would guess 1 to three silver dimes , a gallon of gas , loaf of bread , dozen of eggs to be interchangeable .

[RonPaulIsGreat]

Just curious as to how this might work. I can imagine a few different scenarios. So if the currency crisis hits the U.S. and the world, and the dollar experiences huge runaway inflation (like a loaf of bread is $300,000 on a particular day then $800,000 the next) how do we know what our BTC are worth?

I'm assuming a "basket of goods" valuation would be established pretty quickly somehow. I'm also guessing that those with goods to sell will most definitely prefer cryptocurrencies over bartering and will offer significant discounts off prices to get them, at least until a process of stabilization can occur.Thoughts? Ideas?

I think under such an extreme scenario, everyone would be hording absolutely everything consumable. Rape, and murder would be taking place on the streets, all the dogs would start disappearing into crock pots. No one would pay taxes, the police would turn into gangs confiscating for themselves. Essentially, I think under such a scenario civilization will have halted temporarily or collapsed, and bitcoin would be pretty well be valueless, along with gold and silver for some period of time until things settled down again, and new nations formed from the ashes of the old. I mean under such an scenario world trade would screech to a halt. Horde, Horde, Horde. Guns, Food, Fuel, Medicine. That's all I'd trade for.

Now, once things settled down, in months, or years, and a surplus of goods started being produced again, it's likely a cryptocurrency would be used, likely bitcoin.

[kpitcher]

Some of the largest spikes in Bitcoin pricing came when there have been fiat currency problems. Cyprus banking problems, Greece, even when the US shut down for a day all pushed Bitcoin higher.

Now if hyperinflation happened and people needed a wheelbarrow to buy bread happened, I think it'd come down to whomever had the most ammo.

[muh_roads]

I can see the haters are coming out again now that we passed the 2013 ATH...LOL

Congrats HODL'ers

[anaconda]

If the dollar collapses and bread is $800,000 a loaf, your bitcons with be worth nothing...
No one is going to trade you any physical asset for useless computer code when they are starving.

Seriously.. I wouldn't even trade you a bic lighter for a bitcon at that point.

On the contrary, it may be the only stable liquid currency available, and therefore worth a great deal.

[anaconda]

Yes , I think a " basket of goods valuation " would happen quickly . I doubt though there would be any advantage to cryptocurrency over physical barter items with that realm .

Cryptocurrency would be better than barter for the same reasons that dollars are currently better than bartering. Reason is that people don't need to spend time and energy locating others that have exactly what you want at the same time that you have exactly what they want. Better to deal with mediums of exchange.

[anaconda]

If the dollar collapses I would guess 1 to three silver dimes , a gallon of gas , loaf of bread , dozen of eggs to be interchangeable .

Agree with the way you are thinking here. Relative prices would be theoretically unchanged (i.e. the amount of bread one could swap for a certain amount of gasoline would presumably be the same before and after the currency crisis). But the question is how would BTC be valued. A quick but only approximate method might be to recall what the BTC/$$ ratio was at some point before the currency crisis and the $$/specific commodities on the same date. Might be a place to start and then allow the markets to adjust.

[oyarde]

Some of the largest spikes in Bitcoin pricing came when there have been fiat currency problems. Cyprus banking problems, Greece, even when the US shut down for a day all pushed Bitcoin higher.

Now if hyperinflation happened and people needed a wheelbarrow to buy bread happened, I think it'd come down to whomever had the most ammo.

I tend to agree with that . I do not plan on running out of ammo .

[anaconda]

I can see the haters are coming out again now that we passed the 2013 ATH...LOL

Congrats HODL'ers

Got my gf in at about $555, after which they quickly plummeted to $200-something. But now she's up to about $1198.43 at this moment, and I think she's in for the longer run towards political and monetary instability. And she's a liberal!

[anaconda]

$1199.98

Come on, two more cents!

[muh_roads]

Got my gf in at about $555, after which they quickly plummeted to $200-something. But now she's up to about $1198.43 at this moment, and I think she's in for the longer run towards political and monetary instability. And she's a liberal!

Tell her congrats.

Even smart liberals know it's retarded to save value in systems of unlimited supply.

[muh_roads]

Liberals are quite easy to convert if you can convince them that the 1% is the Government & the banking cartel holding who is holding down the 99%.

They can really get into the 1% / 99% dichotomy.