interested in hearing more from you about this can you explain?
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Replying to @DanielleFong @amnesiabourne
Odd Lots did a great show on this if you have ~40 mins for a listen! Basically the banking networks have created a world that is structurally long dollars and during times of stress they become the most important thinghttps://www.bloomberg.com/news/audio/2019-09-13/why-the-dominant-u-s-dollar-refuses-to-go-away-podcast …
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And here’s a great specific example of why the USD is more important in Venezuela than Bitcoin when there are currency issues that result in a persistent, structural bid for dollarshttps://www.google.com/amp/s/www.coindesk.com/how-i-learned-to-stop-worrying-and-love-the-money-printer%3famp=1 …
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Replying to @JamiePastore9 @amnesiabourne
This is a good link and point. Bitcoin is *not* a replacement for USD as currency yet, but it's possibly a better reserve currency, especially to back higher levels of payment.
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Replying to @DanielleFong @amnesiabourne
The USD is only the reserve currency because (not in spite of) the ability of the US to run persistent deficits without permanently debilitating our standard of living within the country. It’s a Balance of Payments axiom that Bitcoin can’t mimic without the ability to create debt
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Replying to @JamiePastore9 @amnesiabourne
You're right, those are missing pieces. But there is some credit creation that happens by default when bitcoin is rising (taxes paid on avg 6 months later - that's a lot!) AND a currency w Bitcoin as a reserve w rooted identity so that debt creation is possible would change this
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Replying to @DanielleFong @amnesiabourne
I’d be quite surprised if it was able to sustain $20+ in liquid tradable debt while simultaneously appealing to the core constituency of HODLers
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Also a security like Bitcoin is definitionally an asset rather than a liability and the reserve currency system requires liquid liabilities to hold as assets on foreign balance sheets for Balance of Payments issues. It’s just a fundamental constraint on it
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Replying to @JamiePastore9 @amnesiabourne
...I don't know why this is a fundamental constraint on an economy. Maybe it won't work with every system, but I don't know why you *need* liabilities rather than assets to make the world go round...
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Replying to @DanielleFong @amnesiabourne
If two people own assets they are simply swapping assets between buyers and sellers. If there is a liability, it is a claim on a future claim. Holders of a reserve currency need their assets to be matched by liabilities (claims) in a currency supported by outstanding debts
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This seems eminently constructible.
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Replying to @DanielleFong @amnesiabourne
Well it is, but it’s called the US Dollar. It’s difficult to replicate for many other currencies historically https://en.m.wikipedia.org/wiki/Impossible_trinity …
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Replying to @JamiePastore9 @amnesiabourne
The US soft power is at a century long low.
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