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10 sats \ 18 replies \ @79c9095526 OP 9 Sep \ parent \ on: Saying 1 btc = 1 btc when fiat price goes down is stupidity/cope bitcoin
Go to the grocery store and ask them how much the milk costs in sats. Tell them you have the same number of sats today as yesterday, so how much they want more (or less) sats for the same gallon of milk.
Then come back and tell me it is an illusion.
I'm not saying store your wealth in bitcoin, but you must understand that bitcoin is money, just money. Money is a concept and exchanging it for real goods/services is one of its primary values.
Today bitcoin is a great store of value, but it is not a unit of account in any meaningful sense. So to understand the actual value of that bitcoin you and I worked so hard to save, we must mentally convert the value to a widely used unit of account. Otherwise you don't know how much value you have accrued and what you can get in exchange for those sats.
Go to the grocery store and ask them how much the milk costs in sats.
You apologize, but I think this is a mistake, I don't need to do that. It is enough for me to know that now I must measure in Sats how much of milk per week or approximately spending spending, and that today with the same amount of Sats that last year I buy at least twice the same product in this case two milks.
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I generally agree with what you're saying.
My original point was that in a similar way (using your example) when the USD price of bitcoin got cut by 75% a few years ago, I could purchase 75% less milk with my sats.
So while 1 bitcoin = 1 bitcoin, it does not always equal the same amount of milk. And milk is priced (across most of the world) in a local fiat currency, not in sats.
Therefore we are forced to do the mental math of converting sats to fiat to milk. And that is why the sats to fiat exchange value matters a lot, particularly if most of one's networth is in bitcoin.
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I see where you're coming from, but ultimately, the $111k USD fiat price of a bitcoin today (or the equivalent number of cars/houses/groceries one can buy, if they don't like thinking about fiat) is the value of a bitcoin.
I also believe that a bitcoin will be worth more than $111k in the future, which is why I still hold sats that I purchased for less than $7k today, but that is just my belief. It is not predestined, it doesn't come with a definitive timeline, and I can't exchange my bitcoin today for a home that is worth $500k even if I believe that is what a bitcoin is worth in my mind. That is just not reality today.
In that vain, while a half bitcoin is a lot, it is worth exactly $55k USD of purchasing power today. No more, and no less. That is not a very large net worth, but I hope for the person in your theoretical example (and selfishly for myself) that the half bitcoin ultimately becomes worth a lot lot more.
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I also think that 1 bitcoin will be worth more than $111k in the future. This is why I hold bitcoin and very little USD.
That does not make it my unit of account. If today bitcoin's USD value was cut in half, the purchasing power I saved up over my life would also be cut in half. It doesn't matter that I have the same number of sats. Personally I believe the value would recover and have held through two 70%+ drawdowns. That doesn't change the fact that my actual wealth (the groceries, cars, homes) I could purchase DID in fact decline 70% at that time.
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My thought is that unit of account is not 'awarded' or one's opinion.
Unit of account is what your grocery store or car dealership or mortgage prices goods/services in. Perhaps for locals in el zonte (although I don't think even there this is true) the unit of account is indeed sats.
It is simply a fact that the unit of account practically everywhere is the fiat currency of your local country today. It isn't bitcoin, it isn't gold and it isn't silver. I agree with you that most, if not all, fiat currencies will eventually fail (historically they are not replaced by hard currency, but rather another new shiny fiat currency), and that bitcoin may become a unit of account. But that is not reality today.
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The price is listed in USD. There is 0 calculation involved. That is called the unit of account. A gallon of milk is $2.99. The $ (USD) is the unit of account here.
Now, you can choose to do a calculation on top of that. You can say, well I'd like to wait until that $50k USD car becomes 5 ounces of gold before I buy it. Or perhaps 0.1 btc or whatever you'd like. But those are just secondary calculations you are doing.
Perhaps the issue is we aren't aligned on definition of the term "unit of account":
A unit of account is the standardized measure for stating the value of goods, services, and financial obligations, serving as a common standard for pricing and economic comparison. It allows for consistent valuation, making it easier to track assets and liabilities in financial statements, understand the value of different products, and facilitate economic planning.
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Think we've reached the stage of "well that depends on what your definition of 'is' is".
If we can't find agreement that in your example of the $50k car, USD is clearly the standard unit of account (vs. bitcoin) then I think we're just spinning our wheels.