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Bitcoin: Better than Gold

May 9, 2012 Leave a comment

Many proponents of bitcoin come to the technology with the belief that the ultimate currency is gold, or some other commodity with intrinsic value.  This is usually because they correctly realize that the centralized control of the supply of money is too dangerous a power to bestow on anyone.

However, currencies which are based upon an item of intrinsic value have an inherent problem. This problem stems from the same feature that gives it the benefits that they seek. Items or rather commodities, with an intrinsic value cannot be transmitted over distances easily. Whether gold, or silver, or gemstones, or cigarettes or wheat, these must be first converted into a form suitable for transmission over distances if one wants to efficiently do so.

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