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originally posted by: hopenotfeariswhatweneed
A digital currency backed by faith .
originally posted by: Planette
Have been hearing this term most everyday now on MSM only in recent times, concurrently with reports of bitcoin exchange rate, mostly.
It sounds like encrpypted currency. Ie, a bit coin is not a physical coin it is some digital serial number generated by some entity (ie the entity that started circulating the digital currency?) with the encrypted part supposed to make the holder feel some sort of security.
But what is the digital coin backed by? If it is encrypted doesnt that mean some server or something has to be operational continuously for that bitcoin (or whatever cryptocurrency) to be worth anything?
And even then, how do they determine what each unit of the cryptocurrency is worth? Supply and demand? Obviously it doesnt have any value of use in and of itself (unlike gold, silver, seed, water, etc) so unless the cryptocurrency is backed by something ie petrol or gold, isn't it fiat?
What is Cryptocurrency and what's it backed by, anyway?
originally posted by: TinfoilTP
It's backed by crazy market hysteria.
They are worth the energy consumed by warehouses full of NVidia gpus crunching numbers to solve an algorithm.
originally posted by: Blue Shift
It's backed by belief. Just like regular currency. And Tinkerbell.
originally posted by: projectvxn
4 things are needed for a currency to be a currency (regardless of where it is derived): A foundation of value, adoption, usage, and trust.
originally posted by: projectvxn
a reply to: AMPTAH
Just like you can't unmine gold.
Much of the price of gold is reflected in the work it takes to extract it.
originally posted by: Planette
Thanks all for the links and info
So it IS e-Fiat!
Is there a google gcoin or pple/iphone iCoin yet? im thinking at least that would be backed by alphabet or apple, rather than something never heard of like 'bit' me thinks.