Oddbean new post about | logout
 // Fiat is a lie 

I assume you mean currencies when you say fiat .  

Just the way assets are permission less , decentralized and market priced ; currencies are supposed to permission-ed , centralized and fixed price .. 

Currencies have a very important role to play in the economy . Think of them as two wheels (assets and currencies) of economic system. 

While assets ensure a storage of value to the holder , currencies offer liquidity in market to bolster risk taking . Their primary goal of currencies is to  incentivise commodity manufacturers through subsidies. In an "asset only" world the commodities soon lose the price because we need mass production of commodities. In a hypothetical "asset only" world , only scarce things attract value. If commodities become scarce - eg people stop producing wheat  - poor will die of hunger . In essence governments all around the world ( issuers of currency) must provide subsidies or minimum price guarantees to commodities manufacturers. You don't want volatility in bread and milk :-) 

That said there are good or bad currencies just like there are good or bad assets  .. In my mind btc is the best asset and USD is the best currency todate .. we need both of them for a functioning economy ..