Oddbean

I do understand your train of thought, however two things to point out: 1. I did not once mention USD, I said fiat which is any central currency. 2. Using items that merchants have for sale as the comparison point does not work, because those items are only worth that value in Bitcoin/Monero because they are priced relative to fiat. An example using CAD: Eggs cost $4 a dozen. In Bitcoin the eggs would cost me 0.000047, not because the eggs are actually worth 4700 sats, but because that’s the current conversion from local fiat. The value of the eggs can only be denominated in Bitcoin if Bitcoin is actually the UoA, and thus valuable to the merchant (legal tender, circular economy, etc). If X sats = 1 UoA then it makes sense, but in order to value things in Bitcoin, at this moment in time is HAS to be compared relative to a currency or different form of value, like fiat or gold. You cannot determine the trading price between two currencies or assets using something like eggs, because the value of 1 sat or 1 Bitcoin has not been set at a specific level of understood value, and is calculated by comparison to fiat. In a future where 1 sat is the standard unit of account (ex if those $4 eggs now cost 4 sats), then we could use it as a UoA because there would be a decided amount considered to be the lowest valuable or available(1 cent in fiat). Until then, everything has to be linked back to fiat. This includes financial tickers, so when you look at XMR/BTC, the Monero is only worth what it’s worth in Bitcoin /because/ of the fiat conversion.

This is a “So you hate waffles?” strawman reply dude. Nowhere in my post did I say that or anything close. I said their current value is derived from fiat, and at this moment in time it has to be linked back to that valuation because there’s been no alternative standard determined by society. Once society understands what WE understand (the value of Bitcoin) then things can be priced and compared appropriately because it will reach UoA status.

That's where you're wrong. People don't derive the value of their eggs by using paper with numbers on it. People derive the value of eggs by determining they want to eat them and what they can give in exchange for that want. Value is subjective. Value is not derived from fiat.

You’re right, the value is derived from the fact that it is food, however the price value is able applied to the goods because of the standard unit (1 = 1). I believe the point has been blurred because of the examples being used to explain it. The initial comment and focus of the discussion was about the value of one asset comparative to another (finance tickers, XMR/BTC), in which case they cannot have value without being denominated in a standardized UoA like fiat. In terms of purchasing goods, I fully agree with you that it is subjective and more people should use Bitcoin as their preferred currency in circular economies. We are just not there yet.

my brother in Christ, please let me show you the light. This is the full valuation 101 from NYU stern from the legend himself. Thank me later. https://www.youtube.com/watch?v=znmQ7oMiQrM&list=PLUkh9m2BorqnKWu0g5ZUps_CbQ-JGtbI9&ab_channel=AswathDamodaran

the value isn't derived from fiat, this is a wrong statement. it's priced in fiat, but it's value does not come from it's relation to another currency. what you're saying is that bitcoin needs to replace the dollar standard of exchange, which in time it will. The problem is USDT, the digital dollar which still seeks to price every thing in dollars. If you want to start this process, then simply change your medium of exchange from fiat to btc. Price everything in BTC or sats and work from there, and voila, you've achieved the 'standard'. Now get more merchants and plebs to use it and voila, we have a 'global standard' Be prepared for war thought

You're talking about valuation vs market price. There's many factors that effect both; like quality, quantity, supply and demand. The eggs are 4700 sats. They're also $4. Merchants who define their base FX, and then subsequently trade in that, will determine it. "we do not accept cash" - a merchant policy for example. "We only accept bitcoin" - another policy You're not wrong in your understanding, but it's a little strained. Fx exists in any measurable way, x to y. It will always exist in a free market. If one trader has eggs for $4 CAD and another wants to sell bacon, one could equate eggs/bacon market value, attribute that to and currency and then trade it. What you're aiming for, like many bitcoiners, is that Bitcoin becomes the standard medium of exchange/unit of exchange, as the dollar is the standard medium of exchange across base input commodities (wheat, soy, gold, rice, cobalt, diamonds, oil) all priced in USD and allows the US to export it's inflation.

Thank you for the clarification! I think @OceanSlim was right when he said I was over complicating it in my head. This makes a lot more sense. I agree with this sentiment and admit I was incorrect. I also agree with your final point, I definitely am aiming for that and working towards grass roots starts with other locals! Starting local circular economies is one small step forward. 💪

This is indeed when we get a stable yardstick and can price goods accurately. In the meantime, as long as USD is the price that fundamental Units things are Accounted, no price can be represented without fiat taint. Sometimes the taint is very small, like in the case of locally bought eggs. Sometimes it is very large, as in the case of Amazon stock or Tesla.