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RE: Steem Dollars have Limits

in #steemit8 years ago

There are trade-offs either way. US dollars will likely bring in more users outside of the crypto world, but it has a real threat of hyperinflation, given enough time. Too many markets, as you suggested, would cause confusion and create illiquidity in markets. Gold may provide a nice balance. Its likely to never hyper-inflate and its a single market that most users on earth can relate to, although with a bit of perceived volatility.

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People perceive volatility in gold because they are measuring its value against fiat currencies whose prices float against each other. "Two sides to every coin", so to speak... which asset is volatile? the metal or the paper currency? It's a reflection on the instability of the fiat money system that exchange rates on currencies fluctuate so much against each other and nations engage in currency wars to game the system.