this post was submitted on 08 Dec 2024
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The US dollar is backed up by you have to pay your taxes in US dollar so the US economy is going to accept US dollar, thus, if you have dollars, you can buy shit in the US. In effect, thus, the US dollar is backed by the US economy.
There's no such mechanism for crypto coins. If you now say "well the Fed can just print money", that's US policy. The Euro works differently, there price stability reigns supreme, in any case the policies of both Fed and ECB are well-known and people trust that they don't change willy-nilly because neither the US nor the EU has any interest in the fallout that would cause. That trust is in no way weaker, less of a guarantee, wrt. giving a hint at the future value of the currency as the collective faith that props up crypto coins as a unit of account.
And gold, btw, is practically useless as a commodity. Jewelry? Literally only used for that because it's expensive. Technical applications? Do exist, but the amount needed is negligible. The value of gold relies on the existence of a luxury market.