SEC Chair Gary Gensler - Bitcoin is unlikely to become a currency

[fikrett]

Bitcoin is no more in any sort of "grey area" than any other object of value. They will sooner announce Bitcoin is illegal than they will announce grapefruits are illegal.

The US has the the majority of the world's hashrate, we have most of the holders of Bitcoin, and thousands of new products around Bitcoin and crypto have been created in the past few years including by major US financial players such as PayPal.

I get that some people need to feel like they are doing something "dirty" when they are trading Bitcoin, but the actual reality is that it's absolutely positively legal, and there's absolutely no sign that will change.

And spreading these lies about Bitcoin diminishes its value so please stop it.

Just because you need to feel like you are "fighting the man" by owning Bitcoin, most investors don't want to fight their government and do illegal things, so if they believe you they will stop buying Bitcoin and the price will plummet.

Yeah, govs and institutions get more and more skin into the BTC, and they won't make it illegal, as you said, I too don't see that happening, they would rather do the reserves of the BTC themselves and be happy with it

[franky1]

I gotta say, I just dont get Gensler's perspective here.  Sure, Bitcoin isnt quite the go-to currency yet, but writing it off as unlikely to ever make it happen seems short-sighted.  Though I guess trash-talking crypto is part of the SEC commissioner job description.  

It will not, objectively speaking, ever happen. There is simply no way Bitcoin could ever scale to anything even within several orders of magnitude of handling the world's daily transactions.

why do so many idiots think bitcoin needs to become the "one world" fiat currency that replaces all currencies where everyone uses it and no one uses anything else

cant you atleast acknowledge that the UK pound that only serves ~70m people not 8 billion is atleast a currency without having to serve all 8 billion peoples daily transactions to be classified as a currency

cant you atleast acknowledge that many items of value are treated as currency even without national coverage and treatment as a fiat

i do laugh at the anti-bitcoiners that want to promote other networks by pretending bitcoin needs to be a "one world currency or fail"

[shield132]

What do you guys think about this? We know only two countries have declared Bitcoin as legal currency--El Salvador (the most famous one) and the Central African Republic. If they've done it and their economies haven't seen any major issues, like a spike in crime, then why does the SEC chair say it's unlikely for Bitcoin to become a currency?

By "currency," it doesn’t necessarily mean the main currency--fiat will definitely stick around. The point is that people should have more options, not just seeing Bitcoin as a "store of value" (which I agree with), but it could also be used as legal tender so we can enjoy Bitcoin even more!

He is the SEC guy, he won't say that Bitcoin is going to become a currency because I believe he doesn't want it to become but he is wrong here because Bitcoin is an ideal candidate to be widely used as a form of payment. First of all, it's possible to send coins from any part of the world to any part of the world but that's not possible with visa/master cards. When I want to buy something from a shop that's located in the US, I can't buy because my billing and shipping address don't match (I use freight forwarder) but with Bitcoin, this problem is gone, so it's a great option for shops. With the help of Bitcoin, I was able to shop on many websites and their owners earned additional money from me, so it's a great solution for e-commerce.

[stadus]

He is the SEC guy, he won't say that Bitcoin is going to become a currency because I believe he doesn't want it to become but he is wrong here because Bitcoin is an ideal candidate to be widely used as a form of payment.

No matter the government’s stance on Bitcoin—whether they label it as property or legal currency—the reality is that Bitcoin will still function the same. The only thing that changes is the legal aspect, like when it’s considered property, it becomes easier for the government to profit from it through taxes, which is probably why they don’t declare Bitcoin as a currency. Plus, they have their own CBDCs, so they’re likely biased toward supporting those for daily transactions. Let’s be honest, Bitcoin isn’t ideal for microtransactions, and that’s likely one of the reasons they’ll never declare it as legal currency. For me, it’s better as it is now—a “store of value.” That sounds way cooler anyway.

First of all, it's possible to send coins from any part of the world to any part of the world but that's not possible with visa/master cards. When I want to buy something from a shop that's located in the US, I can't buy because my billing and shipping address don't match (I use freight forwarder) but with Bitcoin, this problem is gone, so it's a great option for shops. With the help of Bitcoin, I was able to shop on many websites and their owners earned additional money from me, so it's a great solution for e-commerce.

That’s exactly what fiat can’t do because of its limitations. But it’s not up to us to decide if Bitcoin is a legal currency. There’s no argument in calling it a currency, but when you add the word “legal,” that’s a whole different story.

[dzungmobile]

No matter the government’s stance on Bitcoin—whether they label it as property or legal currency—the reality is that Bitcoin will still function the same.

I believe Bitcoin network will maintain its decentralization and no censorship but there will be many challenges from governments for changes. Its utilities will be nearly the same but Bitcoin users will have to use bitcoin more differently as their adaptations to regulatory changes from governments.

The only thing that changes is the legal aspect, like when it’s considered property, it becomes easier for the government to profit from it through taxes, which is probably why they don’t declare Bitcoin as a currency.

Governments always want tax and no government want to have less money from their citizen tax. Bitcoin will be their main target for tax increase in future and they will do tax changes on Bitcoin first, then expand these tax policies to altcoins.

Bitcoin can be used in many ways by multiple utilities it has, so if it is considered as currency, it is only one of Bitcoin utilities and governments will be able to define things under their governance. If in future, Bitcoin becomes a currency, it won't help Bitcoin users to avoid tax. Like you can use US. dollar, fiat currency for many things, transactions, trades but you will be taxed. Same for Bitcoin in future, if it will be accepted as a currency.

[stadus]

The only thing that changes is the legal aspect, like when it’s considered property, it becomes easier for the government to profit from it through taxes, which is probably why they don’t declare Bitcoin as a currency.

Governments always want tax and no government want to have less money from their citizen tax. Bitcoin will be their main target for tax increase in future and they will do tax changes on Bitcoin first, then expand these tax policies to altcoins.

Bitcoin can be used in many ways by multiple utilities it has, so if it is considered as currency, it is only one of Bitcoin utilities and governments will be able to define things under their governance. If in future, Bitcoin becomes a currency, it won't help Bitcoin users to avoid tax. Like you can use US. dollar, fiat currency for many things, transactions, trades but you will be taxed. Same for Bitcoin in future, if it will be accepted as a currency.

Aside from seizing bitcoins, the US is also making money from taxes on Bitcoin and other cryptocurrencies, so I think they’re already satisfied with that and won’t change their stance on Bitcoin anytime soon. This applies to the US, but in other countries like ours, Bitcoin isn’t taxable and there’s less regulation around crypto.

Just to give us an idea of how taxes are handled, even though we’re not paying them here, I think the guide below could be helpful.

How Is Bitcoin Taxed? A Complete Guide for 2024

[betswift]

I gotta say, I just dont get Gensler's perspective here.  Sure, Bitcoin isnt quite the go-to currency yet, but writing it off as unlikely to ever make it happen seems short-sighted.  Though I guess trash-talking crypto is part of the SEC commissioner job description.  

It will not, objectively speaking, ever happen. There is simply no way Bitcoin could ever scale to anything even within several orders of magnitude of handling the world's daily transactions.

why do so many idiots think bitcoin needs to become the "one world" fiat currency that replaces all currencies where everyone uses it and no one uses anything else

cant you atleast acknowledge that the UK pound that only serves ~70m people not 8 billion is atleast a currency without having to serve all 8 billion peoples daily transactions to be classified as a currency

cant you atleast acknowledge that many items of value are treated as currency even without national coverage and treatment as a fiat

i do laugh at the anti-bitcoiners that want to promote other networks by pretending bitcoin needs to be a "one world currency or fail"

It will be rather used as digital gold, in my opinion. And the reserves for it would be created (or tried to be created) by govs accordingly.

[o48o]

Let's be thankful that he already called it a "store of value" but I challenge him, Bitcoin can do whatever fiat currency can do. The only issue here is that countries will not want to accept it as their reserve and others, and Bitcoin is dependent on the internet. What if a war or disaster breaks and the internet is not accessible? The risk is high to entirely depend on cryptocurrency.

Well i definitely disagree with you there, for the same reason that gold standard was removed from USD. Fiat money isn't just for enabling fast and high liquidity in daily use.
It's for stabilizing the country in case of an emergency, this is basic economics. You can't use gold or bitcoin in same way as fiat money. Because neither gold or btc have inflation that you can control by the country that has issued it.

Inflation seems to be misunderstood as a flaw, when it's actually by design to stimulate capitalism and help in time of crisis. Only when it's out of control, it's dangerous because it can lead to hyperinflation. Inflation itself is needed in fiat money and many people (even educated people), seem to be confused about that.

This brings me to the main differences between fiat money and bitcoin. Bitcoin can't issue stimulus money, because no one controls it. And one of the main reasons why Bitcoin isn't accepted as currency, is because it clashes with aml regulations. It couldn't be frozen.

And since people are saying that it's already currency in El Salvador, they have nothing to lose by adding it as a legal tender. They don't control their other currency (usd) either. And in fear of serious sanctions from first world, i am guessing adding btc is a last resort hail mary, because that usd might become hard to use later on.

If they had more resources, i am guessing they would go the road similar to venezuela and have their own petro token, backed by lies. But when country is so corrupt it can't make their own fiat money work, they just use anything they can. If they would have an option to use their own fiat money, it would not make sense for them to have bitcoin as other legal tender.

And if internet would break down, it wouldn't affect just on bitcoin value.

[Synchronice]

Bitcoin's whole idea is to be a payment method, the one that will be done without the involvement of 3rd parties, peer to peer but at the same time, it's clear that Bitcoin isn't meant for widespread usage, a little increase on chain immediately clogs the mempool and cost per average size transaction goes to the moon.
Gary Gensler is right in this case, Bitcoin is seen as a store of value instead of a currency and there is a very high chance that the tendency will continue this way, especially when bitcoin developers are more conservative towards Bitcoin's protocol.

[legiteum]

why do so many idiots think bitcoin needs to become the "one world" fiat currency that replaces all currencies where everyone uses it and no one uses anything else

cant you atleast acknowledge that the UK pound that only serves ~70m people not 8 billion is atleast a currency without having to serve all 8 billion peoples daily transactions to be classified as a currency

cant you atleast acknowledge that many items of value are treated as currency even without national coverage and treatment as a fiat

i do laugh at the anti-bitcoiners that want to promote other networks by pretending bitcoin needs to be a "one world currency or fail"

It's all about one thing: Bitcoin going up in price. I don't blame anybody for wanting Bitcoin to go up in price (I sure do), but it gets dangerous when they want this so badly that they want special help from the US government to basically force people to buy Bitcoin even though they don't want to (in this thread, for instance, people wanting Bitcoin to be uniquely exempt from capital gains tax).

I think part of the reason is Bitcoin's success: at over $1 trillion in market cap, Bitcoin is about as successful as any product has ever been in the history of the world. But I suspect these people bought Bitcoin at $70k, and need it to be even more successful than that in order to make a profit. And they think the only way that can happen is for the government to artificially prop it up.

[kryptqnick]

AFAIK, sometimes global adoption goes very fast (like with smartphones, and in that case, Bitcoin failed as a currency to gain enough adoption), but sometimes it's also very gradual (like with the Internet, and Bitcoin might still be on track). We can't know for sure how it's going or where it's going, but honestly, I think his opinion is reasonable. Don't most people use Bitcoin as investment and are reluctant to spend it? I suppose, if we experience a major fiat crisis over the next couple of decades, that might significantly change perception and usage of cryptos, but if that doesn't happen, I think he might be right. And by a major crisis I mean something like the USD or EUR suffering from hyperinflation to a point of a strong need arising of abandoning them.
As a Philosophy major, I was also intrigued by his mention of Plato and Aristotle. But, to be honest, I am not sure which particular debate he is referring to here, and more context from him would've been nice.

[o48o]

AFAIK, sometimes global adoption goes very fast (like with smartphones, and in that case, Bitcoin failed as a currency to gain enough adoption), but sometimes it's also very gradual (like with the Internet, and Bitcoin might still be on track). We can't know for sure how it's going or where it's going, but honestly, I think his opinion is reasonable. Don't most people use Bitcoin as investment and are reluctant to spend it? I suppose, if we experience a major fiat crisis over the next couple of decades, that might significantly change perception and usage of cryptos, but if that doesn't happen, I think he might be right. And by a major crisis I mean something like the USD or EUR suffering from hyperinflation to a point of a strong need arising of abandoning them.
As a Philosophy major, I was also intrigued by his mention of Plato and Aristotle. But, to be honest, I am not sure which particular debate he is referring to here, and more context from him would've been nice.

Smartphones had infrastructure in place already as computers and mobile phones were already popular, so it was merely of a case of upgrading phones slowly.
And road for mobile phones has been long as hell, and roots for TCP/IP -> arpanet ->internet are long in the history as well.

But i really wouldn't compare history of bitcoin to either of them, as Bitcoin is just a protocol, and build it's on the shoulders of giants. Meaning that it's an application for infrastructure that was already in place. That infrastructure actually NEEDED adoption. Bitcoin works as it is without more adoption.

[retreat]

-snip-

By "currency," it doesn’t necessarily mean the main currency--fiat will definitely stick around. The point is that people should have more options, not just seeing Bitcoin as a "store of value" (which I agree with), but it could also be used as legal tender so we can enjoy Bitcoin even more!

Why do you need Bitcoin to be legal tender? Would you pay for your coffee with Bitcoin? I don't think you want to use Bitcoin like fiat either. So from that we should be able to accept the fact that Bitcoin cannot replace fiat completely, and let Bitcoin remain as it is. It's fortunate that the government still recognizes Bitcoin as a legal asset to trade, there's no need to go too far to make it legal tender, especially for a large country, because when it becomes legal tender its use is much more complex.

[legiteum]

Why do you need Bitcoin to be legal tender? Would you pay for your coffee with Bitcoin? I don't think you want to use Bitcoin like fiat either. So from that we should be able to accept the fact that Bitcoin cannot replace fiat completely, and let Bitcoin remain as it is. It's fortunate that the government still recognizes Bitcoin as a legal asset to trade, there's no need to go too far to make it legal tender, especially for a large country, because when it becomes legal tender its use is much more complex.

We've discussed Legal Tender here on Bitcointalk at length, and the biggest problem with "legal tender" is that:

Most people don't know what "legal tender" actually means.

In this case, the OP seems to think that "legal tender" would be a way to avoid capital gains tax in the USA. But if you understand what the word means, you'd see that such a thing is totally ridiculous. If you wanted Congress to eliminate capital gains tax for Bitcoin, then they can just do that directly (and good luck explaining to Congress why Bitcoin billionaires specifically should get a tax break and nobody else should).

The only time the legal tender law ever applies is when somebody gets a court judgement against another person, and that person wants to settle the judgement using a payment method they do not mutually agree upon. That's it. That's all it does. This law is basically never used because this situation is almost impossible to imagine.

[d5000]

Three pages in and not a single person mentioned Gresham's Law ... which is what Uncle Gary referred to ...

Gresham's law actually says that "bad money drives out the good", i.e. in a situation where hard money competes with a "softer" variant, that "hard money" is more likely to be hoarded and leave circulation, while people will be more eager to spend the "softer" money (like fiat).

But I actually disagree with Gary here. Bitcoin, as an electronic form of money, simply can be used as a transactional tool without giving up the "hardness" quality. An easy way to to this is to simply "stock up again" once you spend Bitcoin, i.e. re-buying every BTC you spend, or getting them through other means. There are some scalability challenges but I think they will be solved soon.

Gensler also mentioned networking to be necessary to develop Bitcoin as a currency, which is interesting, and in this point I agree that there are significant challenges to overcome.

I believe the payment networks in Bitcoin are currently underdeveloped: too many people who accept Bitcoin convert it instantly to fiat. This means that if you pay Bitcoin to a merchant, in reality you're paying them to a payment processor. In consequence, the "real" payment network is actually limited to some financial companies (apart from payment processors also e.g. investment banking companies and hedge funds) with margin to hedge against Bitcoin's swings, and to some relatively few "believers" who really use Bitcoin to pay for goods and services.

Of course volatility is the main reason for this, but the Bitcoin community at least can be able to move away from that very gradually, with more Bitcoin pricing emerging. For example, creators of digital goods can already price them in Bitcoin in some cases.

[legiteum]

Three pages in and not a single person mentioned Gresham's Law ... which is what Uncle Gary referred to ...

Gresham's law actually says that "bad money drives out the good", i.e. in a situation where hard money competes with a "softer" variant, that "hard money" is more likely to be hoarded and leave circulation, while people will be more eager to spend the "softer" money (like fiat).

Very astute point.

But I actually disagree with Gary here. Bitcoin, as an electronic form of money, simply can be used as a transactional tool without giving up the "hardness" quality. An easy way to to this is to simply "stock up again" once you spend Bitcoin, i.e. re-buying every BTC you spend, or getting them through other means.

I would take that thought one step further and question whether technology changes all of the old rules about money, saving and investing. In short, in order to make a payment your gadget instantly pulls money out of your investment portfolio and into some means of transfer (doesn't matter which), and the payment is made. In this scenario, you are only exposed to the "investment" of the means of transfer (be it USD, Bitcoin, or whatever) for a few milliseconds. And on the other side, you only hold USD, Bitcoin or whatever if that is your investment choice for the longer term. Hence you can transact in USD (for instance) and never actually hold any USD in any significant way.

There are some scalability challenges but I think they will be solved soon.

Gensler also mentioned networking to be necessary to develop Bitcoin as a currency, which is interesting, and in this point I agree that there are significant challenges to overcome.

Bitcoin (and blockchain generally) will never scale to mainstream transaction loads, as this is a hard architectural limitation (PoW means it is actually intentionally slow and expensive to transact). But nobody cares about that since most people don't actually transact Bitcoin directly, rather they do so through a broker, app, or an L2. But all of these things are based around the idea of Bitcoin being an investment, not a means of everyday transactions.

Of course volatility is the main reason for this, but the Bitcoin community at least can be able to move away from that very gradually, with more Bitcoin pricing emerging. For example, creators of digital goods can already price them in Bitcoin in some cases.

Why would you price something in Bitcoin? All that would do is trade a measurement everybody knows for one that very few people know. The USD as a measurement will probably never ever go away since there's no reason to change it (see: the imperial system). In that scenario I talked about above, you could hold zero USD and not ever transact in USD and yet still USD as your measurement system.

I'm telling you: technology is going to change everybody's assumptions about money. You have to re-think everything now. .

[vjudeu]

Bitcoin (and blockchain generally) will never scale to mainstream transaction loads

Why not? As long as you can commit to some hashed data every 10 minutes, and get it timestamped properly, then it doesn't matter, how much data you want to timestamp. You don't have to push everything on-chain, to make a transaction, all you need, is to commit to that data. And a single signature can handle easily a single commitment, without increasing on-chain size, without making additional OP_RETURN; all you need, is just tweaking your signature in a deterministic way. Which means, that you can commit to a single 256-bit number, in every signature, in every block, without any additional on-chain data, if you only want to build an SPV-like proof for your data.

PoW means it is actually intentionally slow and expensive to transact

Why? If you have a single block every 10 minutes, then it doesn't mean, that miners are sitting idle, and suddenly submit something, after those 10 minutes. They are actively trying to build new block templates, over and over again. And if you explore weak blocks, then you can see, if your transaction is included or not. More than that: by exploring miner shares, you can actually measure, how many Proof of Work was already contributed, and provide an SPV-like proof for that, for any hashed transaction.

So, if the difficulty is set to X, then on average, statistically, every second, the whole network produces Proof of Work, equal to 600 times lower difficulty. And you can find a time, where the global difficulty was 600 times lower than today. Which means, that the same power, that was needed to produce a single block then, is spent to mine your transaction now, for every second. If a single confirmation for some amount was safe then, why it suddenly became unsafe now?

For many payments, you don't have to wait for a single confirmation. A rule of a thumb is to measure the "coinbase coverage". If the coinbase reward is 4 BTC (3.125 BTC plus 0.875 BTC fees), then if your transaction sends 1 BTC, you probably need 0.25 confirmation. If you can get a weak block with 0.25 of the current difficulty, then you are probably good to go.

Also, if you want to limit potential replacements, then you can explicitly apply OP_SIZE on a signature, and then it will be guaranteed by the Script, that any replacement will require a given amount of Proof of Work. Which means, that if you can measure other party's hashpower, then you can require putting a given amount of Proof of Work, to actually make a valid second version of the transaction in the first place. Then, you can safely accept for example 0.25 confirmation, because it will reach a single confirmation, before a second party will produce a second transaction version, and broadcast it successfully (also, you can use locktime to control ownership over time).

Why would you price something in Bitcoin?

Because you want to measure, how many goods and services you can buy with coins, that you are currently holding. If you have more BTC than USD, then it makes sense to measure things in BTC. People in other countries, where USD is not the national currency, are measuring everything in EUR, GBP, CHF, and other units. The reason is simple: they have more locally used coins, than USD. And the same is true here: if you have more BTC than USD, then why measure things in USD?

Also, sending round amounts can make it easier to hide in the crowd. Because it is more natural, that more people would send 0.01 BTC than 0.01001234 BTCs. Using round amounts in USD, converted into satoshis, is tricky. It is easier to find two users, one having GBP, and one having USD, and both picking 0.01 BTC, than trying to guess the right amount, which will be round enough for all users, using non-BTC as a measurement unit.

see: the imperial system

Of course, nobody measure things in meters and kilograms, and everyone is using Fahrenheits. Obviously.

In practice, you have at least two systems, if not more. And if you have some legacy software, then it is hard to change some protocols, when you agree upfront on interfaces. For example: I was working with code, where interfaces sent things in Celsius. To introduce Fahrenheits, we need to convert units back and forth, because old devices accepted messages in old units, and you simply couldn't send them a message with "100F", because they would interpret it as "100*C". And nobody wanted to refactor 90% of existing and working code.

So, in BTC, under the hood, we have just satoshis. We can write software, which will display USD. We can use some tricks, to get millisatoshis. But the protocol is already established, and if you want to send 250 msats, then you need to do some tricks, like "4-of-4 multisig on a single satoshi", to express the fact, that there are four users, owning 250 msats each.

[South Park]

snip


What do you guys think about this? We know only two countries have declared Bitcoin as legal currency--El Salvador (the most famous one) and the Central African Republic. If they've done it and their economies haven't seen any major issues, like a spike in crime, then why does the SEC chair say it's unlikely for Bitcoin to become a currency?

By "currency," it doesn’t necessarily mean the main currency--fiat will definitely stick around. The point is that people should have more options, not just seeing Bitcoin as a "store of value" (which I agree with), but it could also be used as legal tender so we can enjoy Bitcoin even more!

There is not much else he can say, he must support fiat and its institutions, meaning he must blind himself to the truth if needed be, after all bitcoin is already a form of money that can be used all over the world, and while it is true we would like for bitcoin to be more widely accepted, gone are the days in which buying something with bitcoin was almost impossible, and now it is relatively easy to get what you want online with it and it will not be long until this expands offline as well.

[legiteum]

Bitcoin (and blockchain generally) will never scale to mainstream transaction loads

Why not? As long as you can commit to some hashed data every 10 minutes, and get it timestamped properly, then it doesn't matter, how much data you want to timestamp.

With approximately $40 billion in hardware, Bitcoin handles about 500,000 transactions per day. Worldwide, there are about two billion transactions per day. This means we would need 4000 times more capacity for Bitcoin--and based on the architecture, the scaling would absolutely not be linear. In other words, it's.. impossible.

You don't have to push everything on-chain, to make a transaction, [...]

LOL. Off-chain = NOT Bitcoin. Yes, as I said above, there are L2 networks, apps, brokers, and other digital currencies that "eventually" back up to Bitcoin, but that is... not Bitcoin.

PoW means it is actually intentionally slow and expensive to transact

Why? If you have a single block every 10 minutes, then it doesn't mean, that miners are sitting idle, and suddenly submit something, after those 10 minutes. They are actively trying to build new block templates, over and over again. And if you explore weak blocks, then you can see, if your transaction is included or not. More than that: by exploring miner shares, you can actually measure, how many Proof of Work was already contributed, and provide an SPV-like proof for that, for any hashed transaction.

Put it this way: Bitcoin has been around for over 15 years now, and it's... slower and more expensive than it's ever been. There is no "fix" to this. Bitcoin is Bitcoin and it was never meant to scale and it... doesn't.

Why would you price something in Bitcoin?

Because you want to measure, how many goods and services you can buy with coins, that you are currently holding. If you have more BTC than USD, then it makes sense to measure things in BTC. People in other countries, where USD is not the national currency, are measuring everything in EUR, GBP, CHF, and other units.

Those people will want to measure in EUR, GBP, CHF and so on, not this measurement that basically nobody knows.

Put it this way, do you want to measure your city's weather forecast in... Kelvin? Why not? Because you don't know what that means. You measure it in Celsius for Fahrenheit because that's what you are used to.

Regardless of the adoption of Bitcoin, the old way of measuring will stay the same basically forever because there's no reason to change anything.

see: the imperial system

Of course, nobody measure things in meters and kilograms, and everyone is using Fahrenheits. Obviously.

So, in BTC, under the hood, we have just satoshis. We can write software, which will display USD.

That's exactly my point: software will entrench the use of USD/EUR/GBP/etc. forever and ever because it will automatically give people the measurement they know and they will never have a reason to learn anything else. So we'll use USD as a measurement metric forever--and what you use an investment will be different, and what you use to transact will be different.

Bitcoin is now and will remain a means of speculative investment. It will not "replace" USD for any other purpose because it is not practical to do so. This is not a government conspiracy, it's just plain old consumer demand.

[d5000]

In this scenario, you are only exposed to the "investment" of the means of transfer (be it USD, Bitcoin, or whatever) for a few milliseconds. And on the other side, you only hold USD, Bitcoin or whatever if that is your investment choice for the longer term.

I can imagine such apps happening but this does not mean Bitcoin should not advance in the direction of an "unit of account" => see below.

Bitcoin (and blockchain generally) will never scale to mainstream transaction loads, as this is a hard architectural limitation (PoW means it is actually intentionally slow and expensive to transact). But nobody cares about that since most people don't actually transact Bitcoin directly, rather they do so through a broker, app, or an L2. But all of these things are based around the idea of Bitcoin being an investment, not a means of everyday transactions.

Yes, what I meant with "scalability" was including L2s (be it Lightning or sidechains). But including "brokers" would already be sacrificing censorship resistance and thus Bitcoin's biggest USP. So in my opinion the community should focus on making centralized brokers unnecessary in the system. Ideally there should be apps hiding the complexity from the end user.

At the same time I agree and disagree about your statement about PoW. In my opinion, it's inexact to say that PoW makes it intentionally slow to transact, instead it slows down the timestamping process of the transactions. The slowness of PoW is instead a result of physical limits associated with the timestamping/validating process due to Internet latency. That's why we need L2s. In theory we could imagine a future where the latency problem is solved and even a big block coin like Solana or Bitcoin SV could be "decentralized" and serve 8 billion people, but then we'd still have an inefficient process. L2s would still be much more efficient.

Why would you price something in Bitcoin? All that would do is trade a measurement everybody knows for one that very few people know.

I do think that a currency should evolve towards an "unit of account". With prices in Bitcoin, it becomes suddenly more predictable and less risky, even if these prices move over time.

It's still too volatile for most tangible goods but some services and digital products could already be priced in Bitcoin with daily or even weekly adjustments using a moving average. If those reference prices move slowly from daily to weekly and later monthly, people become more accustomed to the proportions.

Pricing in Bitcoin can also provide opportunities to digital content creators. Imagine Bitcoin dipping for a day and those who price their goods in Bitcoin suddenly benefit from an income boost because people think it's a good moment to buy their creations (see also this thread) instead of panic selling. This can even limit panic selling in the long run.