Bitcoin
- easy to verify/impossible to forge (as opposed to gold and paper currency)
- fixed supply (as opposed to paper currency, oil, and even gold)
- easy to transfer from one party to another (as opposed to gold, oil, and physical cash)
At that point just hoard resources. Holding a bunch of Bitcoin in a crisis is useless for a country if no other country will buy them off you in exchange for tradeable hard currency.
There is a great reason: a state-backed currency should always be accepted by that state. If the world is in crisis, you may wind up stuck with your Bitcoins.
I agree that you need the currency to be accepted by the state for good local trade support. But that was not the point.
Yes. If you're a random country, you can use your dollars to buy shit from America. Countries hold reserves for basically two direct reasons: to intervene in FX markes and protect their imports. The latter is the main one. At the end of the day, your ideal reserve composition matches your import portfolio because you want currency you can send to the people who are selling you shit.
Yes, none of that makes an iota of sense. If a military wants to take inflation into its own hands, it has far-better options. From hoarding to, you know, taking shit.
But you can easily trade dollars for stuff Americans will sell you. That's the advantage of a national backer. In a crisis, they'll welcome the influx of capital in exchange for goods and services. Precisely what you need it you want to spend it.
This is why sanctions fuck up reserve calculations. If, in a crisis, America will sanction you, you might as well have held gold or Bitcoin.
"Let me just set up my P2P connection to the Bitcoin network and pay mining fees and hope a miner validates the block"
vs
"Here's a bar of gold mate"
Sure, real easy
Yeah, super convenient. Well worth it. I'll just go with gold bars on me to the market to buy lettuce.
By it sure does sound simpler to type some numbers that to cut up pieces of metal.
And there isn't any "hope" involved in bitcoin transactions. Connecting to the peer to peer network is super simple (way, way easier than creating a brokerage or bank account, and no ID or approval is required). Miners will pick up your transaction (and yes fees will help speed that up, as with any financial transaction) and it will be included in a block. Bitcoin has been doing this non-stop, flawlessly since 2009.
There are fixes to that problem, of course, but it's not bitcoin itself that's the solution.
Split the user base along geopolitical axes and see how long the consensus algorithm lasts.
Gold bars don’t have this problem.
When they called in the physical gold, people could squirrel away their $10 and $20 coins in wallsafes and shoeboxes to trade with trusted partners later. Declaring the coins illegal didn't cause them to disappear from people's hands directly.
Crypto doesn't have that physical anchor. If a major world government declared it illegal tomorrow, how would you, as a resident of that country, access the value in your favourite blockchain wallet?
Law enforcement could monitor the remnants of the network and trying to trigger transactions is obvious probable cause. That assumes the remnants still function-- they aren't being blocked by DPI/filtering, or just the functional destabilization caused by a large number of participants being unplugged from the network.
At best, you'd have to go off-ledger and trade talismans (handing over a document with the private keys for an existing wallet like a bearer instrument and hoping they didn't run off multiple copies, or just trying to keep records of transactions and balances elsewhere and hoping to resynch eventually)
This is also why the paper dollar is so important to its reserve-currency status. An enterprising bank in the developing world might say "we offer USD-denominated accounts, all digital, it's 20xx" for customers who don't trust the local currency, but those are a lot easier for the local government to deactivate than a coffee can full of greenbacks buried in their backyard.