I like the part about bitcoin 'not having amy fundamentals to fall back to'. As if fiat currencies are any different.
What does that even mean?
Also, the US government doesn't really have anything to do with the USD; the USD is managed solely by the Federal Reserve, and the Federal Reserve is not a branch of the US government (it's a privately held bank; look it up).
"it's not nothing"
It's worse than nothing. The Federal Reserve can and does change the value of the dollar at will (it's called inflation). That's why you can buy a loaf of bread with your 5 bucks now, but in 10 years your 5 bucks probably won't even buy a candy bar.
Contrast that with gold. In 1913 (the year the Federal Reserve was created), you could buy a house with 100 ounces of gold. 100 1913 dollars is worth roughly 2 2013 dollars, but 100 1913 ounces of gold is worth exactly 100 2013 ounces of gold, and you can still buy a house with it (100 ounces of gold is $156,740 USD; no, this won't buy you a house in New York, but it will in most other parts of the country). That's what it means for a currency to be backed by something of value. Value doesn't change.
Also, comparing gold @ ~$20/oz in 1913 to a dollar stuffed under a mattress in the same year is a bit of a false comparison. The Compounding the same $20 in 10year Tbonds (a decent 'risk free rate' starting in 1928 (the first year I could find data) would yield ~$679 in 2000 (outperforming gold by over 2x) and ~$1385 in 2012 (underperforming slightly, but with almost no volatility).
Tbonds are pretty much the definition of the "risk free rate of return" for USD. Is there an alternate (non-zero) "risk free rate" for gold that you would like use instead to make comparisons?
Are you actually arguing that gold's value does not change?
Also, what are you using to measure the "volatility" you claim fiat money has so much of?
Inflation.
And 'unchanging' wasn't the best choice of words, but my point is that gold is not subject to the whims of monetary policy makers because you can't create more gold. Gold's value only changes when more gold is discovered.
Things change.
I wonder how "running" cyprus is now :P
I'd say the fundamentals could be found looking in the weaknesses in government/central bank fiat and the controls put in place on how freely people can obtain and receive goods/services.
But yeah, this is a bubble, but if you look at the fundamentals that governments/central banks are running on now, it just takes one country with a overly bloated private banking sector and dieselboom to apply his templates… :P
they could have otherwise printed a bunch of money and deflated their debt, which is what the US gov does
Nowadays the power of the US government backs the dollar.
How exactly is it doing that?
Bitcoin is decentralized by definition, and that's a huge difference because only rely in market value (not saying is bad per se). This might change if governments start regulating and supporting the currency.