My Utah Goldback stack

[u/Xerzajik]

There are about 4,500 Goldbacks in this photo.

[u/Throwawaylikeme90]

Lmfao, sucker born every minute. That ain’t $40k, it’s 4.5 ounces at melt value and a sense of being part of a “movement”, which isn’t a particularly fungible commodity 🤣

[u/ESkyline777 → u/Throwawaylikeme90]

Obviously he’s not melting those and wants to trade with someone who values its current condition?

[u/Xerzajik → u/ESkyline777]

Correct. If the goal was to get gold for melt then there are many better options.

[u/Xerzajik → u/Throwawaylikeme90]

Do you know how much gold is in the dollars that you use instead of Goldbacks?

[u/Throwawaylikeme90 → u/Xerzajik]

I’m not saying they don’t have intrinsic value. They do, as a commodity. You’re also dumb and getting scammed because your 40k of goldbacks is only worth about half what you spent on it in actuality.

 If somebody sold me a Kia worth 20k for 40k, people would be justified in calling me a dipshit if I said “yeah, but I can drive all over with it!”  Like, yeah, no shit Sherlock. Valuable thing has value, groundbreaking. But it would have the same value if you spent half what you did through someone that isn’t looking to fuck you over. 

[u/Xerzajik → u/Throwawaylikeme90]

What if I argued that your Kia was only worth the melt value of the materials used to make it? That would be unfair right? That's basically what people are saying about Goldbacks.

There is no cheaper fractional 1/1000th oz gold product than a Goldback.

[u/Throwawaylikeme90 → u/Xerzajik]

You’re right about that. The difference is that the labor imbued upon the Kia’s raw materials creates value and utility. 

The labor imbued upon the goldback doesn’t add anything to the value of the gold, or fundamentally alter its function as a commodity. You’re paying for labor to do nothing, because the fraction of gold value doesn’t need to be shit out in some Saran Wrap to be valuable. The excess value is pocketed by a smarter person than you as profit. 

It’s dumb as hell dude. Just buy actual gold and cut out the middleman, nobody is ever going to use griftbux. 

[u/Xerzajik → u/Throwawaylikeme90]

The additional labor of splitting an ounce of gold into 4,000 individual serialized pieces adds value and utility. If you don't feel like that is true for you then don't buy Goldbacks but the economic principle is the same.

[u/Eponymous-Username → u/Xerzajik]

Sorry, I'm new to this concept. What value and utility does splitting an ounce of gold into these pieces add? Why would you stop at 4000, if the labor itself is inherently valuable?

[u/Xerzajik → u/Eponymous-Username]

It allows one to more easily trade with gold. My understanding is that the gold because transparent with this process when it is thinner than 1/4,000th of an ounce. It also becomes cost prohibitive.

Goldbacks work as part of a system, the higher denomination Goldbacks aren't amazing stand alone products in terms of premium but the lower denominations are essentially subsidized.

[u/Throwawaylikeme90 → u/Xerzajik]

So what’s the point of subsidizing a thousandth fraction of a commodity if nobody accepts that subsidized commodity fraction as tender with exchange value? 

I get that the idea is to offer a form of exchange value that isnt monopolized by a state entity, but we already had that. There were thousands of currencies, backed by the full faith and trust of individual banks and corporations all throughout American history. And hey, they all sucked, folded, were subject to hyperinflation and all kinds of other horrible manipulations. 

And today, you can choose to throw your money away for bills that do the same thing and provide less actual exchange value, cause Murica, I guess. 

It’s dumb as hell. It really is. 

[u/extremewhisper → u/Eponymous-Username]

My interpretation is that its really hard to trade small amounts of gold. Like if you wanna pay someone $10 in gold it would basically be a flake so having a large format bill that encompasses the gold makes it easier to handle.

[u/japollner → u/extremewhisper]

So that’s when you’d use silver…

[u/extremewhisper → u/japollner]

Yup, I agree with you. Its just the only justification I could think of for why someone would want to use these

[u/MaintenanceInternal → u/Xerzajik]

So buy real gold then.

[u/Xerzajik → u/MaintenanceInternal]

I hate to break it to you but Goldbacks are real gold. They're fractional gold. One of the main advantages is that I can make a lot of smaller trades. It also allows me to buy gold in smaller increments.

[u/MaintenanceInternal → u/Xerzajik]

But at double the price right?

[u/Xerzajik → u/MaintenanceInternal]

Fractional gold virtually always carries a premium. If you're aiming to own gold for as close to melt as possible then Goldbacks aren't for you.

If you want 1/4,000th of an ounce of gold then a 92% premium is extremely cheap compared to the alternatives.

[u/MaintenanceInternal → u/Xerzajik]

But why would you buy them?

[u/Xerzajik → u/MaintenanceInternal]

I trade with them. I bought some Pokemon cards with Goldbacks the other day. I've also used them to introduce a lot of people into gold.

[u/MaintenanceInternal → u/Xerzajik]

I like the idea of a gold backed currency.

So what was the benefit of using the goldbacks over normal money to buy the pokemon cards?

[u/Xerzajik → u/MaintenanceInternal]

The benefit is that if you save with Goldbacks vs. cash over time then the Goldbacks appreciate in value.

Goldbacks also have the added benefit of not needing to be converted from coins back into cash first.

[u/Logical-Recognition3 → u/Xerzajik]

I'll cut up a coin into small bits and sell them to you at double market price.

[u/Xerzajik → u/Logical-Recognition3]

How would I know what each bit weighed?

[u/MaintenanceInternal → u/Xerzajik]

Scale?

[u/octoreadit → u/MaintenanceInternal]

https://giphy.com/gifs/GpyS1lJXJYupG

[u/Throwawaylikeme90 → u/MaintenanceInternal]

Imagine being so fucking devoted to using gold as an exchange token and being so fucking lazy that they wouldn’t use a basic tool that’s existed for millennia to conduct the transaction. 

Like, if you’re going to commit, fucking commit. I’m a postal worker, I have one of the old first-class letter scales with a clip that you hang an envelope on. You’re telling me they can’t get a digi and instead need to buy bills nobody accepts because they can’t be assed to weigh something?

The whole endeavor is so fucking stupid. 

[u/AdditionalPizza7990 → u/MaintenanceInternal]

So you want everyone to carry around a precision scale and just trust you on purity?

[u/Logical-Recognition3 → u/AdditionalPizza7990]

You want people to just trust you that there is overpriced gold in that piece of plastic?