Bitcoin and bimetallism
![Image](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg1NaK0KnuQsoTPrLZF29vYZjZ9c4bnYcuZB_9ftO27Kq8BRluQeYQxfpQhC2-LCl7Xf62aWgGWD6qYtCfRDdoLe5HYKBYJ_-FWPiqDXykD5869vp8NWxJtMVmxgEh9XCilD6cP7ECJ_64/s400/British+coins.jpg)
I wrote a piece on Forbes recently in which I described a bimetallic system of coinage and suggested how such a system might work - or rather, fail to work - for Bitcoin. These are the relevant paragraphs: In a bimetallic system, there are effectively two currencies which are linked by a fixed exchange rate set by fiat. At the end of the 19th century - the time of Bryan's speech - Britain's copper penny was worth 1/144 of one pound. Other denominations of coin were created by multiplying up the penny: so the silver sixpence was unsurprisingly worth six copper pennies, and the silver shilling was worth twelve pennies, or 1/20 of a pound. All these relationships were fixed by fiat. So, suppose that instead of using bitcoin as the medium of exchange, we use some other coin - let's call it "satoshi". We decide that this other coin is worth 1/100m of 1 bitcoin. Of course, in the Bitcoin system, there is no government "fiat": the nearest they have to