Comment Re:"everyone from PayPal merchants to Rand Paul" (Score 1) 67
There's a chance that the bank wouldn't be able to redeem the note, because of fractional reserve banking.
Besides other reasons for discounting notes at purchase time, like fake notes, or loss, or the bank being very far away.
That's trusting that the bank has your gold/commodity. Like the bitcoin supporters keep saying - mtgox is not bitcoin and bitcoin is not mtgox. In the same way, the bank is not gold and gold is not the bank. A currency based on gold is one based on MIStrust, because you don't trust the issuers bill and insist that their bill is backed by gold.
Currencies backed ultimately by gold by some bank are most definitely NOT backed by "trust". If you trusted them you wouldn't need the gold. Once again, I reiterate - since the invention of coinage no currency has existed that is based on trust. Not a single one. I fail to see why BTC, based soley on trust, will succeed. Even as an experiment, all it has shown thus far is that we have been inadequately teaching economics.