It seems to me as if Bitcoin is more fungible than the dollar, considering that the price of the dollar depends on (at least): what bank issued the dollar, whether it’s been printed, and what denomination it’s in. Meanwhile, there’s a provenance to Bitcoin that could similarly affect its fungibility.
Anyone want to share their opinions here?
Initial attempts to impact the fungibility of bitcoin have failed and the choke point was largely moved to entry/exit points in the system (so now private banks and exchanges are doing the government’s dirty work).
While the fungibility of bitcoin remains high, because of the public nature of addresses and transactions, there’s relatively more risk in assuming “forward fungibility” than with, say, $20 notes. Maybe 0.04 BTC that you got as a tip may turn out to be a “bad” 0.04 BTC that came from an address that is unlike most other known addresses.
It’s been a while since I last checked the reliability and fees charged by mixing services but I just looked at bitcoinmixer.com and they charge only 0.5% plus a minimal transaction fee. Assuming a stable exchange rate and Fed’s target inflation rate (close to 2%), it’s makes sense to mix one’s bitcoins and use disposable addresses to achieve a near-perfect fungibility for your bit-stash (except for addresses used for Counterwallet assets).
Edit: just came across this article here:
Time will tell all, but it remains self-evident that bitcoin violates the principle of fungibility in a way which is structurally different from any form of money we have seen to date.
It claims that all coins that circulated on the busted Evolution exchange are now tainted, but it doesn’t prove it. Maybe they may the current owners will come under increased scrutiny of the state, but even so, there’s no proof that they were declined. And they can always run them through a mixer.
By the way, above I forgot to note that the cost of mixer service would be larger if coins were mixed more than once.