>What ensures that a paper money with "10 Dollar" on it, is same as 10 coins each with "1 Dollar" on it?
>This is the principle of fungibility, and means I can exchange a paper with "10 Dollar" on it for 10 coins with "1 Dollar" on it, because by government fiat, such an exchange is valid for all cases.
>What ensures that btc.0 and btc.1 are indistinguishable from a human perception?
This is a good question. Does anyone think about why the bitcoins generated from different blocks have the same value? Some of them are still distinguishable ( if they are not combined with others sent out).
Would the bitcoins that can be traced back to the block where it was generated be worth different from others ?If one day Satoshi released his/her/their bitcoins , would the bitcoins from the first several blocks mined by Satoshi be worth more?
I think for fungibility, it is not like either it has fungibility or it has no fungibility. There should be a value of fungibility (e.g. from 0 to 1) that can be measured or evaluated.