The reason is that gold cannot completely replace a currency for the purposes of conducting daily commerce in a large economy. Gold is a hedge to preserve purchasing power and be exchanged for whatever the prevailing currency is when needed, but gold can never become the primary currency of a major economy. It is not feasible for interstate or international commerce, particularly in an economy where many financial transactions and payments are done electronically, across state lines, over long distances, etc. This is why even gold bugs still need to convert holdings to dollars or whatever other currency when they need to conduct other commerce, as long as that currency is still agreed upon and accepted by others as a form of payment for goods and services. There will always be some form of currency in use for mass transactions. Even if the Dollar fails completely, it would be replaced with a new currency. The point of gold is simply to preserve the purchasing power of the holder, regardless of what the prevailing currency at the moment happens to be, and then convert to that currency as needed for conducting other commerce.