A good friend of mine called this evening. He had been thinking of acquiring bitcoin for some time. He was going to take a significant position exchanging a portion of his dollar savings for half a coin. But at the last minute he got cold feet, something held him back. He asked me “What’s backing bitcoin?” We discussed gold and energy usage and the traditional fiat system and I did a pretty good job of listening because it’s so tempting to keep jumping into talks like this with “yes, buts.”

As we spoke I began to realize our conversation was starting in the wrong place. The first question should be “what is money?” Bitcoin is such an unusual entity that it only starts to make sense when you understand it from the perspective of a solution to a huge problem hiding in plain sight.