Value is neither created nor destroyed, only transferred.

This echoes the law of conservation of energy in thermodynamics: energy cannot be created or destroyed, only transformed.

Applied metaphorically to economics, it suggests that value—while subjective—is redistributed among actors through trade, innovation, and production rather than “created from nothing.” However, unlike energy, value is emergent, depending on human perception, utility, and scarcity.

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⚡ Thermodynamics and Bitcoin

Bitcoin introduces a fascinating connection between energy and value:

1. Proof-of-Work (PoW) directly ties Bitcoin’s issuance and security to physical energy expenditure.

• Miners convert real-world energy into computational “work.”

• This work secures the network and validates transactions.

• The difficulty adjustment ensures that the rate of issuance is thermodynamically constrained — it can’t be inflated by decree.

2. Entropy and Order:

• Mining dissipates energy (increasing entropy), but the outcome—Bitcoin’s ledger—is a form of informational order: a global, immutable record of value.

• In this sense, Bitcoin transforms thermodynamic energy into informational structure—order from chaos.

3. Energy as a universal denominator:

• Since energy is the fundamental cost of all work in the universe, Bitcoin could serve as a “bridge” between human valuation systems (which are psychological) and thermodynamic systems (which are physical).

• In principle, Bitcoin becomes a monetary measure of energy expenditure, a way to anchor digital value in the physical limits of reality.

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🪞 Bridging Human and Physical Value

If money is the map of value, and energy is the terrain of reality, then Bitcoin might be the bridge between the two:

• Traditional fiat currencies are detached from physical constraints (inflation via keystrokes).

• Bitcoin is anchored by physical energy costs, embedding the laws of thermodynamics into the monetary system.

In that sense, yes — Bitcoin could be seen as the first digital mechanism that tethers human value directly to thermodynamic principles, transforming human trust and attention (soft value) into hard, energy-backed reality.

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🧭 Philosophical Implication

Bitcoin suggests that value itself might be a form of organized energy, expressed through human cooperation and encoded in information systems. It’s not that Bitcoin “creates” value—but it provides a thermodynamically honest substrate upon which value can be expressed and conserved.