But why would you diversify into something with counterparty risk and that can be inflated away from something that has no counterparty risk and is perfectly scarce?
Still aren't understanding, it isn't an investment. It's a money. The entire apparatus and culture of "diversify your investment" is a product of a shit money system that we've grown up in. It never made sense and is nothing but a pointless, wasteful friction.
"Perfectly" scarce is a bit of a stretch. It is scarce by consensus, and yes that is a pretty strong convention. Perfect, maybe not. It's OK for people to have doubts. Consensus can be gamed. Especially if we are not careful. Indeed the chain could split due to conensus gaming. I am quite sure there are those that would like to see that happen. And it has happened before, almost fatally. We need to stay humble and avoid being complacent on these issues.
It’s simpler than that though. Bitcoin is 21 million and it’s perfectly scarce because of that explicit limit. I run a node, therefore no one can say that anything is different.
Bitcoin’s consensus is and will be defined by the intolerant minority. I run a node that defines it as 21 million, and anything incompatible with that is invalid.
I think accepting the notion that this is NOT set and determined is itself a mental concession. One that I refuse to give. There is no way to “game consensus” and make bitcoin not 21 million, because I will never call anything that changes that Bitcoin. If we accept that this can be gamed, we literally give up leeway to game it. From the POV of my node and my bitcoin, it can’t be.
It is arguable that there is still a place for investment (by that I mean, capital outlay in hopes of more capital in return over time) in a civilization and not simply storing all value in money. A prime example is in the case of needing/wanting a way to acquire more bitcoin. Bitcoin does not replicate itself into more bitcoin.
Traditionally stocks and real estate investments have been inflation hedges (perhaps not as good as bitcoin). In particular with real estate leverage via fixed income debt is method to capitalize on inflationary environments.
Taking your thinking to the extreme, every public/private company should liquidate into bitcoin and distribute it among shareholders. As you've said, owning businesses or other assets makes no sense, it is "pointless, wasteful friction"
