A new year is a natural reset.

People set goals.

They reassess what matters.

They decide where to direct their time, energy, and effort.

This makes it a good moment to think about money.

Money is not wealth.

It is a tool for measuring and storing the value you create.

When the measuring stick is unstable, effort is distorted.

Productivity is punished.

Long-term thinking becomes difficult.

For decades, most people have been forced to trade their time for a currency that loses purchasing power by design.

The result is predictable: higher risk, more speculation, less saving, and constant pressure to chase returns just to stand still.

Hard money changes the incentive structure.

When money holds its value:

• Saving becomes rational.

• Long-term planning becomes possible.

• Productivity is rewarded instead of diluted.

Bitcoin represents this shift.

Not as a get-rich-quick scheme.

Not as a trade.

Not as a yield product.

But as a fixed-supply monetary system with no issuer, no discretion, and no need for trust.

In a Bitcoin standard, progress shows up differently.

Not primarily through rising prices,

but through:

• Falling costs

• Better tools

• Higher quality

• More efficient coordination

The goal isn’t to “number go up.”

The goal is to produce more value with less waste, and store that value honestly.

As this year begins, the question isn’t:

“How do I make more money?”

It’s:

“What am I building?”

“What value am I creating?”

“And what money do I store that value in?”

Hard money rewards patience.

It rewards discipline.

It rewards real work.

That is a good foundation for any year ahead.

#Bitcoin #NewYear #Productivity #ValueCreation

Last time I got to Mossell bay but this time I won’t be able get that far east. So good to see Bitcoin being used as it was intended. Hard money, within circular economies so people can earn, save and spend Bitcoin.

I love this, I’m in SA at the moment and always on the hunt for places to spend sats and support businesses accepting bitcoin.

All the time.

Where is this? It’s perfect 👌

Agreed. A lot of these disagreements come down to how we define “growth.”

GDP measures monetary throughput, not lived outcomes. It rises with debt expansion, asset inflation, and government spending, even when productivity, purchasing power, and quality of life stagnate or decline.

Increased productivity should result in lower prices, higher real wages, and more leisure. In fiat systems, those gains are often absorbed by currency dilution and asset holders instead.

So the real question isn’t “is the economy growing?” but who benefits from that growth, and in what unit is it measured?

Over the past few days, I’ve been involved in a long debate about #Bitcoin, #money, and #economic growth. Below summarises the debate outside of the comments we have had back and forth.

What became clear is that most disagreements about Bitcoin are not really about Bitcoin.

They are about which economic framework you start from.

Two schools of thought

Most modern economics taught in universities today is derived from Keynesian and neo-Keynesian models.

In this framework:

• Money is a policy tool.

• Credit expansion is necessary for growth.

• Debt is not a problem if it funds activity.

• Inflation is tolerated, even encouraged, to stimulate spending.

• Economic health is measured primarily through GDP.

Within this model, a fixed supply monetary system looks dangerous.

If money cannot expand, the assumption is that growth will stall, liquidity will dry up, and the system will collapse under its own weight.

This is why many people instinctively conclude that Bitcoin “cannot work” as money.

There is another school of thought, often referred to as classical or Austrian economics, which starts from different assumptions. This is where Bitcoiners sit.

In this framework:

• Money is a measuring tool, not a control mechanism.

•Growth comes from productivity, innovation, and efficient coordination of capital.

• Credit should emerge from real savings, not monetary expansion.

• Inflation distorts price signals and transfers wealth.

• Falling prices due to productivity are a feature, not a failure.

From this perspective, a fixed or hard monetary base is not a limitation.

It is a discipline.

Why universities teach what they teach

Modern states operate on debt-based monetary systems. Governments, banks, and institutions depend on the ability to expand the money supply.

It is therefore not surprising that:

• Economic models that justify managed money dominate academia.

• Models that limit state discretion are treated as historical or impractical.

• Monetary failure is usually framed as “policy error,” not systemic design.

This doesn’t require malice or conspiracy.

Systems tend to teach what sustains them.

Historical evidence is often misread

Empires did not collapse because money was “too hard.”

They collapsed because money was debased.

• Rome did not fall under a fixed monetary system. It progressively reduced silver content in its coinage to fund military and state spending. Trust eroded, prices rose, and economic coordination broke down.

• Weimar Germany did not fail due to hard money, but due to rapid monetary expansion to service war debts.

• Zimbabwe did not collapse because of sanctions alone. Monetary issuance was used to paper over structural collapse, destroying the currency.

• Time and again, monetary expansion is used as a short-term solution that creates long-term instability.

Hard money systems did not “fail.”

They were abandoned when political constraints became inconvenient.

Where Bitcoin fits

Bitcoin does not ban credit.

It bans base-layer monetary manipulation.

Its base layer is slow by design because it prioritises final settlement, not throughput. This is not new. Gold functioned the same way for centuries. Higher layers always emerged on top of sound settlement layers.

Bitcoin separates:

• Money from policy

• Settlement from payments

• Value storage from discretionary issuance

When people argue that Bitcoin must adopt inflation, tail emissions, or permanent issuance to “support growth,” they are assuming growth must come from monetary expansion.

Bitcoin challenges that assumption.

It forces growth to come from:

• Better coordination

• Better incentives

• Better productivity

Why the disagreement persists

If you believe:

• Money must be managed

• Growth requires issuance

• Stability comes from flexibility

Bitcoin looks flawed.

If you believe:

• Money should constrain power

• Growth should reflect reality

• Stability comes from rules

Bitcoin looks inevitable.

This is not a debate about intelligence, credentials, or good intentions.

It is a debate about what money is allowed to do.

Bitcoin did not create this disagreement.

It simply made it impossible to ignore.

This is the core distinction many miss and I’m glad you’re calling this out.

A custodial balance or ETF share is a claim on Bitcoin, not Bitcoin itself. The protocol recognises only UTXOs controlled by private keys, not brokerage statements or fund disclosures.

Centralised custody concentrates risk, shifts price discovery to paper instruments, and recreates the same trust assumptions Bitcoin was designed to remove.

ETFs and treasury companies may increase exposure, but they do not strengthen the network’s monetary properties. Sovereignty, censorship resistance, and verifiability exist only at the protocol layer.

Bitcoin works best when custody, verification, and settlement remain distributed. Everything else is convenience layered on top, with trade-offs.

Most of the world prices goods, services, and labour in fiat terms.

As the currency supply expands, prices rise.

Wages lag behind.

The gap widens over time.

This distorts the concept of fair value.

People trade finite time and energy for a unit that steadily loses purchasing power. The loss is not always visible, but it is cumulative. Productivity improves, technology advances, yet the currency measures less of both.

Price inflation is often blamed on greed or shortages. In reality, much of it is a reflection of the measuring unit deteriorating.

#Bitcoin exposes this distortion.

When Bitcoin is used purely as a store of value after converting from fiat, it is treated as an investment. That is a rational response within a fiat system, but it is not the full design intent.

Bitcoin was not created to be a speculative asset.

It was created to be a stable monetary unit.

When value is stored in a unit that does not dilute, prices fall as productivity improves. Purchasing power rises without requiring higher nominal wages. Fair value re-emerges because the measuring stick remains constant.

The distinction matters.

If Bitcoin is only bought with fiat and never earned or spent, it behaves like an asset.

If Bitcoin is earned, saved, and spent, it functions as money.

This is why circular economies matter. Not for ideology, but for measurement.

Fair value cannot exist when the unit of account is unstable.

Sound money is not about getting rich.

It is about preserving time, energy, and truth in pricing.

Bitcoin makes that possible.

I agree.

Bitcoin was not designed to be a passive investment or a vehicle for fiat gains. It was designed to be earned, saved, and spent, without intermediaries.

The reason many don’t spend Bitcoin today isn’t ideology, it’s structure. Most people still buy Bitcoin with fiat rather than earn it. When Bitcoin is acquired as an asset, it’s treated like one. When it’s earned, it functions as money.

That’s why circular economies matter. They enable:

Earning in Bitcoin

Saving in Bitcoin

Spending in Bitcoin

I’ve paid staff in Bitcoin since 2016. Where Bitcoin income exists, spending follows naturally.

Platforms like Bitrefill, Fold, BitPay, Strike, and Living Room of Satoshi reduce friction by bridging Bitcoin into a fiat-priced world, though adoption remains region-specific. Education and merchant participation are still critical, especially paying wages in Bitcoin.

Treasury companies and ETFs increase price exposure, but they don’t create monetary circulation. Adoption as money comes from usage, not balance sheets.

Both phases can coexist. But Bitcoin’s long-term strength comes from being used, not watched through a fiat price lens.

Bitcoin is slow by design because it prioritises final settlement and verification, not retail throughput. That does not make it “just an underlying asset.” It makes it base-layer money.

Lightning is not a third-party chain in the custodial sense, it’s an optional second layer that inherits Bitcoin’s security and can be used non-custodially. Optional layers don’t negate sound money; they’re how sound money scales.

Sound money is defined by scarcity, verifiability, and resistance to discretionary issuance, not transaction speed.

Tail emission is a policy choice, not a requirement. Permanent inflation does not make money sound; it makes dilution perpetual.

Anyway, I’ll end this debate here. It’s clear we have different views, which is perfectly fine. These kinds of discussions are necessary for progress, even when there’s no agreement.

You’re conflating credit with growth.

Debt can fund growth, but it does not create it. Productivity creates growth; debt merely pulls future output forward and prices it today. When the productivity fails to materialise, the debt still remains.

China is a perfect example of this distinction, not a rebuttal. Suppressed currency + credit expansion produced output and massive malinvestment, demographic collapse, ghost cities, and an unserviceable debt overhang. That is not proof of sustainability.

Fixed-supply money did not “fail since Babylon.” Credit systems failed when claims exceeded real output. Sound money exposes those failures instead of masking them with issuance.

Inflation is not growth. It is a signal that monetary claims have grown faster than real goods and services.

Debt issuance does not create growth. It reallocates purchasing power forward in time.

Real growth comes from productivity gains, better coordination of capital, labour, and technology. Under sound money, growth shows up as falling prices and rising real purchasing power.

Construction sites are not proof of growth. Malinvestment builds things too, until the cash flows fail and the debt must be rolled, inflated away, or defaulted on.

Issuance expands claims, not resources. Eventually the claims exceed what the real economy can support. That is the bottleneck you’re describing, and it’s caused by debt, not fixed supply.

Economic growth does not come from issuing more units of money.

It comes from productivity, innovation, and better coordination of capital.

A fixed supply monetary base does not prevent growth — it forces growth to express itself through falling prices and rising purchasing power, not monetary debasement.

Issuance creates the illusion of growth by diluting the unit.

Bitcoin measures growth honestly.

Let’s add nostr:npub1wzryyv8ewjsedn5u2endep88xvwntxvut8k73kxnwa24ztm5ptzqsqpmh9 🇳🇿 to the list

#Bitcoin was not designed to be an IOU.

It was designed to remove the need for trusted intermediaries in money.

When you hold Bitcoin through:

– ETFs

– custodial exchanges

– broker apps

– derivatives and paper claims

you do not hold Bitcoin.

You hold a promise denominated in Bitcoin.

That distinction matters.

Paper Bitcoin recreates the exact system Bitcoin was built to escape:

• custodians control access

• regulators control custodians

• price discovery moves off-chain

• users lose sovereignty

If most “Bitcoin ownership” exists as paper claims, then Bitcoin becomes:

– easy to freeze

– easy to censor

– easy to rehypothecate

– easy to politically capture

The protocol still works.

The rules don’t change.

But the people stop using it as designed.

Bitcoin’s security model assumes:

– users self-custody

– nodes independently verify

– transactions settle on the base layer (or trust-minimised layers)

ETFs do none of this.

They increase price exposure while reducing network participation.

That is why ETFs strengthen fiat markets, not Bitcoin.

Bitcoin does not gain strength from number go up.

It gains strength from:

– self-custody

– real settlement

– node verification

– voluntary use

If you don’t run a node, you trust someone else’s rules.

If you don’t self-custody, you don’t control your money.

If you never transact, you don’t participate in the system.

Bitcoin survives paperization.

But it does not benefit from it.

If Bitcoin is treated only as a speculative asset,

it will be absorbed into the system it was meant to replace.

If it is used as money,

it remains outside that system.

The choice is not institutional vs retail.

The choice is custody vs sovereignty.

Use Bitcoin.

Verify Bitcoin.

Hold your own keys.

That is how Bitcoin stays Bitcoin.

#Bitcoin’s protocol still works.

The risk is not in the code. It is in how people use it.

Bitcoin is increasingly held through ETFs, custodians, and treasury vehicles. That gives exposure, but it reduces participation. Price discovery moves off-chain. Coins consolidate into regulated pools. Users stop verifying.

This does not break Bitcoin.

But it weakens its sovereign properties.

Bitcoin was designed to be self-custodied money, settled peer-to-peer, enforced by users running nodes. That is what makes the rules hard to change and capture expensive.

When convenience replaces verification, enforcement thins.

When exposure replaces ownership, sovereignty erodes.

Institutions will always prefer paper claims and intermediated control. That is rational for them. It is not neutral for the network.

As a Bitcoiner, the responsibility is to be honest about this trade-off.

If you want Bitcoin to remain hard money:

• Hold your own keys

• Run a node if you can

• Use Bitcoin as money, not just as a price ticker

Bitcoin does not need belief or protection. It needs users who participate.

The protocol survives only if sovereignty is practiced, not outsourced.

For the world to run on hard money 😉#Bitcoin

Completely agree.

Credit is not savings.

It is a claim created against the future.

In modern systems, credit is issued first and funded later. Banks do not lend deposits. They create new money when they issue loans. The borrower receives purchasing power that did not previously exist. The liability is pushed forward in time.

This process expands the money supply without increasing real goods or productivity.

At small scale, credit coordinates investment.

At large scale, it distorts prices.

When credit is cheap and abundant:

• Asset prices rise before wages

• Risk is mispriced

• Debt grows faster than income

• Consumption is pulled forward

• Future output is assumed, not earned

This is not growth. It is temporal displacement.

The system requires continual expansion to remain solvent. Old debt is serviced by new credit. If expansion slows, defaults appear. If expansion stops, the system contracts.

There is no equilibrium. Only acceleration or collapse.

Because credit is created without hard limits, it concentrates power in institutions that can issue it. Those closest to issuance benefit first. Those furthest away pay later through inflation and higher taxes.

This is why inflation is described as a “mystery.”

Its cause is structural.

Sound money constrains credit.

Fiat money amplifies it.

Bitcoin does not prohibit lending.

It prohibits credit creation from nothing.

Loans must come from saved capital. Risk must be priced. Time preference must be real.

This is the difference between money that measures value

and money that manufactures claims.

One preserves reality.

The other replaces it with promises.

#Bitcoin #Credit #Finance #CentralBanking

Brilliant

A recurring pattern I see in Bitcoin discussions is the conflation of the protocol with the market built around it.

Bitcoin is a monetary protocol.

TradFi exchanges, market makers, ETFs, custodians, oracles, and fiat on-ramps are optional market infrastructure layered on top of it.

When people critique Bitcoin by pointing to exchange failures, liquidity providers, pricing oracles, or custodial risk, they are not critiquing Bitcoin.

They are critiquing fiat-era intermediaries interacting with Bitcoin.

That distinction matters.

Within the protocol:

• No miner can censor a valid transaction

• No market maker can change the rules

• No exchange can prevent settlement between self-custodied users

• No institution controls issuance or supply

• No authority can override consensus

Bitcoin does not eliminate intermediaries by force.

It makes them optional by design.

The confusion arises when people treat:

• price discovery as governance

• custody as control

• liquidity as authority

• markets as protocol

That framing imports TradFi assumptions into a system that was explicitly designed to remove them.

My aim has always been to evaluate Bitcoin on its own terms — at the protocol layer — not through the lens of fiat market behaviour built around it. When you separate those layers, most of the common criticisms collapse.

Bitcoin is not perfect.

But it is precise.

And precision is what most debates are missing.

#Bitcoin #FiatMoney #TradFi

The stock-to-flow ratio explains why some forms of money endure and others fail.

Stock is the existing supply of an asset.

Flow is the amount added each year.

When flow is small relative to stock, supply is stable.

When flow is large, value is diluted.

This ratio matters for money.

Gold functioned as money for centuries because its stock-to-flow was high. New supply could not be produced quickly, even when demand increased. That constraint protected purchasing power over time.

Fiat currency has a stock-to-flow problem by design. Flow responds to policy, not scarcity. When demand for money rises or debt becomes unmanageable, supply expands. Purchasing power declines as a result.

Bitcoin was designed with this distinction in mind.

Its total stock is capped.

Its flow is known in advance.

Issuance decreases on a fixed schedule.

Every four years, Bitcoin’s flow is cut in half. Its stock-to-flow rises automatically, without discretion or intervention.

This is not a pricing model.

It is a description of supply mechanics.

Hard money does not depend on restraint.

It depends on constraint.

Bitcoin’s stock-to-flow is enforced by rules, not promises. That makes it the first digitally native form of hard money with predictable scarcity.

Over time, assets with stable supply are used to preserve value.

Assets with elastic supply are used to spend.

That pattern has repeated throughout history.

Bitcoin fits the former category by design.

#Bitcoin #HardMoney #Money #Economics #Inflation #Finance

The Bank of England cutting rates to 3.75% is not a sign of strength.

It is a response to economic contraction, not confidence.

Rate cuts happen for two reasons:

either productivity is accelerating, or demand is weakening.

This is the latter.

Falling inflation here is not driven by abundance or efficiency.

It is driven by slowing consumption, tightening household budgets, and a fragile economy that cannot tolerate higher borrowing costs.

The so-called “mortgage war” confirms this.

Banks are not cutting rates out of generosity — they are competing for scarce creditworthy borrowers. When lending demand weakens, price competition follows.

Yes, lower rates may reduce monthly payments in nominal terms.

But history shows what usually comes next: house prices reprice upward, absorbing the benefit. Cheaper money does not make housing more affordable. It makes housing more expensive in larger units of debased currency.

An average £270 monthly saving sounds meaningful — until prices rise 5–10% and first-time buyers are pushed further out.

Lower rates help existing asset holders first. That is the Cantillon effect, not prosperity.

This is the deeper pattern:

• Rates rise → households strain

• Rates fall → assets inflate

• Purchasing power continues to erode in both cases

Monetary easing is not a solution.

It is a delay mechanism.

Real recovery does not come from cheaper credit.

It comes from sound money, productivity, and capital formation without distortion.

When central banks cut rates during contraction, they are not fixing the system.

They are signalling that it can no longer function without intervention.

That is not stability.

It is dependency.

https://www.perplexity.ai/page/bank-of-england-cuts-rates-as-jhJuKhX8Su2x0X.F8ELx5g

#UK #UKEconomy #BankOfEngland #Economy

Thank you for the kind words.