Prices matter. In a Waze-like manner, prices guide billions of economic turns a day – constantly updating based on new, real-time information – made individually by billions of humans around the world, 99.999%+ of whom don’t know each other, will never meet each other, and almost certainly don’t realize that price signals – distorted or not – coordinate their actions, for better or worse.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter
CHANGE THE MONEY, CHANGE THE WORLD
Bitcoiners are inherently optimistic, positive people with HOPE (https://hope.com) for the future of society.
In a world where we are barraged with seemingly-ever-greater negative news, our community is unique and immeasurably valuable - a godsend.
Bitcoin is a space-time compressing technology.
Similar to the steamboat, railway, airlines and internet, Bitcoin links us closer to one another.
What was previously either impossible (sending money to e.g. Cuba) or rife with friction (sending money abroad, storing value in a hyperinflationary time) is now possible. Not only that, it is absurdly easy, fast and cheap to do.
What makes something money is not absolutism; it is always relative value - the choice between storing value in one medium vs. another.
To understand why Bitcoin is money, first understand why gold was money. Then, learn what properties make something a better or worse form of money.
- an excerpt from the 2-minute version of Gradually, Then Suddenly (2019) https://www.2minutebitcoin.org/blog/gradually-then-suddenly-bitcoin
In our current system, money creation and money destruction is mainly done through private banks. New money is created when these banks create credit, and through fractional-reserve banking they only keep a small fraction of deposits in reserves.
The financial system then becomes hopelessly intertwined - if too many borrowers default on their loans, the entire system will fail – even for customers who never agreed to have their deposits invested in risky schemes.
This intertwining creates terrible incentives through a severe disconnect between risk and reward for the financial sector.
The government becomes obliged to bail out banks once they get into trouble from risky lending, which drives banks to take even more risk knowing that their potential losses are capped, but their upside is not.
-- an excerpt from the 2-minute version of https://www.2minutebitcoin.org/blog/an-honest-account-of-fiat-money-2018
In the investment sense, the value of money is the purpose it serves in your portfolio.
For the investor, the value of money is determined by the tradeoff of
**commitment** versus **optionality**.
- If he wants more deferred choices then he needs **more cash**.
- If he wants **more income**, then he should get stocks or bonds.
The reason someone might want to defer his choices is because there
are limited periods of time in which investments go on sale.
Similarly, a business benefits from having cash because it is easy to make mistakes whose consequences are not evident until long after they are unavoidable. When that happens a business needs cash in order to survive long enough correct itself.
During such times, good businesses can be bought cheaply for limited periods of time - especially if they need to raise cash.
This is why an investor wants a cash balance ready to spend. You never know what is coming, but if you have cash you are prepared for whatever it is.
Holding a stock is a commitment to a particular enterprise, whereas cash keeps your options open.
-- an excerpt from It's Not About The Technology, It's About The Money (2016), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology
Everybody has a socially established number that is objectively associated with them - their net worth.
They can show other people how much they have, and everyone will agree as to what the number is.
People:
1. can do something which subtracts from this number and adds to another person’s number.
2. desire to accumulate higher numbers.
Money is therefore used for two things - to store it (i.e maintain the number) and trading (subtracting/adding to this number).
-- an excerpt from It's Not About The Technology, It's About The Money (2016), its 2-minute version can be found here: https://2minutebitcoin.org/blog/bitcoin-is-about-the-money-not-the-blockchain-technology
Bitcoin is hope.
Hope to make money.
Hope to save money.
Hope for a better money.
Hope for a free market.
Hope to feel financially secure.
Hope to feel financially safe.
Hope for less inequality.
Hope to suppress governmental power.
Hope for smaller militaries.
Hope for less wars.
Hope for a better life. Hope for a better world.
All of this hope is attached to a open-source software with 99.9% uptime that is consensus-dependent on a community where each individual benefits from the continued function of the software.
If you can't see the value in that....there's no hope for you...
Bitcoin uses a lot of energy globally. How can this be good?
Bitcoin is **a better technology** for performing central banking than the current government monopolies on central banking.
Throughout history, energy use has grown whenever free people making free choices have decided for themselves that the price of the extra energy for the new technology they wanted was worth it. Further, increased energy usage has always followed increased prosperity.
Just like cars consume far more energy than the bikes and horses they replaced, and electric lights replaced candles, and central heating replaced chimneys, and computers replaced typewriters, Bitcoin’s better monetary system consumes far more energy than the current central banking system.
Today, every day, 24/7, Bitcoiners around the world make the decision that the price of Bitcoin’s energy use is worth it because Bitcoin is better technology for money.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter
**_“The Most Significant Monetary Achievement in the History of the World”_**
President Nixon thundered these words on December 18, 1971, in a surprise weekend national address announcing the Smithsonian Agreement.
This agreement coordinated the simultaneous anchoring of each G-10 currency to U.S.-Government-Paper-Money (**USGPM**, or the Fiat Standard) via fixed exchange rates.
This address followed another surprise weekend address earlier that year – the “Nixon shock” of August 15th, which took the U.S. off the Gold Standard, replacing it with the Fiat Standard.
Prior to the Nixon shock and the Smithsonian Agreement, and as motivation for them, Nobel Prize winners and politicians were convinced that **gold gave no value** to U.S. dollars.
Rather U.S. dollars gave value to gold.
Thus, the U.S. could safely go off the Gold Standard and, correspondingly, the G-10 could safely peg their currencies to **USGPM**.
“Every expert knows that the popular conception that money has more value if it is exchangeable into gold exactly reverses the true relation. Were it not that gold has some monetary uses, its value would be much less than it is today ($35/oz).” – Paul Samuelson, Nobel Prize winner
“When the U.S. government stops wasting our resources by trying to maintain the price of gold, its price will sink to $6/oz rather than the current $35/oz.” – Congressman Henry Reuss
In a little over a year, this “most significant monetary achievement” smashed apart on the rocks of economic reality. Instead of gold crashing to $6/oz, by early 1973 it was USGPM that crashed to $125/oz, a level unthinkable to Samuelson’s “every expert” and to U.S. Congressmen.
As USGPM crashed, the G-10 began to see the “P” in USGPM for what it was and, one by one, quietly abandoned the Agreement. Far from a temporal fluke, in the ensuing 50 years, USGPM has depreciated versus gold ~8%/year.
P is P.
-- an excerpt from the Stone Ridge 2020 Shareholder Letter, its 2-minute version can be found here https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter
Naysayers always complain:
> “Bitcoin is too volatile! Nobody will ever use something so volatile!”
That’s superficial and short-sighted.
***Volatility is not a property inherent in Bitcoin itself***.
It is caused by the way people treat the asset - a function of people’s attitudes and behaviors. Unless Bitcoin becomes heavily manipulated or human nature changes, a new monetary asset that regularly grows in both popularity and usefulness will always be volatile.
To complain that nobody will use Bitcoin because it’s volatile is to say
> “Bitcoin’s adoption rate is so astonishingly fast that it will never be popular!“
If Bitcoin were _less_ volatile, would it have an even _more_ rapid adoption rate?
Bitcoin’s price has to go up as more people start using it, and if a _lot_ of new people start using it, then it has to go up _fast_ (that is, be volatile).
-- an excerpt from the 2-minute version of I Love Bitcoin's Volatility (2014) accessible here https://www.2minutebitcoin.org/blog/i-love-bitcoins-volatility
gm pv 🤙
"It might make sense just to get some in case it catches on. If enough people think the same way, that becomes a self fulfilling prophecy."
- Satoshi Nakamoto, 1/17/2009
Bitcoin will not be eagerly adopted by the mainstream, it will be forced upon them by economic reality.
People will be forced to pay with bitcoins, not because of 'the technology', but because no one will accept their worthless fiat.
Contrary to popular belief, good money drives out bad.
This "driving out" has started as a small fiat bleed.
It will rapidly escalate into Class IV hemorrhaging due to speculative attacks on weak fiat currencies.
The end result will be hyperbitcoinization. #BitSignal #Bitcoin
few #plebchain
The system will collapse. Most people refuse to believe this possibility. Especially the older generations that have heard these warnings time and time again over many decades or the better part of a century.
Can't blame them too much - but one has to remember that a broken clock is right twice in a day. It’s coming, although nobody can predict when.
Society changes when money dies. Take for example the Roman Empire which went fiat by way of diluting the denarius of its silver content
> From a purity of greater than 90% silver in the 1st century AD, the denarius fell to under 60% purity by AD 200, and plummeted to 5% purity by AD 300 (Wikipedia)
People became more degenerate whether by social engineering or just declining societal morals and ethics.
People in occupations that were deemed beneath them also became celebrities in a way. Gladiators, actors, entertainers, chefs and so on went from being looked down on to becoming celebrities. Ring a bell today?
Time will ultimately show us. Better be stacking sats in the meantime.
The question of which money humans will choose, therefore, boils down to which good, or goods, any individual believes will best store the sum total of their lifetime of daily labor (i.e., their life force).
Because the most important trades we make are the ones we make with our future selves, humanity’s Darwinian propulsion towards holding the soundest money possible is based on our intuitive understanding that the longer our choice of money can hold its value, the greater the potential compounding benefits of our life-to-date-production.
Our timeless search for ever-sounder money is an individual, intuition-based optimization – as unstoppable as evolution – because we instinctively know that our survival is at stake.
Will our life force be durably storable in a particularly wellchosen money, and therefore potentially accumulate, enhancing our potential longevity? Or will it dissipate, no matter how hard we work, because we chose the wrong storage vessel, threatening our very lives and those of our progeny?
- an excerpt from the 2-minute version of Stone Ridge 2020 Shareholder Letter https://www.2minutebitcoin.org/blog/stone-ridge-2020-shareholder-letter
Bitcoin Education is profoundly important.
As most who have dived in the rabbit hole know, there are an immense amount of concepts, sciences and history to learn.
But without said knowledge, conviction about Bitcoin cannot be reliably built. The only way we reach a world-wide Bitcoin standard is when a majority of the world learns and appreciates its benefits.
We try to help as much as we can by summarizing and hopefully making it more accessible to a greater number of people.
Chancellor on the brink…