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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.

Jimbo Galtomoto 4d ago

Nice note