It seems like the downtrend in the crypto market cooled all the hype around cryptocurrencies down a bit. During this time, I like to reflect why we started investing into this amazing space and why I am certain that it will survive any future economic crash. In this article I want to talk about Bitcoin once again. I want to lay out the different use cases of it and how people could interpret it as. With this being said, lets get started.
Store of Value
The most known use case of Bitcoin is its purpose of storing value. This is one of the biggest arguments towards bitcoin in recent times. With growing inflation and at the same time very low interest rates this means that people are craving something to put their money in so that it can obtain its value. Over the history there were a lot of things that humanity tried to store their value in. Most of the time it was valuable resources like gold, oil or copper because they were considered finite and would run out at some point. The funny thing is that a finite resource as we define it, does not exist so far in the history of humanity. History suggests that whenever the demand for something rises, the production of this good or resource also rises. So far it is a fallacy to believe that the higher a production of a good the less resources there is left on the world. In fact, pretty much the opposite is the case. Whenever more oil was needed, somehow more oil was produced.
The more humans the are on earth the more resources are being used, but somehow the supply also increased over the year. There was also this famous bet a time, where one very famous economists bet another one for 10k to name one resource that would be produced less 10 years from the beginning of the bet. The other person named nickel and other precious metals as he was sure that they will run out. So what happened? You guested it! The production increased and the supply increased. So what are we missing here? That means that humans are the resource. This sounds a little bit crazy but hear me out for a second. It is very obvious that humas are a race that is very technology driven. With the technology getting better, humans are getting better of gathering those “scarce resources” more efficient. This means that there are more resources available. The only finite element here is the human time on earth which makes the human basically the resource because it is necessary to have humans to invent and develop new technologies.
Now that I outlined a little bit the whole resource theory and that we understand that these “scarce resources” are not the perfect store of value, we can now look at Bitcoin. Bitcoin has this amazing perk that it is hard coded to a maximum amount of 21 million. This means that it is not changeable and makes it the second finite element on planet earth so far. With it being a real store of value people can get the incentive to store their money in it and with this incentive they are able to buy the future cheaper.
Digital Property
Another use case is very much linked with the first one. It is Bitcoin as Digital Property. Now there is a good example to describe it. If you want to store your money into thigs you can select a various of option. There is just holding it and loosing constantly value. The next one would be buying stocks and trying to get a good return on your money. The last one would be buying a house which is a stable investment but in recent times also varying in values. The thing with housing is that it is an analog property. You can rent it out or you can sell it or you can even take loans on it, but you can not move it around or sell a portion of it. This is what makes Bitcoin a digital property! It has the same attributes of the house in regard to the economic perspective. You can do all of the things with it but you can also have it in different places and you can divide it in many more pieces.
This is just the next step in the evolution. There is this great example of maps. A few years ago there were only analog maps. They were costing a lot of money and were not changeable. You had a book full of maps and you could only read it. With the maps getting digital, you know can see how traffic is, it is much easier and cheaper to transport and it brings a lot more functunality with it. This technological development can be transferred towards the property sector with Bitcoin. While I am aware that the comparison between house and BTC is a little vague, you can see the similarities in the economic perspective. And the most beautiful thing about that is, that if people will move their money towards BTC, the stuff like housing or oil will get cheaper and more affordable for people again.
Personal Sovereignty
The last purpose of Bitcoin I want to cover in this article is the fact that people could gain back their personal sovereignty. Bitcoin is a thing that is not easily controlled by the government. It will be not easy for the government to collect taxes without offering a good service of some kind. There will be less incentive to finance violent and unnecessary actions by the government. BTC has a policy of defense. It is by a large margin more difficult and more expensive to be offensive and steal stuff because the network is very secure. It will be very difficult in a society run by hard money for governments to make anything that people do not want. Government’s impositions that are not very economically productive are unlikely to survive for very long. That is because there would be very little incentive to continue financing them! This would basically give every citizen back the power which a true democracy should be all about: That the people living in this society have the control of what happens in this society.
Conclusion
To summarize this article, I hope that my points were understandable as I found it a little bit hard to formulate every thought that I had in a short manner. All in all, I think that BTC is a very big chance for humanity to make the next step in evolution. I think that with Bitcoin we will be able to progress faster and maybe even discover new forms of governments as we move further. In my opinion there should be always one goal and that is to make the human’s and society life better. Thank you for reading!
Published by ga38jem on
LeoFinance|Steemit|read.cash
On 11th December 2021
nice work dude....keep it up your good work