There are many people buying bitcoin today because they believe the price will go up and they will become wealthier. This is overlooking a more important reason to own bitcoin. Read on to find out more.

Life is Tough, and the Rich Get Richer

Have you noticed life keeps getting harder and harder for most people? Have you noticed that the savings from a lifetime’s worth of labour is used to pay for a non-extravagant home? Why so extreme? Land is not that scarce. Homes are not that difficult to build – why should two people exchange their life’s effort merely for shelter?

It’s not just homes. Have you noticed that most things are getting more expensive (particularly since 1971)? Have you felt the pressure to use any savings towards a deposit for a home ASAP, before the home rises in price, wiping out the savings? Or invest your savings so it doesn’t lose its value (even though you’ll be taxed on the gains you need just to keep up)?

If you work in your specialised area of expertise and receive money in return, shouldn’t you be able to use that money to get back from society at a later time what you put in? Doesn’t it feel like that money’s value is being stolen from you?

It is. This is how:

Central banks create money that you are obliged to use by law. On its own, that might not sound like a big problem. But central banks (or the hidden people that own these banks) create more of this money without any cost to themselves. And they do not distribute the money fairly amongst the users of that money.

No, they hand it to the rich (I’m simplifying it) or themselves, to buy assets (basically stealing the assets, but also raising the prices). This is a special privilege that we seem to tolerate. If anyone else created money out of thin air and started to buy things with it, they’d be thrown in jail.

So why do we tolerate it? Because people in suits tell us it’s necessary and good for the economy, and we nod and say, “yes”. We have all been scammed. I’m not even going to go into the manipulation of natural interest rates to borrow money, but that does add to the scam.

It’s outside the scope of this essay to give an account of why the mainstream version of economics is wrong (Keynesian Economics, and Modern Monetary Theory). Great minds of the School of Austrian Economics have debunked it all already; Carl Menger, Ludwig von Mises, Murray Rothbard, Friedrich Hayek. I suggest you accept it for now, but just don’t trust me: go check for yourself later.

A great introductory essay is “The Bullish Case for Bitcoin” by Vijay Boyapati, which introduces general concepts of money and how it evolves, and it might be refreshing to see that economics is quite simple and can make a lot of sense. Then if you’re curious to read more about real economics, I suggest this excellent book by Robert Murphy, Choice, which is a commentary on the difficult-to-read masterpiece by Ludwig von Mises, Human action. This is the way to learn it, as it has been banned or silenced from mainstream University education.

The Solution With “a Sly Roundabout Way“

Now, assuming printing money is damaging for society, enriches a select few, is used to effectively milk the time, labour, and wealth of all humans, what can be done about it?

Nobel Prize winning economist, Friedrich Hayek, introduces the problem and hints at the solution, all the way back in 1984:

We need “a sly roundabout way” to take money out of the hands of government – and crucially, in a way which can’t be stopped.

The cypherpunks have been trying to do this for decades. They are a group of freedom and privacy activists and used cryptography as their tool. They helped create the internet, defended PGP (cryptographic communication) from being banned, and had many failed iterations of creating a money separate from the state.

They kept failing, but kept getting better, until the final iteration: BITCOIN. The final piece of the puzzle was that this version could not be stopped. Every previous version was shut down by the state (the cause of the “failure”).

For more information on the cypherpunks, there is an excellent 44-minute documentary on their history that I highly recommend called, cypherpunks write code.

Bitcoin started at almost, but not quite, zero value. Satoshi Nakamoto paid for the electricity his computer used to mine the first block, for which he received 50 bitcoins (more info on mining) – the value was not zero. He exchanged his money for electricity, which he exchanged for 50 bitcoin. Eventually, bitcoin was traded directly for money. The rest is history.

For an examination of why the “no intrinsic value” narrative for Bitcoin is false, see here. In fact, I have many essays countering false FUD narratives.

Bitcoin will become money with time, but it isn’t yet. As the network of people that choose to adopt it grows, its value also goes up (Metcalfe’s law). In the meantime, from the beginning to the point where it is ubiquitously accepted as payment, its exchange rate against government tokens will be volatile. So be it. 

With Bitcoin, Satoshi Nakamoto solved many problems. First and foremost, humanity is separating money and state, the same way the printing press separated church and state.

Secondly, Bitcoin introduces absolute scarcity in the supply of money (no, no one can simply change the supply cap of Bitcoin). This is good news for people who wish to earn money and keep it until a later time, as it won’t lose its value (this applies in the future, once bitcoin is universally accepted – it’s not quite true now during the volatile years). 

Some may argue, particularly those that have been scammed, that the money supply needs to grow with the economy, and therefore Bitcoin won’t work because it’s scarce. This is absolute garbage, and indicates a brainwashed victim. The cure is to learn Austrian Economics; links were provided earlier.

Altcoins

During Bitcoin’s early adoption phase, everything was on track for a while, until altcoins were created, slowing down the ultimate goal. Some might initially think this is fine, but they should realise that if infinite altcoins can be created out of thin air, then no digital token is scarce (just like the fiat money we’re supposed to be replacing).

I used to be concerned about this until some seriously deep thinking, and have since concluded it’s actually not true. What matters is not just scarcity, but RELEVANT scarcity, which only Bitcoin has. What do I mean by that? Well, my fingernails are kind of scarce – does that matter? Of course not, they are not relevant as money. So too, the copies of Bitcoin are not relevant, with or without modifications or “improvements”. Why? Because money is not just made up of the properties of the token/unit itself, but also the properties of the network of people that use it. 

For example, if there is an incredibly superior money in existence (actually, there is one, it’s called Bitcoin), then it would not be of any use as money if there was only one person in the world that valued it. Think of Bitcoin on day 1 – it was only Satoshi Nakamoto who was accumulating it. It was only valuable to him. Now we have many more people who value bitcoin, after 14 years of its existence, and continually proving itself to be resilient and unchangeable unilaterally by any entity.

Now think of any altcoin. It was created by an individual or group, and most of the time, they awarded some portion of the supply to themselves (instead of competatively mining via electricity expenditure the way Satoshi did). The initial network of people starts small and grows as well, but that network falls FAR behind Bitcoin, the leader in the race towards one money. 

And many more altcoins come (and go), all competing for the attention of value exiting fiat, all against the leader, Bitcoin. Any “superior” features tend to just be trade-offs which was been rejected by Bitcoin, and any truly new discovery can simply be incorporated into Bitcoin if useful. In this way, nothing can improve on Bitcoin, and nothing can surpass its network. I make the logical case here of why only Bitcoin can succeed as money, and why all altcoins will eventually fail.

There is another important reason why altcoins are no competition to Bitcoin – that is that they are ALL centralised. It is difficult for a newcomer to understand this or accept it, but I’ll begin to explain.

When there is a leader, a CEO, or a spiritual head of a digital money not run by the state, then they are just like the iterations of money the cypherpunks attempted BEFORE they succeeded with Bitcoin. If there is someone in charge, they can be used either to shut down the network, or secretly enlist to help the state overtake that money and create a digital surveillance coin of the state. To resist state involvement or attack, a digital money must be decentralised – an important property that is poorly understood, and used as a marketing buzzword by altcoins without justification. Only Bitcoin is truly decentralised in the relevant sense of the word, and I elaborate here.

Given that altcoins are centralised, they are not able to compete with Bitcoin to separate money and state. Not only that, but they are actually just like fiat money. Why? Because fiat money is money that is controlled by a few people (this is always true), and those people get to create money FOR FREE, enriching themselves and impoverishing everyone else.

What is the point of kicking out central banks from the control of money, only to give it to, say, Vitalik Buterin? He, together with the Ethereum Foundation (led by The World Economic Forum – enemies of humanity), controls the direction of this altcoin; AND don’t forget that 70% of the supply was unethically awarded to themselves at zero cost.

Gold

Gold is not the answer. It was, but now it’s actually the problem. Society had sound money before fiat money, but because gold was not easily portable, it wasn’t feasible to use for trade, as the world became more interconnected.

Sending gold long distances was a problem, solved by 3rd party banks, which settle trades with private ledgers. Because these 3rd parties are necessary, peer-to-peer trade with gold can never work in global trade. Worse, gold’s supply can never be known, since these 3rd parties can easily and “forever” use a system of fractional reserve to suppress the supply and also enrich themselves.

Sorry, but gold failed, and is why fiat came to be. Bitcoin is here to clean up its mess (One might argue that humans failed, but no, humans are a constant, the money we use is a variable; it can no longer be gold).

One Money

Now I wish to move on to why it’s true that multiple free market monies are not stable, and the trend will be towards the existence of just one.  In a free society, money evolves from a state of barter, in order to reduce the risk of specialisation, and solve the coincidence–of-wants problem. That very natural force that brings money about in society is the same force that resolves multiple free-market contenders for money into one single money. I write about this here, and the logic is irrefutable.

Conclusion

Once you’ve read up to here (and the associated links), you will hopefully see the truth that Bitcoin is separating money and state, and that nothing else can do this. Either it will, or the state will become more powerful and enslave all humanity. There is no middle equilibrium – this is a war.

Given that there is this war for humanity’s freedom going on, what is the point of buying Bitcoin? Is it really so you can own more of your master’s token (fiat)? No. You should be accumulating more bitcoin and never selling for two main reasons:

1. Selfish reason – get it for cheap now before the world wakes up.

2. Altruistic reason – hold as many as you can (and teach others) to help Bitcoin succeed and bring about a world where the state does not control money.

If you have a gambling urge, in addition to owning Bitcoin for the future, then and only then, is it morally acceptable to use some portion of your savings to gamble on the price of Bitcoin, with the purpose of selling it later for a better quality of life. 

The same is true for altcoins – you should know none will ever be money (as they must compete against Bitcoin, and there can only be one free-market money in a free society), and so the only reason to own them is for gambling.

Of course, you are free to go off to the shitcoin casinos and gamble all you want, but we enlightened Bitcoiners are separating money and state; join us.