Sun. Sep 19th, 2021

Credit: bitcoinmagazine.com

A myriad of monetary ruses are revealed to the general public through the scrutiny Bitcoin incites. From the onset, most of us couldn’t see the woods for the trees. For many, the simple technology of Bitcoin helped explain the extremely convoluted machinations of fiat, which were so pervasive as to keep generations of humans effectively viewing the monetary landscape at close quarters. Bitcoin is another lens, a constant measure, through which to view the world. Meanwhile, many are deceived about the state of things due to the all-consuming influence of inflationary credit expansion, which has a telescoping effect on the financial world.

Function 

Through its proof-of-work mining the digital world of Bitcoin’s infinite scarcity is grafted on to the physical world. Such a tether between these two realms hadn’t been achieved before with a distributed system. Bitcoin has the additional magical property that it can be transported through any communications channel, for a nearly inconsequential fee that transparently serves only to protect its value, and incentivize cooperation among its network participants.

There is an insidious misconception, or a popular misassumption, that many competing objects in this world are scarce.

There is only Bitcoin, and it is geographically independent, politically deaf, and cannot be captured by any single entity. Moreover its perceived value, which derives from its terminal infinite scarcity, can be transferred from and to anyone, anywhere on the planet, at any time.

This is in part what separates Bitcoin from every other cryptocurrency. It is not difficult to invent circumstances, or to imagine what might be the case. Altcoins are just an exercise in this, they belong to the realm of ideas. Ideas alone will not bring about change. Altcoins, NFTs, de-fi, all of that noise exists merely in the realm of ideas. In the real world, Bitcoin is the simpler, more practical technology that is subsuming and eclipsing the centralized proof of stake technologies, all of which look more or less the same from the perspective of a decentralized technology.

Alt coins are nothing but iterations of fiat, bringing to the market nothing aside from niche special technical languages that are effectively technobabble gibberish, which serves only to entertain. Altcoins are emergent from Bitcoin. They are merely direct copies or permutations of it, all failing at various speeds. Altcoins are also dependent upon Bitcoin to enjoy any longevity at all.

Bitcoin solved the daunting problem of associ­ating events with points in time in distrib­uted systems. It is worth pointing out that Satoshi didn’t manage to make infor­ma­tion uncopyable. If you have access to infor­ma­tion, you can also copy it perfectly. Centralized systems try to obfuscate and police knowledge by avoiding and actively discouraging people from learning how to do this.

All information, including that associated with your Bitcoin private keys can be copied. This understanding is at the heart of learning to use Bitcoin, and protecting your privacy. Duplication is an inexorable trait of information.

This is a blessing and a curse. This law is what makes both good and bad ideas heedless and intractable. It’s also what makes patents and copyright law a perpetual losing battle, one that only persists through force.

It must be stressed that the impos­si­bility of associ­ating events with points of time in distrib­uted systems was an unsolved problem before Bitcoin. Solutions such as Bitcoin may be singular, but can’t be made single, because all information is copyable, alternative cryptocurrencies will always exist.

It is highly improbably that the set of conditions that led to the launch and successful bootstrapping of the Bitcoin economy will repeat in our lifetime with a currency that can do everything that Bitcoin does, and more.

Bitcoin as a solution cannot be put back in the bottle, and it cannot stay niche. Alternative cryptocurrencies will persist, but will pale in comparison to Bitcoin’s success, because they are and will remain centralized and subject ultimately to the whims of one person, or a small group, or even a large group of people.

Apolitical

Bitcoin is apolitical money. This is one trait that separates it from every other asset.

You might argue we will not find a solution to all political problems in cryptography, however, as Satoshi Nakamoto pointed out, “we can win a major battle in the arms race and gain a new territory of freedom for several years.” And we have and will likely continue to enjoy the opportunity to have freedom and property that Satoshi provided.

Many believe this freedom emerges out of a competition between various cryptocurrencies. This is a mistake. For what it does, Bitcoin has no competition. It is peerless.

In the expansive history of monetary mandate, censorship, and oppression, everyone alive had ideas. Bitcoin delivered a simple, actionable solution. Unforgeable, unstoppable, unconfiscatable transactions ordered and stored on a distributed network.

As long as honest nodes control the most hashing power on the network, they can generate the longest chain and outpace any attackers, and we can store and transmit property, value, and therefore uncensorable free speech across space and time.

The only requirement is that the good guys collectively have more hashing power than any single attacker. For over a decade that has been the case.

Bitcoin gives you the freedom to acquire and control property. This is a singular form of ownership. Bitcoin is freedom. It is unique in this regard. You can actually take ownership of freedom through Bitcoin. This is what it means to be running Bitcoin.

The problem with fiat is that its rules are forever incompletely explained. There is a degree of randomness brought to bear on all forms of alternative cryptocurrencies and fiat, because they’ve introduced a great amount of human governance and dictate into the system.

Humans are not maximally effective at policing themselves, because they are subject to the fallacy of infinite regress. Who watches the watchers? and so on.

This admits of a question: How is governance defined? In Bitcoin one has the option to run older versions of Bitcoin, and the freedom do whatever one chooses with one’s Bitcoin, without being cast out from the network. Our updates are agreed upon by a majority and adopted individually at will. Bitcoin is backwards compatible. And the burden of choice with whom or for what to transact rests solely on the owner of the transactions unspent.