5D·

Why Bitcoin is the best "asset" for me - and could/will be the global currency of tomorrow.

Chapter 1: Why the monetary system is a lie

We all exchange our most valuable and finite resource - our lifetime - for money. The bitter truth, however, is that the money we receive in return is not finite. Our current debt money system is based on the constant expansion of the money supply by central banks.

- The deception: if the money supply grows faster than productivity, the value of each individual unit falls. What is sold to us as moderate "2% inflation" is in fact a creeping expropriation.

- The Cantillon effect: those who are close to the source of money (banks, state) benefit, while the purchasing power of the working population at the end of the chain dwindles. Those who save lose - this is not an accident, but a feature of the fiat system.

Chapter 2: The escape from the FIAT system

Regardless of whether we invest in individual shares or save in the "holy grail" of global ETFs: At the core, we all have the same goal. We have understood that the money in our current accounts is dying. We are manually trying to outrun inflation.

- The shared problem: Every investor at #getquin has recognized the problem of falling value. But we have to ask ourselves: do we invest in shares because we love the company so much, or because we are forced to "park" our money somewhere so that it doesn't melt away?

- Systemic risk: The stock market is also heavily dependent on central bank liquidity. If the interest burden falls or money is printed, prices rise - regardless of the real strength of the economy. Bitcoin is the only exit strategy into a system that cannot be manipulated by political arbitrariness or interest rate decisions.

Chapter 3: The solution that is not seen

Bitcoin is often dismissed as a purely speculative asset because people only look at the volatile price. But Bitcoin is the solution to a millennia-old problem: the separation of money and state. - Incorruptibility: for the first time, we have a commodity that is absolutely scarce, portable, divisible and, above all, resistant to censorship.

- The end of corruption: If a state can no longer simply print its money to finance wars or economic mismanagement, it has to budget again. Many people sense that "something is wrong", but seek the solution within the system (e.g. in gold or real estate) without realizing that Bitcoin is the first perfectly digital, scarce commodity in human history.

Chapter 4: The mathematics of freedom

Bitcoin is not based on trust in people or institutions, but on the laws of mathematics and thermodynamics.

- 21 million: This number is set in stone. There is no authority that can increase this amount by decree.

- Proof of Work: Bitcoin is backed by real energy. This makes it the "hardest money" we've ever had. While gold is hard to transport and real estate is hard to share, Bitcoin is light-speed money. It is equally accessible to anyone with internet access worldwide - without permission from a bank.

Chapter 5: The cost of waiting (opportunity cost)

The biggest fear of many investors is volatility. They wait for the "dip" or the perfect entry point. But the real danger is not being invested.

- Outperformance: Those who have been on the sidelines for the last 10 years have missed out on the strongest demonetization in history. Bitcoin has outperformed every other asset class so far because it is the only asset that cannot react to price pressure by increasing supply (inelastic supply).

- The real risk: The risk is not that Bitcoin will fall 20% tomorrow. The real risk is holding its purchasing power in a system whose money supply doubles every few years.

Chapter 6: From digital gold to the new global currency

We are currently in the monetization phase. Bitcoin is currently establishing itself as "digital gold" - a global store of value. But this is just the beginning.

- Evolution of money: Money always develops in stages: collector's item -> store of value -> medium of exchange -> unit of account.

- Technological layers: Bitcoin is already being sent at lightning speed and almost free of charge thanks to layer 2 solutions such as the Lightning network. As market capitalization increases, volatility will decrease until Bitcoin represents the most stable basis for a global, fair financial system that excludes no one.

Chapter 7: How you too can become a Bitcoiner

You don't become a Bitcoiner by buying €50 of BTC on an exchange. It is an intellectual process.

- From trader to HODLer: Most people come for the quick profits. But those who start reading - whether "The Bitcoin Standard" or technical whitepapers - stay for the revolution.

- Study instead of speculate: Learn to ignore the daily noise of the news. Understand why decentralization is more important than any new feature of a shitcoin. Once you have entered the Rabbit Hole deeply enough, you no longer trade "to make a profit", but save in Bitcoin to save your wealth into the future.

Chapter 8: Conclusion

A Bitcoin is a Bitcoin Stop measuring the success of your investment only in euros or dollars. In a system in which currency units can be multiplied infinitely, the price is an illusion.

- The new fixed point: In 50 years, there will still only be 21 million Bitcoin, but nobody knows how many trillions of euros will be in circulation by then.

- The only question: in the end, it is not the fiat value that counts, but: What percentage of the world's hardest money network do you own?

A bitcoin is a bitcoin.

If you want to learn more about Bitcoin, I recommend this YouTube video and the official Bticoin whitepaper.

https://www.youtube.com/watch?v=0gOhd7waSG8

https://bitcoin.org/files/bitcoin-paper/bitcoin_de.pdf

$BTC (-1,18%)
#btc
#bitcoin
#geld
#rendite
#zukunft

www.youtube.comIch bin ALL IN Bitcoin – das ist der wahre Grund

27 Comentários

Stefan21@stefan_21

Nice contribution, thank you😘

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Philip@Philipwdr

@stefan_21 Thank you for your feedback!

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Yoshika@Yoshika

The 21 million is capped. But the buyers are not. Scarcity alone has no value. It needs demand. And that is not a mathematical constant.

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Philip@Philipwdr

Hey @Yoshika, absolutely right. Scarcity is just the framework, demand is the engine. But this is exactly where Metcalfe's law comes into play: the value of a network increases quadratically with the number of its users. Global adoption of Bitcoin has been growing for 15 years (BlackRock, countries such as El Salvador, millions of private investors). Demand is not a mathematical constant, but historically it has followed an extremely stable upward trend.

The adoption of Bitcoin is exponential. It is only a matter of time before the network reaches a critical mass that can no longer be ignored.

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Yoshika@Yoshika

@Philipwdr
Myspace also had network effects. So did the fax.

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Stefan21@stefan_21

@Yoshika I think you have to ask yourself whether you think the characteristics that Bitcoin has will become more or less relevant in the future. For me, the answer is clear :)

MySpace and the fax also had network effects, that's true.
But switching from MySpace to Facebook didn't cost you anything. With Bitcoin, you give up the very features you're looking for. Money is a "Schelling Point" as far as that is concerned.
In addition, the fax has been replaced by something better in every dimension and, in my view, this is not possible with Bitcoin. It can't be more limited than limited, nor more decentralized than the world's largest PoW network.
And Bitcoin itself can adopt useful features of counterparties via soft forks and 2nd layers. You can copy code in 5 minutes, but not the ecosystem of countless nodes, miners and their energy.
Moreover, MySpace users had zero incentive to defend the network. Bitcoin holders have a massive one. That's a qualitatively different network effect :D

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Yoshika@Yoshika

The Schelling Point only works as long as everyone is pointing to it. After all, gold used to have no alternative. And even strong network effects and incentive systems are not a code for immortality. The leverage lies more in the surrounding factors, such as regulation, CBDCs, on/off ramps. The protocol may remain in place. The mass suitability does not automatically.
I'm not arguing against Bitcoin at all. I just think that this Bitcoin wins anyway safe framing will become difficult at some point and when investment theses become prophecies.

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Yoshika@Yoshika

@Yoshika
The whole thing will probably not kill Bitcoin. Perhaps integrate it. BlackRock, ETFs or El Salvador show that states/institutions can play along.

But please don't argue this with religious determinism.

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Mr. K@TechNav

@Yoshika There will be fewer and fewer buyers. Fewer and fewer people will buy this garbage in the future. NFT 2.0 loading...

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Mr. K@TechNav

Monopoly Geld.

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Philip@Philipwdr

@TechNav Do you mean FIAT money or BTC?

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Mr. K@TechNav

@Philipwdr I bet you paid something with FIAT money in the last 24 hours and not with buttcoins... so you tell me what is Monopoly money and what is real money.

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Philip@Philipwdr

@TechNav Have you paid with a gold bar in the last 24 hours? Probably not. Is that why gold used to be Monopoly money? Certainly not. We use euros for everyday consumption because we are forced to (taxes, compulsory acceptance). But we save in Bitcoin because we don't want our purchasing power to melt away.

From a tax perspective, if I could already pay with Bitcoin today without any problems (without having to check a private sale transaction every time) and receive my salary directly in BTC, I would have no problem with that. Of course, I can't predict the future exactly, which is why I also own ETFs for diversification. But I am convinced that the harder money will prevail in the end.

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Mr. K@TechNav

@Philipwdr I find gold equally useless as an asset/investment. Anything that does not produce cash flow is nonsense as an INVESTMENT. (Gold, watches, Picasso paintings). You are betting that some other idiot will buy your thing for more money in the future. That's Greater Fool Theory. No serious person saves anything in crypto whether bitcoin or fartcoin... They just speculate. Casino gambling.

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SGP@Koenigmidas

Thanks!

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FortunaWealt@FortunaWealt

14H

Well written

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DieEnte7@DieEnte7

There are a few things in your article that I don't think are correct or at least incredibly inaccurate. Firstly, I would argue that the separation of money and the state is also shaky in the case of Bitcoin, and a completely deregulated currency also has its clear weaknesses. There is also a reason why virtually every country has a central bank.
Secondly, I can't think of an example of the "evolution of money" that you describe. I can't think of any example where a MONEY or CURRENCY unit was first a collector's item before it became a medium of exchange. So I'm skeptical about how bitcoin accomplishes that. But would be interested if you have an example that convinces me.

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Stefan21@stefan_21

@DieEnte7 Without wanting to anticipate Philip's answer:
The fact that Bitcoin is non-governmental, or as you say deregulated, is one of the biggest advantages Bitcoin has.
Power corrupts. And if you have power over money, you have enormous power. And this power is exploited.
Take the euro as an example. The Maastricht Treaties clearly set out how the euro should be designed. Central banks may not bail out states; states may not take on more than 60% of their GDP in debt; states may not be liable for the debts of other states.
All these rules have been broken - without consequence, without sanction.
If there is a red button that creates new money out of nothing and that can be pressed whenever it becomes inconvenient, there are consequences.

Citizens' savings are devalued. Every crisis is tried to be solved with new money.

Instead, Bitcoin is highly democratic. Every node operator has a say in what the rules should look like. No one has the power to press a red button. The rules are clearly defined for everyone and no one alone can change them without the consent of the majority of users.

I trust Bitcoin much more than any central bank.

You could also take a look at my Bitcoin for beginners part 1 on money evolution if you like. Basically, Philip is absolutely right.
Whether it's cowrie shells or gold. Non-state goods have always been converted into money in this way. The good with the lowest diminishing marginal utility. So the good with the best properties that everyone wanted was first collected, then became a store of value because it increased in value as a result; then became a medium of exchange because it was in demand; then became a unit of account :)

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Stefan21@stefan_21

@DieEnte7 there is an extremely strong article on the history of money by Nick Szabo, which you can read through if you like :)
https://nakamotoinstitute.org/library/shelling-out/

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DieEnte7@DieEnte7

@stefan_21 Thanks, I'm still skeptical, but I'll take a look at the article!

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Stefan21@stefan_21

@DieEnte7 is also good if you are skeptical :)
If you like reading, I can also highly recommend Broken Money by Lyn Alden, for example. It goes through the history of money and then to Bitcoin.

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Philip@Philipwdr

@stefan_21 Haha, I was just finishing my reply...guess you beat me to it. 😅 Thanks for the strong complement! I couldn't have summarized it any better. ❤️ I'll have a look at the articles you've attached too - looks interesting!

@DieEnte7 Would a money that doesn't belong to anyone and whose rules no one can change be theoretically desirable for you if the technical "teething troubles" were solved? Because then it would only be a matter of weighing up the risks. Without wanting to "convert" you now - as already mentioned in the post, everyone starts where you are now.
You don't become a Bitcoiner overnight, it's a process.

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DieEnte7@DieEnte7

@Philipwdr @stefan_21

I haven't read the articles yet, but here's a first critical contribution :)
I can understand your criticism of central banks and governments, but at the same time I am sceptical that a decentralized currency will really solve these problems. A currency that is subject to such strong fluctuations in value is by definition subject to extreme inflation and deflation, and the lack of a central authority whose primary goal is price stability doesn't make it any better. Instead, this central administrative body is a community of very many profit-oriented investors. And to make a direct comparison, I wouldn't be convinced that the pursuit of profit would make the ECB or FED any better, so I'm skeptical that the "community" is the better controlling authority for Bitcoin. And yes, the "red button" has been pressed several times, but what if that button had never been pressed? Would a stronger chain reaction at the banks in 2008 have been the right way out? The national bankruptcy of Greece in 2014/15? And how would the crises have developed if the means of payment had been Bitcoin? Rules change and somewhere along the line that is precisely the task of politics to moderate this. Otherwise, we are stuck where the USA is right now - an ancient, outdated constitution that nobody dares to tackle, even though it is urgently needed.
The shell/gold example also falls short for me in several areas. A) the economy today is hardly comparable with the hunter-gatherers of thousands of years ago, B) it is also difficult to imagine that the path was the same as with Bitcoin today. So there were people who first searched wildly for shells on the beach until they had a large supply of them and were then able to convince other tribe members to accept shells as a means of payment? And historically, gold only became a reliable means of payment when early states began to establish a monetary system.

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Stefan21@stefan_21

@DieEnte7 Thank you, you've opened up a few barrels😂 I'll try to go into a few points without having to write too much.

"Inflation" originally comes from "inflare" which means "to inflate". Originally, inflation meant the expansion of the money supply.
It wasn't until the introduction of fiat money by the state that this definition was abandoned in favor of an increase in the price of goods. And then there are lots of great economists who claim that money supply and inflation have nothing in common because they can always find some kind of war or temporary shock to explain why price x of good y has now risen.

In my view, the extreme volatility of Bitcoin is mainly due to the fact that Bitcoin is still so young and in the middle of its monetization phase. Look at the discrepancy of different opinions about Bitcoin. This ranges from "Bitcoin is the best money in human history" to "Bitcoins are worthless series of numbers with no use case".

Do a thought experiment. Imagine that overnight someone invents the truly best money in the history of mankind. What would happen?
Would everyone understand and adapt it immediately? Would the price jump from 0 to, say, 10,000,000 and would fiat currencies immediately become worthless?
Or would such a money slowly gain more and more popularity and be extremely volatile on its way up? :D
I think the latter.

And you have to know: Bitcoin does not fluctuate or hardly fluctuates at all. What fluctuates is the scale on which it is measured. Bitcoin does its thing, is limited to 21 million and currently throws 3.125 new Bitcoin onto the market with every new block. Fiat currencies are the ones that fluctuate constantly.

On the subject of the red button, I would say that our current monetary system sets completely the wrong incentives. Our monetary system rewards taking on debt and speculating, but penalizes saving because it permanently devalues. And this results in the classic "buy now, pay later" or consumption on credit.
And these false incentives are, in my opinion, the reason why we always have these boom and bust phases on the one hand and that the bust phases are always met with a highly indebted society that is unable to help itself on the other. And in order to help the over-indebted society, money is printed again, which at the same time further devalues society's savings. Paradoxical, isn't it?

Moreover, we all know that a planned economy cannot work. And with such an important component of the global economy, money itself, we think that the price of money (i.e. the interest rate) can only be determined centrally by the people in a bank. But they can't have all the information they need to make the right decision, can they?
Hayek called this the "presumption of knowledge" - and I think that sums it up pretty well :)

Bitcoin as a network or organism naturally has the urge to maintain itself. The network rules are enforced by tens of thousands of nodes. Whether there are many privacy advocates or profit-oriented investors as you write is not really of interest. In order to change something fundamental, it has to be decided almost unanimously. Nobody can change anything to their own advantage. That is very important to know :)

Regarding the shell and gold example - yes, in principle it was like that or something similar :D but have a look at my article on this or alternatively Szabo's article.
It is clear that we no longer consist of hunters or gatherers. The fact that the good with the lowest diminishing marginal utility could ultimately prevail has little to do with it. The right characteristics are crucial. But the process will take a very long time. As I wrote in one of my last posts, there are 2 laws that are crucial from my point of view :)
https://getqu.in/iiSGwO/

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BoldTake@BoldTake

Thermodynamik?

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Paul@MitStickstoffAufschlagen

23H

You are right about everything. But only under the premise that all traders agree to attribute a corresponding value to Bitcoin. In this respect, just like FIAT, it is a cultural agreement to recognize this entity as a medium of exchange. This can also tip over.

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