Money, Bitcoin and Time: Part 2 of 3

In the ancient story of money a new chapter is being written…
The Simple Truth about Bitcoin: Bitcoin is the hardest form of money ever invented. It has successfully brought the advantages of physical cash money into the digital realm. Bitcoin is changing the way people organize themselves. The next chapter in the story of money is being written in a new language…

Grasping Bitcoin [7]

Digital Cash Money [1]

“That in order to make a person covet a thing, it is only necessary to make the thing difficult to attain.”

— Mark Twain

Technological Properties [1]

Blockchain, Energy and Mining [1,3,8,11]

Bitcoin mining is exceptionally energy efficient relative to other monetary systems and their institutions.

“I’d put my money on the sun and solar energy. What a source of power! I hope we don’t have to wait until oil and coal run out before we tackle that.”

“The Bitcoin network is a global energy net that liberates stranded assets and makes new ones viable. Imagine a 3D topographic map of the world with cheap energy hotspots being lower and expensive energy being higher. I imagine Bitcoin mining being akin to a glass of water poured over the surface, settling in the nooks and crannies, and smoothing it out.”

The Internet of Value [9]

The Infinite Hardness of Bitcoin [1]

The monetary policy of Bitcoin is set in (mathematical) stone.
As expected, the price volatility of Bitcoin is gradually declining as its network value grows.
Due to its decreasing supply growth rate, over 95% of all Bitcoins will be mined by the year 2025.
As sure as 1+1=2, Bitcoin will soon surpass gold to become the hardest form of money in history.

Bitcoin’s Social Contract [10]

A New Form of Life [1]

“Bitcoin is the first example of a new form of life. It lives and breathes on the internet. It lives because it can pay people to keep it alive. It lives because it performs a useful service that people will pay it to perform. It lives because anyone, anywhere, can run a copy of its code. It lives because all the running copies are constantly talking to each other. It lives because if any one copy is corrupted it is discarded, quickly and without any fuss or muss. It lives because it is radically transparent: anyone can see its code and see exactly what it does.

It can’t be changed. It can’t be argued with. It can’t be tampered with. It can’t be corrupted. It can’t be stopped. It can’t even be interrupted.

If nuclear war destroyed half of our planet, it would continue to live, uncorrupted. It would continue to offer its services. It would continue to pay people to keep it alive.

The only way to shut it down is to kill every server that hosts it. Which is hard, because a lot of servers host it, in a lot of countries, and a lot of people want to use it.

Realistically, the only way to kill it is to make the service it offers so useless and obsolete that no one wants to use it. So obsolete that no one wants to pay for it, no one wants to host it. Then it will have no money to pay anyone. Then it will starve to death.

But as long as there are people who want to use it, it’s very hard to kill, or corrupt, or stop, or interrupt.”

The Decentralized Network Archetype [7]

Clockwise from the top left: the human heart, lightning, the human brain, a fungal mycelium network, roots from a tree, an aerial view of the Grand Canyon, branches from a tree and a cosmic web of galactic superclusters in the deep Universe (which is the largest observable structure in the known Universe at over 1 billion lightyears across).

“Transport networks are ubiquitous in both social and biological systems. Robust network performance involves a complex trade-off involving cost, transport efficiency, and fault tolerance. Biological networks have been honed by many cycles of evolutionary selection pressure and are likely to yield reasonable solutions to such combinatorial optimization problems. Furthermore, they develop without centralized control and may represent a readily scalable solution for growing networks in general. We show that the slime mold Physarum polycephalum forms networks with comparable efficiency, fault tolerance, and cost to those of real-world infrastructure networks — in this case, the Tokyo rail system. The core mechanisms needed for adaptive network formation can be captured in a biologically inspired mathematical model that may be useful to guide network construction in other domains.”

BAT is a cryptoasset designed to allow web browser users to monetize their own attention. Using a set of open-source software extensions, today you can perform browser-based microtransactions similar to BAT but using Bitcoin instead. This effectively eliminates the need for a cryptoasset like BAT. The capacity of Bitcoin to subsume market-proven features from competitive cryptoassets fortifies it from disruption.

Antifragility [1,11]

“Wind extinguishes a candle and energizes fire… Some things benefit from shocks; they thrive and grow when exposed to volatility, randomness, disorder and stressors and love adventure, risk and uncertainty. Yet, in spite of the ubiquity of the phenomenon, there is no word for the exact opposite of fragile. Let us call it antifragile. This property is behind everything that has changed with time: evolution, culture, ideas, revolutions, political systems, technological innovation, cultural and economic success, corporate survival, good recipes, the rise of cities, legal systems, equatorial forests, bacterial resistance… even our own existence as a species on this planet.”

Bitcoin’s Positive Feedback Loop [1,4]

Bitcoin autonomously proliferates its network by economically rewarding everyone who interacts with it.

Bitcoin’s Network Effects [1,4,5]

“In business, creation stories reinforce the role of the individual as a societal agent of change and speak to a core audience of customers. They are the bedrock for what marketers call a brand and the source waters for Wall Street’s shareholder value.”

As a pure bred monetary technology, Bitcoin derives none of its value from alternative uses.
Bitcoin’s price appears to follow a fractal wave pattern based on the archetypal Gartner hype cycle.
Bitcoin is the fastest growing and most volatile asset in history, although both are leveling off as it grows.
The annual low prices of Bitcoin provide an effective proxy for the collective intransigence of its hodlers.
Every four years, the Bitcoin supply growth rate is cut in half. Each halving also cuts the Bitcoin sell pressure from miners in half and creates upward pressure on its price. Historically, this quadrennial event is the best proxy for the timing of Bitcoin price fractal wave patterns.

Minority Rule [3]

“Aramaic is a Semitic language which succeeded Canaanite (that is, Phoenician-Hebrew) in the Levant and resembles Arabic; it was the language Jesus Christ spoke. The reason it came to dominate the Levant and Egypt isn’t because of any particular imperial Semitic power or the fact that they have interesting noses. It was the Persians –who speak an Indo-European language –who spread Aramaic, the language of Assyria, Syria, and Babylon. Persians taught Egyptians a language that was not their own. Simply, when the Persians invaded Babylon they found an administration with scribes who could only use Aramaic and didn’t know Persian, so Aramaic became the state language. If your secretary can only take dictation in Aramaic, Aramaic is what you will use. This led to the oddity of Aramaic being used in Mongolia, as records were maintained in the Syriac alphabet (Syriac is the Eastern dialect of Aramaic). And centuries later, the story would repeat itself in reverse, with the Arabs using Greek in their early administration in the seventh and eighth’s centuries. For during the Hellenistic era, Greek replaced Aramaic as the lingua franca in the Levant, and the scribes of Damascus maintained their records in Greek. But it was not the Greeks who spread Greek around the Mediterranean — Alexander (himself not Greek but Macedonian and spoke a different dialect of Greek) did not lead to an immediate deep cultural Hellenization. It was the Romans who accelerated the spreading of Greek, as they used it in their administration across the Eastern empire.”

“Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.”

A Superior Species of Money [1,4,12]

“If the modern world is ancient Rome, suffering the economic consequences of monetary collapse, with the dollar our aureus, then Satoshi Nakamoto is our Constantine, Bitcoin is his solidus, and the Internet is our Constantinople. Bitcoin serves as a monetary lifeboat for people forced to transact and save in monetary media constantly debased by governments… the real advantage of Bitcoin lies in it being a reliable long term store of value, and a sovereign form of money that allows individuals to conduct permissionless transactions.”

Investing in Bitcoin [1,5,13]

“Intelligent risks are based on wide and voracious data gathering checked against gut instinct; while dumb decisions are built from too narrow a base on inputs.”

Bitcoin is competitively superior to both gold and government fiat money, and has plenty of room to grow.

“Technology follows 14-year innovation cycles. These began with the Mainframe in 1954, then the Microchip in 1968, the Personal Computer in 1982, the Internet in 1996 and most recently the Mobilenet in 2010. As a result of the innovations introduced by Bitcoin, soon we will christen 2024 as the dawn of the Trustnet.”

As innovations in information technology age, they inevitably become commoditized and create the bedrock upon which future waves of innovation are built.

A Momentous Innovation [1,4,5,7,8,10]

· Immutable Monetary Policy — Predictable, transparent and unchangeable money supply schedule. The most critical aspect to outcompeting in the free market for money, as people will naturally come to favor the hardest form of money available to them (uninflatable money).

· Digital Scarcity — Necessary to solve the double-spend problem and bring the speed and finality of physical cash settlement into the digital realm.

· Absolute Scarcity — The only asset in the world which has an absolutely finite supply, like time itself.

· Global Final Settlement System — A permissionless, unstoppable payments system with zero counterparty risk (like gold, only digital) that can be used to quickly and efficiently provide finality of settlement across scales and space.

· Self-Sovereign Network — A self-sovereign monetary good (an informational bearer instrument) whose network operates autonomously in full accordance with its own immutable rules as reliably as the laws of mathematics.

· Stateless Money — The first globally connected payments system that is politically neutral. Possible catalyst for the separation of money and state over the long run.

· Revolutionary Social Contract Implementation — A unique 2-layer social contract implementation that decentralizes power among its constituents and creates a hypercompetitive market for its own network security. A new form of social institution.

· Global Consensus — Perhaps the only truly objective set of facts in world history, its distributed ledger is created by converting processing power into indisputable truth.

· Global Energy Buyer of Last Resort — Enables anyone in the world to convert excess electricity into digital gold on demand. A perpetual incentive for everyone in the world to develop more energy efficient innovations.

· A New Form of Life — Feeds on human self-interest and electricity to provide uninflatable money, an unstoppable payments channel and immutable governance.

· Adaptive Security — By virtue of the mining difficulty adjustment, as more value is stored on its network, the network adapts to become more secure.

· Adaptive Functionality — As an open-source software project, programmers around the world are constantly improving Bitcoin’s codebase, however it is up to the users to adopt these changes, which creates a governance equilibrium in which only those changes that are in the collective best interests of users will be adopted. Enables Bitcoin to subsume superior features from competitors that are market-proven, making it highly resilient to disruption.

· Programmability — As a digitally native form of money, it can be used as a form of payment, collateral or fuel for a variety of smart contracts (self-executing software or commercial agreements). Can interface with other decentralized applications. Could function as the core value system for the TrustNet, the anticipated wave of innovation triggered by the emergence of Bitcoin.

CONTINUE READING →

Bitcoin accepted here: 3CiBznmvP2jXVSPR9bUWZwSNtbe9ubp36M

Synthesized Works & Further Reading

Freedom Maximalist. Bitcoin is Honest Money — stack sats here: http://bit.ly/2THg4Jg Links To All My Work: http://bit.ly/3fG91KV YouTube: http://bit.ly/321Lzm0

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