My super simplistic view on the failing Bond Market
1) Government
- needs to borrow $1,000
- offers a bond at 5%
- will offer 5% interest and return your money after 5 years
- the deal: you will get $1250 ($1000 + $250)
2) Bond Holder A
- accepts deal but…
- later thinks government will default on the debt or…
- can earn more than $1250 elsewhere. So…
- cuts losses and sells bond for $800 to Bond Holder B
3) Bond Holder B
- has a new deal: $250 on $800 = 6.25%
4) Government
- needs to borrow another $1,000 but…
- must match the market expectation of 6.25% which…
- convinces more bond holders that the government will default.
5) Rinse and repeat.
Ok-ish?
**A New Investment Paradigm**
For over a century, the dominant motivation for investing has been simple: grow capital and protect it against inflation. From individual savers to trillion-dollar institutions, the goal was to generate a return that at least exceeded the pace at which fiat currencies lost their value. Asset managers built empires on this promise, offering portfolios and strategies to outpace inflation. But what happens when the rules change—when the need to constantly grow wealth to preserve it begins to fade?
Enter #Bitcoin. With its fixed supply, decentralized nature, and resistance to monetary manipulation, Bitcoin represents a new kind of store of value—one that could fundamentally shift why and how we invest.
**The Inflation Imperative: Why We Invest Today**
Traditional investment has been anchored in the reality of inflation. As central banks print money and purchasing power erodes, savers are incentivized to place their capital in assets that grow in value: stocks, bonds, real estate, and increasingly, alternatives. The entire apparatus of modern investing—funds, benchmarks, passive ETFs, active management—is a response to this inflationary pressure.
Asset managers like BlackRock and Vanguard thrive because they provide the infrastructure and insight necessary to preserve and grow wealth in this inflationary environment. Their job is not just to earn returns—it’s to avoid loss via erosion.
**Bitcoin as a Store of Value**
Bitcoin breaks this model. With a hard cap of 21 million coins and no central authority to inflate its supply, Bitcoin offers a value proposition that fiat currencies and even gold cannot: predictability and scarcity. Its decentralized, borderless nature makes it difficult to confiscate or manipulate, and its growing adoption suggests it may increasingly function as a global monetary base.
For investors, this changes the game. If one can hold Bitcoin and preserve wealth without the need for complex portfolios or exposure to volatile markets, then the rationale behind traditional investment begins to weaken. The default action becomes to hold, not to seek returns.
**Investing Beyond Money: The Rise of Purpose-Driven Capital**
In a world where holding Bitcoin is enough to preserve wealth, the question shifts from "How do I protect my money?" to "What is worth investing in?"
This opens the door to purpose-driven capital. Rather than chasing ROI to beat inflation, investors may begin to fund projects and companies that reflect their values, passions, or long-term vision for society. This includes:
- Renewable energy and climate tech
- Social equity initiatives
- Open-source technologies
- Community infrastructure
- Space, biotech, and frontier science
The motivation is not just profit—it’s impact. The metrics become more qualitative: legacy, meaning, contribution.
**The Crisis and Opportunity for Asset Managers**
This shift poses an existential threat to traditional asset managers. If wealth preservation can be achieved by simply holding Bitcoin, the value of complex, fee-laden portfolios diminishes. Large firms like BlackRock must pivot or risk irrelevance.
But there is an opportunity. These institutions can reposition themselves as brokers of purpose:
- Curating portfolios of values-aligned, impactful investments
- Offering tools to measure non-financial returns (e.g., carbon offsets, social impact)
- Advising clients on how to align capital with conscience
In this new role, the asset manager is not just a financial engineer—they are a guide in a moral, social, and philosophical investment journey.
**A New Financial Archetype: The Investment Philosopher**
The next generation of financial advisors may look less like Wall Street traders and more like investment philosophers. They will help clients navigate questions such as:
- What causes do I care about?
- What kind of world do I want my capital to build?
- How can I measure satisfaction beyond returns?
This is already emerging in impact investing, ESG mandates, and regenerative finance. Bitcoin simply accelerates the transition by removing the "survival pressure" of beating inflation.
**Risks and Counterpoints**
Of course, Bitcoin is not without its challenges. Volatility remains high, regulatory uncertainty persists, and adoption is uneven. For now, traditional investments still offer diversification and yield opportunities. Moreover, many investors will still chase returns out of habit or ambition.
Governments may also impose tax policies or incentives that push capital back into conventional markets. And some may argue that a truly post-inflation world is still decades away.
Still, the direction of travel is clear: Bitcoin has planted the seed of a new investment paradigm.
**The Quiet Revolution**
Bitcoin may not loudly overthrow the financial system—but it quietly rewires the motivations behind it. In a world where money no longer leaks value over time, investing becomes a matter of meaning, not necessity.
For investors, the question becomes not just "What will this return?" but "What will this create?"
And for the financial institutions of tomorrow, survival will depend not on beating benchmarks—but on helping clients build a life—and a world—worth investing in.
I had an interesting conversation with an activist today. She was exposing the evil large corporations commit.
I started explaining that, once Bitcoin is established as a store of value, companies will have to offer something more than a simple return to stop your fiat savings dwindling to zero. They will have to offer a socially or environmentally investment model.
Oh, Bitcoin… apparently her father invented a digital currency at the same time but was just beaten to market. The good news is that he was invited to work for Bitcoin. She didn’t say if that was Inc, Ltd, GmbH, SA , etc. 🤔
I walked away soon after that.
