Time and bitcoin. The only two things human effort can’t produce more of.
Bitcoin is scarce the same way time is. We only have so much time on earth, there will only be so much bitcoin.
Everything else bends to incentive.
Gold can be created more of. Maybe it’s in the earth, the ocean, outer space. We will find more. We have an abundance of land. We can make underground, underwater structures. Maybe we even colonize Mars. If it’s feasible and profitable, the supply of homes, offices, and buildings will continue to be created.
Bitcoin breaks that relationship.
If the price went to $10 million per BTC, more people would try to mine. They’d buy ASICs, build warehouses of computers, bring more computational power onto the network. The key difference is the difficulty adjustment. To mine a bitcoin gets infinitely harder when more people are trying, ensuring a certain amount gets issued roughly every 10 minutes. Like a chameleon camouflaging into its environment, the difficulty adjusts. Everyone can see the monetary policy and it is unchangeable.
Bitcoin’s 21 million supply cap cannot be changed. To change the supply cap would be to fork the code and create an entirely new chain. Different rules, different hash rate, a new protocol. The original Bitcoin chain remains the same. Those that never left continue to reap the benefits.
What benefits you might ask? Well, I like to think money is stored time and stored energy. And if you were to save in something that can’t be printed, diluted, or inflated away, you preserve what you’ve already given to acquire it.
People look at Bitcoin and see a speculative asset, a store of value, and/or a tech trade.
They’re not wrong, but they’re looking at the emails, not the internet.
They’re missing what Bitcoin actually is.
Bitcoin is a monetary network. Its timechain serves as infrastructure for moving information across the internet.
The units of information are called satoshis—100 million satoshis make up 1 bitcoin.
Think 100 cents = $1; 100 million satoshis = 1 bitcoin.
This monetary unit, which is native to the Bitcoin network, is the information.
That’s the thing. That’s what most people overlook.
It’s an innovation to the monetary system the world currently operates in.
The Bitcoin monetary network has distinctive properties that other monies partially have, but no one money has the properties Bitcoin does.
There’s no middleman; you send value directly to other peers on the network.
Someone in the United States can send the same monetary unit to someone in India, Nigeria, and Argentina. There’s no conversion as one satoshi here is one satoshi there.
There is no central issuer. No company, no government, no person controls it. What controls it is just a protocol with rules and its participants.
The system is permissionless, and the protocol is open-source code. Anyone can run a node, verify transactions, and join or leave the network at will.
Its encoded monetary unit, satoshis, is the hardest money to produce. It has a credibly enforced fixed supply and decreasing issuance—there will come a day when no new bitcoins are issued, and its supply will be 2.1 quadrillion satoshis forever (21 million bitcoins).
Its monetary unit is the most divisible out of all monies. You can transact up to 8 decimal places, enabling you to send cents around the world.
It’s portable; it moves on the internet, can be sent via Bluetooth on mesh networks or even on paper. It has close to zero storage and shipping costs.
These properties put Bitcoin in its own stratosphere.
Oh, and don’t forget you can own part of this network. The same network as BlackRock. The same network as the countries that buy bitcoin, the same network as your grandmother.
Everyone has access to the same infrastructure. Every satoshi held is ownership in a global monetary system.
2.1 quadrillion satoshis total.
That number never changes.
Your ownership can never be diluted.
And when you view Bitcoin as a network for moving money over the internet, the price noise fades. The volatility makes sense: fixed supply, variable demand. Once you can realize this, you stop watching a ticker and start accumulating pieces of infrastructure.