Bitcoin; Humanity’s Dream
From my understanding the American Dream comes down to 3 things:
- Freedom- the power or right to act, speak, or think as one wants without hindrance or restraint
- Potential- upside opportunity, material prosperity, support a family
- Egalitarianism- the doctrine that all people are equal and deserve equal rights and opportunities
“Bitcoin isn’t the American Dream, It’s Humanity’s Dream”
Not meant to be technical about how bitcoin works. Not financial advice.
How does Bitcoin give freedom?
You have the power. You can hold your bitcoin yourself. You can store it on a computer, an app on your phone, or even a secret USB drive.
The only barrier to entry is an internet connection. When connected, you can always send and receive it, at any time, 24/7/365.
You can send bitcoin similar to how an email is sent. You have a wallet address, and the person you are sending it to has a wallet address and you can send to anywhere in the world with a connection to the internet.
“Think of it as a money layer on top of the internet”- Andreas Antonopoulos
The network has ran at 99.98% uptime, moving millions of dollars daily since 2014.
This video is one of the thousands of mining facilities all around the world.
Nodes are dispersed all around the world.
This is truly groundbreaking, for the first time ever, you can send and receive value anywhere in the world without having to get permission from a company or government.
How does Bitcoin have potential?
Bitcoin has been called the, “world’s most pristine reserve asset” by Ex Goldman Sachs hedge fund manager Raoul Pal. Meaning it is the best asset to hold your wealth in. But why?
To start, anyone can invest, with any amount of money, unlike real estate, stocks, mutual funds, and bonds. (yes, some companies sell fractional reserves of stocks but that’s for a different paper). Bitcoin is divisible to the 8th decimal point. The smallest amount being 0.00000001 of a bitcoin, also known as a “satoshi”.
Similar to gold, bitcoin is pure of any debt, and cannot hold any debt. So why is this valuable? It can’t default or run out of revenues because it has none. Some people knock bitcoin for not generating cash, however most cash generating businesses hold risk.
Furthermore, most big stock market companies have massive debt.
It is also nearly impossible to buy a house without taking on a mortgage, (This could also be considered ‘good debt’ but that’s a different discussion).
Bitcoin has a capped total supply at 21 million. For context, there are 46 million millionaires in the world. Not every millionaire can own one whole Bitcoin. This stuff is scarce.
Quick overview of how bitcoin supply is distributed. Computers running the Bitcoin network secure the blockchain and add decentralization. As a reward, they are given freshly minted bitcoin. If you are running a super computer, you will get paid more bitcoin overtime than running an old piece of junk.
The daily supply of bitcoin rewards:
Every 4 years’ bitcoin’s daily reward is cut in half. This event is called the Halving. This deflationary system can be very powerful. The year I turn 50, only 7 bitcoin will be produced a day.
There is also an estimated million plus bitcoin lost due to user error. These lost bitcoins will never return, limiting the supply even more.
Scarcity by itself has a ton of value. Baseball cards, sports cars, signed jerseys, vintage art, and even real estate are perfect examples of the power of scarcity.
You may be wondering; how much are all the bitcoin worth?
The current market cap (as of 12/29/20) is around 495 billion dollars, three times the net worth of Jeff Bezos. This sounds like a lot of money, but is it? Well it is tiny compared to other comparable markets.
Another visualization. This is an older chart as BTC is now worth $0.495T. Major upside if it continues its success in getting more adopters.
More demand, less supply, usually ends nicely for investors.
I’m making the case that…
It is the first store of value that uses the internet without a middle man.
Digital bitcoin is 10x better than analog gold. — Pomp
If bitcoin just matched gold in size of market cap, it would be around $400,000 a coin.
How does Bitcoin give Egalitarianism?
Quick reminder, Egalitarianism is “the doctrine that all people are equal and deserve equal rights and opportunities”.
Bitcoin gives everyone equal rights and opportunity to fair money. The only barrier to access is the internet. No barriers on religion, ethnicity, social class, anything!
There are over 3.5 BILLION smartphones users in the world, that means 3.5 billion people have the option to connect to the greatest performing asset of all time!
If 1% of 3.5 billion people start to use bitcoin, that is more people than United State’s citizens.
I am an American, and we have it nice. Pretty much anywhere we can go accepts the U.S. Dollar. We do not have to worry about the dollar, except for some inflation. Bitcoin is not seen as a necessity by most Americans.
That’s why American’s fall into the left side of the “Luxury to Necessity Spectrum”. I personally use it as a hedge against inflation.
Other countries citizens are not so lucky. The right side of the chart is the “Necessity” side of bitcoin.
Citizens in Venezuela, Greece, and Lebanon use Bitcoin as a safe heaven from hyperinflation and bad government policy. They may still transact in the local currency, but they store wealth in Bitcoin.
“Financial security delivers more happiness over time than almost anything money can be spent on.” ~Dan Buettner, author of The Blue Zones of Happiness: Lessons From the World’s Happiest People.
These people NEED bitcoin. Why would they not use bitcoin? A lot of countries are embracing bitcoin and cryptocurrencies.
Out of 65 countries in the Statista Global Consumer Survey, Nigerians were the most likely to say they used or owned cryptocurrency. Almost a third of Nigerians said this applied to them. The high cost of sending money across borders the conventional way has caused many to turn to local cryptocurrency exchanges catering to overseas workers and their families.
Europeans and English-speaking nations have low adoption because they don’t need it (yet).
32% of Nigerians use it, value it, need it, everyday.
Whether you like your government or not, you have an option to opt out.
Bitcoin isn’t the American Dream, it’s Humanity’s Dream
“90 percent of the human population, aged 6 years and older, will be online by 2030”
In a few short years, 90% of the world will have access to the greatest performing asset of all time, and it’ll be as easy as sending an email.
This isn’t the new American Dream, this is Humanity’s Dream.
I’m not saying drop everything for bitcoin, (even though everyday, people all around the world do) maybe just throw $20 bucks in of every paycheck, or switch out some stocks for some satoshis.
I will say this though; the incorrect amount of exposure is zero.
HODL ON!!!
For more from me, visit https://satoshijabroni.com/
