Have you heard the refrain that Bitcoin is not money or doesn’t have value because it is “made out of thin air”?
Well, let’s take an unbiased, factual look at what requirements “money” has to meet and see how different forms of money compare across the spectrum :
|Means Of Exchange||Yes||Yes||Yes|
|Unit Of Account||Yes||Yes||Yes|
|Store of Wealth||Yes||Short-term: Yes|
(Gradual, persistent loss due to inflation.)
(Wears out and has to be replaced)
(Can be produced in unlimited quantities at the government's whim)
|Portable||Yes||Yes||Only practical in small quantities|
(To 8 decimal places = 1 Satoshi)
(To 2 decimal places in most currencies)
(Smallest unit is the grain = 1/140 troy ounce)
(Each unit is identical)
Therefore, as you can see, if you look at the above objectively, Bitcoin is better suited for the majority of conditions that define “money”.
Well, let me give you some further benefits of Bitcoin as “money”:
- The bitcoin market never closes; it is available 24/ 7/ 365. Such is not the case with banks and other financial institutions and markets.
- There are no delays for global transactions. They can occur in seconds and be verified and added to the blockchain in minutes, and at fractions of the cost compared with traditional methods today. We all know that it takes international financial transactions several days to settle.
- Everyone knows the total supply of bitcoin produced at any given time, and also the total that will ever be (21 million by year 2140). Compare that to fiat currency or gold – NO ONE knows the supply of either.
- Bitcoin is borderless, unlike fiat currencies (in which a foreign money can be boycotted in a given country) or gold (which can be prevented from being transported into another country).
Bitcoin is NOT made out of thin air. It is generated by a “proof of work” math algorithm to solve increasingly complicated math equations, which require increasing computer power. This involves both a significant capital investment and ongoing energy costs. Thus there has to be a reward system to compensate.
Once a bitcoin is mined, it is verified across the global Bitcoin network and cannot be duplicated or counterfeited. It would actually be much easier to counterfeit US dollars than a bitcoin!
Now compare that to fiat currencies, which are in fact created out of thin air, in the sense that they can be produced in unlimited quantities and are not backed by anything other than the word and faith of the governments printing them.
Fiat currencies today are actually digital money. All that money going through the financial institutions is not backed by gold or any other assets. The whole system relies solely on the faith of all the parties involved in the transactions.
Bitcoin is the world’s first PROGRAMMABLE money. It is decentralized, borderless, censorship-resistant, immutable, and completely owned and controlled by the individual. In essence, it is the IDEAL form of money and the FUTURE of money.
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