Bitcoin continues to rage ahead, looking to break ground with a new all-time high the media coverage and excitement around it is already at an all-time high. Investors such as myself are rightfully giddy that our investment has paid off on paper, and there’s nothing quite like “number go up” to confirm your biases.
When prices rocket up the way they’ve done over the last year, you get two types of retail investors. Ones that FOMO in trying to capture some of that upside and others that feel they are too late and their investment in BTC won’t offer much return.
While I can’t exactly help those who FOMO in, I thought about what it would be like if I were one of those who didn’t have any Bitcoin, and the price keeps surging. Would I be bitter about the fact that I missed the boat?
simply unaware of what’s being built
My first instinct was yes if you followed the history of Bitcoin and never got in. I would imagine you’d be pretty bitter about it. However, there will be millions, if not billions, who will miss Bitcoin price surges.
If it does become a world reserve asset at around 10 trillion USD market cap and above, yearly increases won’t be as big as today. Suppose Bitcoin becomes the unit of account or backing for a new currency.
Yes, I would imagine early HODL’rs will be pretty well off, but I’m also sure that this will be a minority of people, so why would the rest give a shit then?
Isn’t that the bloody same system we have now, with a few people sitting on all the wealth? If we look a the distribution of Bitcoin, then yes, very few will hold most of the Bitcoin.
No additional supply
Since there won’t be more than 21 million BTC and so many BTC, have already been lost. There’s only a few million of this left to be created, but it takes more resources to mint one and the schedule unchanged due to the difficulty adjustment.
So without more supply, how do we get Bitcoin into the hands of more people if there are so few holding all the cards. I hear this critique all the time, and I also wonder if Bitcoin won’t fall into the same trappings as we have today with fiat.
To me, this will be one of the true tests if Bitcoin is digital gold. In the previous system, where money was backed by gold, if a country or business overspent, they would eventually run out of money and become more responsible. To get money in return, they would need to provide value to the market to get cash flow back into their favour.
It wasn’t a perfect system by any means, but it sure did keep more companies and individuals honest, more so than we have today.
Insistence on real rewards
If Bitcoin is the currency of choice in the future, labour will insist on payment in BTC. This assistance means holders need to spend it to get access to goods and services. This will be the second phase of redistribution of the currency.
Getting paid in Bitcoin will ensure that your labour is not only rewarded right now with value but all the future value due to deflation and allowing human ingenuity to push down the cost of living.
The importance of getting off zero
Even if you don’t believe in Bitcoin, you can see that if this does search its full potential, it’s important to have more than zero. Having a stake in the new system isn’t just about the purchasing power you’ll be able to own or the privacy, but having a say in where value is moved in the system.
If we average out the full delusion of Bitcoin, 21 million, and share it with everyone on the planet today, it sits at around 0.0026 BTC per person, at the current price that’s around $153,95.
But we know this isn’t the real case; we know that there’s already Bitcoin last, and there’s going to be more people in the future, making that 0.0026 a less likely figure to own in the future.
So while I am grateful for having some BTC, I still think its real effect on the world is yet to come and will make working a far more pleasurable endeavour when you’re rewarded in something that cannot be destroyed by governments.
