5 reasons to accept Bitcoin
1 – Bitcoin is a currency.
So what is acceptance really? To start with, it means acknowledging the value that Bitcoin intrinsically has. A currency is something that can be used to exchange the value of work between two parties. Historically, this has been able to be represented by anything from bags of salt, to rum, to shells, to gold and other precious metals.
The concept of Barter is not new, however bitcoin introduces a new way to barter, digitally. The blockchain, and the work (aka energy) required to mine bitcoin, provide a foundation for valuing that work, valuing that energy. Indeed, much of the valuation of bitcoin is based in the amount of work and investment in hardware required to mine it. As “The Halving” approaches, the work required to earn each bitcoin will be doubled. The value therefore is more than likely to increase.
So, the first acknowledgement or acceptance which we need to make is that if we have a way of representing work which can be exchanged freely between parties, then we have the basis for a currency. This may seem self evident to some, and indeed with the government of Japan now officially recognising bitcoin as a currency, there are still pockets of resistance.
Australia is an interesting case in point.
The Australian government has recognised that there is value in bitcoin, however the government has chosen here to see it as a commodity rather than a currency. In an effort therefore to try and regulate, the government deemed bitcoin to also have GST applied to it. When this happened in mid 2015, it saw an exodus of technology companies and bitcoin startups relocate overseas to more reasoned jurisdictions. Bitcoin users have in the main thus far been geeks, speculators and libertarians. This userbase is changing however.
2 – Bitcoin is Global
Fiat currency, and it’s vagaries are generally local. Many people wish to recognise that the US dollar is a global currency, however of any of the international work-value exchange mechanisms, this is possibly one of the most flawed. Quantitative easing has seen the US Federal reserve create Trillions of dollars out of thin air in order to support their economy. Absorb that for a moment – out of thin air. No basis of work exchange, just “because they wanted to” and because they needed a way to fool the rest of the world into believing that the was still value in their economy.
Largely, they were successful unfortunately, and most of these funds now sit overseas with the likes of the Chinese government or in IOUs to other third parties…
Bitcoin, whilst it needs to have a Fiat currency equivalency in order to have that work value equivalence, is something that can be independently exchanged between parties wih ease, and speed.
The global nature of the bitcoin network and the blockchain more generally make bitcoin in fact the best way to exchange work value – more so even than fiat currency transfers. There is minimal cost to exchange data between 2 nodes. Where these nodes are physically located is irrelevant – they could be physically adjacent, or at the North and South poles respectively. It just doesn’t matter.
Some would say there problem therefore is that bitcoin doesn’t respect borders. I take this one step further and say that it doesn’t recognise borders because there are, in reality no such things as borders. Any border is an artificial construct of human intervention based on political or historical conquest based actions. Bitcoin doesn’t have any borders. There is a lot society on general could learn from this concept…
3 – bitcoin is transparent
Many bitcoin naysayers (and there are quite a few of them) say that bitcoin is the realm of villains and scoundrels because of the anonymity it provides. To an extent, whilst bitcoin addresses can provide discrete anonymity by refusing to link identifiable personal information pertaining to a party with that address, fundamentally bitcoin is valuable because of its openness and transparency.
Every single bitcoin transaction which has taken place, and which ever will take place, is open and visible to everyone. There is no hiding a bitcoin transaction – no cash under the table so to speak – it is out there.
Like all things technical, it is possible to obfuscate, but it is possible to track as well.
4 – bitcoin is not able to be controlled
This is where some of the real intrinsic value of bitcoin resides. It has a work equivalence value, but it is not able to be physically controlled by old money or big money. This is the very capital – L Libertarian point of view, and it should be said that this has an attraction tom many.
If we take a broader picture look at the concept of “wealth” and “power”, all it really means is that somewhere along the line you have been able to control something or someone and exchange a larger value for that than the individual puts on it themselves. Exploitation is what some would call this, and it has been going on for as long as sentient humans have existed.
We have been convinced that there is value in certain things and that it is desirous to control those things. But what is that value? Really, the value which exists and which we have is based in our health, our ability to work (either physically or mentally, or both), in energy (which enables the former) and in our ability to transfer that energy, and in food and crops, again energy transfer.
Big Money (banks and moneylenders) seeks to control the flow of money and the transfer of fiat currency, playing with the value of work of others and scraping, scraping, scraping to generate their profits. Little if any work or value is really generated by Big Money. They have however found a way to control the mechanism by which the rest of society exchanges work value.
Bitcoin can’t be controlled by them and they can’t scrape scrape scrape, so it is a threat to their existence. I see that as a good thing… it’s the main reason Big Money is trying to suppress Bitcoin.
5 – bitcoin is here for the long haul
But is it really all going to keep working? The answer is yes.
The technology on which the platform has been built is robust, and the deflationary mechanisms which have been built into it will ensure that over time as work value is decreased, Bitcoin value will be increased. We are unlikely to see a complete failure of the planetary network infrastructure any time soon – parts of it perhaps, due to EMP, solar flares or some other catastrophic global disaster, but somewhere the blockchain will survive. It can be rebuilt, and it could even be built into all future computing devices so it exists in and of itself. Perhaps a network of geostationary satellites can be deployed to cover off any planetary disasters – this would indeed perhaps make sense.
As we come to accept that there is a value in having a global, transparent, currency which is independent of greedy vested interests this will indeed become more important. It is only a matter of time before we see this.
So, welcome to the emergence of the fourth type of bitcoin user, the general populace. The geeks, the speculators and the libertarians have had it to themselves thus far – it’s about time we all saw the value in bitcoin and accepted that it is here to stay.