Why is Bitcoin so hard for most people to understand?
| If you find WORDS helpful, Bitcoin donations are unnecessary but appreciated. Our goal is to spread and preserve Bitcoin writings for future generations. Read more. | Make a Donation |
Why is Bitcoin so hard for most people to understand?
By plasticman2011 - note - I cannot find this comment or user on YouTube anymore.
Posted February 17, 2020
h/t to nick-bravo on Reddit and Crypto Rothbard and Justin Hanneman for surfacing this post.
Why is Bitcoin so hard for most people to understand?
βThe reason itβs so hard for most people to understand is that most people donβt really understand money. Money isnβt wealth. Itβs an accounting system used to facilitate the exchange of wealth. (The paradox of money is that while everyone wants it, no one actually wants it - they want the stuff they can buy with it!) Many people are put off by the fact that Bitcoins are βjust dataβ. But thatβs what ALL money is, information! More precisely, money is a means for credibly conveying information about value given but not yet received (or at least not yet received in a form in which it can directly satisfy a personβs wants or needs).
To put it yet another way, money is a ledger. With fiat currencies like the dollar, that ledger is centralized. And that gives the central authority responsible for maintaining that ledger tremendous power, power that history has proven will inevitably be abused. With Bitcoin, the ledger is decentralized. And that means that no one individual or entity has the power to arbitrarily create new units (thereby causing inflation), freeze (or seize) your account, or block a particular payment from being processed. Weβve had decentralized money before. After all, no one can simply print new gold into existence. And the βledgerβ of gold is distributed because the physical gold itself (the βaccounting entriesβ in the metaphor) is distributed. But with gold, that decentralization comes at a heavy price (literally). The physical nature of gold makes it hugely inefficient for global transactions.
And this is why bitcoin is important! It is the first currency in the world that is both decentralized and digital. It is more reliably scarce than gold and more private and transactionally efficient than βmodernβ digital banking. This is why people are excited about bitcoin, it has the potential to completely revolutionize money.β