The Minimalist’s Guide to Bitcoin — for Those Who Don’t Have the Passion or the Time
This guide isn’t about buying Bitcoin — that’s an investment decision. This guide is about a new way of thinking.
Bitcoin is as important as understanding the internet.
You can’t live in the 2020s and refuse to use the internet — you’ll be left behind to collect dust in a bunker designed to avoid a Zombie apocalypse.
To understand Bitcoin is to understand Web 3.0. This version of the web is what you will use to eat, live, buy stuff, work, and connect with people. A colleague of mine laughed at me twelve months ago when I shared my (at the time) secret passion for Bitcoin.
He said, “Bitcoin isn’t backed by a country; therefore it has no value.” At the time I thought he was right. What I didn’t understand was the concept of value had changed.
Value can be determined by a country. Value can be determined by code too. Countries backing a currency is now an old idea. Technology has made us all global citizens.
Borders don’t exist on the internet. Borders don’t exist with internet money (Bitcoin) either.
I want to understand Bitcoin because I want to understand the future. I want to dream about technology doing the things we hate doing. I want to dream of spending time exploring other planets, rather than spending so much time doing boring manual labor a robot could do for a lot less money.
This guide isn’t about buying Bitcoin — that’s an investment decision. This guide is about understanding the future so you can thrive in it.
- Bitcoin was created in 2008. It was launched during the 2008 Great Recession, where banks were bailed out using government money for wildly speculating/gambling on home loans.
- Bitcoin only has one use case: it stores value. A lot of technology you use in your daily life is complicated but not Bitcoin. Bitcoin is a long-term savings account. It’s a place you store value you won’t need access to for a year or more.
- Bitcoin is decentralized. This means there is no Bitcoin office or official Bitcoin employees. You can’t shut down Bitcoin unless you turn off the internet, which is unlikely to happen.
- There is no Bitcoin Founder. The official Bitcoin white paper credits Satoshi Nakamoto as the Bitcoin founder. This nickname is most likely a group of cryptographers who we will never know the names of, because Bitcoin wasn’t designed to have an ego.
- Bitcoin is a throwback to the original days of the internet. Big tech companies — Apple, Facebook, Google — made the internet centralized. Bitcoin is a belief system that says we should go back to the original model. Bitcoin is the belief the internet should be owned by the users of the platform, and ownership should be publicly verifiable.
- Bitcoin is extremely volatile. This makes it good, not bad. Money stored in your bank account has no volatility at all. That’s why it is dead and rots away with inflation. Vibrant, living things have volatility. Volatility is a sign of growth. The downside is you have to learn to stomach the 30% or more price swings. I think about the value of each coin over a two year or more period, which means I am always ahead.
- Bitcoin is scarce. There are twenty-one million Bitcoins. No more can be created. This feature is crucial. Traditional currencies can be created out of thin air to fund pandemics. Therefore, things you can buy with currency change too. This is what causes people to say, “my Tesla stocks went up 300%.” What is missed is, how much of the price increase was the result of excess currency sloshing around, looking for a home.
- Bitcoin cuts out the middlemen. Many middlemen companies exist to create trust. Bitcoin runs on blockchain. Blockchain is a way to verify ownership or legitimacy, so you don’t need a middle man to check with. A lot of what we do online wouldn’t be possible if a trust system didn’t exist. Bitcoin is version 2.0 of trust. You trust code not people.
- Bitcoin isn’t a payment system. I hear odd dudes on traditional news channels say, “I haven’t bought a hot dog with Bitcoin yet.” That’s not what Bitcoin is. You don’t pay for stuff with Bitcoin. Bitcoin is where you store value to hide from inflation and manipulation of the money supply.
- Bitcoin isn’t new. It’s a twelve-year-old experiment worth more than $600 billion dollars. You can buy Bitcoin using PayPal … think about that.
- Bitcoin is the start. When you take a look you quickly discover Ethereum. Then if you look at Ethereum you start to see the world of decentralized finance and discover other coins like Chainlink. Bitcoin is the start of a new way of thinking, not a one-off idea that will end up on a bookshelf.
This Is What Is Missed
Everything I just said is pointless if you don’t understand these two things: Bitcoin is a philosophy. Bitcoin is a change in how you live your life.
It’s an idea that says borders don’t need to exist. It’s an idea that says anybody in any country should be able to exchange value with each other no matter where they live. It’s an idea that says oppression, suppression, racial divides, and humanity’s problems need a new perspective.
Bitcoin is money. Money is a social network. A change in the social network is the big idea behind Bitcoin.
Bitcoin is just an idea. Anything more than that is ridiculous. Open your mind to ideas.