Could Transparency Ruin Other Stores Of Value
Hey JessCoiners
The reason I feel Bitcoin is the hardest money ever created is that there are only 21 million available ever, there will never be more and can only be less, technically. As people lose their Bitcoin or send it to burn addresses we remove them from circulation and effectively spread the market cap over fewer coins and drive even more value.
Having a hard cap on supply means that it is highly limited and that having such digital scarcity and transparency has brought in questions on things that we've valued in the past.
Plenty of nay-sayers are saying Bitcoin isn't scarce because you can fork it or create a new cryptocurrency which feeds of it as cryptocurrencies tend to do but what these folks don't understand is that this is what a free market is supposed to be about and how it creates perceived value.
If you don't have competition, how do you compare things to see which is best? Fiat never had competition, it was tied to money printing and nation-states and now we have a money that is tied to algorithm monetary policy and game theory and they're scared to compete with their inferior product.
Image source: - quertime.com
Money printing will always be popular
Money printing won't go away even if fiat disappears, it's here to stay and if the incentive is there for people to do it, they're going to do it. Every altcoin created is essentially money printing but they cannot print forever without driving value, which is why most of them will be here today gone tomorrow.
Altcoins are idea and monetary Darwinism if you can take on Bitcoin and win, by all means, and good luck. Money is a confidence game and confidence can come from two ways, having nothing to hide or being good at hiding things that could reduce the confidence of the currency.
Fiat currency
When it comes to fiat, imagine having an accurate count of ALL the fiat in circulation for all the countries both cash and digital and having complete oversight as to who got the money how it got there. You see, if we had oversight on fiat, we would see how it is produced and allocated and having this exact transparency would piss a lot of the economy off and having them drop it in a second.
However, with regulation and legal tender and taxes governments along with banks and their financial products keep you thinking its a complex system and you don't ask questions.
Commodities
Non-perishable commodities like gold and silver are great stores of value and have been that way for thousands of years. The problem with gold and silver and even precious stones like diamonds are the supply chains aren't exactly public knowledge. We don't know how many of these things have been pulled out of the ground and how much is needed to say gold being used in smartphones.
These metals have a certain use case as all as the aesthetic value in becoming jewellery as well as requiring effort to mine and create I get that, but I am pretty sure if we knew exactly how much of it is out there and who owns it we could see the value of these commodities drop when you see how much is actually out there, especially in the artificial markets with controlled value chains like diamonds.
They also make these commodities non-fungible through licencing so not everyone can come in and mine it or sell it, it has to go through a select few who are able to manipulate the supply and demand.
Debt backed assets
It's no secret that debt has been abused by the ability to print money, pulling money from the future to enrich our society now and paying it back over time is not a bad method of finance but it can only be done responsibility when there isn't money printing.
If it's done in a deflationary currency there's a real risk of default catching up quickly if you do not generate value and debt backed assets wouldn't be the multi-trillion dollar market it is today.
If the debt was actually recalled and not inflated away, we actually see how much of the world is actually running on the value that was only borrowed into existence.
Have your say
What do you good people of HIVE think? Have you ever thought about how transparency in Bitcoin is a game-changer?
So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."
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