Bitcoin Critics pt. IIII
Can you trade Bitcoin for pizza?
Happy Friday readers,
When is the ideal day for this letter to hit your inbox?
Important Announcement🚨🚨🚨
Be mindful of the withdrawal fee associated with your pool.
For example, Luxor pool has a flat fee of .000075 BTC ( currently ~ $5)
If you are making frequent withdrawals, this can significantly impact your profitability. It is recommended to withdraw less frequently when fees are high.
If you wanted to withdraw a UTXO smaller than .000075 BTC, you would not be able to. It would be an unspendable UTXO.
To avoid problems with UTXOs, you should consolidate your UTXOs.
To learn more about how to manage UTXOs, check out the dedicated page on our website: https://www.insights.simplemining.io/tag/utxo/
This edition concludes the scrutiny of the TOP 10 BITCOIN CRITIC ARGUMENTS:
Bitcoin has no intrinsic value (it is not backed by anything)
Bitcoin is for criminals and money laundering
Bitcoin uses too much electricity
Bitcoin is too volatile
Bitcoin is bad for the environment
Bitcoin will get banned by the government
Bitcoin supply distribution is centralized
Bitcoin will be replaced
I can’t buy anything with Bitcoin
What if the internet goes down
Today we will finally stress test the validity of “I can’t buy anything with Bitcoin” and “What if the internet goes down” critic arguments.
I can’t buy anything with Bitcoin
Many critics defending these arguments may actually be expressing resentment for not purchasing Bitcoin earlier.
This can lead to nonsensical conclusions to undermine Bitcoin’s true value.
These clips showcase this point (hard not to laugh at this):
It’s ironic how the first Bitcoin payment was for pizza in 2010.
American citizens are privileged to have access to the world's most “stable” and liquid financial system.
We do not need to worry about our currency getting devalued 50% overnight (at least not yet).
In many places worldwide, the price of a common good like pizza may drastically fluctuate based on the nation’s monetary policy.
Bitcoin is a better money with which to purchase goods than fiat currencies.
All centrally planned currency paths lead to debasement and erosion of purchasing power.
In the long run, Bitcoin will prove itself to be the greatest monetary instrument that solves the double coincidence of wants.
Here are two helpful graphics to aid in understanding this:
Goods get cheaper in terms of Bitcoin over time
Properties of money do not get adopted all at once
Bitcoin will first be recognized as a store of value (such is the case), then a medium of exchange (we are here i.e. El Salvador), and finally a unit of account (goods are priced in terms of Bitcoin).
These adoption phases of money may take years.
Bitcoin is already being used by merchants all across the globe as a means of payment.
Check out this map to search Bitcoin vendors near you: https://btcmap.org/
Adoption of a new technology happens gradually, then suddenly.
The Total Addressable Market of Bitcoin is anyone who uses money.
What if the internet goes down
Bitcoin is currently being transacted using SMS (Short Message Service) technology in South Africa.
This does not require internet access.
(The service is currently custodial, but they are working to use SIM cards as private keys).
If the internet were to go down in one region, the Bitcoin network would continue operating in other areas via nodes.
Here is a map showing the geographic distribution of nodes:
Alternate digital communication methods are being developed, such as radio wave transmission and satellite broadcasts.
Bitcoin is a cyber technology that will continue to improve and strengthen its resilience to attack vectors and choke points.
In the doomsday scenario of a global internet outage, it would be catastrophic for modern civilization as a whole, far beyond just affecting Bitcoin.
In such a scenario, guns and food would skyrocket in value.
Evaluating advanced technology through an apocalyptic lens is an interesting thought experiment, although not helpful to form logical conclusions.
We are going through a digital renaissance.
Fiat money will continue to obscure the reality of value,
gold will get co-opted to meet the needs of final settlement,
and Bitcoin will be a beacon of the first instance of digital scarcity.
Have a relaxing holiday weekend✌️