Potential Inside Bitcoin: WHY IT OWNS THE BEST NAME IN THE PAST 10-YEAR?
The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.
-Satoshi Nakamoto, FEB 11,2009
Bitcoin, the decentralized digital currency, was discovered on January 3rd, 2009 by Satoshi Nakamoto, the pseudonymous developer(s) who pieced together the original source code. Satoshi mined the first Bitcoin Block, and got 50 BTC as the reward for his work. Since then, decentralized crypto-network started living under the sunshine, and was filled in the world like what air did.
Most of the time in 2009, the Bitcoin price remained to be 0 due to the ironic fact that no one was willing to spend a piece of fiat-currency for bitcoins. A year gone by, more and more miners joined the game. When the first Christopher Columbus spent dollars to buy bitcoins, the peg was triggered. At that time, 1309.03 bitcoins were only valued at $1, which means that BTC/USD was $0.00076.(Yep, it is sort of amazing. Everyone wishes they could have a second chance.)
Since the first batch of Bitcoins born, the Bitcoin price has been worried about. From a few to many, the group of Bitcoiners grew. Even top investors such as Bill Miller, Paul Tudor Jones, Stanley Druckenmiler and etc. now are also keeping Bitcoin being in their portfolio.
Chaos is a ladder.
The most charming part of Bitcoin itself is its decentralization. Without central departments and institutions, the market capitalization still surpassed one trillion.
So, Why did Bitcoin own the best names in the past 10 years?
- How did Bitcoin spend his past 12 years?
“Bubble” shall be the most frequent words about Bitcoin in the past 12 years. As people linked “Bubble” with a plummet, it is easy to detect that bubbles have happened several times during the past 12 years.
The first “Bubble” happened when Bitcoin skyrocketed from $0.01 to $0.36 on NOV 7th,2010, then it crashed to $0.19 on DEC 10th, 2010. During the period, the Bitcoin price pumped by 36 times then dumped by 47%.
The second “Bubble” happened when Bitcoin boosted from $0.19 to $30 in June 2011, then the bitcoin price collapsed to $2.30. In this time, the Bitcoin price had a 157 times increase, then presented a 92% decrease.
The third “Bubble” happened when Bitcoin surged from $2.30 to $250, then got rekt until Bitcoin found the bottom at $62. This time, it was a 108 times rise, and 75% drop.
The fourth “Bubble” happened when Bitcoin reached a peak at $1150, but it fell back to $154 rapidly in January 2015. 18 times pumps and 86% dumps during the days.
The fifth “Bubble” is the most widely-known one. The Bitcoin price moved up to $19,700 as it started from $154. After then, it plummeted to $3,140 in January 2019. In this circle, Bitcoin had a 127 times surge and 84% plummet.
From the “Bubbles” above, the market of Bitcoin is extremely volatile.
While the Bitcoin market meets the bull, people like developers, investors, and miners would join in the ecosystem. When a bear comes out, it helps the market take the people who do not truly learn “What is Bitcoin”. Every time when a “Bubble” happens, only tear and regret left.
Yes, Bitcoin is totally a Stanford Marshmallow Test for Adults and societies.
Why can Bitcoin be valued?
Even genius cannot fix the puzzle of “Why can Bitcoin be valued?”. Mostly, they named Bitcoin as “Bubble” and assumed that there is no reason for anyone to HODL Bitcoin. Thus, they made a mistake essentially.
Bitcoin is a monetary good. Monetary goods throughout history have been gold, dollars, silver, salt, rai stones, shells, glass beads, and many other objects.
The type of Monetary good should be unique. Its value is dependent on the market bids. Unlike the goods we see in our daily life, such as an iPhone, whether you hold it or not, it already has valued itself. Like most other goods, its value does not need to rely on any other human being.
Though we said it so, it does not mean that Bitcoin is a “Bubble” that is made by mass delusion.
Trillion value accumulated, based on the fact that it is the game-theoretic monetary Schelling point for individuals. Because of Bitcoin’s unique monetary properties, individuals have an incentive to adopt Bitcoin as a path to store their wealth because the market will reward bitcoiners in the long run.
Bitcoin is at least a 100x improvement over gold, fiat, and all other previous monetary goods. It is the only way for humans to perpetually store wealth across both time and space without dilution.
It is important to note that for Bitcoin to continue functioning as the best monetary good it does not necessarily need billions of people using it. If Bitcoin simply retained its existing user base of savers, it would still be the world’s best monetary good. However, because Bitcoin is the world’s best monetary good due to its unique properties, and we know that individuals are incentivized to adopt the best monetary good due to its advanced store of value functionality (“Number Go Up Technology”), we can be highly confident that the price of Bitcoin will continue to grow at an exponential pace due to an increasing number of people adopting Bitcoin as their primary monetary good.
After all, how can normal individuals get their first Bitcoin even they are not miners?
Taking the Bitcoin exchange that only charges 0.05% for buying Bitcoin as an example:
- Login on https://www.bitoffer.com
- Click “Assets”, then deposit ETH or USDT. (They don’t have OTC trading at the moment, but the trading fees to buy bitcoin on BitOffer is the cheapest one in the world. So, using BitOffer is a friendly experience to newbies.)
- After depositing ETH or USDT, then click “Exchange”.
- Then, choose the trading pair you can trade, and then click “Buy”
