My 4Fs (Fiat Friends Family and Fools) ASK:
As we all know bitcoin has a limit, when we reach that limit how is the value of bitcoin defined, assuming that the cost of bitcoin is the floor of the energy cost of the system + speculation?
I SAY:
In a hyper bitcoinization scenario, the price would be the inherent cost of energy + the capital cost of investing in mining and its margin + speculation - yes. But there's another component you're not considering – productivity gains. We should all live in a deflationary world. Exponential technological growth is a constant pressure to lower prices. You don't see it because it's being captured by the central banks and their Cantillonaires (Cantillon effect). In reality, Inflation is about 8%, because it is the theoretical inflation of 2%, plus about 5-7% of deflation inherent to innovation productivity growth. All of this value is energy that is being taken out of the economy and is not creating value effectively. In a deflationary future, your BTC is always appreciating, firstly because it is scarce (fixed supply) and limited resource but mainly because all the economic growth of the economy and technological innovation is captured in BTC as a strategic reserve. Therefore, the growth in the value of BTC would be associated with global economic growth, and would be exponential, in-line with the exponential advances in technology. We would live in a world of Abundance. That is why I spend much of my time doing the work of studying BTC. I want a better world to my children! A world of Abundance and Freedom!
Sendtotim / Tim 4 Fs (Tim for Fiat Friends, Family and Fools)
npub1ar…9mv9j
2024-03-07 17:05:51
Author Public Key
npub1arga0k5sgm70uxdvl9g9hzgf0t0qqzrvmkvkjs2yvkrpf3vzrqgq39mv9jPublished at
2024-03-07 17:05:51Event JSON
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"content": "My 4Fs (Fiat Friends Family and Fools) ASK:\nAs we all know bitcoin has a limit, when we reach that limit how is the value of bitcoin defined, assuming that the cost of bitcoin is the floor of the energy cost of the system + speculation?\nI SAY:\nIn a hyper bitcoinization scenario, the price would be the inherent cost of energy + the capital cost of investing in mining and its margin + speculation - yes. But there's another component you're not considering – productivity gains. We should all live in a deflationary world. Exponential technological growth is a constant pressure to lower prices. You don't see it because it's being captured by the central banks and their Cantillonaires (Cantillon effect). In reality, Inflation is about 8%, because it is the theoretical inflation of 2%, plus about 5-7% of deflation inherent to innovation productivity growth. All of this value is energy that is being taken out of the economy and is not creating value effectively. In a deflationary future, your BTC is always appreciating, firstly because it is scarce (fixed supply) and limited resource but mainly because all the economic growth of the economy and technological innovation is captured in BTC as a strategic reserve. Therefore, the growth in the value of BTC would be associated with global economic growth, and would be exponential, in-line with the exponential advances in technology. We would live in a world of Abundance. That is why I spend much of my time doing the work of studying BTC. I want a better world to my children! A world of Abundance and Freedom!\n",
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