Bitcoin primer from @AnilSaidSo
To appreciate Bitcoin's potential you must first understand why societies converge on a single form of money. No essay argues this more convincingly than ‘Bitcoin Obsoletes All Other Money’ by @parkeralewis "All forms of money compete with each other for every exchange."
“Think of each individual as a potential trading partner.
As individuals adopt the common medium as a standard of value, all existing participants in the monetary network gain new trading partners...
There is mutual benefit, and ultimately the range of choice expands.”
“Money represents the collective recognition that everyone benefits from the existence of a common language to communicate individual preferences. It aggregates and measures the preferences of all individuals within an economy, at any point in time..”
"money serves one singular function for all market participants: to bridge the present to the future..
At the point of exchange, each individual must make a decision as to which monetary good will best...preserve value created in the present into the future."
"There are billions of goods and services produced by billions of individuals, all with unique preferences.
The need for money is real and individuals will converge on the form of money that best fulfills the function of exchange."
"Through the convergence on a single form of money to aggregate and communicate all preferences, a price system ultimately emerges."
All forms of money compete with each other for every exchange."
"Bitcoin combines the strengths of physical gold with the strengths of the digital dollar without the limitations of either. Bitcoin is finitely scarce, easy to divide, and easy to transfer."
"It would be illogical to assume competition between two monetary mediums (or multiple) would be in any way parallel or would follow a similar pattern to that of two companies."
"It does not matter how complex bitcoin is. At the end of the day, bitcoin becomes an A/B test. Currency A continues to increase in purchasing power relative to goods and services while Currency B does the opposite. Which one do I want?"
Because bitcoin becomes the common language of value for all participants, anyone that is a part of the network will be able to communicate and ultimately trade with other network participants.
METCALFE’S LAW: Conceived by George Gilder but attributed to Robert Metcalfe (co-inventor of Ethernet), this concept relates to the value of a communications network being proportional to the square of the number of connected users. NV≈n^2
"The ability to power up a computer anywhere in the world and transfer a finitely scarce resource to any other individual, without permission or reliance on a trusted third-party is empowering."
"The market converges on bitcoin over time and its value continues to increase because it provides a constant that is superior to any other form of money."
"No other currency in the world can ever be more scarce than bitcoin, and scarcity will act like a gravitational force driving adoption and communication of value."
About the author
Anil is an independent bitcoin educator based in Canada. He holds an MBA, CBP and was part of MIT's inaugural FinTech certificate cohort. He's guest-lectured at Business schools and launched the first Bitcoin-specific university scholarship in Canada. His focus is on simplifying concepts through visuals and storytelling to make bitcoin easier to comprehend.
You can follow him on Twitter @anilsaidso
You can pre-order his book representing approximately 3,000 hours of research, teaching, writing and design in an effort to best communicate Bitcoin as a concept.