What is money?

RRBTCBitcoin Resources

Money is a tool that solves the coincidence of wants, and a mode of communicating value.

3 Functions of Money:

  • Store of Value
  • Unit of Account
  • Medium of Exchange

First Principles of Money:

  • Durability
  • Portability
  • Fungibility
  • Verifiability
  • Divisibility
  • Limited Supply
  • Acceptability

What is wrong with our money today?

  • Fiat Currency (Since 1971) – Issued by decree; Funds forever wars
  • Centralization of Gold and rehypothecated “paper certificates”
  • Fractional Reserve Banking – 0% Reserve requirement
  • Counterparty Risk – Bank Failures
  • The Cantillon Effect – Those closest to the money printer benefit

3 Functions of Fiat Money:

  • Store of Politics – savings debased and inflated away
  • Unit of Infinity – unlimited supply, no way to audit how many total dollars in circulation
  • Medium of Extortion – Censorship of certain transactions; total surveillance

Bitcoin Freedom vs. CBDC Slavery

Bitcoin First Principles: All changes and upgrades to the protocol should strive to maintain and reinforce these Principles of Bitcoin.

  • 21 million coins.
  • No censorship: Nobody should be able to prevent valid txs from being confirmed.
  • Open-Source: Bitcoin source code should always be open for anyone to read, modify, copy, share.
  • Permissionless: No arbitrary gatekeepers should ever prevent anybody from being part of the network (user, node, miner, etc).
  • Pseudonymous: No ID should be required to own, use Bitcoin.
  • Fungible: All coins are equal and should be equally spendable.
  • Irreversible Transactions: Confirmed blocks should be set in stone. Blockchain History should be immutable.

Recommended Reading from the Austrian School