Gold is not a perfect store of value:
MORE IDEAS FROM THE BOOK
In Bitcoin, you have public addresses and private keys:
A store of value is a way of transmitting wealth across space and across time. it is useful when you want to preserve the surplus value for future spending.
Gold 🪙 has historically been the defacto preserver of value. From the 70e however our money are no longer linked to gold so Central Banks are stealing our savings through money printing and inflation.
If you do not hold your own private keys, the Bitcoin is not really yours. If someone else holds your private keys (like PayPal, Robinhood, or any cryptocurrency exchange), you do not control your own Bitcoin. The Bitcoin does not truly belong to you. It can be lost, hacked, seized, or otherwise confiscated.
If you need to log in to an account to view your Bitcoin, it probably means that someone else is holding your private keys for you.
Bitcoin solves all of Gold problems.
Is a paper famous for coming up with a valuation got Bitcoin. It borrows the concept of “stock-to-flow” from precious metals analysts. “Stock-to-flow” (henceforth “S2F”) as a way of measuring the relative scarcity of a commodity. With the analogy the price of bitcoin is predicted to hit:
One of the hallmarks of the “efficient market hypothesis” (EMH) is that current information and future information that is known today will get priced into an asset.
If everyone knows that Apple will beat earnings this quarter, those expected earnings will get priced into Apple’s stock even before earnings are actually reported. Likewise, if everyone begins to believe that there is a 50% chance that PlanB’s model will still be working well in 2028 the fair value or expected value of Bitcoin should be $1,500,000 today.
Bitcoin's low number of transactions may make it less suitable for daily transaction. It does not matter. “Bitcoin as store of value” Is what matters.
Like gold coins, Bitcoin is simply too valuable to be used in daily transactions. There is no reason that we will ever need to use Bitcoin to buy a cup of coffee. That transaction size is handled fine by Visa or in the future, central bank digital currencies (“FedCoin”) may provide the main payment rails for the financial system.
Investing is not magic. Remember that ...
If you can stick around long enough and keep learning, you will be successful at this game. Learn the basics and practice.
Bitcoin is a peer-to-peer online currency, meaning that all transactions happen directly between equal, independent network participants, without the need for any intermediary to permit or facilitate them. Bitcoin was created to allow “online payments to be sent directly from one party to another without going through a financial institution.”
The supply of bitcoins in the world is capped at 21 million and, currently, about 18.7 million have been mined. The production of new coins is slowed every four years or so, with the number of coins minted upon completion of a block cut in half each time.
The limited supply is one of the things that makes Bitcoin attractive to many people. Decentralization means it is unlikely that any one person or group could gain control of the ledgers or enough of the currency to manipulate its value.
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