He identified an economic void, which decreases the quality of nearly everybody’s financial situation — inflation. He chose the words “debase the currency,” and then proceeded to design Bitcoin in such a way for currency debasement to be nearly impossible. Of all the economic issues, inflation has the most detrimental effect on a vast majority of society. Without a doubt, other economic issues exist and should be addressed. However, we cannot simultaneously solve every issue, so prioritizing is only logical.
Nakamoto must have had his priorities straight, because he sacrificed scalability among other features to preserve and protect monetary policy. If we can’t change the behavior of those people in power, then we can take the power away from them altogether. Some people benefit from inflation , but most people suffer. The reliability of the Bitcoin network is proof of our ability to eliminate the unjust practice of inflation. Although Bitcoin is a complex technology, the monetary aspect is simple — fair and transparent monetary policy, which is a step toward the restoration of economic hope.
Too many people live paycheck-to-paycheck with minimal savings and no investments. Relying on the purchasing power of fiat currency is the norm (and also a huge problem). Bitcoin as a monetary tool allows everybody to have the same opportunity — accumulate and save as much money as possible and preserve any amount of wealth, large or small, without the worry of confiscation or inflation, i.e., the way money should be. Saving fiat is not rewarding, which breeds consumerism. If we ever want to achieve any amount of financial progress (especially those in the lowest economic classes), then our money cannot be consistently devalued over time.
Bitcoin fits into the framework of economic equality, which exposes Nakamoto’s intentions. As the network grows and develops, the integrity of Bitcoin becomes ever more clear. Other than current and temporary market conditions, owning bitcoin is not risky. We can have high confidence in the predictability of the monetary policy (issuance rate) and network security, while having peace of mind knowing our currency will not be debased over any amount of time, which is the exact opposite of fiat currency. Although many altcoins appear to be solid on the surface, none have the security of Bitcoin.
For many people, no financial implication is more important than preserving what small amounts of wealth we have. Living paycheck-to-paycheck is manageable; being broke and becoming even more broke due to inflation is hopeless. People who work hard should never have fear about not having enough purchasing power to afford the basics. The 21 million supply cap of bitcoin might be the most important feature because all we’ve ever known is an unlimited supply of fiat currency leading to higher and higher levels of inflation.
One can defend other cryptocurrencies as solving the issue of inflation, and part of the argument would be valid. Although inflation is likely the greatest problem, it is not the only problem. Nakamoto’s careful selection of protocol aligns with the complete monetary package. Lay the strong foundation first and then build up. When analyzing Bitcoin as a complete set of monetary tools, it is undoubtedly superior to every other cryptocurrency on the market. We can debate this until Jesus returns, but the market has undisputedly decided which cryptocurrency belongs in the #1 spot.
Nakamoto’s state of mind is apparent — establish and distribute sound electronic cash which empowers and maximizes self-sovereignty. Thinking about the basics of adulthood, people want to work, spend some of their money while surviving and enjoying life and save the rest for retirement. With fiat currencies and altcoins, proper measures were not taken in the beginning to ensure preservation of monetary policy and security, so we have no reason to have long-term confidence. In other words, shortcuts were taken. Nakamoto was evidently focused on building a strong foundation, which takes time. Since Bitcoin’s narrative has barely changed since the beginning, the earliest visions of Bitcoin are still relevant, and likely always will be.
This is a guest post by Salvatore Norge. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.
