By Michael Seymour, LUXOLO Exchange Desk Agent
There are only two sources of actual value in this world: natural resources and human labor. Both, in their essence, can be described as energy. The energy of labor, the energy derived from burning fossil fuels, the energy of the sun to produce forests and agriculture, the energy of the earth that creates moving water, etc… Money, more specifically currency, serves as a medium of exchange and a store of these values.
Money, as we know it, is based on faith. We believe that the U.S. Dollar will be accepted for value. This faith is instilled by experience, experts, and consensus, and backed by the confidence we have in the U.S. Government, and its military power that protects its interests. The U.S. Dollar states plainly on its Federal Reserve promissory note, or bill, “In God We Trust.” This is evidence of the faith-based nature of money. This placement of trust in God was effective in 1913, the founding year of the Federal Reserve, and for many decades following. But times are changing, and people are shifting their allegiance to technology. While money has been digital for several decades now, that technology only enabled a representation of paper fiat currency, until 2009. The release of the bitcoin white paper announced the beginning of a global paradigm shift.
Money is a tool that facilitates the flow of energy, directed towards projects that increase value and/or provide service. The financial industry uses metaphors of water to describe its purpose. Banks derive their title from the banks of a river, responsible for directing the current of flowing water. Water flows through rivers to the sea; the current flows to the sea. This became currency. Liquidity is often used to describe assets that are mobile. When a government wishes to punish a criminal enterprise, it freezes its assets. Cash flow is an essential operational condition for a viable business. The markets ebb and flow. When a company is spending more than it earns it is draining its resources.
Water, as a metaphor, represents the resources of the old world and the medium through which we communicate value. Bitcoin, intrinsically and abstractly, represents the resource and medium of the new world; it is even “mined” into existence. Distributed ledger technology, or blockchain, serves as the ‘banks’ that guide the flow of this new resource. Bitcoin has established itself as a store of value, a reservoir that is growing into an ocean. The market capitalization of Bitcoin, as an asset, is akin to the volume of water behind a hydroelectric dam; more volume equals more power, more energy. More importantly, the growth of bitcoin technology creates a fountain of hope that fills the sea of faith.
Some may argue that State regulators will crush bitcoin. Please recognize that all parties involved have a vested interest in the bitcoin network, to prove to the people of the world that this technology deserves their faith and confidence. Bitcoin validates and sustains the entire ecosystem of blockchains, distributed ledger technologies, and cryptocurrencies. All other cryptocurrencies are accessible through bitcoin. It is paramount that bitcoin succeeds so that the entire financial system can migrate to this new paradigm.
Given what you can see in society, is it not inevitable that cryptocurrency will replace paper fiat currency? Given what I have demonstrated, is it not in your best interest to invest in bitcoin? Contact us today to discuss your options!