Bitcoin is Next-Generation Gold
Bitcoin is here to stay and will only grow as governments increasingly manipulate the money supply. The nation-states and banking system have joined forces to create the Financial Matrix, a financial system which uses fiat and fractional reserve credit to enslave the people. This is described in detail in my new book EXPOSED: The Financial Matrix. Bitcoin, however, is the free market response to the Statist’s money system. It’s vital the people understand Bitcoin and how its limited supply can protect the people’s wealth.
The demand for Bitcoin, simply stated, is a place to park wealth outside of the control and manipulation of the Financial Matrix. Just as lawyers and accountants have value to legally protect assets through knowledge of the IRS codes, so too does Bitcoin have value because it legally protects a person’s wealth from the rampant inflation of money applied by the Statist monetary system. The Austrian economists call it marginal utility and the utility of Bitcoin is its limited supply. People who desire to protect their hard-earned wealth are utilizing Bitcoin as a hedge against inflation, investing 5–10% outside of the Financial Matrix money system.
Throughout history when the force matrices became too oppressive people escaped to new lands where the matrix could not reach. Today, however, the Financial Matrix reaches everywhere. Thus, the escape is to a virtual currency where the Financial Matrix cannot reach. We live in exciting times because the pivot towards Bitcoin digital gold has the possibility to bring free market principles back into money and banking and help set the people free!
Bitcoin is a decentralized, distributed, digital virtual currency created in 2009 as a direct result of the housing market crash and has been called analogous to digital gold. It was created by the pseudonymous Satoshi Nakamoto and follows the protocols outlined in the white paper released at its creation. The identity of the person or persons who created the technology is still a mystery to this day. Bitcoin offers the promise of lower transaction fees than traditional online payment mechanisms and is operated by a decentralized, distributed authority, unlike the Financial Matrix’s centrally issued currencies. Since bitcoins are digital, there are no physical coins, only balances on a public ledger transparently displayed with the transaction history. Furthermore, since bitcoins are decentralized and are not issued or backed by any government or bank, no entity can control the creation, transfer, or value of them. Instead, bitcoins have market price because, like all goods and services, the market values them. In fact, the value appears to be growing as people realize the size of the con the Financial Matrix is perpetrating at their expense. Bitcoin, essentially, is a grassroots movement aimed at the creation of free market money, entirely separate from centralized governments and force matrices.
The idea of free market money is not new. Also, the idea of digital money is not new. And certainly, the desire for stable money goes back as far as money itself. The reason Bitcoin is so revolutionary is that it figured out elegant solutions to massive age-old problems in order to accomplish all of these desires for money in one invention. One of the biggest obstacles to creating something like Bitcoin was the problem often referred to as the Byzantine Generals Problem (BGP). Software entrepreneur Marc Andreessen described this: “Bitcoin is the first practical solution to a longstanding problem in computer science called the Byzantine Generals Problem (BGP). To quote from the original paper defining the BGP: ‘[Imagine] a group of generals of the Byzantine army camped with their troops around an enemy city. Communicating only by messenger, the generals must agree upon a common battle plan. However, one or more of them may be traitors who will try to confuse the others. The problem is to find an algorithm to ensure that the loyal generals will reach agreement.’” The BGP, in other words, poses how to identify trustworthy actions from fraudulent ones, and establish a basis for trust in a decentralized network of unrelated parties like the Internet.
Nakamoto’s technological solution created, for the first time in world history, the ability to transfer value between distant peoples without relying on a trusted intermediary, as neither banks nor governments are needed to successfully complete the transaction. Indeed, the ramifications of Bitcoin’s core technologies are so profound that it has rightfully been suggested that Nakamoto is a worthy potential recipient of both the Nobel Prize for economics and the Turing Award for advances in computer science. The four fundamental technologies uniquely encapsulated to create Bitcoin are:
1. Digital Signatures: These ensure identities cannot be forged, permitting one party to securely verify transactions with other parties.
2. Peer-to-Peer Networks: Durable networks like BitTorrent or TCP/IP are difficult to take down and require no trusted central third party.
3. Proof-of-Work: This ensures users cannot spend the same money twice, even without a central authority to regulate transactions. Bitcoin has created an incentive system for “miners,” who are paid by “discovering” new coins, by running powerful networks of computers that validate transactions, securing them from tampering. Moreover, anyone with computational resources can anonymously and democratically choose to become a miner to earn new coins.
4. Distributed Ledger: Bitcoin records the history of each and every transaction in every wallet. This “blockchain” ledger publicly displays all validated transactions.
Essential Characteristics of Money
These technological innovations created Bitcoin with the essential characteristics of money, money that is scarce (only twenty-one million bitcoins will ever be created), durable (being digital, they don’t degrade), portable (the digital signature allows bitcoins to travel with you anywhere and to be transmitted electronically), divisible (into trillionths called satoshis), verifiable (through the public blockchain), easy to store (paper or electronic), fungible (each bitcoin is equal in value), difficult to counterfeit (cryptographically impossible), and achieving widespread acceptance within the marketplace, with many top technologists and programmers working overtime to improve it.