Modern Economical Nonsense — The Money Problem

By xuanling11 | Crypto Learning | 2 May 2022


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There is a problem with your money 💵!

 

😒 Don’t think so? Hear me out here.

 

💳 Visa

 

Credit was introduced in the 1950s. 

 

Everyone thought credit cards would replace money, but they didn’t.

 

The benefits from credit cards were tremendous.

 

For users 👤, credit cards take less room, no need to exchange currencies when going abroad, and there is a faster transaction speed and defer payments if you want to.

 

For authorities 👮, credit cards are traceable and easy to fight for unlawful money activities.

 

The credit card was cutting-edge technology at the time, but they did not replace cash.

 

Then a virtual version of the credit card system was introduced: electronic payment system technology.

 

You can now make payments through a smartphone 📱. That almost makes it accessible to everyone who only owns a smartphone. You do not even need a bank account to pay through your phone.

 

Cash, on the other hand, makes a transaction anonymous.

 

Credit cards and cash have co-existed since.

 

 

₿ Digital Cash

 

When you combine a credit card and cash, you get digital cash. Bitcoin is the first effective form of digital cash.  

 

Bitcoin is short for business in the technology of currency on investment, and no one can destroy 😁.

 

Simply Bitcoin was created against a conflict of interest from the central bank's monetary system, or an insurance policy in case of the fall of the central bank.

 

💪 Power of Money

 

To become money, such replacement has to become very powerful. It has the purchasing power to acquire something, transfer power to dedicate someone, and create power to the reserve of value.

 

In traditional, a currency of the money is a debt that is a liability asset. For example, when you hold a dollar bill, the central bank owes you that dollar of value.

 

Bitcoin changes that fundamental idea. When you own a Bitcoin, no one is liable to pay off Bitcoin. 

 

In that sense, many people believe that Bitcoin has no value because none of the central authorities will claim that one Bitcoin is some kind of value or liable to pay that one Bitcoin.

 

Money is a credit in the past, and Bitcoin has destroyed that idea!

 

When the money was created by banks, and you owned that money, you owned a right to claim that money value. It is an entitlement of ownership of such money. 

 

Bitcoin destroyed that entitlement as well! Since Bitcoin has been a digital gold, it has absolute power over itself without being entitled to someone else.

 

The value of an official currency depends on the commitment of the central bank not to issue too much money to purposely devalue the currency. However, there is no restriction on the central bank no to do so.

 

Bitcoin destroyed that privileged. The cap of 21 million total supply completely bars inflation.

 

👌 Better Money

 

The goal of Bitcoin or cryptocurrencies is to reduce human error to prevent moral hazards.

 

 

Like NFT hype, Otherside Meta made $300M overnight but with $180M gas fees.

 

So many victims fall from such NFT scams.

 

 

Elon Musk offered $44B to buy Twitter and sold more Tesla stocks to raise funds.

 

So many victims fall from such company purchasing scams.

 

One can always argue that if you hold those assets for a long time, everything will pay back eventually.

 

The same argument can apply to any assets you are holding.

 

📢 Distributed System

 

The solution does not rely on decentralization but rather on a distributed system. The difference is the degree of autonomy. Rather than operating without anyone, a distributed system has nodes to compete with each other to make sure everyone is in check. 

 

In Conclusion

 

Money itself is a monopoly idea. To be able to operate without moral hazard, such currency should embed with competition to spread out its power. 


Photo by Alexander Popov on Unsplash
Note: the post was shared on multiple platforms here.

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Disclosure: The article was written by a delusional author who is possibly a nut job without any questions whatsoever about expertise in the subject matters. You should not believe any words this author wrote or you may experience similar symptoms or even possibly become a nut job.

 

 

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