Value in the digital economy

An unexplored and still barren wasteland is unappealing to all but the adventurer. Any wild frontier is rife with both danger and opportunity.

Today, this wild frontier is all around us and encompasses every continent of this previously unknown planet. Economic processes have become global and produced unprecedented wealth for some as well as abject poverty for others. No matter which side of this development you currently find yourself on, you must know that this is only the beginning as change remains our only constant.

The dawn of the internet has created a new culture that brings together billions of people who unleash humanity's greatest and most terrible powers like never before. This global gathering of Netizens is divided by geographical region, language and wealth but united in purposes found across the digital space. People all over the world are looking for the same information, entertainment, work and countless other things across the internet every day.

This creates shared goals and incentives for cooperation. If you scam people, you may profit once but if you give and receive what both sides consider fair value, you can build sustainable business where there was nothing but wild frontier before. As everyone here knows, Cryptocurrency  is an example of both the great potential and the great perils of the digital era and has, by now, become an example of real world value.


How real is value? Why Bitcoin has already won.

The current market for Crypto is not challenging the traditional model of finance by a long shot. Fiat currency is more useful for almost every possible application. The value of daily necessities like food and shelter are expected to be pain in Fiat and the value of such essential goods is clear to anyone who needed toilet paper in a 2020 supermarket. There is ,however, a thing that Fiat currency cannot buy. It cannot buy the decoupled and global approach to value exchange that Crypto delivers. If Crypto ever became as viable for everyday transactions as Fiat currency, conflict would be inevitable and results chaotic. While by definition impossible to control for authorities, Crypto would surely lose the mass appeal needed to sustain its newfound role as a dominant form of value exchange. It is likely that central banks will offer more digital and easy to use versions of their Fiat currencies to avoid chaotic confrontation, too. Crypto will, however, continue to be an expression of global Netizen culture. As we place more value in our digital life, we see that every transaction in the ledger of the blockchain added to it. Every step along this road helped create a new identity and a new perception of value.

Bitcoin has therefore already won. It will never require practical application. Its simple existence as the first household name in Crypto is enough to make it infinitely valuable. When the last Bitcoin will be mined in the 22nd century, owning a single Satoshi of it can very well be worth 1 unit of the Fiat currency that is in daily use. Bitcoin today is already fungible. It can, like gold in the Fiat economy, be exchanged for other currencies to suit daily needs.

Most of all, however, it is a way to partake in one of the greatest technological revolutions in history. Bitcoin's value is all about cultural perception and limited supply. Unlike gold, whose existence as a pretty looking element across the universe is assured by the natural world around is, Bitcoin requires a constant cultural effort to exist. This can make it the most valuable storage of wealth in the coming century. There will be countless lost wallets, failing exchanges and whatnot that will decrease the supply of Bitcoin. Bitcoin is one of humanity's constant attempts to create something of ephemeral value.

Whether you go and mine physical metals, provide services to others or let your computer run protocols to generate Crypto, the value of your actions and products only exists through the perception of others and their willingness to give something in exchange. Bitcoin's potential for generating value therefore increases infinitely for as long as an effort is made to sustain its existence that. Bitcoin's existence mirrors humanity's efforts to create a digital global economy. In a future cashless society where every IoT toaster participates in the newest Crypto network that has all sorts of smart applications that long made many parts of traditional finance obsolete, Bitcoin will still shine as the monolithic blockchain that stood at the beginning. Just as Gold is a lasting testament to nature's power, Bitcoin is a testament to human ingenuity and the spirit to create a better world.

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Has Crypto won? An outlook on the 22nd century.
Has Crypto won? An outlook on the 22nd century.

The value of any asset is ultimately 0. In time, all companies go out of business and even the precious metals that humanity has considered valuable will be rendered irrelevant when there are no more people left to engage in trade. Trade is the exchange of perceived value by two parties. Despite understanding that nothing can last, humanity is constantly occupied with exchanges of value since the economics of the near future will determine much of the life ahead of us. Time to explore future scenarios!

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