Don’t Complicate It

Bitcoin doesn't need to be complicated, it's money

Author

Tristan Hillerich
July 27, 2024

Industry terminology and jargon are common no matter what profession you are in. People in sales know different aspects and speak with different vocabularies than people in finance or marketing. The world of medicine and pharmaceuticals is a world filled with labels and terminologies almost no person understands unless they are a trained specialist. People skilled in a trade know the intricate details for the mechanical aspects of what they are working on while someone not well-versed wouldn’t even be able to describe one aspect of what they do.

There is no denying that the crypto industry and specifically, the Bitcoin industry, has a niche following today. Understanding this point is key to facilitating further interest and involvement from people who don’t know anything about this sector. Yet, too many people when asked to explain Bitcoin struggle to realize this point and instead may jump to highly-specialized topics instead of sticking to the basics.

When a family member or friend comes to you with the questions of:

  • “What is the purpose of Bitcoin?”

  • “Why does Bitcoin exist?

  • “What makes Bitcoin different”

It is an absolute disservice to get bogged down with industry jargon and specialized topics. There is no immediate need to talk about Layer 2 solutions, smart contracts, the nuances of decentralized finance, seed phrases, or any other “rabbit hole” worthy, industry-specific topic. The only reasonable and serviceable answer to these questions is to address the root issue of these conversations:

Defining what money is and consequently, what Bitcoin is—a currency.

Hardly anyone has ever sat down to define what money is and hardly anybody truly understands money.

People understand that we use the dollar to pay for things but beyond that, I believe many people have never discussed things like:

  • Why the dollar has value.

  • What backs the dollar.

  • Where dollars come from.

  • Why do we use the dollar.

Yet, people accept the dollar as money with no moral issues. By sitting down to answer questions like these, you can begin to understand what money actually is and where the value it has comes from. You can also begin to understand why currencies lose purchasing power at the hands of inflation.

I will save extensive discussions of monetary issues such as inflation, hyperinflation, fiat currencies, quantitative easing, and the Fed for later but will circle back to a point I have made previously in “It Just Works.” It is unnecessary for many to understand the “how” behind Bitcoin because of how well it performs its “what.”

The “what” is simple.

Bitcoin is made to be money, a better form of currency than what anyone in the world has seen or used up to this point. By definition, Bitcoin is money. The purpose of Bitcoin is to create the most sound form of currency ever that can bring everyone in the world a stable currency to use.

The underlying reason for Bitcoin being the best form of currency ever is that it has an absolute fixed scarcity of 21 million that can never be changed. There is no government official, no federal reserve, and no entity at all that can suddenly decide to print more supply into the system unfairly. Every technological and niche sub-topic besides this is icing on the cake that 95% of the world’s population does not need to understand to ultimately understand what Bitcoin is.

The premier aspect of Bitcoin resides in this specific fact of scarcity.

“If the supply of bitcoin remains fixed at 21 million, more people will demand it, and its purchasing power will increase. Nothing about the complexity under the hood will prevent adoption. Most participants in the dollar economy (even the most sophisticated) have no practical understanding of the dollar system at a technical level. The dollar system is not only far more complex than bitcoin. It is far less transparent. Similar degrees of complexity and many of the same primitives that exist in bitcoin underlie an iPhone. Yet, individuals manage to use the iPhone successfully without understanding how it works at a technical level. The same is true of bitcoin. The innovation in bitcoin is that it achieved finite digital scarcity while being easy to divide and transfer. Twenty-one million bitcoin, period. Compare this to $2.5 trillion new dollars created by one central bank in just two months. Bitcoin’s fixed supply is the only common-sense feature anyone really needs to know.”

Parker Lewis in “Gradually, Then Suddenly”

Bitcoin is money.

Bitcoin is the most sound form of money ever created.

Through this lens, Bitcoin is inherently simple.

Don’t overcomplicate what Bitcoin is.

Your grandma, your neighbor, and the next billion people who opt into a Bitcoin system don’t need to understand any underlying technological features of Bitcoin besides that.

Stack SATs.


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