I want to honor that there are many who would and do disagree with my perspective here. I also want to honor that my perspective is well-informed and based on my decades of experience with technology and investments. With that in mind…
Bitcoin has all the money properties of gold including being superior to gold in each of those ways… except that it does not have gold’s 6000 year history as a store of value and money. This whitepaper by Fidelity goes over that:
bitcoin-first.pdf (1.6 MB)
My perspective is this: bitcoin is in a class and category of its own. It’s open source. It’s free to participate. No one has any more “say” within the bitcoin network just because they have more bitcoin. Work is involved. It’s decentralized. We trust the math and the code and the protocol – NOT “powerful” people. It aligns incentives for everyone involved, across the planet, without regard to status or any of the identities people seem to focus on. It’s proven useful. It’s proven resilient. The network is 24/7, producing block after block after block for over a decade with no downtime. You can even run your own FULL bitcoin node (and 30,000+ people do) on a $300 computer from your home to help validate and provide resilience to the network (I don’t yet, but I will someday).
Like the internet, bitcoin is engineered to survive attacks. Very key point. The internet can be attacked. It is attacked every day, every microsecond in fact! yet it endures and is, honestly, surprisingly reliable and robust. Bitcoin’s core principles are simplicity and security – which go together.
I believe it is useful to consider at this time that ALL other cryptocurrencies are investments in projects with an intention to earn a profit… not as “money.”
If you start engaging with people who are passionate about bitcoin, you will hear from some the term shitcoins used to apply to anything other than bitcoin. Why? Because cryptos often proclaim themselves “better than bitcoin” while making significant tradeoffs (and not disclosing them) or glossing over their importance. Also, with 1000+ coins out there, some are absolute scams. Others have their initial value “pumped” by promoters so insiders can “dump” them before the value craters.
Early in any new technology’s life cycle, there is speculation. Speculation (and both the optimism and often greed that can drive it) is not inherently bad. But it IS why I left the space back in 2018. The speculation was buffeting me and making me lose my balance, honestly. I didn’t have enough grounding in the difference between bitcoin (which I energetically found attractive) and all the other initial cone offerings (ICOs) that were flooding the market and distracting most people.
Today, there are some real projects out there. Ethereum is a real project, and there are a lot of people building on it today. Other Ethereum competitors are out there, too. What I can tell you about Ethereum is that there is a massive technological risk there that I can see clearly and most others are glossing over. They have been promising things for many years that have not come to fruition and it has all the red flags of a technology transition that “may fail” – whether gracefully or catastrophically.
Of course, Tesla was at that same place between the release of their Model S before the Model 3 was released and in mass production to much acclaim. But there IS a difference between “money” and “investment” – even though I believe we’ve been FORCED into making investments when what many want for their “money” is long-term holding of value. Meaning, if I work for a day and store the fruits of that labor, can I come back in 4 years or 40 years and get BACK a “day’s worth.”
I like some of the projects for what they might do over time. But my own personal nature is to RARELY be speculative – and only around things where the energy is something I really and truly want to boost and it’s okay if it goes to zero – because the project matters. I invested in Tesla AFTER the Model 3. I started moving energy into bitcoin for the Family Freedom Fund only after companies like Tesla started holding bitcoin on their balance sheet.
Yes, earlier gives more room for spectacular “returns.” I’ve just been burned in a prior part of my life chasing that, so today I look for technologies that are solid and look like they are highly likely to “cross the chasm” to widespread adoption. Tesla electric cars (and more), Yes. I say bitcoin YES, too. And this is where discernment and clarity really matter for each of us individually.