Posted: Mon, February 04, 2013 | By: Special Guest
by Brandon King
Money, like government and religion, once had its purpose and was useful for society. But today money - like government and religion - is increasingly obsolete and it’s becoming a detriment to society and the progress of Human V1.0.
Once upon a time, money was what fueled innovation and progress and led to the world we live in today, but time and time again now, when we’re faced with new technologies that could prevent damage to the environment, help raise the standard of living for humans, or just help move our society closer to a Level 1 society on the Kardeshev Scale… inevitably, people with power, influence, and money do everything they can to ensure those technologies never make it to the market, or they use regulations and smear campaigns to ensure they stay in a fringe market.
Let’s talk about a well-known example of this: fossil fuels. We should obviously move to alternative energy sources which are environmentally friendly and renewable. But, are we? No, the oil barons fight tooth and nail to remain in power and keep their money.
My father argues that fossil fuels are renewable, and that does have some truth to it, but it’s not renewable enough to be sustainable. So much money is in the hands of so few people that any attempt to spread it out through use of the free market and capitalism is just shot down by the powers that be. Losing their money is the last thing the oil barons want to have happen, so they stall progress and innovation as much as possible.
Now, how does Bitcoins enter the equation? Bitcoins are a decentralized crypto-currency created by Satoshi Nakamoto in 2009, when he created the “Genesis Block” in the Block Chain. Bitcoins work like this - whenever a transaction is made with Bitcoins, it creates a block of hash data, and miners use their GPUs (formerly CPUs until the math got too hard for the CPUs to handle it) to solve increasingly complex mathematical algorithms to “mine” the block. The complexity is determined by the amount of people using Bitcoins.
Mathematical algorithms confirm the transaction did in fact happen utilizing real Bitcoins; if counterfeits were used the math wouldn’t add up and the system would reject the transaction. When a block is mined and transactions are confirmed, 25 Bitcoins are released into the Bitconomy. (It was previously 50, but every four years the amount released is cut in half.)
Bitcoin’s value goes down 8 places past the decimal, as compared with most money that goes down only a mere 2 places past the decimal - this means Bitcoins can be cut in half enormously.
The system is designed to only generate 21 million Bitcoins… to prevent mass inflation - this is what Pre-Nazi Germany went through. Using Austrian Economics, the more people that use Bitcoins, the more the value rises, but because there’s only a limited amount in circulation, smaller and smaller increments will be used to make Bitcoins naturally deflationary.
The only way the Bitcoin value can inflate is if no one uses it. The money we use right now can inflate no matter how many people use it.
Like any drug, you can’t just stop using it, you must wean it off. It is Bitcoin’s naturally deflationary properties that I see having the potential to wean us off our money addiction. It is evident that centralized monetary systems are on the verge of total collapse globally, the unsustainable debts that every government, and indeed most people, are in, is evidence of this.
The present monetary system is simply too unsustainable in our increasingly globalized society. With its decentralized and peer-run nature, Bitcoins may be one of the only currencies, if not the only, to survive. With many people running to Bitcoins to feed their addiction, the value will drastically rise and will make smaller and smaller increments more valuable.
Over time the value of the Bitcoins will continue to deflate as our technology continues to advance exponentially until we ease into a Resource-Based economy of abundance when we will discard money completely and are cured of our addiction plagued society. Removing money and emphasizing compassion and love towards our fellow humans is how we can cast off our shackles of tradition and rekindle the innovation and progress that made America a superpower, but on a global scale.