Trigger Phrase: Store of Value
Have you heard that Bitcoin is a store of value?
I think Bitcoin is a store of value.
What is it a store of again?
Value.
Seriously, this marketing trigger is almost as bad as the word 'disruptive'. Yeah, we get it, everything is going to disrupt everything. Message received.
The truth is: Bitcoin is actually not a store of value. Well, it is, but it isn't. The context that the term 'store of value' is used in is often incorrect.
When you hear someone say the term 'store of value' what are they usually referring to? Sometimes it is in reference to Bitcoin being Gold 2.0. Bitcoin is a store of value. Gold is a store of value. It all makes sense.
However, my experience with this phrase is that it is used to describe why Bitcoin will remain relevant in the face of other superior cryptocurrencies.
It's a store of value, because it stores value, and the value that it stores has value because that value is being stored. This circular logic is the actual legal definition of begging the question.
You can't claim that the reason Bitcoin will stay relevant in the face of other cryptocurrencies is due to its store of value. Every cryptocurrency has its own rules for inflation. Every cryptocurrency is controlled by a much bigger and more trustworthy group than fiat. Every cryptocurrency is a store of value. Bitcoin is not special in this regard.
Bitcoin is a flip phone, fiat is a desktop calculator, and smart contracts are smartphones. Why would anyone care about a flip phone once killer apps on smartphones are unleashed?
Bitcoin is The Anchor!
Ironically, the reason we should trust Bitcoin is also the reason why we shouldn't be that excited about it.Bitcoin isn't going to evolve.
Bitcoin is consistent.
Bitcoin is boring.
This space is evolving so fast that the Bitcoin community already consists of a bunch of dinosaurs. Which, don't get me wrong, is a good thing. We need an anchor on our ship. The seas of time we travel on are pure unpredictable chaos. The anchor provides security. We wouldn't want to get swept away.
It is very hard to change Bitcoin. The community doesn't want change. They want consistency and trust. Soon™, with the advent of ETFs and mainstream adoption, Bitcoin will be the go-to coin for people who really have no idea what's going on. The value of Bitcoin will increase, and the real risk-takers will leave Bitcoin and move on to the platforms that have a higher chance of reward. For the first time ever, with this new cooperative capitalistic open-source system, we are going to see Trickle-Down theory actually do what it promised to in the first place.
In ten years, we aren't going to need stable-coins anymore. Bitcoin will be the stable-coin. However, instead of being pegged to shitty fiat it's value will slowly rise over time with little variance. Mark my words. It will happen.
The value of Bitcoin will rise with the value of new technology and production methods. This will allow anyone in the world to 'store their value' in the form of a currency that can be spent worldwide. Decentralized production methods like 3D-printing will, in turn, allow a more decentralized economy, but I'm getting grossly off-topic here.
False inflation argument.
I've heard people make this false claim many times. They think that Bitcoin has more value because it's hard capped at 21 million coins. The idea here is that this scarcity gives it more value than say a platform like Steem.
Well, first of all, Bitcoin inflation is not capped. None of us are going to live to see the day that Bitcoin inflation ends. On top of that fact, nothing is stopping the Bitcoin community from hardforking in 2140 to continue inflation production. This, of course, assumes Bitcoin will be around in a hundred and twenty years. Which of course it won't, unless it's simply kept around as an antique collectors item.
Think about how far we've come in the last 120 years. Cars were just invented and electricity was only recently discovered. To assume that Bitcoin will be around in 120 years is laughable.
Inflation is bad?
If Steem didn't have inflation our upvotes wouldn't be worth anything. Therefore, a cap on inflation would actually kill our entire platform. Assuming inflation is automatically flawed is a great fallacy. We are conditioned this think inflation is bad because central banks have been raping the world for the last hundred years. Inflation isn't a bad thing; the bankers are.
Without inflation, you have a stagnant economy that is almost guaranteed to become more centralized as more and more users figure out ways to game the system and consolidate wealth.
The entire point of crytocurrency is to provide an intelligent system of distributing inflation. The smarter the system, the more decentralized and trustworthy it will become. I maintain that POW, POS, and DPOS are a primitive start. The proofs of the future will usher in ultimate blockchains that put everything we see today to shame.
Random Number Generator
Random rng = new Random(Bitcoin)
As you may or may not be aware, I'm creating a lottery on Steem. Bitcoin (and every other POW coin) uses cryptographic hashing to mine blocks in a lottery. The hashes that get posted to the blockchain are basically unhackable winning lottery tickets. It takes 4,700,000,000,000,000,000,000 (4.7 sextillion) Bitcoin lottery tickets to create one winning ticket. From this perspective, it's not hard to see why the random hash on winning Bitcoin blocks is completely unhackable.
I'm going to extend this concept further and start a side lottery right here on Steem, but based on the trust of Bitcoin. Whoever guesses closest to the winning Bitcoin lottery ticket (hash) will win the Steem lottery that I'm going to create.
The point here is that blockchains are going to start being used for purposes other than their original intention. This innovation will create massive value in the space. Every POW coin is creating unhackable random numbers, and literally no one in the world is really using that fact to their advantage in other applications. I mean to change that. I want to start a new trend of block-based gaming.
Competitive Corporation Fallacy.
This is another big misunderstanding in the space. Crypto enthusiasts assume Bitcoin is like a business. Like Amazon or Google, the Bitcoin Corporation will smite down the other blockchains and reign supreme over them.
This is not how blockchain works. Blockchain is a system of cooperative open-source collaboration. For this same reason, the blockchain comparison to the Dot Com Bubble is also a huge fallacy that almost everyone believes in.
This is understandable because we've only known cut-throat capitalism our entire lives. Our brains are not wired to understand this new paradigm.
Corporations are immortal. Corporations are undead parasites, and they are sucking our lifeforce away in order to live forever.
https://steemit.com/ungrip/@wwf/the-real-zombie-apocalypse
https://steemit.com/satire/@citizenzero/the-zombie-apocalypse-it-s-happening-now
The blockchain is here to end the cycle of exploitation. Blockchains are not immortal, they will not harm us; they are here to empower us against these oppressive enemies. Still, they have a lifespan, and they will die just like the rest of us. This is good for evolution; a necessary evil; one that we continually rage against despite the damage caused. The fear of death often persuades us to take wrong action. That fear is used against us.
DUNE: LITANY AGAINST FEAR
DUNE: LITANY AGAINST FEARFear is the mind-killer.
Fear is the little-death that brings total obliteration.
I will face my fear.
I will permit it to pass over me and through me.
And when it has gone past I will turn the inner eye to see its path.
Where the fear has gone there will be nothing.
Only I will remain.
The war is starting to get heated. Already we see those vampires trying to recruit Bitcoin into the ranks of the undead. Can the flagship stay strong in the face of death? Only time will tell.
Conclusion
The next time you hear someone use the phrase 'store of value' remember that the term is a wildly overused marketing manipulation tactic at this point. It is a gross oversimplification that glosses over the many nuances of the cryptosphere. It would be much more accurate to call the space a store of trust over a store of value. Still, it is impossible to compare two blockchains against each other by saying one is a store of value and the other isn't. Value is subjective.
The Flippening will happen much sooner than most think. Bitcoin's days as the number one coin are coming to an end within 5 years. My guess would be 2 or 3.
The anchor of this ship will not always be its most valuable asset. It is simply a way to give the general public the security they desire to overcome the fear they face in climbing aboard this vessel of hope. This is the true asset that The Blockchain has to offer in a world of deceit: trust. Value is secondary.
Whether or not some other coin will dethrone Bitcoin will depend on its immediate utility and usability and not on possible use cases or technological superiority. Until smart contracts become practical to use for both common people to use, common people to trust, and scale to the demands of common people, I don't see anything coming "sustainably" close to Bitcoin in the next ten years.
Bitcoin has probably the most secure network that relies on little trust on governance and the exterior community. This makes the base protocol layer extremely resistant to change (which can be seen as a good or bad thing). But there are tons of blockchain developers working on scalable solutions to both money transactions and introducing smart contract capabilities onto the Bitcoin network.
Perhaps, Bitcoin doesn't need to be the blockchain that doesn't everything. But rather Bitcoin provides a less variable slow changing layer one foundation for other sidechains, blockchains, and protocols to build from. Being a source of secure randomness is a benefit that you mention that can be applied in lots of ways that are useful.
Other blockchains have risen up due to weaknesses in Bitcoin's protocol. I only wonder which side of development will win out? Those building on top of Bitcoin to fix its weaknesses, or those starting from scratch that solve these issues while compromising in other areas like security, centralization, etc.
Couldn't agree more.
It's not worth sacrificing the trust of Bitcoin unless the application is killer.
I ironically speculate that the days of speculation will be over soon™.
I highly doubt that Bitcoin can keep up with other blockchains due to its
I guess we'll see.
I don't think Bitcoin needs to keep up with other blockchains necessarily. Moreso, I think the more important question is whether or not the Bitcoin stack (with BTC at the bottom) will compete with any other blockchain stack.
I think Ethereum was the first real coin that hinted towards this idea, but it is also dealing with scalability issues that it needs to solve by expanding and building out its stack. But I pretty sure Ethereum's scaling approach involves changing the base protocol layer which may be harder in the long run and risks potential danger in hard forks. I think a newer smart contract platform may surpass Ethereum before it passes (if it passes) Bitcoin.
I think development in protocol stacks is a safer method as it avoids hard forking in general. I mean we've seen the harm that sloppy forks can cause. Luckily we haven't seen a breaking bug. But hey, like you've said, we'll see what happens.
Sharding definitely feels like a change to the base protocol level. Seems like it's sacrificing decentralization. Plasma might be a little better in that regard with the whole side-chain concept... I assume it's basically the Lightning Network of Ethereum.
Like you said though... it's mostly about the demand of the dapps on the chain. No one is exactly clamoring to use any dapp in existence right now.
In January 2017 Bitcoin was worth 22 times more than Ethereum. Today Bitcoin is worth 5 times more, and that gap has been as small as x2. It might only take one more bull run to flip it, and when it flips it's going to flip hard because of all the bandwagon jumpers.
Ripple might even be the coin to flip it... which would be horrifying... lol.
Stacking silver and harvesting some good old #MENE gold!
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