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I remember the first time I saw it. It was $10. How can a digital coin be worth anything if I can make a million copies?
10/12/17
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One year later I noticed it again; it was $100. Maybe I should do some reading...
10/12/17
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I remember reading the #bitcoin whitepaper, today, the most famous whitepaper in the world. http://nakamotoinstitute.org/bitcoin/
10/12/17
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People sometimes joke their "minds are blown", but it's a rare thing when it actually happens.
10/12/17
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It’s the feeling you get when your conception of the world snaps into an irreversibly new configuration.
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Like an unfolding chessboard or like stumbling out of a famous cave.
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I understood: the world would never be the same. #bitcoin was a harbinger of the impending reorganization of our civilization.
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I’ve seen it written that people never realize when they’re living through great periods of change.
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That someday, readers of history will point back at them and say, if only they had known what was in store for the world.
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But none of the great paradigm changes of history ever involved the internet.
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Today humans are living through a paradigm change as members of a global hivemind, and of course, the hivemind IS the paradigm change.
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We are conscious of the turning of the Wheel.
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If the internet is our civilization’s brain, then #bitcoin is its heart because bitcoin measures that which we desire.
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Internet is the globalization and disintermediation of communication networks, #bitcoin is the globalization and disintermediation of money.
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My first realization was that bitcoin was not a “coin” at all. It was simply a ledger of accounts. Names with numbers next to them.
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Just like the ledger your bank holds. Alice: $100. Bob: $50.
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As with your digital dollars, when you send bitcoin you are really sending a message that says: "update your account".
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Alice send $5 to Bob. Alice: $95. Bob: $55.
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The truth about money is that once you have this ledger you don’t need the “coin”.
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You can see this is true by emptying your pockets of the cash you have and then compare that to the amount of money in your bank account.
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Money has never been about the sea shells, silver, gold, or paper. Those were just measuring tools.
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Money has always been about information. Information about how much Value we were storing and sending.
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Everything we’ve ever used as money was a proxy for stored and transmitted Value measured in the most convenient way available at that time.
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The paper dollar is a measuring tool. The paper you hold informs others about the amount of Value you hold (denominated in that paper).
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The moment we had a trusted place to digitally record that information we no longer needed the paper.
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As soon as we had a digital way to “send” the Value, ie. update the information, we stopped trading the paper. It’s just not as convenient.
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Trust. Until #bitcoin it’s not something I every really thought about too much.
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It seems so abstract. But this abstract concept is the scaffolding on which our civilization is draped.
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It’s the reason we pay taxes, the reason we have a military, the reason we have banks.
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Just so we can be sure that the cheap paper in our wallets, or the ephemeral numbers in our bank accounts, represent something of value.
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That they're something that can be used to trade for food to eat, or a car to drive to work.
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Without collective trust in institutions, the paper is just paper, the numbers are just numbers. No one would trade food for them, or a car.
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When we receive this paper we trust that someone in the future will take it from us or that we will pay taxes with it.
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Imagine trying to keep an online record of the amount of Value we possessed without relying on a bank?
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I would post how many dollars I had. You would post how much you had. I would message you “I am sending you $5” and update my records.
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How do you know I didn’t message anyone else at that same moment? How do you know I didn’t double spend?
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What stops me from just giving myself an extra $10? Money is just information after all!
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Anyone can synthesize information out of thin air. It is infinitely available, which means it is worthless. How can you trust me?
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These are the two main challenges of running a digital ledger of account, aka digital money.
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How to enforce the scarcity of infinitely available information, and how to prevent people from being able to double spend their Value.
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That’s why we need the bank, who we all have to trust.
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So that we can know that the numbers in our bank accounts actually mean something, that they aren’t created out of thin air.
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Without that trust, trade and progress will halt.
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Reading the whitepaper I understood that Satoshi, whoever s/he is, had figured out how to keep a digital ledger without relying on a bank.
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S/he had solved the double spend problem. S/he had solved the digital scarcity problem.
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Bitcoin lets me message “I am sending you 5 bitcoin” and for you to be sure the bitcoin wasnt created out of thin air or sent to anyone else
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It does it without relying on a bank, a government, or any other institution. It relies on me and you running open source software.
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For the first time in history, you and I can have our own money without relying on or trusting anyone else, not even each other.
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Given enough participants in our network, we can be sure that no one can stop or alter our transactions or find out who we are.
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That is the "inherent" value of #bitcoin: the uncensorable freedom to instantly store & send Value anywhere in the world.
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In the process, #bitcoin removes the raison d’etre of much of the banking and legal architecture that exists in every country in the world.
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This means that fundamental institutions must be transformed to provide a service other than the establishment of Trust at gunpoint.
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Nothing like it has been possible until now. The world has irreversibly changed.
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What it will look like going forward is difficult to predict. But this is just the beginning.
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