By Jaffer Ali
Bitcoin represents the 4th new industry I lived thru and participated in:
- Home Video
- Infomercial
- Internet/ecommerce
- Bitcoin
In each industry, it took a LOT of deconstructing of new narratives and ultimately study. In creating businesses in each of those industries,.(making and losing a lot of money in each), I learned by theory merging with practice.
The Bitcoin industry is filled with both pro and anti crowds.who really do not understand Bitcoin. Some former anti Bitcoiners like Larry Fink (CEO of Blackrock).have switched sides and some formerly pro Bitcoiners have switched.
Interestingly, the home video industry first spread due to porn.and the major studios sued SONY for making VCRs that only “had one purpose,.criminal uses for spreading porn and violating copyright”. Obviously major studios switched sides and eventually made BILLIONS selling movies,.concerts, exercise videos, etc.
Similarly, one rapidly eroding critique of BTC was made succinctly.made by Larry Fink saying BTC was only good for money laundering. Also economist Jim Rickards chimed in that BTC was only good for *terrorists* like those in Gaza.
Fink switched sides with substantial investments.in BTC mining operations and Rickards has moved on. to just hawk his course on inoculating the unwashed.from the looming economic disaster. BTC critic and economist Steve Hanke has lost the script on the theory.of value and embraces long discarded theories of.“intrinsic value” (which is a term that any shopkeeper knows is a BS concept).
But pro Bitcoiners are just as confused and contribute to the fog of a new industry. Some will promote silly use cases. One of the silliest was that BTC is a great CURRENCY. These folks are not merchants or understand the difference between “money” and “currency”.
Some pro Bitcoiners will invoke the “Network Effect” and really do not understand that without increased utility (like used as a currency), there is not exponential increase in value. It is worthwhile to note that 74% of all mined BTC has been pulled off the network and held in cold storage.
The above confusion stems from a lack of understanding of what Bitcoin actually is. Many people confuse the digital commodity with the technology that is required to create that commodity.
When I write or tweet about BTC, I am trying to help craft the language for this new industry. The anti Bitcoiners are slowly marginalizing themselves. But the pro-Bitcoiners often are lost in a sea of metaphors. Michael Saylor is struggling with his metaphor du jour, but he is trying to find the right language.
He is just too in love with his own cleverness and overly complicates the Bitcoin thesis. In each of the 4 industries I outlined, the patterns were the same. Techno nerds complicated the narratives. If you go back and read people talking about the Internet in 1996, you would be lost. Today, few know or care about HOW the Internet works.
Anti Bitcoiners have plenty of fodder slapping down pro Bitcoin narratives that are dated and filled with jargon. Again, I do not spend much time debating anti Bitcoiners because they are generally lost, just like those who rejected the other industries mentioned.
Anti Bitcoiners do not have a coherent view on value and both sides confuse ATTRIBUTES OF VALUE WITH VALUE. But to devolve into a complex and academic discussion on the theory of value will not move the BTC industry forward.
To end this missive, let me leave you with the simple Bitcoin proposition: Bitcoin is a digital commodity that has a fixed supply but with an uncertain future demand. There are several attributes that appeal to different constituencies that COULD increase demand over time.
If future demand increases, the price of this innovative commodity will increase. While BOTH anti-Bitcoiners and pro-Bitcoiners cannot predict the future demand, each owner or potential owner must handicap the risks and the potential reward of different demand curves.
Demand COULD collapse and it COULD exponentially increase. But one anti Bitcoin observation is ACTUALLY A POSITIVE: “Bitcoiners are like a cult”. And when you understand that 86% of Bitcoiners held onto their coins when the price moved from $17,000 to $3,000, these people, like a religious cult are true believers and just might form a solid foundation for the future of this commodity. This BTC cult is part of my handicapping the potential of the BTC price moving 10X higher.
This essay was first published by Jaffer on Twitter and has been under permission by the author translated into Vietnamese by the team of BitcoinVN News.
Jaffer Ali is the CEO & Founder of PulseTV – and an entrepreneur by heart with decades long experience of risk-taking and risk-managing in the real world.
