| The fixed supply / deflationary nature is actually less important than the method of minting. PoW demands massive energy & computational input, which can spontaneously arise without any human regulating authority. In other words, physics / the laws of nature are the authority. This creates an implicit resilience in the network and elevates the standard of money creation to go beyond human authority, and enter something higher. I see PoW systems as mechanisms to quantify human technological development and mastery over energy. As access to energy & computing increases, the implicit value of crypto increases in kind. It is a crystallization of energy into value, and a rather "pure" one at that. As people sit here and talk, debate, buy into propaganda by dying platforms, this value crystallization marches on. It cannot be stopped. Because of the limited supply, it motivates people who see and understand these facts to buy in, but even when "easy" access to the crystallization ceases, it still promotes 2nd tier energy to value capture via transaction fees, which also scale with energy & computation. People get confused and think it is imaginary money. Managing the logistics of server farms, optimizing access to cheap energy sources, and developing increasingly powerful / efficient circuits is far from imaginary. This and much more is required to compete in today's crypto mining. The crypto itself is representative of countless modern industries working in harmony, all in cutting edge industries that push humanity further. The criticisms are largely thoughtless and nonsensical. The energy is agnostic of the production; you can mine bitcoin with coal power, but you can also mine it with solar and nuclear. You can even mine it with a dyson sphere. It doesn't matter. It isn't wasted energy, insomuch as massive office buildings in the center of every city dedicated to an inefficient banking system is a waste of money, or countless lives lost over wars and access to resources is a waste of money. Anyway I could write all day about this, but I believe what I am saying strikes closer to the heart of what you were bringing up. |
You're correct, money is potential energy. A higher abstraction of energy than the physical energy we're used to, but potential energy nonetheless. Proof-of-work means that everyone must put in work of equal value to create bitcoin - the energy they put in to obtain it is stored within it - and this applies to everyone, whereas fiat allows bankers and people close to them to put in almost no work to obtain vast amounts of energy, simply because they have tricked the world into giving them a monopoly on creating it - fractional reserve is fundamentally a trick, a fraud. The more they can lend out (creating wars generates great demand for debt I hear), the faster the flow of free money into their bulging, overflowing pockets. I wonder how much they really have after centuries of this trickery? I heard someone posit that they have 93% of all the money while the rest of the world is fighting over the last 7%. That doesn't sound unrealistic to me.
Regarding bitcoin, I agree that the method of issuance (proof of work, like gold) is more important than the rate of issuance. But the rate of issuance is still extremely important - if bitcoin didn't have a capped supply, then it would be superseded by another form of itself that did, that would be a superior store of value (bitcoin's key use case currently). It's this that provides an enormous incentive for people to risk their wealth and adopt it in its current early stage and will ultimately go on to fuel it's amazing victory over the monstrously powerful and corrupt fiat system.
A creation that can do this would surely be one of the most important in the history of mankind.