Shift From Traditional System to Bitcoin Standard

Bitcoin is a word that has been around for a long time now. We might have heard some person earning a fortune in it, or someone still trying to figure out what it is. Is it like the stock market? What is this whole fad about? What it actually is that it’s a system of exchange for the future, learning from the past systems. It is not just an option of investment but the future of exchange lies in it.

A Shift from Barter System to Banks

In the book The Bitcoin Standard, the author Saifedean Ammous tries to paint that picture, traveling from the barter system of the past markets to our current systems of banks and the government-backed currencies.

The book questions if we are actually satisfied and doing well in the current exchange system. We have had many recessions since this system was adopted and the government intervention in this structure has only added to poorly adopted policies, then it may be the Keynesian theory of increasing spending to move out of recession, turning people indebted or the lack of knowledge people has about the market as no single person, agency or department ever has access to all the information necessary to understand the vast and constantly changing web of preferences, choices, costs, and resources that define an economy.

Bitcoin Standard—Wiser than the Rest

With the weight of the failures of the barter system, the Gold Standard and Bretton Woods, the author in The Bitcoin Standard bring out the realization that we stand on a crossroad, and theBitcoin Standard is the bright future we should walk towards.

The bitcoin standard counters all the failures of the previous systems like constant inflation, deflation, government interferences and provides the best knowledge and security any system could offer. The blockchain adding to one of the major takeaways. 

Bitcoin is unique in its scarcity, hence it avoids leaving value for years to come, and even if it does increase in number it goes through a series of complex equations which will take years to solve.

The other problem of security with solid money like Gold and Bitcoin is its security, no question. Again the technology of blockchain counters each on every point. Each block is added to a chain of prior blocks, establishing the Bitcoin blockchain. This ledger stores every last information about every blockchain transaction ever executed. Bitcoin ownership is only legitimate until it has been registered on the blockchain, which is only conceivable with the permission of a majority of network users.

This makes the system fully self-sustaining, safe and of tremendous value for the future.

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Demerits of Bitcoin Standard

Though we face many challenges to this system, as the author points out the digital currency will have to overcome some teething problems.

First being the price volatility because it’s new and the second major being that it would eventually depend on the increasing reliance on large, centralized institutions. That’s an issue when a currency is designed to give people an exchange system that doesn’t rely on government-approved third parties like banks.

Hence, we do stand on a crossroad and the book, The Bitcoin Standard, gives all the perspectives to make a decision on that crossroad, if not decision nut at least builds an opinion about the exchange system which affects each and every one of us.