This lack of divisibility in most goods and services posed a problem, especially for those with only one goat or cow to spare. Therefore, humans had to invent a way to track what belonged to whom. Be it cows or goats, haircuts, pots, or spears. Enter the ledger. A ledger is a book or collection of accounts in which humans record transactions. Historical findings point to ledgers as the first type of writings with numbers that humans ever produced. These ledgers enabled early societies to track who owned what and owed what to whom. The earliest known ledgers are pictographic tablets. The Mesopotamians used them over 5000 years ago. @Knut Svanholm ∞/21M

Abundance in money = Scarcity in everything else, and conversely, Scarcity in money = Abundance everywhere else. Or as Knut so eloquently describes… Everything divided by 21 million. @Knut Svanholm ∞/21M

Individually, our thoughts and actions form our own reality, and collectively they roll up and form our shared reality. From our narrow view of what we consider an accurate representation of the world, we fail to see that others live in a completely different reality that they also deem accurate. We can easily see in others where their ideas may be holding them back, but we completely fail to see the same thing in ourselves. @Knut Svanholm ∞/21M

The Bitcoin Paradox It is now possible to explain the paradox of Bitcoin and the reasons that it has often been analyzed inadequately by Austrians. In order to analyze bitcoins properly, it is necessary to use only the cold, hard logic of the regression theorem rather than let ones love of gold interfere. The Bitcoin paradox is that bitcoins appear to have no use other than as a medium of exchange. Its technological features, though elegant, are barren as long as there is nothing that bitcoins can buy. Thus, it would appear to be a violation of the regression theorem if bitcoins were to become a medium of exchange. There are two fallacies inherent in the statement of this apparent paradox. The first is an argument from lack of imagination. Just because the nature of bitcoins’ original value is unclear does not mean that there isn’t one. The second is a violation of subjectivism, which is fundamental to Austrian methodology. The economist need not demand to understand the reasons why people value anything—demand is proven by the fact that something has a price, not by the fact that the economist understands why people pay for it. I don’t deny that a lottery ticket is an economic good even though I can’t understand why anyone would buy them. Bitcoins are known to be a medium of exchange today. This proves that the regression theorem must apply to them even if it is hard to understand the original demand.[3]] It is also empirically known that they were sold for dollars before ever being used as a medium of exchange.[4] This confirms what must necessarily have been true according to the regression theorem. The correct approach should have been clear to any Austrian economist, but until recently, Austrian analyses of Bitcoin have been superficial. It is not yet generally understood among Austrians that Bitcoin is fundamentally different from both gold and fiat currencies, and therefore requires a fundamental analysis going back to first principles. This may have to be reiterated a few more times before the Austrian movement is convinced. The anti-Bitcoin Austrians are incapable of mounting a reasonable case against Bitcoin. They are convinced that something must be wrong with Bitcoin, but when they attempt to articulate it, they arrive at conclusions which are either subjective or fallacious.[5] The most common reaction is that the regression theorem implies bitcoins cannot become money or are somehow unsustainable,[6] but this conclusion misunderstands the nature of praxeology. Praxeological arguments are only capable of saying that certain causal relationships are possible or impossible. It is not possible for something in real life to violate a praxeological law, even momentarily. I believe that this reaction has to do with a misattribution of the reasons that fiat currencies (and bitcoins by analogy) are unsustainable, as compared with the reasons that gold is superior. Gold has obvious productive uses; dollars and bitcoins do not. However, gold is not stable and the dollar unstable for those reasons. Rather, the dollar is unstable because the organization issuing it is presently tampering with it. If the tampering should stop and the government should provide real evidence that it will manage the dollar responsibly, then there will be no reason to expect the dollar to be unstable after that. On the other hand, because gold has obvious and widespread productive uses, its price cannot go to zero as long as it still has these uses. The same argument cannot be made of bitcoins, but it does not follow that bitcoins’ value will go to zero or is likely to go to zero: once again, the best argument is provided by Šurda, who asks “If Bitcoin fails, what would replace it?”[7] As long as Bitcoin has uses which are impossible with any other currency and as long as it remains competitive against other currencies and payment systems, it will not entirely collapse in value. #bitcoin

Every misunderstanding of #bitcoin  can be traced back to the misapprehension that the essential functions of base-layer money are transact-ability, velocity, and privacy, rather than incorruptibility, censorship resistance, and auditability. The #bitcoin  blockchain was NOT designed to be private. In fact, a universal open ledger is the worst possible design you could think of for privacy. For privacy, physical cash is many times better than ANY blockchain-based system (Monero included - Monero, leading a digital footprint accessible to anyone, is WAY more easily traceable than physical cash), and for a blockchain-based system, privacy was always going to be a layer two + solution (ie e-cash) wherein the transaction ledger is NOT open and universally auditable. #bitcoin  was designed to be AS PRIVATE AS POSSIBLE while still being open, universally accessible, decentralized, and auditable. But that is not very private. #bitcoin  was not designed to be the currency of the Silk Road. Literally mailing cash in an envelope would have been better. The fact that it was used as such lead to a lot of this misapprehension both among government opponents of #BTC  and among the early, more privacy-focused bitcoiners. But private transactions was not the problem #bitcoin  or any blockchain was designed to solve; it is *orders of magnitude WORSE* than the existing tech: 💵. The #bitcoin  blockchain was NOT designed for high transaction throughput. Again, if you just sit down and back-of-the-envelope calculate the number of transactions per second of the current global economy (let alone one that is on a exponential growth trajectory and in which the volume of digital payments will likely increase by several orders of magnitude in the next few decades with a fully digital economy, AI compute etc.), blockchains per se simply cannot scale to any meaningful percentage of this. You can add 100x capacity to #BTC  and maybe it takes you from 0.00001% to 0.001%. It’s a worthless gesture. It can’t happen. You have to scale in layers. This was known from day one by anyone with the most basic of math skills. Layers offer the only way forward because keeping transactions off the main ledger is the ONLY way to scale by the 6+ orders of magnitude necessary for global economy. The blockchain was designed to be AS TRANSACT-ABLE AS POSSIBLE while maintaining robust syncing and decentralization. There is a tradeoff here with full personal (ie holding and using your own private keys) sovereignty. #bitcoin  cannot do this for everyone on earth. Not with 10x the block size. Not with 100x the block size. Not with 1000x the block size. Not without layers that make some careful and calculated trade offs between velocity and sovereignty. This is a tough pill for many to swallow, because it requires acknowledging that the way we use #BTC  today is not the way it will be used by everyone forever. Literally every ounce of FUD, from de Vries to the Big Blockers, to the Monero Bros, comes down to not understanding what base layer money *is* and what problem it solves: ie theft and incentive misalignment due to fiat debasement. But the good news is that when you take away the money printer, governments become less powerful, and all of the other problems become less pressing. #bitcoin