There are fair reasons to be worried about the current fiscal and monetary stimulus in the current economic landscape. For starters, the money supply is expanding at its fastest rate since World War II, and there have been only a few times when the supply growth of money has exceeded the real out-put growth over a period of 5 years.
Global economic uncertainty is at its peak and if the central banks are unable to drive monetary debasement, other inflationary forces might come into to boost the demand for store-of-value assets such as Bitcoin. Now, the question is, are we looking at the wrong characteristics of Bitcoin, which is driving market affinity?
Bitcoin’s sovereignty and secular surrounding
For a minute, if the comparison of Bitcoin with Gold, Silver is dropped, it is important to understand that the largest digital asset is not touted to improved its purchasing power only on the basis of extreme volatility and popular price-bubbles. The main difference between Bitcoin and other “politically neutral assets” lies in its sovereign nature and its secular landscape.
Messari’s recent report, suggested that Bitcoin’s potential in the market is revolutionary because for the first time an asset has been created on a sovereign state of network based on a computer. From a fundamental point of view, it is pretty accurate.
Now, the concept of sovereignty underpins many important properties that made Bitcoin. The asset is the only monetary asset in the world with absolute scarcity and this particular feature is assured by a global network of diverse participants that run Bitcoin full nodes.
The 2nd part of its sovereignty lies in its blockchain, which serves and acts as a worldwide transparent, incorruptible, distributed ledger, that is used for transferring and storing value, and on top of that, it is politically untouched.
Unlike other fiat systems at the moment, it is impossible to restrict value transfer on Bitcoin no matter what kind of…
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