Note: You may not be impressed by this article or don't agree with viewpoints of the articlle at current time you read, but suggest you read it again after 10 years (Nov, 2029)!
Since its creation of 10 years ago, Bitcoin has been stumbling to grow up with numerous criticism and hatreds. Though it’s not for certain that Bitcoin will succeed in our civilization, the odds of success would be much greatly higher than that of failure. Even if the Bitcoin cannot succeed, it’s only a matter of time that our current monetary system will be replaced completely by Bitcoin-like cryptocurrency.
Should Bitcoin succeeds, it will change our world and civilization to great extent beyond imagination of most of people, not only financially, economically, politically, technologically, but also religiously, and even salvationally.
Financial Effect
Bitcoin has the potentiality to change the traditional monetary system dramatically, it would be surprise if it was not severely criticized by people who have been adapted well and benefited from existing system, and hated by a large number of people who don’t really understand what it is, how it works and what it is for.
Today, most monetary systems are fiat monies which are highly decentralized and defined by central banks and governments, who have the power to manage the money supply easily. Central banks and governments across the world manipulate money in various ways to achieve their desires in the interests of their own, their nations, their group or even their individuals.
Though dollars are considered as stable fiat and are widely accepted as reserve assets nowadays, it has lost over 96% of its value since 1913, refer to the chart below:
However, China, the second largest economy, is even worse in currency devaluation. The chart below shows Money Supply M2 of US and China since 1960, China surpassed US in 2009 to become the largest M2 money supply country in the world and keeps rapid growth.
Source: Federal Reserve, National Bureau of Statistics of China
Bitcoin is so far the only truly decentralized currency in our human history and could be the only one without inflation. With its increasing demand, Bitcoin has the potentiality to replace gold as the leading commodity to store value. Once Bitcoin replacing gold, it will pave the way to be reserve assets of international monetary systems and change the monetary systems fundamentally.
Many doubt Bitcoin scaling due to its forks. According the site forkdrop.io, there are 74 Bitcoin forks in total However, it’s worth noticing that, first, most of the forked coins are not tradable and have no value, indeed, died; second, all of the few survived (till now) Bitcoin forks occurred in 2017, 2019 sees almost no new Bitcoin forks. As the market grows maturer and the fad of forks subsided, market does not accept Bitcoin forks anymore.
We can assert that, in the future, there will be no more inflation under Bitcoin-based monetary system.
Economical Effect
With change of current monetary system, Bitcoin and cryptocurrencies will change the global economy subsequently. Commercial transactions, government revenue, government expenditure, taxes, economic connections among different countries in the near future would be different greatly as we experience today, should Bitcoin and cryptocurrency not crushed down by authoritarian regimes and succeed as what they should be.
Under Bitcoin-based monetary system, traditional monetary tools will cease to be effective,
government revenue will be reduced, this will certainly weaken governments’ control over economy. As a result, in short term, the world economy would be not as efficient as today’s.
It’s not a wise strategy to launch trade war with China. As the world's largest current foreign-exchange reserve holder, it is emboldened to fight back. However, nation of the largest foreign-exchange reserve holder can be fragile. If Bitcoin price could rally to its historical high point and set new high to $100K in the near future, people there would use various ways to move funds to cryptocurrency market and its foreign exchange reserves can be reduced substantially, though major exchanges were cracked down and citizens are under strict foreign currency control. If this happens, it would be a nightmare for its economy.
In short term, Bitcoin-base monetary system will not only bring harmful effect on China economy, but also bring negative effect on US and global economy. However, in long term, Bitcoin-base monetary system would boost more stable and homogeneous global economy, with less border barriers, less tariffs, less expenditures spending on activities to impede development of human civilization.
Political Effect
Bitcoin has the potentiality to become the universal currency. If it does, the whole world can be changed fundamentally, not only in finance and economy, but also in politics:
Think about some authoritarian regimes, their expenditure on Social Stability Maintenance could be even higher than their expenditure on national defense. The expenditures from revenue rely on its hefty taxes and exploitation on their people. With Bitcoin anonymous feature somehow, people are easier to break foreign exchange controls and transfer funds internationally, this will result in weaker governments. Without sufficient funds, disorganization of such autocratic regimes can be accelerated. Bitcoin has the capability to change the world from the direction of dictatorship to democracy. Leaders in autocratic countries are frightened by Bitcoin more than leaders in democratic countries.
Autocratic regimes tend to impose heavily internet censorship, Blockchain could be the savior of breaking censorship. Hope “There's no 404” in the world in the near future ……
US politicians might have more reasons to hold unfriendly attitude towards Bitcoin. After all, Bitcoin could impose a direct threat to USD-denominated exchange reserves. It’s not surprising that U.S. Treasury secretary Steven Mnuchin branded Bitcoin and cryptocurrencies as a “national security issue”. However, there is no empire on which the sun never sets in human history. It’s up to the politicians to contemplate which system is better for the future of humanity, a Bitcoin-base free sovereign system, or a NON-USD-denominated exchange reserves based on an authoritarian regime.
Technological Effect
According to Kardashev Scale, there are three categorized civilizations: Type I civilization, also called planetary civilization, can use and store all of the energy available on its planet; Type II civilization, also called a stellar civilization, can harness the total energy of its planet's parent star. Intelligent life may reach Type I civilization, but would be impossible reach Type II civilization, because they are “too” intelligent, a double-edged sword. Current centralized systems are sharpening other side of the sword.
In the past decades, we have been experiencing exponential growth of technology, and the technological growth is expected to accelerate in the future. The more centralized a society is, the faster technological progress they can develop. Autocratic regimes (more centralized political system) can mobilize more resources to achieve what they decide to do than democratic regimes (more decentralized political system like USA).
Under Bitcoin-based monetary system, governments can no longer generate revenue through currency manipulation; individuals have more sovereignty to control their wealth and transmit their wealth globally. As a result, governments will have less utilizable resources to implement their technological plans, development of technologies under the level of national will could be undermined. However, this is not bad news in long-term run, as we are approaching the edge of Type I civilization.
Religious Effect
GOD created human in the image of GOD, every human, no matter who is poor and wealthy, strong and weak, powerful and powerless, should have the same equality. However, under current monetary system, inequality has not been reduced, but has been risen up, refer to the chart below:
Bitcoin, the “peoples” currency, is the first individual sovereign-based money ever existed and existing in human history. With its capability to change traditional financial and economic system, it can create more equality society, giving human unprecedented sovereignty and dignity as the image of the Creation.
Salvational Effect
Birth of gene-edited babies was an important event in human history. It’s not necessary at all to blame the scientist A. If it was not the scientist A, it could be B, C, or many others. There must have someone to do the same in other day, as the technology developed. In TV show “The Twilight Zone” aired in 2002, there is one episode “Hunted”, this story is not purely fictional, it’s likely to happen in our civilization, and human already opened the Pandora's Box.
Human has developed weapons which could destroy the whole world, for now, at the level of national commitment. With exponential development of science and technology, such level could be lowered down and further down. Sooner or later, human can develop technologies that individuals can make massive destructive weapons without difficulties. Should this day comes, destiny of human is doomed: no matter how powerful a society or nation is, it cannot totally control behaviors of all individuals, whilst there are always infinitesimally small individuals who have extreme opinions. By “infinitesimally small”, even if it’s one in a billion, they could bring catastrophic disaster to our civilization.
Recall the story of Bible in Genesis 11:3-9, people were going to build a tower that "reached to the heavens". God was not pleased and confused their languages so they could not understand each other and the tower was abandoned. Nowadays, advancement of technology is not too slow, but too fast. With centralized “language” and system, sooner or later, people will develop technologies to build their final tower to “heaven” (extinction).
In our universe (needless to say in multiverses), there are numerous of civilizations like us or even more advanced than ours, but why cannot we ever meet one extraterrestrial life? The reasons are simple, first, the universe is so vast that only extraterrestrial lives at scale of Type II civilization could be possible to cross the vast space; second, intelligent beings are so “intelligent” that they could develop advanced technologies to destroy themselves before reaching scale of Type II civilization.
The most precious thing in the universe are not at all any resources and energies, but TIME. Decentralization could somehow delay rapid development of technology. Bitcoin is the salvation for human to buy more time.
Conclusion
The core future of cryptocurrency is not Libra from Facebook or any centralized cryptocurrencies created by any giant companies or any powerful governments, but a currency which possess two basis characteristics: true decentralization and trustlessness.
Current system supporters, people who don’t understand Bitcoin, and many governments have been attacking mercilessly and will attack Bitcoin continuously to prevent it from growing and succeeding. However, it’s only a matter of time (not more than a generation) that Bitcoin or Bitcoin-like currency will not only demonstrate it can supplant current monetary system, but also prove it could bring revolutionary change and salvation to our world.
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