Bitcoin: The Evolution of Money and its Potential to Replace Gold

👋GM Valued Readers,

“Money” has 6 distinct characteristics: Divisibility, Portability, Acceptance, Scarcity, durability, and a stable store of value. For 5000 years, gold has been the closest to “perfect” money that we have been able to find. This is why, up until 1971, all of the fiat money of the world was backed by it. The United States dollar has been the reserve currency of the world since Bretton Woods in 1944, and all other world currencies have been pegged to USD, so in essence, pegged by gold.

When President Richard Nixon took the United States off of the gold standard in 1971, he took the WORLD off the gold standard, and the era of fiat money printing began. Countries like Venezuela have experienced hyperinflation to the point that TRILLION-dollar bills were created, and the currency basically became worthless. The money printing here in the United States in the last couple of years has significantly inflated prices and put a strain on our currency.

On January 3, 2009, when Bitcoin was first released to the globe, we were finally given a monetary product that TRULY satisfied ALL 6 characteristics. As good as gold is and was, Portability has always served as a real issue. If one amassed wealth and wanted to convert that wealth to gold, that would prove to be difficult to move from border to border, both because of the weight and carrying and or transferring, as well as worries about seizure from another nation state.

Bitcoin has made transporting millions of values an easy as holding a key fob or a cell phone. Gold bugs and Bitcoiners share MUCH more in common than they want to admit. For me personally, it was my involvement with gold and silver in how I found Bitcoin.

Believe it or not, I also started out as a skeptic when I first heard of it in early 2013. 

I didn’t actually get any exposure until the end of 2013 after much research was done into what it was, how it worked, and more importantly what it could be.

I think if more gold bugs put aside their bias and really dove into the nuts and bolts of Bitcoin, they too would make the decision to add exposure to this asset. I myself still hold some commodities still, albeit on a small fraction of what I own in Bitcoin.

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