Originally posted on twitter by twitter.com/eemelijarvela

Link to original tweet: https://twitter.com/EemeliJarvela/status/1532356905418506240?s=20&t=ybPScPZFCXmZe-lXB6xfbg

The United States left the gold standard in 1971. Since then, compensation for work hasn't been in line with productivity. Easy money makes us have a high time preference which increases speculation and short-term thinking.

Bitcoin was the first cryptocurrency that was truly decentralized. Since the first block, the network has grown massively. Bitcoin now has millions of users with the current market cap of $600B.

Bitcoin network is secured by thousands of computers that are mining blocks, which means that a 51% attack would cost billions of dollars and massive amounts of energy.

There are already public companies that are holding bitcoin on their balance sheets and recognizing bitcoin as a way to store massive amounts of value. Countries have also started adopting bitcoin and declaring it as legal tender.

Trying to invent a better Bitcoin is like trying to create a better chess game. Users of Bitcoin either have to play by the rules or create their own fork, but it doesn't mean that people will use that fork. Eventually these shitcoins with no usage will go to zero.

When you are buying bitcoin on an exchange, you are basically just buying an IOU. That IOU is only settled when you withdraw your bitcoin. These exchanges are also vulnerable to hacks and they collect your data.

You can take your bitcoin off the exchange by sending them to a hardware wallet. Many people think that the hardware wallet somehow stores your bitcoin, but that's not true; it stores your private keys and the bitcoin is "stored" in the blockchain.

The hashes generated by thousands of computers, the ledger and private keys are all just text. Because the private keys are just text, you can encrypt them into any form like 12 or 24 words.

This is truly what makes Bitcoin borderless money. You can run around on some foreign island without a wallet and still be very wealthy if you remember those 12 words. It also means that no one can steal your bitcoin if the private keys only exist in your head.

PoS needs a central time keeper to reach consensus. Bitcoin doesn't need that because the time between the blocks is ~10minutes, which is a long enough time to reach consensus even with bad connectivity.

Central Bank Digital Currencies or CBDCs for short would work like regular dollars or euros, but you'd have a checking account on central bank's server. These CBDCs would remove physical cash and make currencies digital.

This means that central banks would have the ability to create new money and distribute it through UBI straight to people's accounts. They could also track every transaction and perform mass surveillance using these CBDCs.

They are already testing this technology in China where they are connecting these CBDCs to their social credit system, so they have the ability to freeze someone's funds if they have criticized the government, for example.