Is Bitcoin Better Than Gold? with Robert Breedlove (WiM398)
Nov 26, 2023
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Expert in Bitcoin, Robert Breedlove, discusses why Bitcoin is better than gold, the currency counterfeiting cartels, and the importance of studying Bitcoin. They explore the concept of money, Bitcoin's properties, and its disruptive potential in the monetary system. They also discuss the impact of quantitative easing, the advantages of Bitcoin over gold, and recommend books for exploring reality.
Gold's lack of portability led to its failure as money and the rise of central banks.
Bitcoin's properties as a digitally portable asset disrupts gold as the primary monetary technology.
Bitcoin's decentralized nature and perfect portability make it resilient against price manipulation and potential hyperinflation scenarios.
Deep dives
Gold as Failed Money and the Central Bank
Gold has failed as money due to its lack of portability, leading to the need for central banks. The concentration of power in one institution through central banking has resulted in corruption. This sets the stage for the exploration of various concepts related to money. Gold's physical nature hindered its scalability as a transactional medium, making it susceptible to centralization and fractional reserve banking. This ultimately led to the failure of gold as money and the rise of fiat currencies. Bitcoin, on the other hand, overcomes the limitations of gold, being a digitally portable asset without the need for centralized custody, thereby disrupting gold as the primary monetary technology.
Understanding Money and its Functions
The understanding of money involves distinguishing between its functions and properties. Money serves as a store of value, holding purchasing power across time, a medium of exchange that facilitates transactions, and a unit of account enabling economic calculation. The properties of good money include divisibility, durability, portability, recognizability, and scarcity. Gold emerged as money due to its superior properties compared to other goods, while Bitcoin exhibits all these properties and even surpasses gold as a monetary technology. The functions and properties of money illuminate the rise of gold as money and the disruptive potential of Bitcoin.
Quantitative Easing, Counterfeit Currency, and Gold Price
Quantitative easing (QE) or currency counterfeiting by central banks is not a recent phenomenon. It has been happening throughout the existence of central banks, including the Federal Reserve since its establishment in 1913. While QE accelerated during the 2008 financial crisis and the COVID-19 pandemic, its impact on gold prices has been limited. The large ownership of gold by central banks, the manipulation of its price through paper markets, and the lack of portability and scalability of gold have contributed to its subdued response to currency counterfeiting. In contrast, Bitcoin has showcased a stronger response to these monetary policies due to its superior properties as a digitally portable asset with fixed supply.
The Functions of Money: Medium of Exchange, Store of Value, and Unit of Account
Money serves as a medium of exchange, allowing individuals to trade goods and services with one another. When we save money, we are essentially choosing not to spend it immediately, incurring the opportunity cost of forgoing other potential purchases. In this sense, money also acts as a store of value, allowing us to preserve purchasing power for the future. Additionally, money serves as a unit of account, providing a common language for us to think, talk, and negotiate economic transactions. Just as words are a medium of exchange for human ideas, money acts as a medium of exchange for human action and economic decisions. Bitcoin, for example, has evolved from being a collectible to a store of value and is gradually moving towards becoming a widely accepted medium of exchange and unit of account, parallel to the historical monetization of gold.
Bitcoin's Advantages and the Challenges of Manipulating Its Price
Bitcoin's advantages over traditional currencies, such as the US dollar, lie in its decentralized nature and perfect portability. While central banks can manipulate the price of gold due to its lack of portability and the large concentration of gold supply, Bitcoin's distributed supply and ease of final settlement make price manipulation more difficult. Bitcoin's resilience against authoritarian regimes like China indicates its potential to withstand adversarial attacks. However, potential negative catalysts for Bitcoin remain unknowable, as they would likely involve black swan events. Despite this uncertainty, the rapid debasement of fiat currencies, like the US dollar, indicates a potential hyperinflation scenario in the future, where Bitcoin's price could skyrocket. It is advised to study Bitcoin's fundamentals and understand the nature of money rather than relying on specific price predictions.
In this episode with Robert Breedlove and the host of the Aimstone podcast, we discuss what is money, why Bitcoin is better than gold, the currency counterfeiting cartels, and the importance of studying Bitcoin.
// OUTLINE // 00:00:00 - Coming up 00:00:31 - Intro 00:02:04 - Helping Lightning Startups with In Wolf's Clothing 00:02:50 - Money as Time and Energy 00:09:32 - Money as an Attribute 00:05:05 - What is Money? 00:15:32 - Functions and Properties of Money 00:24:28 - Why Gold Was the Best Money 00:25:25 - Why Bitcoin is a Perfect Money 00:26:22 - Run Your Business from Anywhere with NetSuite 00:27:27 - Secure Your Bitcoin Stash with the iCoin Hardware Wallet 00:28:24 - What is the Unit of Account 00:32:51 - Bitcoin From Store of Value to Unit of Account 00:39:15 - Money vs. Currency 00:42:55 - Is Bitcoin Better Than Gold? 00:49:45 - Enhance Your Brain Power with Mind Lab Pro 00:50:52 - Take Control of Your Healthcare with CrowdHealth 00:51:54 - A Bitcoin Wallet with Privacy Built-In: Wasabi Wallet 00:52:45 - Currency Counterfeiting Cartels 00:55:02 - Why Gold’s Price Hasn’t Responded Well To Money Counterfeiting 01:00:11 - What Would Change Robert’s Mind on Bitcoin 01:03:59 - Price Prediction for Bitcoin and the US Dollar Hyperinflation 01:06:13 - Financial Advise: Study Bitcoin 01:06:52 - Three Books Recommendation 01:10:07 - Where to Find Robert on the Internet
