Bitcoin’s Best Use Case Is Simple
$BTC
Bitcoin can seem complicated at times, when in reality it’s one of the simplest ideas the financial world has seen in modern history. Still to this day, a large percentage of people are grappling to understand what Bitcoin even is. Bitcoin is just a little over 15 years old, and most people have never had to seriously question what money is in the first place.
Let’s break down what Jack Mallers said during a recent appearance on Bloomberg, July 29:
Jack Mallers on Bloomberg Panel
“I think the use case for Bitcoin from the highest value possible, is that I created value and I want to keep it. That’s true. I got out of bed, I sacrificed, I commuted, I worked, I created tasks, I created value for people around me.
The definitions of currency and money and how we see medium of exchange, store of value — I think it gets too complicated. And I think Bitcoin is so simple, people don’t believe it can be that simple.
The reality is that money is what you acquire in exchange for your effort, your time, and your energy. It’s our time and energy in an extracted form. And I exchange my work hours for it so I can get the things I want later in life — I want to go to Whole Foods and get a steak, I want to go on vacation, I need to pay rent.
That’s what money is for, to allow me to create value and let me take it with me tomorrow. And that’s the use case, and today it’s increasingly difficult to achieve that. I can’t save it in dollars, we all know that.
Okay, you’re going to force me to understand Japanese central bank monetary policy? You’re going to force me [to know] what tech stocks to pick?
No — how about something that’s definitively scarce, no one can inflate, I can store for free, I can move cheaply, and I can put it into my brain.
And that’s the use case. And we all have that use case: nation-state, corporation, families, individuals.
Simply put, I think everyone can find value in a technology that is open source and solves that for everyone.”
Bitcoin vs. the Complexity of Other Stores of Value
I still find myself having trouble discussing Bitcoin with friends or even the co-hosts on the Investing or Gambling podcast I sometimes join on Sundays. I do my best to explain why I think Bitcoin is a great long-term investment. But I’ll admit, a lot of times, my pitch doesn’t land. The other person ends up more confused than convinced.
I’m not sure why Bitcoin has become so complicated—when really, it shouldn’t be. We hear all sorts of questions thrown around:
Is it a currency?
Is it going to compete with the dollar?
Is it just a store of value? Why is it so volatile?
Is it a peer-to-peer payments network?
Is it digital gold?
Does it have intrinsic value at all?
Who’s even behind it?
It can be overwhelming for someone in finance to wrap their head around Bitcoin, let alone a friend outside the industry who’s unsure if it’s even a good investment.
I’ve written many posts on Substack stating that it takes hundreds of hours to understand Bitcoin. I’ve said things like “you don’t truly understand Bitcoin until you’re stuck and forced to learn it.”
But lately, I’ve started thinking… maybe the opposite is true. And maybe all of that was just my frustration with how many people still don’t get it.
Maybe Bitcoin is so simple that people don’t believe it can be that simple. Maybe they’re overanalyzing it. Maybe they’re looking for hidden layers that aren’t there. And maybe they are confusing “crypto” with “Bitcoin.”
Just this past weekend, I found myself in the comment section of a WSJ article titled, “The Hottest Business Strategy This Summer is Buying Crypto.” It had over 700 comments, and I’d estimate 85% of them were calling Bitcoin a tulip bubble, a Ponzi scheme, or warning that it “will all end badly.”
One commenter even shouted “Can someone please explain to me, once and for all, what Bitcoin’s value is!?”
I left a comment that got a few likes: “I see value in Bitcoin, only. I’m unsure about ‘crypto.’ They say you don’t really understand Bitcoin until you’re forced to, or until you understand the problem with dollar debasement. In case that helps.”
You Don’t Need to Be Warren Buffett to Store Value
I’m still unsure of Satoshi’s true intentions, or even if they fully understood how powerful Bitcoin could become as a new form of money. But going forward, it can be simple: a tool to store your time and energy, and use it however you want.
Bitcoin exists to serve investors as a long-term store of value, without requiring you to become a financial wizard, macroeconomist, or value investor like Warren Buffett.
Fiat currencies like the U.S. dollar steadily lose purchasing power over time due to inflation. For example, $1 in 1913 had the same buying power as about $26 in 2020 — meaning the dollar lost over 96% of its value in that period.
That’s a hidden tax on savers. It forces people into complex investment strategies just to preserve wealth. It forces investors to speculate on which stocks or assets will result in financial freedom.
Bitcoin was designed to counter that.
It should remove the guesswork. It should simplify the idea of saving. That’s why it’s one of the most important financial ideas of our time.
As Jack Mallers pointed out:
“Money is our time and energy in an abstracted form.”
And if that money isn’t fixed in supply or decentralized, it can be manipulated and debased. Bitcoin’s value proposition is to remove that complexity and unfairness — giving individuals a way to simply save the fruits of their labor in an asset that can’t be inflated or diluted over time.
This is why many who try to explain or learn Bitcoin start with the simple question: “What is Money?”
That’s why the first section of Saifedean Ammous’ book, The Bitcoin Standard, is almost entirely about the history of money. Before he dives into Bitcoin’s technology, he walks the reader through centuries of economic history to answer one question: what makes good money?
The reader at the end of the book understands that Bitcoin is a return to monetary first principles. Bitcoin doesn’t just fix the supply issue. It’s reintroducing money that’s independent of government, resistant to debasement, and based on voluntary consensus rather than coercion.
Whether or not Bitcoin is the perfect form of money will be debated for years. But in my view, if we’re ever going to have a truly sound, global money, it will have to be digital. And it won’t be “crypto.” It will be Bitcoin.
Hopefully this post serves as a reminder that Bitcoin doesn’t have to be complicated and has a simple “best use case.” Bitcoin is a technological invention with a simple idea. It’s designed to solve a problem that has affected every individual, family, corporation, and nation-state throughout history.
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Disclosure:
This blog is for informational purposes only and does not constitute financial advice. All opinions are my own, and I am not a financial advisor. The information provided reflects my personal views and is intended to encourage discussion and thought among readers. Investments involve risk, including the loss of principal, and past performance is not indicative of future results. Always conduct your own research or consult with a qualified professional before making any financial decisions.