Although the concepts associated with Bitcoin are decades old, Bitcoin is a new technology. It solves the problem of double payment, and let everyone see that currency can also be completely replaced by digital certificates.
It can be said that this is an unprecedented paradigm shift, and in the face of Bitcoin technology, we need to use new thinking to understand it in order to maximize its role.
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Similarities Between Bitcoin and Email
At the end of the 20th century, e-mail not only replaced the mail, but also revolutionized the way people sent information. Like e-mail, the emergence of bitcoin is not a simple improvement of the existing transfer method.
Think about how we send emails. When you type text into the mailbox, you are actually typing your "letter". You press the send button, and the "letter" is delivered to the recipient via the Internet.
Let’s look at bitcoin transfers again: through the service provider, you first exchange fiat currency for bitcoin, and then send it to the recipient through the bitcoin network, without an intermediary. Once the value of Bitcoin has been transferred, it can be converted into fiat currency immediately, just like the text you write is displayed directly to the recipient in the email.
In the email scenario, once the information transmission of the email is completed, the email has no other use except as information recording and archiving. The same is true for bitcoins, as a recipient of bitcoins, you need services or goods, not bitcoins themselves.
Bitcoin is essentially an instant payment method, and holding it and hoping it will become valuable is like holding an email or PDF file and hoping it will become valuable in the future.
There are many misconceptions about Bitcoin in the market at present, for example, it is like currency, for example, it cannot be reused. In fact, if you think about it carefully, you can transfer fiat currency assets in unlimited quantities with only a few bitcoins.
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Why Bitcoin's Price Doesn't Matter So Much
So, why is it that the price of Bitcoin doesn't really matter to consumers?
Let's take compressed files as an example. When you want to send a large file to another person, you need to use a compression tool, because the size of the compressed file may only be 80% of the original file, which greatly reduces the efficiency.
When we put this idea on Bitcoin, the percentage of compression is the price of Bitcoin on the exchange.
If you want to send $1,000 to Indians to pay for shopping, and 1BTC=$1,000 at that time, then you need to buy 1 Bitcoin to send the money to Indians; if 1BTC=$10, then you need It takes 100 bitcoins to send $1,000 to India.
They are expressed as 100% and 1% compression respectively, but no matter what the value is, in the end you have successfully paid for the shopping fee.
This is why Bitcoin transfers have little to do with price. In theory, as long as the value of Bitcoin is not zero, it has the same utility.
Therefore, on this basis, we need other services to facilitate the transfer of bitcoins faster.
It can be argued that the current exchange business model does not help solve the essential problems of Bitcoin.
They are just directly applying the model of traditional stock exchanges, and it is not easy for ordinary users to deal with these exchanges, sometimes having to wait for several days to receive fiat currency withdrawn from their Bitcoin accounts. While this isn’t the exchange’s fault, it poses a very intuitive barrier to Bitcoin’s value.
Imagine that the e-mail that should have been received immediately is due to the existence of a middleman, and you have to apply to the middleman to send this email to you. Isn’t this absurd?
However, this is what is happening with Bitcoin and has nothing to do with any Bitcoin technology.
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Bitcoin price fluctuations have nothing to do with demand
Like Hotmail (the Internet's free email provider founded in 1995), it will eventually reach critical mass and then grow exponentially across the Internet as more people download and use the client. When this happens, the right business model will emerge naturally.
In the future, I think few people will speculate on the value of Bitcoin, because even if it is profitable, it is not as profitable as providing an easy-to-use Bitcoin service.
It is certain that the word speed will be the core of the business model related to Bitcoin in the future, and only companies that can satisfy the satisfaction of both parties in the transaction can succeed.
Finally, if everything in the future is denominated in Bitcoin, there will be no volatility in Bitcoin. If Bitcoin is compared with the volume of fiat currencies in the world, then it still has a great opportunity to expand until it reaches an unimaginable sky-high price, and then slowly returns to the price, and the fluctuations are getting smaller and smaller.
Through it all, Bitcoin is still Bitcoin, except that its users will only respond to the quantity needed, not the price.
(Text: Beautyon Compilation: Mashaka)
