• Bitcoin reduces administrative bloat and can cheaply transfer large sums of wealth across the globe.
• Bitcoin can potentially work like a treasury bond but delivering higher yield returns.
• Bitcoin’s contribution to civilization is expected to be so significant that gold and treasury bonds should gradually become obsolete.
Charlie Munger recently made a statement expressing his disdain for the success of bitcoin. As a life-long thinker, philosopher and author of “The Straight Science”, Bernardo Filipe is here to analyze Munger’s arguments and explain why bitcoin may actually be an asset to civilization.
Bitcoin is a decentralized digital currency that has been gaining traction in recent years. It operates on a public ledger and is powered by a colossal amount of computing power that is distributed across several jurisdictions. This makes bitcoin’s network and ledger incorruptible, and thus it is becoming increasingly popular as a store of wealth or even as a savings account.
The most obvious benefit of bitcoin is that it reduces administrative bloat. By making the ledger public, much of the work needed to verify and audit wealth transfers is eliminated. Moreover, it can cheaply transfer large sums of wealth across the globe. Furthermore, bitcoin can potentially work like a treasury bond but delivering higher yield returns. This is because the real return on bonds is always lower than the nominal expectation, due to inflation.
Due to the numerous advantages that bitcoin possesses, it is expected to make a significant contribution to civilization. Gold and treasury bonds may become obsolete, as bitcoin’s adoption rate increases. Thus, it is important to consider the positive implications of bitcoin and not just focus on the negative aspects that Charlie Munger has highlighted.
In conclusion, it is clear that bitcoin is not a currency solely for criminals, but rather a technology that is here to stay. Its potential to revolutionize the way we transfer wealth and store value is undeniable, and it is certainly an asset to civilization.