Bitcoin, The Communal Value Pike or The Global Highway of Value transfer
Written by FF2k
June 16, 2019
The purpose of this paper is to try and express and work out a thought that has been rattling around my brain as I discover and learn about Bitcoin. I think this analogy will resonate with a lot of no-coiners and may encourage them to do more research.
The Communal Value Pike or The Global Highway of Value transfer
In the state of NJ, we have (2) major highways, The New Jersey Turnpike and the Garden State Parkway. Both of these were built selling bonds and are maintained with tolls. Growing up, I remember having to stop every 10 miles to pay 25 cents. Financially both of these highways are very sound. The tolls bring in sufficient funds to keep the roads in good shape and pay thousands of bureaucrats along the way. They sell bonds based on the future ability to service the debt with tolls, etc. Imagine if a road like this was owned by the people that used it every day and you eliminated the bureaucrats who run the Turnpike Authority?
Bitcoin is The Communal Value pike. It is a highway to transfer value amongst its users. It was designed by Satoshi Nakamoto to boot strap itself through financial incentives as it expands exponentially. As more people find a need to use the Communal Value pike, the existing users benefit financially along with the new users. The network incentivizes miners to maintain the highway by allowing them to collect the tolls. If you own bitcoin, you own a fixed percentage of this Value Pike.
As bitcoin becomes more popular and increases in price, the use case of the highway will most likely change. Only the most important value transfers/transactions will be done on the main highway but the owners/users will build 2nd layers for you to exit on and off as needed. Similar to county roads or side streets. It is in everyone’s interest to build off of the main highway.
November 9, 2019 Update
I have come to the realization that owning bitcoin is like owning a zero-coupon bond with a user designated maturity. I think if you are willing to hold it for 5 years, we are talking a price of less than a penny on a dollar. With Bitcoin, you don’t need to pay tax on phantom interest either. It is instantly liquid and its holding costs are zero.