Author: Mu Mu, Vernacular Blockchain
For many years, there has been a saying in the crypto space: "The biggest risk of Bitcoin is that you can't hold it." In essence, "not being able to hold it" is a problem of cognition and information gap. 16 years have passed since the birth of the Bitcoin Genesis Block, and many people still feel that Bitcoin is "illusory" and are worried. Rather than discussing "what is the biggest risk of Bitcoin", it is better to discuss whether people's biggest concerns about the existence of Bitcoin are redundant...
01. The “virtual” attributes of crypto assets
Cryptocurrency assets such as Bitcoin have always been classified as "virtual" assets by the crypto community. When people mention the word "virtual", they naturally have a sense of "elusiveness" and it doesn't sound like something "formal" or "serious". Therefore, opponents have a point of view: virtual assets have no credit endorsement, currency must be based on credit and physical exchange, and virtual assets are ultimately a dream.
The reason why the above viewpoint resonates with many is that, according to common sense, whether it be the dollar or yen, they are backed and guaranteed by the national credit of the U.S. and Japan, which provides stable purchasing power. Naturally, crypto assets without a known source lack these guarantees, how can they be trusted?
In fact, this viewpoint overlooks the technological value behind crypto assets and fails to understand what 'consensus' really means. Concepts like blockchain technology, Web3, and decentralized finance have already demonstrated their practical application value in global payment and clearing sectors. More importantly, the 'consensus' behind the value of crypto assets is essentially the same as the consensus generated by credit endorsement.
The reason currency needs credit endorsement is that the structure of human society is complex, requiring a unified and powerful centralized organization to act as a credit intermediary to provide a basis for consensus. In contrast, decentralized items, like gold or stones from rivers, possess their own natural consensus due to their physical properties. Even without national credit endorsement, in everyone's consensus, stones are hard, and gold is always shiny, rust-resistant, and valuable. This is also why ancient human societies were able to use shell money, stone money, and gold as currency.
In short, whether something has value is not determined by whether it has credit endorsement, but because it has consensus.
02. America's Harvesting Tools?
In recent years, as a global financial center, the U.S. has gained more voice over crypto assets. Not only are crypto assets priced in dollars, but the crypto asset spot ETFs listed on U.S. stock exchanges have attracted hundreds of billions in funds, and many publicly listed companies and financial institutions hold Bitcoin. Now, even the incoming president is keen on capitalizing on America's advantages in crypto assets.
As the U.S. increasingly tightens its regulation and control over Bitcoin and other crypto assets as well as the industry’s upstream and downstream, people have begun to worry and even believe that this will become a tool for the U.S. to harvest the world, just like the dollar.
This concern is indeed not unfounded. The greater the influence, the more it can sway the crypto market, making it easy for global retail investors to be 'harvested'. Referring to the previous logic of harvesting in the United States, the U.S. attracts global funds into the virtual currency market through financial innovation and dollar hegemony. If the price of crypto assets plummets, it may ultimately lead to a capital return to dollar assets, which indeed aligns with the logic of 'dollar harvesting' to some extent.
Of course, this concern also has its limitations because crypto assets such as Bitcoin and Ethereum are not actually initiated and led by the U.S.; they are more driven by grassroots forces through technological innovation. Capital from Wall Street and elsewhere only began to position themselves after Bitcoin and other crypto assets matured, so this should not be seen as a premeditated 'conspiracy' by the U.S., but rather a field born out of technological development and market demand.
Moreover, public blockchains like Bitcoin and Ethereum are technically unlikely to be controlled. Even if some mining pools and service agencies are deployed in the U.S., their distributed nodes are widely spread across the globe. Even if U.S. authorities can restrict local nodes from reviewing transactions through regulations, overseas nodes can still submit and publish transactions. It is like gold mines located worldwide; local authorities can order local gold mines to stop working, but they cannot command or influence the operations of gold mines in other regions.
Furthermore, the reason the U.S. collects globally through dollar hegemony is because of its absolute control over the dollar. But can the U.S. control Bitcoin like it controls the dollar? No, it cannot. However, the U.S. can dominate Bitcoin just like it dominates mainstream global assets such as gold and oil.
On the contrary, the U.S. can also marginalize Bitcoin to some extent within a specific range, but it cannot kill it (if it could, it would have died hundreds of times by now). Of course, considering the entanglement of interests, the U.S. is unlikely to sacrifice Wall Street capital interests; at least not before separating from its own interests.
03. Financial Inequality and Unlimited Issuance?
Some people say that it is unfair for ordinary people today compared to early participants, which is what many refer to as financial inequality. In fact, the Bitcoin network and community information are open and fair. As a public blockchain, it lies there like a public resource; anyone can access the information and submit transactions to its network. It is just that some people are unwilling to understand and accept new things and do not want to take a step forward.
Some people say that the Bitcoin cap of 21 million does not exist because its smallest unit is a 'satoshi', making it almost limitless.
This is a somewhat strange viewpoint; changes in units have nothing to do with total quantity. 1 liter of water is enough for 1 person to drink; you cannot say that if it has 1000 milliliters, it can be shared among 1000 people. The unit has changed, but the total quantity remains unchanged.
04. Summary
Overall, most people's 'opposition' to Bitcoin is more due to misunderstanding. The 'virtual' era has become a thing of the past; Bitcoin has transformed from a marginal 'small player' to a mainstream asset over 16 years, with a consensus and status that have become increasingly solid, now capable of competing with gold. The strong intervention of the U.S. currently does not seem to be a bad thing, but many uncertainties remain, necessitating caution against significant fluctuations. I still believe that crypto and AI will jointly lead to the reshaping of the future in the digital age.
