Author | Mu Mu
Produced by | Plain Language Blockchain
For many years, there has been a saying in the crypto space: 'The biggest risk of Bitcoin is not being able to hold it.' Essentially, 'not being able to hold it' is a problem of cognition and information disparity. Since the genesis block of Bitcoin was born, 16 years have passed, and many people still feel that Bitcoin is 'ethereal' and worry about it. Rather than discussing 'what the biggest risk of Bitcoin is,' it may be more relevant to explore whether people's concerns about the existence of Bitcoin are indeed excessive...
01. The 'virtual' attribute of crypto assets
Crypto assets like Bitcoin have long been negatively classified as 'virtual' assets by some in the crypto community. When people mention the word 'virtual', there is naturally a sense of 'elusiveness', making it sound less 'formal' or 'serious'. Therefore, opponents have a viewpoint: virtual assets lack credit endorsement, and currency must be based on credit and physical exchange, so virtual assets are ultimately just a dream.
The reason this viewpoint resonates deeply is that, according to common sense, whether it’s the dollar or the yen, they are backed and guaranteed by the national credit of the U.S. and Japan, which have stable purchasing power. Cryptocurrencies, whose sources are unclear, naturally lack these guarantees, making them hard to trust.
In fact, this viewpoint overlooks the technological value behind crypto assets and fails to grasp what 'consensus' is all about. Concepts like blockchain technology, Web3, and decentralized finance have already demonstrated their practical application value in global payment and clearing fields. More importantly, the value 'consensus' behind crypto assets and the consensus generated by credit endorsement are essentially the same thing.
The reason currency needs credit endorsement is that human social structures are complex and require a unified and powerful centralized organization to act as a credit intermediary to provide a basis for consensus. In contrast, decentralized entities, like gold and stones in rivers, have inherent physical properties that serve as their natural consensus. Even without national credit endorsement, there is a consensus among all that stones are hard, and gold is always shiny, does not rust, and is valuable. This is also the fundamental principle behind why ancient human societies were able to use shells, stone money, and gold as currency.
In short, whether something has value is not determined by its credit endorsement but by the consensus it has.
02. The harvesting tool of the U.S.?
In recent years, as a global financial center, the U.S. has gained increasing influence over crypto assets. Not only are crypto assets priced in dollars, but crypto asset spot ETFs listed on U.S. stock markets have also attracted hundreds of billions in funds. Many publicly traded U.S. companies and financial institutions hold Bitcoin, and now even the newly elected president is keen on the advantages of U.S. crypto assets.
As the U.S. increasingly tightens regulation and control over Bitcoin and other crypto assets and the industry, people have begun to worry and even believe that this will once again become a tool for the U.S. to harvest the world, like the dollar.
This concern is indeed not without reason; the greater the voice, the more it can influence the crypto market, making it easy for global retail investors to be 'harvested'. Referring to the previous logic of U.S. harvesting, the U.S. attracts global funds into the virtual currency market through financial innovation and dollar hegemony. If the prices of crypto assets plummet, it could ultimately lead to a capital flow back to dollar assets, which indeed aligns with the logic of 'dollar harvesting' to some extent.
Of course, this concern has its limitations because crypto assets like Bitcoin and Ethereum are not actually initiated and dominated by the U.S.; rather, they are driven by grassroots forces through technological innovation from the bottom up. American capital from Wall Street and elsewhere only began to get involved after Bitcoin and other crypto assets matured, so this cannot be considered a pre-planned 'conspiracy' by the U.S. but rather a field born from 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 organizations are based in the U.S., their distributed nodes are widely spread around the world. Even if U.S. authorities can restrict local nodes from reviewing transactions through regulation, overseas nodes can still submit and publish transactions. It’s like gold mines spread globally; local authorities can order local mines to cease operations, but they cannot command or influence the operations of mines in other regions.
Furthermore, the reason the United States harvests globally through the hegemony of the dollar is that it has absolute control over the dollar. But can the U.S. control Bitcoin in the same way? No, but the U.S. can dominate Bitcoin like it does with gold, oil, and other mainstream global assets and modern technology.
On the contrary, the U.S. can also marginalize Bitcoin to a certain extent within a specific range, but it cannot kill it (if it could, it would have died hundreds of times already). Of course, considering the binding of interests, the U.S. is unlikely to go against its own interests and sacrifice Wall Street capital, at least not before detaching from its own interests.
03. Financial Inequality and Unlimited Issuance?
Some 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, and anyone can access the information and submit transactions to its network. It's just that some people are unwilling to understand and accept new things and don't want to take a step forward.
Others say that Bitcoin's cap of 21 million does not exist because of its smallest unit, the Satoshi, which makes it almost limitless.
This is a somewhat strange viewpoint; changing the unit has nothing to do with the total amount. 1L of water is enough for 1 person to drink, but you can't say that because it has 1000ML, you can share it with 1000 people. The unit has changed, but the total amount 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; from being an unremarkable 'small player' to becoming a mainstream asset, Bitcoin's consensus and status have become increasingly solid over the past 16 years, now having the strength to compete with gold. The strong intervention of the U.S. currently does not seem like a bad thing, but many uncertainties still exist, and we need to guard against significant volatility. I still believe that crypto and AI will jointly lead to the reshaping of the future in the digital age.
