Author | Mu Mu
Produced by | Baihua Blockchain
For many years, a saying has circulated in the crypto space: "The biggest risk of Bitcoin is not being able to hold onto it." Essentially, "not being able to hold it" is a matter of cognitive and informational gaps. Since the birth of Bitcoin's genesis block, 16 years have passed, and many still feel that Bitcoin is "ethereal" and worry endlessly. Rather than discussing "what the biggest risk of Bitcoin is," it might be more relevant to explore whether people's greatest concerns about Bitcoin's existence are actually unnecessary...
01. The 'virtual' attribute of crypto assets
Crypto assets like Bitcoin have long been negatively categorized by some in the crypto community as 'virtual' assets. When people mention the word 'virtual,' it naturally brings about a sense of 'elusiveness' and sounds unlike something 'formal' or 'serious.' Thus, opponents argue that virtual assets lack credit endorsement; currency must be based on credit and physical exchange, and virtual assets are ultimately a dream.
The reason the above views resonate deeply is that there is a certain rationale behind them. According to common sense, whether it is the dollar or the yen, there is backing and guarantee from the national credit of the U.S. or Japan, which provides stable purchasing power. Naturally, crypto assets, which have no clear source, lack such guarantees, making them hard to trust.
In fact, this view overlooks the technological value behind crypto assets and fails to understand what 'consensus' truly means. For instance, concepts like blockchain technology, Web3, and decentralized finance have already demonstrated their real-world application value in global payment and settlement areas. 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, powerful centralized organization to serve as a credit intermediary to provide a basis for consensus. In contrast, decentralized entities, like gold and stones in rivers, have their physical properties serving as their natural consensus. Even without national credit endorsement, there is consensus among all that stones are hard, gold always shines, does not rust, and is valuable. This is also the fundamental principle that allowed ancient human societies 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 by the existence of consensus.
02. A harvesting tool for the U.S.?
In recent years, as a global financial center, the U.S. has gained greater influence over crypto assets. Not only are crypto assets priced in dollars, but the crypto asset spot ETFs listed on U.S. stock exchanges have also attracted hundreds of billions of dollars in funds. Many U.S. publicly traded 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. increases its regulation and control over Bitcoin and other crypto assets, as well as the upstream and downstream of the market, people also begin to worry and even believe that it 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 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 crypto asset prices plummet, it could ultimately lead to capital flowing back into 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 like Bitcoin and Ethereum are not actually initiated and led by the U.S.; rather, they are driven by grassroots forces through technological innovation from the bottom up. Capital from entities like Wall Street only began to take positions after Bitcoin and other crypto assets matured, so this cannot be considered a premeditated '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 institutions are deployed in the U.S., their distributed nodes are spread all over the world. Even if U.S. authorities can limit local nodes from conducting transaction reviews through regulation or laws, overseas nodes can still submit and publish transactions. It's like gold mines scattered around the globe; local authorities can order local mines to shut down, but they cannot command or influence the operations of mines in other regions.
Furthermore, the reason the United States harvests the world through the dollar's hegemony is that it has absolute control over the dollar. But can the United States control Bitcoin in the same way it controls the dollar? No, but the United States can dominate Bitcoin just as it does with mainstream global assets and modern technologies like gold and oil.
On the contrary, the U.S. can 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 act against its own profits and sacrifice the interests of Wall Street capital, at least not before separating from its own benefits.
03. Financial inequality and unlimited issuance?
Some say it's unfair for ordinary people today compared to early participants; this is what many refer to as financial inequality. In reality, the Bitcoin network and community information are open and fair. As a public blockchain, it lies there like a public resource, where anyone can access information and submit transactions to the network, but some people simply do not wish to understand and accept new things or take a step forward.
Some also argue that Bitcoin's cap of 21 million does not exist, because its smallest unit, the 'Satoshi,' makes it virtually unlimited.
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, and it cannot be said that having 1000 milliliters means it can be shared with 1000 people to drink. The unit changes, but the total amount remains unchanged.
04. Summary
Overall, most people's 'opposition' to Bitcoin stems more from misunderstanding. The 'virtual' era has become a thing of the past; Bitcoin has transitioned from being a 'minor player' to a mainstream asset, and its consensus and status have become increasingly solidified over the past 16 years, gaining strength to compete with gold. The strong intervention by the U.S. does not currently seem like a bad thing, but uncertainties remain, and we need to be wary of significant volatility. I still believe that crypto and AI will jointly lead to the reshaping of the future in the digital age.
