In a previous article titled, “Who is trying to control, manipulate, or destroy Bitcoin?”, we discussed the many competing groups who have different interests trying to manipulate, control, or destroy Bitcoin. They are all vying for our attention on news and social media about what Bitcoin is and should be. The public is bombarded with a barrage of posts and articles from well-meaning but misinformed sources or people who knowingly publish false narratives and flat-out lies. How can we know the truth about what Bitcoin is?
To understand why Bitcoin exists, we refer to the Bitcoin Whitepaper because it is in the Introduction paragraph where the inventor of Bitcoin, Satoshi Nakamoto, explicitly describes the problem he wanted to solve with Bitcoin:
Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments. While the system works well enough for most transactions, it still suffers from the inherent weaknesses of the trust based model. Completely non-reversible transactions are not really possible, since financial institutions cannot avoid mediating disputes. The cost of mediation increases transaction costs, limiting the minimum practical transaction size and cutting off the possibility for small casual transactions, and there is a broader cost in the loss of ability to make non-reversible payments for non-reversible services. With the possibility of reversal, the need for trust spreads. Merchants must be wary of their customers, hassling them for more information than they would otherwise need. A certain percentage of fraud is accepted as unavoidable. These costs and payment uncertainties can be avoided in person by using physical currency, but no mechanism exists to make payments over a communications channel without a trusted party.
We notice that Nakamoto’s focus was NOT to seek ways to circumvent crime or subvert the government or the state. He was motivated first and foremost to find a way for people to transact cheaper because currently, businesses must rely on costly payment solutions using the prevailing payment/monetary system. Consumers – all of us – ultimately pay for these transaction costs as businesses raise their prices to cover their costs. These costs can be reduced or avoided altogether by following Satoshi’s vision of Bitcoin, which the BSV blockchain/project is implementing. The author cannot say the same for the Bitcoin BTC blockchain/project because it has abandoned Satoshi’s on-chain scaling approach, searching for second-layer solutions from which they are hoping to profit.
Reducing transaction costs across countries would ease the burden of millions of people in poorer countries working abroad and spending most of their earnings every time they send money to their loved ones back home. Further, about half of the world’s adult population has limited or no access to banks and payment services. This is not only true for communities in underdeveloped countries. It is also a reality in ghettos in the richer countries, including the USA, where people are mugged for the cash they carry or robbed at home because they have no other way to store and secure whatever they have as their life savings. Having access to store and secure cash, as well as having the ability to pay and be paid, would open opportunities to improve many lives.
In addition to meeting fundamental needs to secure one’s wealth and transact, Bitcoin has other benefits that can potentially stimulate economic activity as massively as when the Lydian civilization introduced their coins to Europe and the Middle East thousands of years ago[i]. When transaction costs are very low, like with Bitcoin SV (BSV), microtransactions that are currently not possible with traditional systems become feasible. Microtransactions can be anything from a few dollars, euros or cents, or even fractions of a cent! This is very useful if you wish to charge in tiny increments, like per second or minute (of a video), per word (for writing and translating services), per page (for books or magazines), or per post (for classifieds ads, directory listings, etc).
If you are a teacher, expert, lecturer, coach, or instructor, imagine selling your videos, PDFs, audio instructions to anyone around the world? Yoga teachers and sports instructors can sell videos of classes, guides, or instructions. Maths and science tutors in Singapore or Germany can offer tutoring services to pupils and students in the USA or South America. If you are a programmer, a web developer, SEO, an Excel or Photoshop expert, imagine just being paid for small, odd jobs to a global market that can all add up to make a substantial income from which to start a consultancy business one day!
Many people do not attempt to take their hobbies to the next level because payment systems are complicated and expensive to set up and use. Millions of passionate, knowledgeable, talented hopefuls need to join websites that ask for membership fees and set-up fees that are way higher than they could earn when they are still just starting up and testing the market. Those who tried to set up a way to accept and process payments with their websites will know how expensive it is.
Most people with a business idea do not have the capital to quit their day jobs and put everything at risk to try something out. However, with Bitcoin SV, where transactions are cheap and fast, you can post an offer on Facebook, Twitter, a directory, or a freely-hosted blog, and a prospect from the other side of the world can pay you to your Bitcoin (SV) address, or with a QR code! You get a chance to service a customer or a client one at a time and slowly build up your cash flow. Even if you have no intention or ambition to become a full-time business, wouldn’t it be great to make a side income from what you already know or are already good at? If you are an artist, teaching what you know might help pay for your next month’s batch of paint. You can earn side income to buy equipment or instruments if you’re a musician. Bitcoin (BSV) allows you to monetize your hobby and anything else you are passionate about.
Much of the literature on Bitcoin focuses on the more extreme themes and considerations that it touches. It would not be a surprise if you believed Bitcoin is nothing but criminal money or a tool used by anti-government ideologues or extremists. These groups permeate many online channels, and understanding their possible incentives would help you observe the competing agendas. If we want to learn about Bitcoin, it is helpful to skip other people’s opinions and interpretations and go as close to the source as possible to gain valuable insight and knowledge ourselves.
In this article, we went straight to the Bitcoin Whitepaper. We learnt that Satoshi Nakamoto, the inventor of Bitcoin, was not motivated to create a cash system used for crime or a tool to take power away from governments. He had a more straightforward, more practical, and more empowering ambition. He wanted to build an electronic cash system that helps everyday people like you and me monetize our knowledge, skills, and talents by providing a way to accept and make payments cheaply, quickly, and easily to and from anyone around the world.
[This article was first published and featured in CoinGeek.com https://coingeek.com/bitcoin-is-not-made-for-crime-or-to-tear-down-government-it-is-made-for-you-and-me, 8 March 2022]
[i] We discussed this in a previous article, “How innovations in money changed the world and how Bitcoin will do the same” by Marquez Comelab, published by CoinGeek.com on 30 Nov 2021, URL: https://coingeek.com/how-innovations-in-money-changed-the-world-and-how-bitcoin-will-do-the-same.