The second and third paragraphs of the "Introduction" chapter provide a concise overview of Bitcoin (the lowercase letter prefix) as a unit of currency. Author AA begins by stating: "Users can transfer Bitcoin online, achieving almost all the functions of traditional currencies, including buying and selling goods, sending money to individuals or institutions, and providing credit services. Users can buy and sell Bitcoin on professional currency exchanges, or exchange it for other currencies. It can be said that Bitcoin is the ideal form of currency for the internet age—it is fast, secure, and borderless." However, it's clear that author AA primarily focuses on the practicality of BTC as a value transfer vehicle, without discussing its ability as a store of value. This deviates somewhat from the core value proposition currently supporting the consensus on BTC's value. Of course, considering that this book primarily introduces BTC as a practical currency, while the concept of value storage is actually the other side of practical currency and involves a completely different narrative, it's not appropriate to discuss them simultaneously. Furthermore, the book "Mastering Bitcoin" is technically oriented. A technical approach only needs the explicit narrative; the underlying narratives of value storage and currency over-issuance are more financially oriented and don't really need to be discussed in this book. Thinking about this, it's probably understandable why Satoshi Nakamoto's 2008 Bitcoin white paper only contained the positive narrative and completely lacked any secondary narrative. One reason might be that the white paper was technically oriented, not financially oriented. However, the absence of it in the white paper doesn't mean Satoshi Nakamoto was unaware of that narrative. Because in his forum posts, Satoshi Nakamoto was passionately advocating against the risks of over-issuance of centrally managed currencies, stating that the total supply of BTC was locked at 21 million, and so on. (See Chapter 9, Section 38, "Better Gold," of Liu Jiaolian's "A History of Bitcoin") The so-called professional currency exchanges mentioned by author AA are actually what are now known as centralized exchanges (CEXs). In the decentralized world, the crucial infrastructure for the interconnection and transfer of assets with the real world is actually a centralized platform, which carries a touch of dark humor and often becomes a point of criticism for the most steadfast proponents of decentralization. However, historical development has proven that CEXs, as a bridge and buffer between the purely idealistic decentralized world and the centralized real world, and even a means of cutting off on-chain data flow, are still products of market choice in the current stage of development. BTC, as a form of currency that is not anchored to any real-world value and is purely electronic and inherently digital, is extremely unique and has never appeared before in human history. Here, BTC's monetary form is first and foremost a form of existence. It is first and foremost an object, and only secondly a currency. That is to say, it is natural currency. It's like what Marx said: gold and silver are not naturally money, but money is naturally gold and silver (see Chapter 9, Section 36, "The Monetization of Commodities," in Liu Jiaolian's *A History of Bitcoin*). After the emergence of BTC, this statement needs to be revised and expanded: Gold and silver are not naturally atomic currency (commodity currency), but atomic currency is naturally gold and silver. Bitcoin is not naturally bit currency (digital currency), but bit currency is naturally Bitcoin. What is an atom? Hydrogen, helium, lithium, beryllium, boron... in the periodic table. What is a bit? 0 and 1. All fiat currencies fall into two categories: those pegged to gold and those not pegged to gold. The relationship between all fiat currencies and gold is also constrained by the Mundell-Fleming impossibility triangle: Fiat currencies pegged to gold are merely shadow currencies, similar to paper gold. They abandon the independent monetary policy (issue quantity entirely controlled by gold reserves) of the Mundell-Fleming triangle in exchange for stable exchange rates and free convertibility against gold. Fiat currencies not pegged to gold, which are the fiat currencies of almost all countries in the contemporary world, are almost entirely debt currencies. Debt currencies are essentially debt, merely the credit of the borrower. The end result of debt is default; the end result of debt currencies is zero. It regained the independent monetary policy within the Mundell-Fleming triangle, freeing the relevant authorities (composed of people, essentially human nature) from the constraints of gold and reclaiming independent monetary policy (allowing them to over-issue currency based on seemingly scientific and logically sound reasons fabricated by human nature). Therefore, it must use various overt or covert means to restrict its free exchange with gold to maintain its relative value to gold! In the long run, no matter how much restriction is imposed, its value relative to gold will inevitably tend towards zero. (See Chapter 10, Episode 41, "The Great Gold Robbery," in Liu Jiaolian's *A History of Bitcoin*). Therefore, the essence of all debt-based currencies is a Ponzi scheme. The life cycle of every scheme is: launch, control, crash, and collapse. The only difference is the length of the life cycle. Excellent operators possess strong control over the scheme and the willpower to resist the urge to crash and run, instead opting for long-term profit-taking. Such a scheme becomes an excellent one. Such operators become excellent operators like the Federal Reserve. The electronic and online payments we use every day are simply the electronic and digital forms of fiat currency. Electronic and digital fiat currency is still fiat currency. If BTC is to be considered the ideal internet currency, as AA wrote in his book, it's because of its fast transfer speed, high security, and cross-border nature. While the cross-border aspect offers a visibly obvious advantage over the incredibly slow international remittances, in terms of transfer speed and transaction security, BTC not only lacks a perceptible advantage over internet online and electronic payments for ordinary users, but it's even slower, more difficult to access, and more prone to errors. From a ChainTeaching perspective, BTC as a globally accepted payment currency is currently only a future vision. This vision is presented because it's the visible side of the story. The other side of the story is more important, but each reader needs to delve into it, think about it, and reflect upon it. The story of BTC is like a mirror called the "Mirror of Love and Lust"—on the surface, it's a bewitching beauty; on the other side, it's a mountain of bones. It's humanity's first attempt to recreate another form of gold using a completely different material (bits, not atoms)—that is, depriving humans of control over monetary policy and replacing it with a fixed, public algorithm to strictly constrain currency issuance (using powerful, distributed computing power to ensure the effectiveness and inviolability of this constraint); simultaneously, maintaining its complete free convertibility with gold (and all other forms of currency), without imposing any inherent restrictions; of course, according to the Mundell-Fleming triangle, it inevitably cannot maintain exchange rate stability relative to gold and other forms of currency—it will either depreciate or appreciate. When you truly understand all this, you will truly understand the saying: there are only two kinds of coins in this cryptocurrency market—Bitcoin and non-Bitcoin coins, commonly known as altcoins. All other non-Bitcoin coins are altcoins. The ultimate logic of altcoin economics, regardless of what it says or claims in its white paper, or how it promotes itself, is fundamentally destined to revert to the same Ponzi scheme logic as fiat currency. Without exception.
Alex
Brian
Kikyo
Hui Xin