Breaking ChatGPT’s Bitcoin FUD #10: Mainstream Acceptance - part 1...
Vlad Costea's "Breaking FUD" series continues finishes with the 10th "top threat" to Bitcoin according to ChatGPT. Perhaps Bitcoin never gains mainstream acceptance. What does Vlad think about that? Read on to know...
On to the segment from the e-magazine "BTCTKVR 3: Breaking FUD", released May 2023.
"Breaking ChatGPT’s Bitcoin FUD #10 – part 1: Mainstream Acceptance
ADOPTION, MAINSTREAM, EL SALVADOR, LEGAL TENDER
According to ChatGPT, the fact that bitcoin still didn’t reach mainstream acceptance among businesses and individuals is a big issue. Presumably, this is a threat for the entire Bitcoin project. And while I agree that creating demand for the currency by offering products and services in exchange for it is an integral part of building an economy, I still believe that the AI model’s expectations are unrealistic and this piece of FUD is silly.
To better explain why I’m not taking ChatGPT’s FUD about mainstream acceptance too seriously at this point, I’m going to have to define mainstream acceptance (or adoption). A first definition concerns nation state adoption, which El Salvador and the Central African Republic pioneered. The second definition focuses on bottom-up grassroots adoption, which is more significant and ideologically aligned with the mission of the Bitcoin project. It includes businesses, individuals, and everything in between which concerns the private sector.
Is Bitcoin such a failure or disappointment in terms of nation state adoption? Well, let’s compare it with the two biggest fiat currencies in the world: the US dollar and the euro. The US dollar was first conceptualized on July 6th 1792, and it took another 6 years and 9 months until it became the United States of America’s official currency through the Coinage Act of 1792. However, it wasn’t until 1944 that the dollar became the world reserve currency – 152 years since launch and approximately 158 years since the first announcement.
In the case of the euro, it’s the result of decades of discussions about a single European currency to challenge the US dollar’s supremacy. It was first announced on February 7th 1992 as part of the Maastricht Treaty, and it became an official currency in 11 European countries at once on the first day of January 1999. Due to the fact that the German mark was already a reserve currency worldwide, the euro instantly inherited this property. As of May 2023, Bitcoin has only been around for 14 years and 4 months. 12 years into its existence, it became an official currency in El Salvador.
The Central African Republic also embraced bitcoin in April 2022, but gave up on it only a year later. Though this adoption happened in a top-down manner, the use of bitcoin is not enforced by the states – meaning that using bitcoin is legal for all types of payments, but the government won’t use its monopoly on violence to coerce merchants and banks to accept bitcoin. In the case of the euro, the Italians, Spaniards and Germans had no choice but to exchange their lira, pesetas and marks for the new currency that they were obligated to use in all transactions. In comparison, this first wave of nation state-level bitcoin adoption is much more voluntary.
But Bitcoin wasn’t created to serve governments of nation states. It exists as a way for individuals to opt out from tyranny and escape the consequences of central bank-driven inflation. The intended purpose of the project was made clear by creator Satoshi Nakamoto in the network’s first block: “Chancellor on the brink of second bailout for banks” – a direct quote from the front page of The Times, a British newspaper which made a headline out of Chancellor Alistair Darling’s decision to save the banks at the expense of all taxpayers on the same day that Bitcoin launched.
Bitcoin is not issued or controlled by any country, it functions according to a predictable monetary policy which is clear and transparent for all participants and relies entirely on voluntary interactions. This type of digital currency can’t be confiscated, frozen, or taxed. Nobody can stop a certain user from installing, using, or else building their own wallet to participate in this economy. Furthermore, nobody can stop individuals from securing the ledger which contains the entire history of transactions and then broadcasting their own transactions to the network through their full node. And if users want to provide thermodynamic security to Bitcoin and also participate in the money issuance process, they can deploy their own solo or collaborative mining operations.
In many ways, any comparison with existing types of money is wrong – mostly because we put side by side metrics from a free, transparent and voluntary system, and data from a trust-based, military-enforced, and politically coercive apparatus. It’s a choice between freedom and submission to the big bully.
Nonetheless, it’s still useful to understand that Bitcoin has accomplished quite a lot during its existence of 14 years and will only become more accepted as a worldwide currency specifically because its competitors are dishonest and untransparent.
Free markets outlive elections, regime changes, and governments. Likewise, non-governmental and uncensorable internet money will outlive any type of financial central planning. Historically speaking, markets and neutral money tend to stick around for longer than empires, nations, and different waves of migration. The Silk Road consisted of Eurasian trade routes that lasted for about 1500 years, while gold and silver have been used as money since at least 550 BC. Bitcoin is relatively young, but it has already set a nice record of withstanding crises and navigating through chaos.
The most important part of Bitcoin’s mission is for it to be adopted by people who need it and provide more economic freedom to the world. For now, it mostly works as a blackmail against governments and central banks–they either agree to maintain a reasonable degree of accountability by not devaluing everyone’s savings, or else the people will refuse to use their currency and pay taxes. Bitcoin is the effective protest, a tool that works much better than marching in the streets and signing petitions. However, the main condition is that the people use it in a non-custodial and sovereign manner.
This, I believe, is the main barrier that still stands between Bitcoin and mass adoption – or, as ChatGPT calls it, mainstream acceptance. Even today, when the user interfaces are friendlier, there are quirks and frequent roadblocks that make the experience bumpy. Sometimes the on-chain transaction fees rise for awhile and transactions get stuck in the mempool. Other times Lightning payments fail due to a communication error. There are times when managing UTXOs induces headaches. These issues can be tricky to identify even from an advanced user’s perspective."
Vlad will finish his showdown with ChatGPT over Bitcoin threats in part 2... coming soon after this post.
I'm Charles Polanski and I seek to turn the Bitcoin-curious into Bitcoin investors and enthusiasts.
Thanks to Vlad for making this excerpt available to freely spread.
Find him on Twitter: @TheVladCostea
"Your Bitcoin influencer's influencer."
Host of the Bitcoin Takeover Podcast
Writer of the open source @btctkvr mag.
Check out his work: http://linktr.ee/btctkvr