We’ve just seen how, unlike fiat currencies, Bitcoin achieves reliable digital scarcity with no one in charge. Here’s how it satisfies the remaining properties of sound money:
- Durability: the architecture of the blockchain makes it incredibly robust. Since every node has a copy of the ledger, destroying the Bitcoin network would require that all 50,000 nodes distributed around the world (and above) would need to be destroyed at the same time, along with however many backups there are. That’s very unlikely.
- Divisibility: Bitcoin’s smallest unit, called a Satoshi, is 1/100,000,000 of one coin. In today’s values, that’s orders of magnitude more precise than even the smallest microtransactions would require. However, due to network fees, that level of precision isn’t currently practical – we’ll discuss this below..
- Fungibility: all bitcoin are created equal and have equal value – just like one gram of gold is equal to any other gram of gold.
- Portability: Bitcoin is entirely digital and incredibly portable. It can be stored on a computer, mobile phone, and on paper. It can be instantly transferred anywhere in the world with just an internet connection – and even without one..
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