Bitcoin's network value

There are a number of ways you can value an asset. Here are the 2 most important ways.

1. Cost Method -How quickly you get your investment back
2. Market Value Method -What someone will pay you for the asset

When analyzing Bitcoin's market value we see a 140 Billion variation over the last 2 years; which is why there is a lot of truth to the fact that most people don't understand Bitcoin.

Another way to evaluate is via what people have paid for it.

This is called realized market cap. As you can see by the graph people as a whole have paid 102 Billion to store Bitcoin in their wallets. The value really went up 2 years ago when some people where paying US$20k to get a Bitcoin. If you average the cost out per Bitcoin -- Realized Market cap divided by active wallets-- people will have paid US$5700 for 1BTC. This means to me the cost of Bitcoin going below US$5700 is slim.

My history in Bitcoin

9 years ago today Doug and I where having a hard time understanding Paypal's role in our "current" monitary system. So, I mentioned the idea of Bitcoin to him. This (according to my gmail history --see image) was my first conversation with a friend about sending money over the internet. Paypal was already 10 years old and generating almost 1 billion every year. This is when Paypal decided to freeze money that was destined for Bitcoin. Now there are over 400 exchanges and every fiat currency can find a way into Bitcoin. In Canada yesterday, we had 86 million go in/out of btc/can, which is normal. See CBIX  What is so amazing to me, even though Paypal tried to stop Bitcoin, Bitcoin has now come out ahead.  Bitcoin is now worth 1/4 of a trillion dollars.

Using Bitcoin to store value/time.

People who understand these 3 concepts can't help but buy Bitcoin if they want to save for the future.

1. Where we are in relation to history.
With debt being used to finance stuff for the last 106 years we (as a society) have gotten used to central control of our lives -- the scarcity of time makes time to be the most important. This time control not only reaches to people living in China and Russia but also in democratic societies. On the gold standard, time could be exchanged for gold and later redeemed for time at a one to one ratio.  This was due to the scarcity aspect of gold (only 1.2% added every year).

2. How energy is related to value.
Quality of life is a factor of controlled energy consumption. This is why for last century we didn't see our store of time eroding. Technology has made many leaps in helping people save time; but to rely on technology rather than a sound forum of money is stupid.

3. Why is Bitcoin better that Gold as a store of value/time?
The main reason is you need an army to protect your gold whereas with Bitcoin you just need 24 key words memorised. Mind you, pain might get me to reveal my 24 words, but at least I don't have to worry about people stealing my money/time when I am not there to protect it. Bitcoin is the first liquid asset that humanity has created that is truly scarce.  All resources (gold / silver) are not scarce they are a product of human time (time is human's only scarce resource).  Every store of value/time we invented before Bitcoin can be diluted, whereas Bitcoin is based upon math and thereby halves every four years.  In 300 days Bitcoin's inflation will be at 1.80% which will enable better price stability and more scarcity. Go ahead and listen to Saifedean Ammous and Trace Mayer talk and see if you can poke any holes in their arguments.

Before I bought Bitcoin

Before I bought bitcoin, I thought the dollar was backed by gold.
Before I bought bitcoin, I'd never learned of fiat currency.
Before I bought bitcoin, I didn't understand fractional reserve banking.
Before I bought bitcoin, I never truly
considered the intentionally crippling deck stacking against the unbanked.
Before I bought bitcoin, I believed I was already experiencing personal financial freedom and I was in control of my own financial future.
Before I bought bitcoin, I thought bitcoin was silly because I assumed I could answer
"What is money?"
Before I bought bitcoin, I didn't know I needed to know these things.

Bitcoin is a life raft.
Bitcoin is freedom
Bitcoin is a catalyst, and so much more.

Buy bitcoin
Earn knowledge.

Bitcoin and Price

Most people enjoy holding what everyone else wants. That is why Technical Analyst is a thing. Computers have helped people figure out what others are up to better than ever before. So, according to Bitcoin T. A. it is going to be another 2 to 10 months before Bitcoin will be at a higher price.  In fact BTC should drop another $1000 before it hits its low. I am starting to believe TA more and more the older I get, thanks Tone Vay.

The real variable in my mind is when the fiat money system will collapse. That is a lot harder to predict because the central banks have a lot of leavers at their disposal. They could confiscate bank accounts. The could order all gold be sold to the government. They could limit withdrawals or just go on a fiat printing sprint.  If and when the fiat system collapses that is when it is best to have your monies in gold, silver or Bitcoin.

Living in -40 C the last week (-47 C was the lowest) you get to understand the value of being prepared. I heat with wood. Therefore I have a large storage of wood indoors for just the occasion. So,  it is hard to quickly acquire Bitcoin if and when fiat fails.

Right now most people don't understand the difference between Bitcoin and other cryptocurrencies.  My neighbour thinks Dodge-coin is the best crypto and it is has divisibility, securability, recognizability (not to the Bitcoin extent), portability, durability but not fungibility.  This is what people need to understand in order for the crypto market to take off.

Yesterday when QuadrigaCX had their court case in Canada it proved the importance of having your own keys. Having a ruling about crypto in Canada will help more people understand the laws about how crypto will be treated in Canada.