When viewed through the lens of necessity, we can better understand Bitcoin’s progression toward a broader, circular economy.

This is an opinion editorial by Aleks Svetski, author of “

It has become meaningless, virtual, arbitrary, pointless points which one group can make up at the expense of all other players in the game. And who are those players in the game? Well — it’s the rest of us, our livelihoods and of our scarce natural resources.

This is a model of the world that cannot last, in much the same way as the fool who jumps off a cliff attempting to fly thinks he’s beaten gravity for the first few seconds as he’s moving upwards.

When we extend the timescale a bit, we’ll find that gravity catches up. It always catches up.

Another example is the entire KYC/AML edifice, and the ridiculous new mandates like the “Travel Rule.”

Money exists so that two parties who do not know each other can exchange the product of their time and labor, for things each subjectively values more or less. “Knowing your customer” is fundamentally antithetical to the entire raison d’être of money and the scale it’s supposed to enable in society via efficient trade.

Imagine all of the wasted resources that go into:

• Unnecessary compliance
• Knowing all of your customers
• Reporting meaningless statistics for AML
• Licensing and regulations
• Bureaucratic negotiations and lobbying

Imagine how much more effective we could all be and how many resources we could save and allocate toward productive means if we were not forced to play this game. And to add insult to injury, think about how much privacy this entire “performance” compromises on the part of all “customers” involved. See these two idiot companies in Australia, within a week of each other recently:

It’s crazy.

Payments and financial privacy will not get better under the existing system. They’re only going to get worse.

Savings will not be protected under the existing regime. They will only continue to evaporate.

This is all why Bitcoin’s necessity as the foundation of a new monetary and payments network is only going to increase, as will the magnitude of its circularity.

There Is No Alternative.

It will be driven just as much by the decline of the existing fiat system, as the zero to one evolution of money that Bitcoin represents.

Incompatibility

One of Bitcoin’s most important and, for many, compelling features is incompatibility, specifically with the status quo or legacy money and payments.

Bitcoin is fundamentally unlike anything that currently exists and it is therefore by definition circular. Bitcoin can really only move over the Bitcoin Network. Any bitcoin that looks as if it interacts with the legacy system or perhaps even other “crypto networks” is just paper bitcoin.

Bitcoin is only truly recognized on the Bitcoin network, and vice versa: the Bitcoin network is only useful insofar as bitcoin can be moved on it. Bitcoin can only live on the Bitcoin network.

What more circularity can you ask for? This is not some interoperable shitcoin, or an exchange à la FTX or BlockFi, or some digital database with points. This is an entirely different beast that few understand, especially those who are arrogant or stupid enough to think they’re somehow larger or more significant than Bitcoin itself.

Bitcoin is as different to every other form of payments and money as the internet is to the flag communication system created by Genghis Khan almost 1,000 years ago.

It is a complete paradigm shift. It is a zero-to-one discovery and invention.

Zero To One

It’s worth noting that zero to one transformations are not always seen as “improvements” in the beginning, especially with respect to networks. They’re fundamentally different and require input and energy from the participant, much like the activation energy in a chemical reaction. But as new “catalysts” emerge, and different participants find themselves “energized” enough to change (as the necessity arises), the movement cascades, achieving both mass and scale, and we look back to wonder how we ever lived without it.

This is how we’ll all look back on Bitcoin decades from now.

Future generations that are free to transact globally, instantly and securely with a money that’s always on and incorruptible will look back on this period of fiat history and wonder how some could’ve ever been stupid enough to think Stephanie Kelton economics, where 2 + 2 = 435, would last.

In much the same way that we now take things like electricity for granted, or the internet, or Uber or social media, for that matter, we too will take Bitcoin for granted. People laughed at the early electricity pioneers, whether it was Nikola Tesla, George Westinghouse or even Thomas Edison. They couldn’t fathom what we’d need to use this mysterious power from God for, other than, perhaps, lights.

The internet was the same. The “greatest minds” of the time couldn’t imagine far beyond a fancy video and conferencing call medium. Some saw the potential for online shopping, but that was it until about two decades in. Now it forms the backbone of almost every major industry and artery of modern civilization.

I could go on, but I think you get the point.

In closing, to understand Bitcoin’s circularity, you need to look at Bitcoin’s holistic functionality, through a lens of necessity and time, and you need to get a feel for the incompatibility or paradigmatic shifts that occur with a zero-to-one types of discoveries or innovations (Bitcoin being a blend of both).

Bitcoin wins in the end because it has time on its side. Bitcoin is where the puck is going.

The legacy system loses because it is fighting a losing battle against entropy, and every move it tries to make to save itself is actually a move toward killing itself. The legacy system is where the puck was.

It’s over for fiat. It’s just going to take what seems like a long time to any one individual, but what’s really a very, very, verrrrry short time on a civilizational timescale.

What a time to be alive.

This is a guest post by Aleks Svetski, author “The UnCommunist Manifesto” and founder of The Bitcoin Times. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.