'Bitcoin fixes' inflation and government control over people's wealth says 'The Bitcoin Standard' author
With the present global market instability, the notion that Bitcoin (BTC) is a safe haven against inflation has been called into doubt, and the flagship digital asset has seen tremendous downward pressure in recent weeks and months.
Austrian economist and author of ‘The Bitcoin Standard‘ Saifedean Ammous addressed the merits of Bitcoin in a recent interview with Lex Fridman on his podcast published on May 11.
Interestingly, Ammous discussed the benefits and criticisms of Bitcoin while challenges such as rampant inflation are impacting different economies across the globe as the asset is currently undergoing a bearish spell in the market. On these global issues, the economist stated:
“I think a very large number of problems in the world are caused by easy money, are caused by inflation, and caused by government having access to essentially an infinite recourse to people’s wealth and I think Bitcoin fixes this.
“It combines gold’s saleability across time with fiat saleability across space in one immutable package that nobody can change.”
Bitcoin’s consensus mechanisms remain largely untouched
Whatsmore, the economist emphasized that Bitcoin’s consensus parameters have not changed, saying that they are still the same.
Ammous pointed out that the vast majority of other digital currencies, if not all of them, have undergone several hard forks, which the community considers to be improvements. He noted the creators and founders by saying, “Bitcoin can’t upgrade, but we upgrade all the time.”
The author opined
“Well you know what else upgrades all the time, Facebook, Apple, Amazon. Anything that centralizes is very easy to upgrade and that’s precisely why as Michael Saylor says these things are somebody’s liability, they are security. You’re carrying on somebody’s technical and economic liability they can hard fork they can 10x the supply tomorrow.”
Bitcoin and its volatility
Much has been made about Bitcoin and its volatility; according to Ammous, one should consider tolerating volatility more because the other option is you hold fiat assets that only go down relatively stable.
“The dollar is not a lot of volatility day-to-day, the value of your dollar doesn’t change 40% or 20% overnight but it does go down reliably. It’s going to go down 40% you can count on it. So the option really is relatively short-term stability with long-term decline or short-term volatility with long-term rise.”
Finally, on Bitcoin and its energy consumption, the economist believes the digital asset’s energy consumption is worth it. Bitcoin, he noted, does not need to buy electricity from places where it has high demand because it can buy electricity from anywhere, “this is what’s truly mind-blowing about it, the electricity that you need for mining can be done anywhere.”
Watch the full interview: Saifedean Ammous discusses Bitcoin
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