The Modern Dystopia – How Fiat Has Turned Us Into Number Junkies
Everybody is trying to get you hooked. Some peddle illicit substances in the black market, hoping you become dependent on them, so they can profit from you. These dealers typically focus on substances that are physically addictive since these are often the most challenging to quit. This scenario is a paradise for drug traffickers and dealers. They are almost guaranteed a constant flow of customers, as long as they survive. However, this addiction devastates the quality of life for the user. Their life revolves around their next hit. The dealer’s challenge lies in the illegality of the product. To remain in business, a dealer must be careful, cautious, and willing to incur expenses. Additionally, many potential customers are deterred by the negative reputation associated with drugs. So, what’s the solution?
If the problem is legality, why not create legal drugs? Pharmacies sell legal drugs, many of which are equally addictive. There’s a drug for every ailment and multiple for the common cold. Some, like a simple nasal spray, are addictive and can lead to a lifelong condition that “hooks” you. It’s the same business model as street dealers, but with fewer obstacles, less risk, and a better public image. The only requirement is that the clients must be “sick”.
Consider supermarkets, where the market may be saturated, but nearly everyone is a potential customer – everyone eats. Junk food can be highly addictive and can make consumers sick. Ill junk food addicts might resort to pharmaceuticals without altering their eating habits, exacerbating the issue. As damaging and widespread as these addictions may seem, there’s an even larger global addiction: the obsession with numbers.
The first instance of number addiction is seen in fiat currencies. They allow transactions with everyone in a specific country. It’s incredibly convenient to use these numbers as a means of exchange. Number addicts often say: “I can’t buy anything with bitcoin, so I’m not going to buy any.” Essentially, they are saying, “I am hooked on the convenience of a medium of exchange even though my purchasing power will decrease.”
Some people understand that money is usually static. It’s active when people are transacting and passive when they’re just saving it for later. To effectively store value, money needs to maintain (or increase!) its purchasing power over time. When I have savings, I should not be forced to actively manage it. Hence, entire market segments focus on the passive use of money. It is odd how the system forces you to actively use your money to solve the passive use – it seems counterproductive. Nonetheless, you can’t allow it to depreciate due to inflation. The main categories here are – bonds, real estate, equities, gold, and art.
The advantage of a bond is its pledge to return more numbers after a certain period. This promise is “guaranteed” by the state. Indeed, they do! They provide you with an increased number of digits, and even with the additional digits, your purchasing power is less than when you began. However, it’s still better than just saving. The bond number addicts will not buy bitcoin because bitcoin in cold storage generates no interest.
The advantage of real estate is a number “yield” in the form of rent and the numerical value of the property will increase. The value of the property is a function of the returns it generates every month. The numerical value of the building increases because the depreciation of the fiat numbers occurs faster than the degradation of the physical structure. Real-estate addicts will not buy bitcoin because it is not tangible and does not pay any digits for rent.
Financial “engineers” create products for people to bet against each other. The whole concept of a stock market is that you sell something you have for something else that may increase in numerical value. Each trade has a winner and a loser, but like in a casino, the house always wins in the end. Yet another addiction with a different kind of dealer. The Bitcoin system is consolidating everything into one. In a bitcoin economy, there are no losers because one person’s profit is not necessarily a loss for another. These addicts would not buy Bitcoin because there is no betting system in Bitcoin and they can’t do call or put options or other illusionary “engineering” things so the insiders benefit. If you just buy Bitcoin and HODL for when you need it then all the dealers of that addiction will be out of business.
Gold addicts are fixated on the metal without realizing how it can be used against them. How can anyone tell us the market cap of gold if no one can tell us the exact weight numbers of the gold that is found? This is the modern Schrödinger’s cat. Now owning gold is represented only by a number on a screen, reducing it to the same status as fiat. With fiat currencies, one piece of paper has the number 1 on it and the other has the number 100 on it. We don’t care that they are on the same paper value but we value the numbers written on the paper. The gold number addiction is the same, but it took longer to foster because everyone can measure its weight rather than rely on arbitrary numbers. Nobody can put 100 on top of 1 kilogram of gold and tell you that it is 100 kilograms. But since digital displays of gold ownership have largely replaced physical possession, it follows the same mechanism as paper. Gold addicts say that bitcoin lacks physical (metal) properties, so it has no value, and they won’t buy it.
What about the art number addicts? Their views on bitcoin aren’t very well known since they aren’t very active in the discourse. The benefit of art lies in the emotions it evokes. When Bitcoin starts to demonetize the art industry, we will see art number addicts defending its value. Art should be art, it should not be a method for a store of value.
The next number addiction dominating today’s societies is loyalty programs, like air miles, and loyalty points for discounts, promotions, and exclusive offers. Even today, my grandmother is looking through the brochure of EVERY store in the area to find a discount of 10 cents cheaper bananas per kilo. Because the companies can’t print currency numbers they print loyalty numbers. They not only have much greater purchasing power inflation than currencies (most of the time) but they also have much greater controls over when, where and how to actively use them. The addicts of the loyalty numbers start orienting their lives around the loyalty program numbers and the dealers love it.
The next number addiction is social media. People become hooked on subscribers, likes, views, etc. The benefit they provide is the platform, the ability to reach a far larger audience than through face-to-face interactions. This addiction is not directly connected to money, but all those numbers are what promoters, sponsors and everyone is looking at sponsors and subscribers automatically convert metrics into value to assign worth in fiat.
The next number addiction is to video games. Gamers become addicted to the tokens required to “unlock” the “special” item. They start pursuing those token numbers so fervently in the virtual world that they forget to live in the real one. As young players grow older, their addictions often transition from game tokens to other number dealer systems.
The current FOMO number addiction is to blockchains. Their benefits include faster transactions, more anonymity, and smart contracts to reel you in. If the creator is not a direct scammer and genuinely wants to provide these benefits to people, he is essentially saying that the benefit he provides is more important than incorruptible money. The benefit of smart contracts surpasses incorruptibility. That is probably a misunderstanding that secure and decentralized money is the foundation that gives you certainty to build everything on top. If you want to launch rockets into space you do not change gravity to make your use case easier to achieve. If you do, you will destroy all the sports where people need to jump. All the tall buildings and trees will collapse because for winds it will be much easier to tilt them. You destroy the way of life on earth but it is nice that we can go to space. If you believe that the benefit is worth it then do the work and build it on Earth without destroying it. Build on Bitcoin!
The next addiction is to the numbers of the custodians. Bitcoin ETFs were eagerly anticipated and have garnered plenty of praise. But their custodians are getting the gamblers hooked on convenience. Give me your bitcoin in my custody because you are unfit to hold it yourself. Give me your Bitcoin, and I will give you numbers.
The common trait among all these number addictions is that they offer some benefit in exchange for dependence on certain number lords. Once people experience the benefit, it becomes the trap. That is one of the struggles of Bitcoin enthusiasts to accept that there are benefits to all the addictions mentioned above. Bitcoin has its benefits and limitations, but the benefits of Bitcoin do not negate the benefits of other things.
This is the root of the biggest clash between Bitcoin enthusiasts and crypto enthusiasts. Bitcoin enthusiasts should not dismiss other cryptocurrencies just because they are inferior. Instead, we should compete with them just like we have been for the past 15 years. Some of them do provide nice benefits to get people hooked to their blockchain numbers. When we as Bitcoin enthusiasts do not compete with them and learn what we can, we are going to deprive Bitcoin of those benefits. Bitcoin probably shouldn’t adopt every feature that emerges somewhere in the crypto world, but competition fosters improvement. As a former professional athlete, I can say that my skills improved the most after losing to a weaker opponent. When a weaker opponent defeats a stronger one, it only means that he revealed a weak spot. Just because the weaker opponent won does not imply that the rules are unfair and need to be changed or the weakling should be disqualified. That is the tactic of the fiat number lords. If we want to beat more powerful opponents (i.e. fiat currencies), we must also face the weaker ones. Bitcoin’s obvious weak spot was, until recently, its throughput. Enter Lightning Network.. Privacy? Welcome to eCash on top of Bitcoin.
The Struggle for Control Persists in a New Domain – The Number Lords Are Capturing Bitcoin Number Addicts
The addiction is so embedded in all of us that even when someone understands Bitcoin and its implications, they transfer their number addiction onto Bitcoin.
