Saifedean Ammous
Bitcoin distributed software transfer value inflation
“Bitcoin can be best understood as distributed software that allows for transfer of value using a currency protected from unexpected inflation without relying on trusted third parties”
—Saifedean Ammous
money costly produce wealth savers
“For something to assume a monetary role, it has to be costly to produce, otherwise the temptation to make money on the cheap will destroy the wealth of the savers, and destroy the incentive anyone has to save in this medium”
—Saifedean Ammous
World War I monetary media free market governent
“World War I saw the end of the era of monetary media being the choice decided by the free market, and the beginning of the era of government money”
—Saifedean Ammous
hyperinflation government money gold silver standard
“Hyperinflation is a form of economic disaster unique to government money. There was never an example of hyperinflation with economies that operated a gold or silver standard”
—Saifedean Ammous
21th century unsound money paper force people violence
“The twentieth century was the century of unsound money and the omnipotent state, as a market choice in money was denied by government diktat, and government-issued paper money was forced on people with the threat of violence”
—Saifedean Ammous
sound money time preference dcision present future
“Sound money is a prime factor in determining individual time preference, an enormously important and widely neglected aspect of individual decision making. Time preference refers to the ratio at which individuals value the present compared to the future”
—Saifedean Ammous
money value consumption capital accumulation
“The better the money is at holding its value, the more it incentivizes people to delay consumption and instead dedicate resources for production in the future, leading to capital accumulation and improvement of living standards”
—Saifedean Ammous
money value society save consume capital
“The move from money that holds its value or appreciates to money that loses its value is very significant in the long run: society saves less, accumulates less capital, and possibly begins to consume its capital”
—Saifedean Ammous
civilization prosper money disintegrate Romans Byzantine
“Civilizations prosper under a sound monetary system, but disintegrate when their monetary systems are debased, as was the case with the Romans, the Byzantines, and modern European societies”
—Saifedean Ammous
sound money gain value time
“Sound money is money that gains in value slightly over time, meaning that holding onto it is likely to offer an increase in purchasing power”
—Saifedean Ammous
capitalism time preference debt asphyxiation respiration
“Capitalism is what happens when people drop their time preference, defer immediate gratification, and invest in the future. Debt-fueled mass consumption is as much a normal part of capitalism as asphyxiation is a normal part of respiration”
—Saifedean Ammous
cause economic growth delay gratification productivity
“The only cause of economic growth in the first place is delayed gratification, saving, and investment, which extend the length of the production cycle and increase the productivity of the methods of production, leading to better standards of living”
—Saifedean Ammous
modern artists craft practice shock indignation angst
“Modern artists have replaced craft and long hours of practice with pretentiousness, shock value, indignation, and existential angst as ways to cow audiences into appreciating their art, and often added some pretense to political ideals, usually of the puerile Marxist variety”
—Saifedean Ammous
prices tool capitalist profit information system coordinate
“Prices are not simply a tool to allow capitalists to profit; they are the information system of economic production, communicating knowledge across the world and coordinating the complex processes of production”
—Saifedean Ammous
economy central bang fractional reserve politicians generals
“In an economy with a central bank and fractional reserve banking, the supply of loanable funds is directed by a committee of economists under the influence of politicians, bankers, TV pundits, and sometimes, most spectacularly, military generals”
—Saifedean Ammous
central bank prevent recession pyromaniac fire brigade
“Imagining that central banks can “prevent,” “combat,” or “manage” recessions is as fanciful and misguided as placing pyromaniacs and arsonists in charge of the fire brigade”
—Saifedean Ammous
print money power government
“Having the ability to print money, literally and figuratively, increases the power of any government, and any government looks for anything that gives it more power”
—Saifedean Ammous
supply bitcoins Nakamoto macroeconomics money
“By placing a hard cap on the total supply of bitcoins, Nakamoto was clearly unpersuaded by the arguments of the standard macroeconomics textbook and more influenced by the Austrian school, which argues that the quantity of money itself is irrelevant”
—Saifedean Ammous
society stable money time preference future
“Societies with money of stable value generally develop a low time preference, learning to save and think of the future, while societies with high inflation and depreciating economies will develop high time preference as people lose track of the importance of saving”
—Saifedean Ammous
fiat money monetary spigot customer credit competitor
“In the world of fiat money, having access to the central bank’s monetary spigots is more important than serving customers. Firms that can get low-interest-rate credit to operate will have a persistent advantage over competitors that cannot”
—Saifedean Ammous
banking business risk returns
“Banking has evolved into a business that generates returns without risks to bankers and simultaneously creates risks without returns for everyone else”
—Saifedean Ammous
Bitcoin digital object scarce cash
“Bitcoin was the first engineering solution that allowed for digital payments without having to rely on a trusted third-party intermediary. By being the first digital object that is verifiably scarce, Bitcoin is the first example of digital cash”
—Saifedean Ammous
central bank money finance lending Bitcoin resources ledger
“Whereas in a modern central bank the new money created goes to finance lending and government spending, in Bitcoin the new money goes only to those who spend resources on updating the ledger”
—Saifedean Ammous
difficulty adjustment reliable technology hard money
“Difficulty adjustment is the most reliable technology for making hard money and limiting the stock-to-flow ratio from rising, and it makes Bitcoin fundamentally different from every other money”
—Saifedean Ammous
Bitcoin hardest money value supply network secure attack
“Bitcoin is the hardest money ever invented: growth in its value cannot possibly increase its supply; it can only make the network more secure and immune to attack”
—Saifedean Ammous
security Bitcoin assymmetry cost proof-of-work verify validity
“The security of Bitcoin lies in the asymmetry between the cost of solving the proof-of-work necessary to commit a transaction to the ledger and the cost of verifying its validity”
—Saifedean Ammous
Bitcoin ledger blockchain objective facts
“The Bitcoin ledger of transactions might just be the only objective set of facts in the world”
—Saifedean Ammous
Bitcoin digital goods transfer stop own sender
“Bitcoin is the first example of a digital good whose transfer stops it from being owned by the sender”
—Saifedean Ammous
digital age bitcoin technological leap cattle salt gold silver
“As the digital age has introduced improvements and efficiencies to most aspects of our life, Bitcoin presents a tremendous technological leap forward in the monetary solution to the indirect exchange problem, perhaps as significant as the move from cattle and salt to gold and silver”
—Saifedean Ammous
Bitcoin volatility supply demand
“Bitcoin’s volatility derives from the fact that its supply is utterly inflexible and not responsive to demand changes, because it is programmed to grow at a predetermined rate”
—Saifedean Ammous
Bitcoin future guarantee debase value
“Bitcoin is the cheapest way to buy the future, because Bitcoin is the only medium guaranteed to not be debased, no matter how much its value rises”
—Saifedean Ammous
Bitcoin global wealth government voluntary tax
“If Bitcoin continues to grow to capture a larger share of the global wealth, it may force governments to become more and more a form of voluntary organization, which can only acquire its “taxes” voluntarily by offering its subjects services they would be willing to pay for”
—Saifedean Ammous
modern central bank disrupted digital competitor
“The modern central bank business model is being disrupted. Central banks now have no way of stopping competition by just passing laws as they have always done. They are now up against a digital competitor that most likely cannot be brought under the physical world’s laws”
—Saifedean Ammous
non-Bitcoin blockchain worst structure risk trust
“A non-Bitcoin blockchain combines the worst of both worlds: the cumbersome structure of the blockchain with the cost and security risk of trusted third parties”
—Saifedean Ammous
saifedean ammous bitcoin grief five stages denial anger bargain
The Five Stages of Dealing with Bitcoin Grief:
1) Denial: "Bitcoin can't work and will die"
2) Anger: "Ok, Bitcoin works, but government should ban Bitcoin"
3) Bargaining: "Ok, government can't ban Bitcoin, but it's not important. What's interesting is blockchain, the technology behind Bitcoin"
4) Depression: "All blockchains other than Bitcoin will fail"
5) Acceptance: "Bitcoin is gunpowder, the later you adopt it, the worse off you will be"
—Saifedean Ammous
curicculum corrupt reality government policy
"But in an academic system completely corrupted by government money, the curriculum is not determined through its accordance with reality,but with its accordance with the political agenda of the governments funding it."
—Saifedean Ammous