{"id":56073,"date":"2025-04-01T17:34:50","date_gmt":"2025-04-01T17:34:50","guid":{"rendered":"https:\/\/mycryptomania.com\/?p=56073"},"modified":"2025-04-01T17:34:50","modified_gmt":"2025-04-01T17:34:50","slug":"beyond-the-vault-why-bitcoins-true-power-lies-in-motion","status":"publish","type":"post","link":"https:\/\/mycryptomania.com\/?p=56073","title":{"rendered":"Beyond The Vault: Why Bitcoin\u2019s True Power Lies In Motion"},"content":{"rendered":"

Bitcoin Magazine<\/a><\/p>\n

Beyond The Vault: Why Bitcoin\u2019s True Power Lies In Motion<\/a><\/p>\n

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Michael Saylor, you were forced to realise that all the store-of-value assets are defective and pushed you to focus on the only asset that is not. That does not make you immune to seeing the medium of exchange case. You will see how the housing market is huge when you watch it from one point of view and horrible from another. But if you experience pain driving you to keep your billions of dollars purchasing power, housing is a decent tool to keep it.<\/p>\n

Your SoV obsession misses the mark\u2014badly. The biggest aspect of Bitcoin is the medium of exchange. Even though the fiat system increasingly separates money\u2019s functions, that doesn\u2019t mean it should. I get that saying Bitcoin is a medium of exchange is kicking the hornet\u2019s nest, and all the other currency lords will try to stop Bitcoin. It\u2019d be great if they joined in instead of fighting it. That will give all the billionaires certainty that they can put money in it, but simply using Bitcoin just to store value is attacking it. That approach will turn it into digital gold 2.0, captured.<\/p>\n

There\u2019s no store of value without a medium of exchange! The medium of exchange comes first. You receive a transaction, then you store the Bitcoin. If the store of value were the main point, imagine announcing you lost your keys for your Bitcoin stack\u2014you\u2019d still store it perfectly, but without the medium of exchange function, the market will wipe out the fictional fiat value layered on top. That value is there exactly because it can move and still can be used as a medium of exchange.<\/p>\n

An oxygen tank is vital for reserves, but breathing matters more. The store of value is secondary and relies on the ability to transact. Without that, the store of value means nothing. Michael, you learned this firsthand when your million-dollar holdings in Argentina were diluted by 90%. You struggled to preserve the value not because you did not see it coming but because you couldn\u2019t use it as a medium of exchange. True, a poor store of value weakens the medium of exchange, but why does the latter take priority? Because the ability to exchange is what lets you respond.<\/p>\n

By now, most people exposed to Bitcoin know the chart from Jesse Mayers that you popularized. You claim there\u2019s no better idea than a $900 trillion clean store of value, then immediately call Bitcoin one of the world\u2019s most liquid markets, running 24\/7\/365. Guess what? Liquidity means medium of exchange.<\/p>\n

Now, let\u2019s break down the Jesse chart, starting with the housing market. It\u2019s valued at $330 trillion, but it\u2019s such a poor medium of exchange that it only trades for $1.3 trillion annually. Regulations and taxes make trading real estate even tougher. Still, since it\u2019s more than 100 times better as a store of value, billionaires prize it, increasingly dominating the market and pricing out younger generations.<\/p>\n

A house might be valuable, but its worth grows not just from what it is but from its ties to nearby utilities. Build a road to it, and the value rises. Add a superstore or a gas station, or connect it to the electrical grid, and the value climbs again. The network creates opportunities for energy to flow into the area, boosting the chance to capture that energy as economic value, like money. So the exchanges that happen in the network are what increases the value of a house. But I see the flip side: if you\u2019re a billionaire and everyone\u2019s after your resources, you don\u2019t want a big network around your house. You\u2019d prioritize privacy instead. The house might lose value, but the goal shifts to raising the cost for others to reach you, reducing the chance to be attacked.<\/p>\n

What about the bond market? Bonds are valued at $300 trillion as a store of value, with $140 trillion traded yearly plus $25 trillion in new bond issuance. That means the medium of exchange value is about 50% of its total value annually. It\u2019s better than houses in that sense, but the numbers still show people primarily use it as a store of value.<\/p>\n

Next up are equities. Valued at $115 trillion, they were traded for about $175 trillion. This shows their strength as a medium of exchange exceeds their store of value role. Take your MicroStrategy stock\u2014you know it better than anyone. How much value did it store last year, and how much was exchanged through it?<\/p>\n

The next two sections are interesting. The art industry\u2019s yearly transactions are so minor that they don\u2019t even register on the chart. Meanwhile, the cars and collectibles sector sees trading volumes of nearly $4 trillion annually. This highlights that they\u2019re mostly seen as a store of value each year, but it also reveals how poorly the housing market performs as a medium of exchange\u2014outdone even by the car market.<\/p>\n

Ooooh gold! Gold bugs rave that it\u2019s been around for over 5,000 years, calling it the ultimate store of value for whatever reason\u2014yet it\u2019s just 1.78% of the store of value market. This shows that once its medium of exchange role was stripped away, it became vulnerable to capture and manipulation. Sorry, gold bugs, that genie\u2019s not going back in the lamp. Gold holds $16 trillion in value, and the gold bugs claim it could store the $120 trillion worth of money in it. They\u2019re desperate to pump their bags, but the market disagrees, valuing the defective fiat money ten times higher than the shiny, lifeless rock. Is gold a better medium of exchange, then? It trades at $54 trillion yearly, boosted by derivatives, making its medium of exchange use 3.5 times its store of value role.<\/p>\n

Money might not dominate as a store of value among assets, but it\u2019s the leading medium of exchange by far. Other stores of value assets don\u2019t even come close. What if the dollar, the top currency, became just a store of value? It would collapse the USD network, boosting the value of non-US assets as their networks step in to meet the demand. Over time, their store of value assets would rise while USD assets would plummet. Global money totals around $120 trillion, but look at the top central banks\u2019 transaction volumes: Fedwire at ~$1,182 trillion, TARGET2 at ~$765 trillion, CHAPS at ~$145 trillion, and others (partial) at ~$500 trillion (a conservative estimate due to incomplete data). So, while the store of value is $120 trillion\u2014per the Jesse chart\u2014the medium of exchange utility of these networks is over 20 times greater, which is around ~$2.5 quadrillion. What would the medium of exchange value be if 2 billion unbanked people were included? How many more transactions would that spark? And what if microtransactions were possible?<\/p>\n

Where does Bitcoin fit into all of this? The prevailing narrative urges holders never to sell, positioning Bitcoin solely as a store of value. Yet, the market tells a different story. In 2024, Bitcoin\u2019s market cap hit $2 trillion, while the value exchanged on its first layer\u2014the blockchain\u2014reached $3.4 trillion. Factor in the Lightning Network (though its exact figures remain elusive), and the total likely approaches $4 trillion. This suggests that Bitcoin\u2019s role as a medium of exchange is twice as significant as its store-of-value function. So, what happens if that long-standing \u201chold forever\u201d propaganda narrative begins to fade?<\/p>\n

Bonds and equities are financial \u201cinstruments\u201d that pretend to be money because fiat currency is flawed. This creates a market that shuts out much of the population from safeguarding their wealth, further splitting money\u2019s store of value role. But how inclusive are these instruments? Or are they just tools to siphon value from the fiat medium of exchange, channeling it to privileged individuals and billionaires and others alike with a need to hoard?<\/p>\n

Globally, only 10-20% of people have exposure to bonds, mostly indirectly through pension or investment funds, not directly. For equities, 15-25% of the population has some access. That leaves at best 80% of humanity without these tools to protect themselves, making them vulnerable to exploitation. Splitting the store of value from the medium of exchange sets up a dynamic of extractors and the extracted. This amplifies the \u201ccantillion effect\u201d: those who can print the medium of exchange buy up store-of-value assets, sidelining 80% or more of people. It\u2019s a feedback loop that weakens the system, widening the gap between haves and have-nots. The more you print, the more you disconnect money from its store-of-value role.<\/p>\n

Another very big part of the whole system is the fees. There are fees for sending dollars via the banking system, and that is a service, but how much are the fees when you want to switch from the medium of exchange into the store-of-value instruments? A lot more. That is creating so much friction in the whole system, and it contributes to excluding the have-nots from storing their value. At this point, the medium of exchange turns more and more into the medium of extraction rather than for exchange. This is also a reason why the store of value case is more appealing in the fiat system.<\/p>\n

Bitcoin is not pretending to be money like everything else; it is the first engineered money that doesn\u2019t erode like a melting ice cube and doesn\u2019t discriminate. It is the money of those who choose it. With no printer behind it, there\u2019s no urge to swap it for a \u201cbetter\u201d store of value\u2014there\u2019s no second best. Even those without Bitcoin can use it to shape their lives into the lives they desire. Moving away from chasing money to store in something and instead building whatever enriches their lives on top of Bitcoin.<\/p>\n

The biggest idea isn\u2019t storing value\u2014it\u2019s moving it. But to move value, you first need to have some stored. Then again, to have some stored, someone needs to move some your way first. That\u2019s why the rich prefer assets that don\u2019t erode like a melting ice cube. Meanwhile, those starting their careers focus more on receiving value than storing what they don\u2019t yet have.<\/p>\n

Why does the store of value case draw so much attention? One reason could be the effort involved. With a store of value, you buy and hodl\u2014no work needed to improve your life. With a medium of exchange, you must work to grow your savings, persuading others to pay for your goods or services in Bitcoin. Another factor: for most, their fiat portfolio still outweighs their Bitcoin one. Only when Bitcoin surpasses their fiat holdings will they consider enhancing their lives with it. That shift isn\u2019t tough for much of the world\u2019s population, who lack savings or assets anyway. This might explain why the current system resists letting them exit, pushing dependency by offering to custody their Bitcoin\u2014trading one reliance for another.<\/p>\n

Even ossification ties into the need for more mediums of exchange use. You, Michael, strongly support ossification, but if Bitcoin isn\u2019t used to reach more people, you\u2019re delaying it. Unlike you, America knew that to make the dollar the world\u2019s reserve currency, they had to distribute it widely to lock in the network effect. They saw the network as the key to ossification, and it worked easily since printing and sharing bills cost little. With Bitcoin, its absolute scarcity requires balancing how much to spread versus store. Still, that doesn\u2019t mean you shouldn\u2019t spend any at all.<\/p>\n

The metaphor of storing fat in the body is key to long-term survival. True, but it overlooks the need for a steady food income to stay alive before storing fat. Without income, there\u2019s nothing to store\u2014so exchange comes first. Yet, for someone not worried about hunger, the focus shifts to storing food to prevent spoilage. I keep hammering this point to highlight your bias toward the store of value, which skews your judgment and misleads others.<\/p>\n

At this stage of my Bitcoin journey, I\u2019m certain of this: chasing money corrupts you. Bitcoin shifts that\u2014it stops you from pursuing money endlessly and lets you use it for the life you want. What happens when you have enough of everything you desire? What then? With Bitcoin, that\u2019s entirely possible, and every Bitcoiner should be ready with an answer for when it happens. Chasing money, though, is a bottomless pit you can\u2019t fill. The Bible says the love of money is the root of all evil. I agree, but how does it play out? What is the mechanism? Chasing money\u2014making it the top priority and making the other things lesser\u2014is the mechanism.<\/p>\n

You\u2019re not building a Bitcoin standard\u2014you\u2019re stacking a deck. Like gold in the past, you\u2019re the one this time hoarding Bitcoin from people and institutions, further entrenching the fiat standard. Saylor, you\u2019re not attacking the dollar as some believe\u2014you\u2019re bolstering it by boosting your stock and its ecosystem. Instead, you\u2019re speculatively hitting those who fund your Bitcoin buys. You\u2019re not just hurting them; by strengthening the dollar, you\u2019re amplifying the pain for other currency holders. Hoarding sats while the world watches? That\u2019s not a cybercity\u2014it\u2019s a gated estate funded by their own money.<\/p>\n

I wonder if people would want to invest their Bitcoin in your securities. How many would actually do it? I\u2019m sure true Bitcoin maximalists wouldn\u2019t trade their perfect store of value asset for a fiat \u201cinstrument.\u201d Ask yourself: at this point, would you spend your Bitcoin to buy Apple stock? You did invest in them before, after all. It makes no sense\u2014I\u2019d give you Bitcoin just for you to turn it into some fiat thing, pay fiat fees, bolster fiat custodians and third parties, only so you can buy Bitcoin again on the other end.<\/p>\n

In the end, I don\u2019t have proof, but I\u2019m fairly certain you already know everything I\u2019m saying in this article\/message. Though it\u2019s written to you, Michael, it\u2019s aimed at those who see you as the new Bitcoin Jesus, blindly following without questioning your actions. They make reckless bets in their own lives\u2014bets that could wipe out their Bitcoin\u2014lacking the financial safeguards and interest rates you have. Your messages, which they echo, don\u2019t apply to most of humanity.<\/p>\n

Bitcoin isn\u2019t just another asset or financial tool\u2014it\u2019s borderless, permissionless money for the people. Treating it otherwise diminishes its true worth. Merely storing it won\u2019t bring freedom. Letting sats flow builds the network. Letting sats flow fosters cooperation for a better future. Letting sats flow strengthens the ecosystem. Store some for tomorrow, but do not be the richest man in the grave\u2014save them for plans that keep them moving later.<\/p>\n

This is a guest post by Ivan Makedonski. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.<\/em><\/p>\n

This post Beyond The Vault: Why Bitcoin\u2019s True Power Lies In Motion<\/a> first appeared on Bitcoin Magazine<\/a> and is written by Ivan Makedonski<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"

Bitcoin Magazine Beyond The Vault: Why Bitcoin\u2019s True Power Lies In Motion Michael Saylor, you were forced to realise that all the store-of-value assets are defective and pushed you to focus on the only asset that is not. That does not make you immune to seeing the medium of exchange case. You will see how […]<\/p>\n","protected":false},"author":0,"featured_media":56074,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-56073","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-discovery"],"_links":{"self":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/56073"}],"collection":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=56073"}],"version-history":[{"count":0,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/56073\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/media\/56074"}],"wp:attachment":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=56073"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=56073"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=56073"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}