This is an opinion editorial by Tim Niemeyer, co-host of the Lincolnland Bitcoin Meetup.
As you may have learned from watching the mainstream news, the bitcoin price has skyrocketed lately. If you bought the top and kept it up until now, you may want to consider taking the advice of the same good old Mr. Goldshill, Peter Schiff, and take advantage of this opportunity to sell. However, if you are someone who missed the train, you can reasonably wait for confirmation and buy close to $70,000. For those who are looking to make a quick buck, you can hop on for a ride just to try and cash in near the next all-time high. If you’re a communist who doesn’t think we need a non-coercive way to coordinate human action… well, then I can’t help you.
Whatever your story or specific situation, one thing is clear: buying bitcoin is not going to help you.
Yes, you read that right. The physical act of exchanging one monetary good for another does almost nothing for you. Sure, you can earn a few bucks in the short term (except for up to 37% in taxes on short-term gains). You might even get a girlfriend. Pay for the next vacation? lambos? Why not?! But none of that matters because the final value of bitcoin is not merely quantitative, but qualitative. And to get the qualitative benefits, you’ll need to prove that you’ve done some work…
Work test
The gift of bitcoin lies in the unfathomable unlocking of the understanding you receive from spending the time and effort to study it. The bad news is that there are so many different rabbit holes to go down. You could spend months or years learning about any of the following: cryptography, computer science, distributed systems, open source software, network effects, game theory, economics, monetary theory, 11th grade mathematics, energy production, geopolitics, history, human rights, philosophy, human psychology, personal responsibility, just to name a few… a few. The good news is that there are so many rabbit holes to go down. I have been studying Bitcoin since 2018, and have yet to come close to exhausting the depth and breadth that Bitcoin offers. On top of that, derived wisdom is rooted in reason and logic; it acts as an anchor in a world where reality is constantly and increasingly manipulated.
Initially, it’s hard to deal with the fact that you’ve gotten used to living in a relatively short-term mindset, as we all have at some point in our lives. This short-term mindset is what bitcoiners refer to as “high time preference.” It may take some time, but understanding how the money we choose changes people’s incentive structure is the first step in understanding why Bitcoin is the best form of money. Inflationary fiat currency incentivizes its users to make decisions based on present needs, while disinflationary bitcoin incentivizes its users to plan for the future while de-prioritizing present consumption. It took me years of intense study to get to a point where I could articulate that point and really grasp its effect on society. Don’t expect to get there in a conversation, article, or podcast. This knowledge can only be spoon-fed to a certain extent. You have to build a “proof of work” mentality. Unfortunately, many of your friends think they already know what they don’t know…
Dunning-Kruger around and find out
Source: author
Wikipedia States that the Dunning-Kruger (DK) effect is a cognitive bias whereby people with little ability, expertise, or experience in a certain type of task or area of knowledge tend to overestimate their ability or knowledge. A main reason why most standards do not take the time and effort to do their own research, or DYORit is due to arrogance.
The most recent and obvious example of this regarding Bitcoin occurred during Recent Joe Rogan Interview featuring New York Times bestselling geopolitical strategist, speaker, and author Peter Zeihan. While this guy is outwardly smart and well versed in much of what he writes and talks about, he completely exposed his complete lack of knowledge and understanding of Bitcoin (and basic monetary theory) in less than three minutes. For a great breakdown of how epically wrong I was about Bitcoin, listen up. Guy Swann’s Brilliant “Bitcoin Audible” Podcast.
The point here is not to hit Zeihan (too much). The point is that we are all human and can easily make incorrect assumptions based on misconceptions and ignorance. To approach Bitcoin, you need to start with a level of humility and intellectual honesty. Unfortunately, many of us will outsource this to “reliable” media sources full of people who still have to do the work themselves. This is a core concept within Bitcoin: do not trust, verify. If you choose to trust those who show bravery but lack deep knowledge, you will end up sharing your same misconceptions. You have to do the work yourself and come to your own conclusion. It takes… time (pun fact intended).
It takes time…
The physical act of buying bitcoin is not the pinnacle of virtue. If you want to capture the full value that Bitcoin offers, you need to show the proof of mental work necessary to understand at least a fraction of what this invention can do. However, most of your normal friends won’t. Many will continue to believe that the solution to life’s ills can be resolved by submitting their will to an equally flawed human, either red or blue. Others will return to their bread and circuses. Most will lose focus to support “what’s next.” Everyone will have their reasons and justifications. Some of your friends will even convert salty enemies or remain intellectually dishonest.
You, on the other hand, have the opportunity to expand and grow, to see outside of yourself. Reduce your time preference. Face your Twitter addiction. Turn off your television. Anchor yourself in reality. Don’t listen to any cocky DK. read a book. listen to an audiobook. Download a podcast. Ask questions. Attend a local meeting. Show your work. Take the orange pill. Do your own research. I humbly implore you, do not buy bitcoin. Just learn about it.
This is a guest post by Tim Niemeyer. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
