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@ Andrey Arapov
2025-05-19 13:53:15An honest response to objections — and an answer to the most important question: why does any of this matter?
\ Statement: Deflation is not the enemy, but a natural state in an age of technological progress.\ Criticism: in real macroeconomics, long-term deflation is linked to depressions.\ Deflation discourages borrowers and investors, and makes debt heavier.\ Natural ≠ Safe.
1. “Deflation → Depression, Debt → Heavier”
This is true in a debt-based system. Yes, in a fiat economy, debt balloons to the sky, and without inflation it collapses.
But Bitcoin offers not “deflation for its own sake,” but an environment where you don’t need to be in debt to survive. Where savings don’t melt away.\ Jeff Booth said it clearly:
“Technology is inherently deflationary. Fighting deflation with the printing press is fighting progress.”
You don’t have to take on credit to live in this system. Which means — deflation is not an enemy, but an ally.
💡 People often confuse two concepts:
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That deflation doesn’t work in an economy built on credit and leverage — that’s true.
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That deflation itself is bad — that’s a myth.
📉 In reality, deflation is the natural state of a free market when technology makes everything cheaper.
Historical example:\ In the U.S., from the Civil War to the early 1900s, the economy experienced gentle deflation — alongside economic growth, employment expansion, and industrial boom.\ Prices fell: for example, a sack of flour cost \~$1.00 in 1865 and \~$0.50 in 1895 — and there was no crisis, because wages held and productivity increased.
Modern example:\ Consumer electronics over the past 20–30 years are a vivid example of technological deflation:\ – What cost $5,000 in 2000 (e.g., a 720p plasma TV) now costs $300 and delivers 10× better quality.\ – Phones, computers, cameras — all became far more powerful and cheaper at the same time.\ That’s how tech-driven deflation works: you get more for less.
📌 Bitcoin doesn’t make the world deflationary. It just doesn’t fight against deflation, unlike the fiat model that fights to preserve its debt pyramid.\ It stops punishing savers and rewards long-term thinkers.
Even economists often confuse organic tech deflation with crisis-driven (debt) deflation.
\ \ Statement: We’ve never lived in a truly free market — central banks and issuance always existed.\ Criticism: ideological statement.\ A truly “free” market is utopian.\ Banks and monetary issuance emerged in response to crises.\ A market without arbiters is not always fair, especially under imperfect competition.
2. “The Free Market Is a Utopia”
Yes, “pure markets” are rare. But what we have today isn’t regulation — it’s centralized power in the hands of central banks and cartels.
Bitcoin offers rules without rulers. 21 million. No one can change the issuance. It’s not ideology — it’s code instead of trust. And it has worked for 15 years.
\ \ Statement: Inflation is an invisible tax, especially on the poor and working class.\ Criticism: partly true: inflation can reduce debt burden, boost employment.\ The state indexes social benefits. Under stable inflation, compensators can work. Under deflation, things might be worse (mass layoffs, defaults).
3. “Inflation Can Help”
Theoretically — yes. Textbooks say moderate inflation can reduce debt burdens and stimulate consumption and jobs.\ But in practice — it works as a stealth tax, especially on those without assets. The wealthy escape — into real estate, stocks, funds.\ But the poor and working class lose purchasing power because their money is held in cash — and cash devalues.
💬 As Lyn Alden says:
“When your money can’t hold value, you’re forced to become an investor — even if you just want to save and live.”
The state may index pensions or benefits — but always with a lag, and always less than actual price increases.\ If bread rises 15% and your payment increase is 5%, you got poorer, even if the number on paper went up.
💥 We live in an inflationary system of everything:\ – Inflationary money\ – Inflationary products\ – Inflationary content\ – And now even inflationary minds
🧠 This is more than just rising prices — it’s a degradation of reality perception. You’re always rushing, everything loses meaning.\ But when did the system start working against you?
📉 What went wrong after 1971?
This chart shows that from 1948 to the early 1970s, productivity and wages grew together.\
But after the end of the gold standard in 1971 — the connection broke. Productivity kept rising, but real wages stalled.👉 This means: you work more, better, faster — but buy less.
🔗 Source: wtfhappenedin1971.com
When you must spend today because tomorrow it’ll be worth less — that’s rewarding impulse and punishing long-term thinking.
Bitcoin offers a different environment:\ – Savings work\ – Long-term thinking is rewarded\ – The price of the future is calculated, not forced by a printing press
📌 Inflation can be a tool. But in government hands, it became a weapon — a slow, inevitable upward redistribution of wealth.
Indexing is weak compensation if bread is up 15% and your “increase” is only 5%.
\ \ Statement: War is not growth, but a reallocation of resources into destruction.
Criticism: war can spur technological leaps (Internet, GPS, nuclear energy — all from military programs). "Military Keynesianism" was a real model.
4. “War Drives R&D”
Yes, wars sometimes give rise to tech spin-offs: Internet, GPS, nuclear power — all originated from military programs.
But that doesn’t make war a source of progress — it makes tech a byproduct of catastrophe.
“War reallocates resources toward destruction — not growth.”
Progress doesn’t happen because of war — it happens despite it.
If scientific breakthroughs require a million dead and burnt cities — maybe you’ve built your economy wrong.
💬 Even Michael Saylor said:
“If you need war to develop technology — you’ve built civilization wrong.”
No innovation justifies diverting human labor, minds, and resources toward destruction.\ War is always the opposite of efficiency — more is wasted than created.
🧠 Bitcoin, on the other hand, is an example of how real R&D happens without violence.\ No taxes. No army. Just math, voluntary participation, and open-source code.
📌 Military Keynesianism is not a model of progress — it’s a symptom of a sick monetary system that needs destruction to reboot.
Bitcoin shows that coordination without violence is possible.\ This is R&D of a new kind: based not on destruction, but digital creation.
Statement: Bitcoin isn’t “Gold 1.0,” but an improved version: divisible, verifiable, unseizable.
Criticism: Bitcoin has no physical value; "unseizability" is a theory;\ Gold is material and autonomous.
5. “Bitcoin Has No Physical Value”
And gold does? Just because it shines?
Physical form is no guarantee of value.\ Real value lies in: scarcity, reliable transfer, verifiability, and non-confiscatability.
Gold is:\ – Hard to divide\ – Hard to verify\ – Expensive to store\ – Easy to seize
💡 Bitcoin is the first store of value in history that is fully free from physical limitations, and yet:\ – Absolutely scarce (21M, forever)\ – Instantly transferable over the Internet\ – Cryptographically verifiable\ – Controlled by no government
🔑 Bitcoin’s value lies in its liberation from the physical.\ It doesn’t need to be “backed” by gold or oil. It’s backed by energy, mathematics, and ongoing verification.
“Price is what you pay, value is what you get.” — Warren Buffett
When you buy bitcoin, you’re not paying for a “token” — you’re gaining access to a network of distributed financial energy.
⚡️ What are you really getting when you own bitcoin?\ – A key to a digital asset that can’t be faked\ – The ability to send “crystallized energy” anywhere on Earth\ – A role in a new accounting system that runs 24/7/365\ – Freedom: from banks, borders, inflation, and force
📉 Bitcoin doesn’t require physical value — because it creates value:\ Through trust, scarcity, and energy invested in mining.\ And unlike gold, it was never associated with slavery.
Statement: There’s no “income without risk” in Bitcoin: just hold — you preserve; want more — invest, risk, build.
Criticism: contradicts HODL logic; speculation remains dominant behavior.
6. “Speculation Dominates”
For now — yes. That’s normal for the early phase of a new technology. Awareness doesn’t come instantly.
What matters is not the motive of today’s buyer — but what they’re buying.
📉 A speculator may come and go — but the asset remains.\ And this asset is the only one in history that will never exist again. 21 million. Forever.
📌 Look deeper. Bitcoin has:\ – No CEO\ – No central issuer\ – No inflation\ – No “off switch”
💡 It’s not a stock. Not a startup. Not someone’s project.\ It’s a new foundation for trust.\ It’s opting out of a system where freedom is a privilege you’re granted under conditions.
🧠 People say: “Bitcoin can be copied.”\ Theoretically — yes.\ Practically — never.
Here’s what you’d need to recreate Bitcoin:\ – No pre-mine\ – A founder who disappears and never sells\ – No foundation or corporation\ – Tens of thousands of nodes worldwide\ – 701 million terahashes of hash power\ – Thousands of devs writing open protocols\ – Hundreds of global conferences\ – Millions of people defending digital sovereignty\ – All that without a single marketing budget
That’s all.
🔁 Everything else is an imitation, not a creation.\ Just like you can’t “reinvent fire” — Bitcoin can only exist once.
Statements:\ The Russia's '90s weren’t a free market — just anarchic chaos without rights protection.*\ Unlike fiat or even dollars, Bitcoin is the first asset with real defense — from governments, inflation, even thugs.\ And yes, even if your barber asks about Bitcoin — maybe it's not a bubble, but a sign that inflation has already hit everyone.
Criticism: Bitcoin’s protection isn’t universal — it works only with proper handling and isn’t available to all.\ Some just want to “get rich.”\ None of this matters because:
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Bitcoin’s volatility (-30% in a week, +50% in a month) makes it unusable for price planning or contracts.
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It can’t handle mass-scale usage.
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To become currency, geopolitical will is needed — and without the first two, don’t even talk about the third.\ Also: “Bitcoin is too complicated for the average person.”
7. “It’s Too Complex for the Masses”
It’s complex — if you’re using L1 (Layer 1). But even grandmas use Telegram. In El Salvador, schoolkids buy lunch with Lightning. My barber installed Wallet of Satoshi in minutes right in front of me — and I now pay for my haircut via Lightning.
UX is just a matter of time. And it’s improving. Emerging tools:\ Cashu, Fedimint, Fedi, Wallet of Satoshi, Phoenix, Proton Wallet, Swiss Bitcoin Pay, Bolt Card / CoinCorner (NFC cards for Lightning payments).
This is like the internet in 1995:\ It started with modems — now it’s 4K streaming.
8. “Can’t Handle the Load”
A common myth.\ Yes, Bitcoin L1 processes about 7 transactions per second — intentionally. It’s not built to be Visa. It’s a financial protocol, just like TCP/IP is a network protocol. TCP/IP isn’t “fast” or “slow” — the experience depends on the infrastructure built on top: servers, routers, hardware. In the ’90s, it delivered text. Today, it streams Netflix. The protocol didn’t change — the stack did.
Same with Bitcoin: L1 defines rules, security, finality.\ Scaling and speed? That’s the second layer’s job.
To understand scale:
| Network | TPS (Transactions/sec) | | --- | --- | | Visa | up to 24,000 | | Mastercard | \~5,000 | | PayPal | \~193 | | Litecoin | \~56 | | Ethereum | \~20 | | Bitcoin | \~7 |
\ ⚡️ Enter Lightning Network — Bitcoin’s “fast lane.”\ It allows millions of transactions per second, instantly and nearly free.
And it’s not a sidechain.
❗️ Lightning is not a separate network.\ It uses real Bitcoin transactions (2-of-2 multisig). You can close the channel to L1 at any time. It’s not an alternative — it’s a native extension built into Bitcoin.\ Also evolving: Ark, Fedimint, eCash — new ways to scale and add privacy.
📉 So criticizing Bitcoin for “slowness” is like blaming TCP/IP because your old modem won’t stream YouTube.\ The protocol isn’t the problem — it’s the infrastructure.
🛡️ And by the way: Visa crashes more often than Bitcoin.
9. “We Need Geopolitical Will”
Not necessarily. All it takes is the will of the people — and leaders willing to act. El Salvador didn’t wait for G20 approval or IMF blessings. Since 2001, the country had used the US dollar as its official currency, abandoning its own colón. But that didn’t save it from inflation or dependency on foreign monetary policy. In 2021, El Salvador became the first country to recognize Bitcoin as legal tender. Since March 13, 2024, they’ve been purchasing 1 BTC daily, tracked through their public address:
🔗 Address\ 📅 First transaction
This policy became the foundation of their Strategic Bitcoin Reserve (SBR) — a state-led effort to accumulate Bitcoin as a national reserve asset for long-term stability and sovereignty.
Their example inspired others.
In March 2025, U.S. President Donald Trump signed an executive order creating the Strategic Bitcoin Reserve of the USA, to be funded through confiscated Bitcoin and digital assets.\ The idea: accumulate, don’t sell, and strategically expand the reserve — without extra burden on taxpayers.
Additionally, Senator Cynthia Lummis (Wyoming) proposed the BITCOIN Act, targeting the purchase of 1 million BTC over five years (\~5% of the total supply).\ The plan: fund it via revaluation of gold certificates and other budget-neutral strategies.
📚 More: Strategic Bitcoin Reserve — Wikipedia
👉 So no global consensus is required. No IMF greenlight.\ All it takes is conviction — and an understanding that the future of finance lies in decentralized, scarce assets like Bitcoin.
10. “-30% in a week, +50% in a month = not money”
True — Bitcoin is volatile. But that’s normal for new technologies and emerging money. It’s not a bug — it’s a price discovery phase. The world is still learning what this asset is.
📉 Volatility is the price of entry.\ 📈 But the reward is buying the future at a discount.
As Michael Saylor put it:
“A tourist sees Niagara Falls as chaos — roaring, foaming, spraying water.\ An engineer sees immense energy.\ It all depends on your mental model.”
Same with Bitcoin. Speculators see chaos. Investors see structural scarcity. Builders see a new financial foundation.
💡 Now consider gold:
👉 After the U.S. abandoned the gold standard in 1971, gold surged from \~$35 to over $800 in a decade — while suffering wild -40% to -60% crashes along the way.
Source: 📈 Gold Price Chart — Macrotrends\
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Nobody said, “This can’t be money.” \
Because money is defined not by volatility, but by scarcity, adoption, and trust — which build over time.📊 The more people save in Bitcoin, the more its volatility fades.
This is a journey — not a fixed state.
We don’t judge the internet by how it worked in 1994.\ So why expect Bitcoin to be the “perfect currency” in 2025?
It grows bottom-up — without regulators’ permission.\ And the longer it survives, the stronger it becomes.
Remember how many times it’s been declared dead.\ And how many times it came back — stronger.
📊 Gold vs. Bitcoin: Supply Comparison
This chart shows the key difference between the two hard assets:
🔹 Gold — supply keeps growing.\ Mining may be limited, but it’s still inflationary.\ Each year, there’s more — with no known cap: new mines, asteroid mining, recycling.
🔸 Bitcoin — capped at 21 million.\ The emission schedule is public, mathematically predictable, and ends completely around 2140.
🧠 Bottom line:\ Gold is good.\ Bitcoin is better — for predictability and scarcity.
💡 As Saifedean Ammous said:
“Gold was the best monetary good… until Bitcoin.”
While we argue — fiat erodes every day.
No matter your view on Bitcoin, just show me one other asset that is simultaneously:
– immune to devaluation by decree\ – impossible to print more of\ – impossible to confiscate by a centralized order\ – impossible to counterfeit\ – and, most importantly — transferable across borders without asking permission from a bank, a state, or a passport
💸 Try sending $10,000 through PayPal from Iran to Paraguay, or Bangladesh to Saint Lucia.\ Good luck. PayPal doesn't even work there.
Now open a laptop, type 12 words — and you have access to your savings anywhere on Earth.
🌍 Bitcoin doesn't ask for permission.\ It works for everyone, everywhere, all the time.
📌 There has never been anything like this before.
Bitcoin is the first asset in history that combines:
– digital nature\ – predictable scarcity\ – absolute portability\ – and immunity from tyranny
💡 As Michael Saylor said:
“Bitcoin is the first money in human history not created by bankers or politicians — but by engineers.”
You can own it with no bank.\ No intermediary.\ No passport.\ No approval.
That’s why Bitcoin isn’t just “internet money” or “crypto” or “digital gold.”\ It may not be perfect — but it’s incorruptible.\ And it’s not going away.\ It’s already here.\ It is the foundation of a new financial reality.
🔒 This is not speculation. This is a peaceful financial revolution.\ 🪙 This is not a stock. It’s money — like the world has never seen.\ ⛓️ This is not a fad. It’s a freedom protocol.
And when even the barber starts asking about Bitcoin — it’s not a bubble.\ It’s a sign that the system is breaking.\ And people are looking for an exit.
For the first time — they have one.
💼 This is not about investing. It’s about the dignity of work.
Imagine a man who cleans toilets at an airport every day.
Not a “prestigious” job.\ But a crucial one.\ Without him — filth, bacteria, disease.
He shows up on time. He works with his hands.
And his money? It devalues. Every day.
He doesn’t work less — often he works more than those in suits.\ But he can afford less and less — because in this system, honest labor loses value each year.
Now imagine he’s paid in Bitcoin.
Not in some “volatile coin,” but in hard money — with a limited supply.\ Money that can’t be printed, reversed, or devalued by central banks.
💡 Then he could:
– Stop rushing to spend, knowing his labor won’t be worth less tomorrow\ – Save for a dream — without fear of inflation eating it away\ – Feel that his time and effort are respected — because they retain value
Bitcoin gives anyone — engineer or janitor — a way out of the game rigged against them.\ A chance to finally build a future where savings are real.
This is economic justice.\ This is digital dignity.
📉 In fiat, you have to spend — or your money melts.\ 📈 In Bitcoin, you choose when to spend — because it’s up to you.
🧠 In a deflationary economy, both saving and spending are healthy:
You don’t scramble to survive — you choose to create.
🎯 That’s true freedom.
When even someone cleaning floors can live without fear —\ and know that their time doesn’t vanish... it turns into value.
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