Bitcoin. The solution is Bitcoin. But why? And what is it, really? What's the definition? What's the essence?

There’s your definition.

Now let’s dig into its meaning.

It's the answer to perhaps the world's most pressing problem. Monetary inflation. And all of inflation’s disastrous consequences on societies. A claim like this is beyond controversial – but never before has there been anything that is a solution to the degree that Bitcoin is.

Where are the doubters going so wrong? Why are skeptics so entrenched? How is it that people looking straight at it are not able to see it? What's the hurdle none of these people can clear? Their biggest problem is they're thinking that because it's digital, it's not a real object and thus it has no tangible value and no utility value. Or that it isn’t backed by anything – and can’t be.

It's not only digital, it's a never-before-seen entity known as a digital scarcity. The only one there is and the only one that we will ever know, or need. It's digital information with a capacity to be owned as property. As an asset.

We think we've become so familiar with the digital world that it's difficult to, only now, see such a fundamental aspect of society... money and property... emerge in the digital realm with this monumental discovery. Yes, currencies have been digital for some time now. Most use them every day. But we’re talking about money now. Money and currency are not the same thing.

But there's one more puzzle piece we need to find here. It’s true, this digital information can actually be copied – completely and precisely – just like anything else that's digital. All the code, the addresses, the transaction data, the encryption, all of it.

So what's with the big speech about digital scarcity then? Why is this such an important puzzle piece? How is it possibly the most important piece?

It's that this digital information is secured on its own network which validates only the data and the participants who are the owners of the digital property on that network. Again, the code, data, protocols, all the infrastructure, it can be copied, infinitely – it's digital after all. But the reason the digital scarcity is a scarcity is the network participants. Because they all want something. All of them.

And what is that?…

They want the largest network of other participants that agree on what the scarce thing is and who has what amount of it. Is this an assumption? No. It’s just the human process of determining if holding or receiving a possession is going to be beneficial to their life and survival and thus the life and survival in the minds of others in the network. Right there. Re-read that. We’re going to go on to explain this and some other stuff but when you want to recall the big idea, there it is. Consensus.

They want consensus and they need to know its true.

It doesn’t even matter what the possession is because they all agree those digital things, the assets, are what is going to hold the value they and the other participants bring to it. And it doesn't matter how many digital things there are - as long as the number of those things is fixed, fungible, divisible and the security protocols don’t change.

Now hold on, there can be lots of different things that are digital, fungible, divisible and of a fixed supply. What about that? Alright, sure, that's right. But the difference maker, the real discovery... It's the network. You gotta have all that other stuff but you really, really gotta have the network.

Oh but wait, there is more.

And this is where a bunch of people finally get thrown off the bull – the network has to be the biggest one. Has to. That’s the biggest in terms of participants and in terms of the energy that's been used to secure it.

In Bitcoin's proof-of-work protocol, the "work" refers to the energy being used by the computers building the blocks of encrypted transactions. It’s the security layer, which is to say the ones stopping bad actors from achieving a double-spending of the money. Of the bitcoins.

Those doing valid transactions are the participants and in many cases they're also the decentralized nodes validating the blocks. So when you're dealing with money in a digital monetary network, the biggest network is simply the one that wins. It's the same as saying the strongest money wins. Or the hardest money. Any other money will not hold value to the degree the largest networked-money will. That alone is enough to convince people where to store their value. That’s the gravitational force that eventually pulls in all the monetary premium in the universe, with all the other assets going back to their utility value.

For fiat money, it means going to zero.

In the physical world, different things can be money, or property or assets because they've got different properties of nature, existing on different networks. In the digital world there's only room for, or only a need for one monetary asset. You'll know which one it is because it will be on the largest monetary network using the most energy to secure its participant's assets.

Now, let’s say a participant was to see an exact replica of this network with all the same rules, incentives, protocols and all the rest. They're not going to see it as being superior unless it's the larger, more secure network with more participants. That scale is directly correlated to the scarcity of its digital assets.

Why?

Because one part of what a scarcity requires is to be of a fixed supply. Not much else needs to be said there other than it would be infinitely divisible so that the network can grow its participants, and therefore its value, forever.

And of course the other part is the capacity to be desirable to the largest majority of individuals and groups – although this is partially a result of the first requirement.

In both cases, this is where having the most network participants comes in – that's to achieve the most desirability. Because as we're about to see, in the digital world, if you're not the most desirable property, you're certainly not going to make it as money.

So what's with a digital scarcity? How is that any different from other scarcities like gold?

We’ll, it’s not only different, it's where this entire creation goes from being genius, to simply magical. When something is digital, it is, at its core, all just electromagnetic energy. Electrons... electricity... ones and zeroes... bits… moving at the speed of light. In other words, all exactly the same as anything and everything else that's digital.

They're its fundamental properties of nature.

The arrangement of these bits moving across the circuits and gates can of course be different in order to constitute different information – but the nature of being digital never changes, regardless of what the information is.

What could all of this even mean?

It means the digital-ness... the electricity, ones and zeroes and the rest... these properties can only be made, or arranged then applied as a networked scarcity once. One time. When it's digital money you're dealing with, it only happens one time.

That's it. One digital scarcity at-a-time, essentially.

One digital scarcity FOREVER is what has actually happened here. You don't get to have two digital scarcities at a time because the properties of being digital don't and won't change.

At the base-level, it's ones and zeroes all the way down the line. The only differentiating factor then, is the size of the network. Remember that's the largest group of people that are in agreement about what the scarce thing is and what wallets have what amount of it.

In monetary terms, that difference means EVERYTHING.

When this digital information is the money itself, there is no better application for a scarcity than that. Storing one's value, one's purchasing power, is the job.

If digital assets and money don't do that, then they're not digital assets and definitely not money. So even when there's an exact replica of our network, its assets can't be considered scarce unless that other network is the larger one.

But if the assets aren't scarce, they're not desirable. If they're not desirable, they're not holding any value. If they're not holding value, the network has no participants. Then you’ve reached the end of the debate.

The next obvious question is why wouldn’t, or why couldn’t a new digital monetary network, with all the other requisite qualities, overtake the original digital monetary network?

The answer is as plain as it is elegant. It won’t and can’t because that would require the larger network’s participants to sacrifice their value secured in that network.

The trade-off is scarcity. Anyone outside that network bringing their acquired value to the smaller one suffer the same fate. If you own any amount of value you'd like to preserve, joining the more secure network is too easy.

Anything else is just trading the most secure asset for one that's less secure. The opportunity cost is too great.

It's the act of destroying the value they've created and are seeking protection for in the first place. Their wealth. Their property. Their energy. It doesn't mean you can't. Speculators will speculate. But that’s a game you play in the fiat world. Fiat world was made for that.

That’s increasingly all it is anymore which is why it’s so sick now. It’s why we call it clown world. In a proof-of-work world, you'll just be suffering consequences as part of a minority becoming increasingly energy-poor. Humans don’t do that because it's anti-survival.

It's unnatural.

Scarcity always resides in the larger, harder monetary network. And it doesn't leave.

That is the way a digital scarcity is networked. That's why it has value.

When they ask you, this is what you say Bitcoin is “backed by”. It’s why you can own it and use it as money. These characteristics make it at least the greatest monetary asset of all time, and likely FOR all time. That's enough to put it among the most useful and valuable assets of any kind that we have ever seen. And likely will ever see.

You know what to do now.