This is an opinion editorial by Tim Niemeyer, host of the Lincolnland Bitcoin Meetup.
As you may have learned by following the mainstream news, the price of bitcoin has been rising lately. If you’ve bought the top and kept it this far, you might want to consider taking some advice from the good man Mr Goldshill himself. Peter Schiff, and use this opportunity to sell. If you’re someone who missed the boat, you could reasonably wait for approval and buy for around $70,000. For those looking to make a quick buck, you can embark on a journey to make money near the next all-time high. If you’re a communist who doesn’t believe we need a non-coercive way to coordinate human action…well, I can’t help you.
Whatever your story or your specific situation, one thing is clear: buying bitcoins will not help you.
Yes, you read that right. The physical act of trading one monetary product for another does not produce any results for you. Of course, you can make a few bucks in the short term (save up to 37% in short-term capital gains taxes). You might even find a girlfriend. Pay the next vacation? Lambo? Why not?! But none of that matters, because the ultimate value of bitcoin is quality, not just quantity. You will need to prove that you have done some work to get a quality benefit…
Proof of work
The gift of Bitcoin is the unfathomable understanding you gain by putting in the time and effort to learn it. The bad news is that there are many different rabbit holes to go down. You can spend months and years studying any of the following: cryptography, computer science, distributed systems, open source software, network effects, game theory, economics, monetary theory, eleventh grade math, energy production, geopolitics, history, human rights, philosophy, human psychology, personal responsibility, to name a few. The good news is that there are plenty of rabbit holes to go down. I have been studying Bitcoin since 2018 and I have not even come close to exhausting the depth and breadth that Bitcoin has to offer. Moreover, acquired wisdom comes from reason and logic; acting as an anchor in a world where reality is constantly and increasingly manipulated.
In the beginning, as we all do at some point in our lives, it’s hard to deal with the fact that you get used to living with a relatively short-term mindset. This short-term mindset is what Bitcoiners call “high time bias.” It may take some time, but understanding how the money we choose changes the incentive structure of individuals is the first step to understanding why bitcoin is the best form of money. Inflationary fiat encourages its users to make decisions based on present needs, while deflationary bitcoin encourages its users to plan for the future by prioritizing current consumption. It took me years of research to get to a point where I could articulate this point and truly understand its impact on society. Don’t expect to get there in one talk, article, or podcast. This knowledge can only be spoon-fed so much. You need to build a “proof of work” mindset. Unfortunately, many of your friends think they already know what they don’t…
Dunning-Kruger Around And Find
Wikipedia states that the Dunning-Kruger (DK) effect is a cognitive bias in which people with low ability, expertise, or experience with a particular type of task or domain of knowledge tend to overestimate their own ability or knowledge. Arrogance is one of the main reasons most normies don’t take the time and effort to do their own research or DYOR.
The most recent and obvious example of this regarding Bitcoin came during Joe Rogan’s recent interview with geopolitical strategist, speaker, and New York Times best-selling author Peter Zeihan. While this guy seems smart and knows most of what he writes and talks about, in less than three minutes he completely exposed his complete lack of knowledge and understanding of Bitcoin (and basic monetary theory). Listen to Guy Swann’s brilliant “Bitcoin Audible” podcast to learn how epically wrong he is about Bitcoin.
The point here is not to beat Zeyhan (much). The point is that we are all human and can easily make wrong assumptions based on misconceptions and ignorance. To approach Bitcoin, you need to start with a level of humility and intellectual honesty. Unfortunately, most of us will leave that to “credible” media sources full of people who haven’t done the work yet. This is a key concept within Bitcoin: don’t trust, verify. If you choose to trust those who are bold but lack any deep knowledge, you will share their same misconceptions. You have to do the work yourself and draw your own conclusions. It takes… time (pun really intended).
This takes time…
The physical act of buying bitcoin is not the pinnacle of virtue. If you want to get the full value that Bitcoin has to offer, you need to show mental proof of the work required to understand at least a fraction of what this invention can do. Most of your normal friends won’t. Many will continue to believe that the solution to life’s ills can be found by submitting their will to an equally flawed person, be it red or blue. Others will return to their bread and circuses. Most will lose focus to support the “next job”. Everyone will have their own reasons and reasons. Some of your friends will even be salty haters or intellectually dishonest.
And you have the opportunity to expand and grow, to see beyond yourself. Reduce your time selection. Face your Twitter addiction. Turn off your TV. Get anchored in reality. Don’t listen to any arrogant DKs. Read the book. Listen to an audio book. Download the podcast. Ask questions. Attend a local meeting. Prove your work. Take an orange pill. Do your own research. I humbly beg you, do not buy bitcoins. Just find out about it.
This is a guest post by Tim Niemeyer. The views expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.