Why Bitcoin's Economic Velocity is Key for Adoption - #207
TL;DR - With PayWithMoon's services being shut down, Bitcoiners must find alternative ways to live on Bitcoin. A parallel economy may emerge.
Dear reader,
I received an email today, one that brought disappointment. PayWithMoon, my go-to resource for living on Bitcoin in a private way, informed me that their banking services are being turned off.
This is due to Operation Chokepoint 2.0, a government effort to target the bank accounts of crypto companies. While some may cheer the fall of exchanges, it's the services like PayWithMoon that end up being collateral damage. It's a saddening experience to see something that made life easier now gone.
The search for alternatives begins.
Not a lot of options…
I am a firm believer that adoption of Bitcoin is happening. However, the reality is that there are not a lot of options for commerce in the world of Bitcoin. In my last article, I wrote about how to buy groceries using Bitcoin, but now even that option has been removed.
The options that remain for Bitcoin commerce include P2P markets such as RoboSats and Bisq, gift cards, ATMs, bartering with friends and families, and exchanges - while they last. It's not a lot, but it's a start. The key is to keep pushing for more adoption and to find creative solutions for using Bitcoin in everyday life.
We must remember that Bitcoin is still in its early stages, and it will take time for widespread adoption to happen. In the meantime, we can continue to use what we have and support the development of new solutions that make it easier to use Bitcoin in commerce. With each step forward, we move closer to a future where Bitcoin is a commonly accepted form of payment.
Economic velocity is key
It may be the meetups I attend or the social circles I'm in, but I've noticed that many Bitcoiners don't actually use their Bitcoin. They hold on to it, hodlin' as they say, but is hodlin' always the best strategy?
Economic velocity is key. In simple supply and demand economics, when there are sellers and buyers, the market remains in balance. But what happens when there are sellers with no buyers? Prices drop, and the market stagnates. And what if there are buyers but no sellers? Prices rise, but without the ability to exchange, the market becomes less liquid.
It's important for Bitcoin to have a healthy balance of hodlin' and spending. Holding onto Bitcoin is good, but using it in everyday transactions is better for the overall health of the market. Without economic velocity, the value of Bitcoin cannot reach its full potential. So let's not just hodl, let's spend and invest in the future of Bitcoin.
Pushing producers away
Many Bitcoiners are caught up in the "when moon" mentality, which is why producers of goods and services are searching for markets that are willing to engage in commerce.
I work in the entertainment media industry, and I see a lot of potential for economic development and growth for Bitcoin. A video game company, with employees and infrastructure, paying its staff in Bitcoin and selling gaming products for Bitcoin, creates a self-contained economy within the industry. THNDR Games comes to mind.
However, many Bitcoiners don't seem to recognize the potential for growth in industries like this. Instead, they focus on the speculative aspect of Bitcoin, waiting for the next bull run. But the true power of Bitcoin lies in its ability to create new economies and drive economic growth. It's time for the "when moon" mentality to shift towards a focus on practical use cases and real-world adoption.
Stupid monkey jpegs
NFTs are a hot topic of debate among many Bitcoiners. While they may seem like an extreme example, they illustrate an important point about market perception in the Bitcoin community. (Unfortunately, it seems that art is often the least appreciated commodity in the space.)
Many fail to see how artists, by nature, are capitalists and free market makers. Art shapes culture, and culture shapes politics. Sure, there may be some ugly pictures of monkeys, but look just a pixel over and you might find incredible talent. Picture a famous writer such as Camus, a musician like Mingus, a painter similar to Rockwell, illustrator or animator like Disney using Bitcoin as their primary means of engagement with their customers and clients. Now imagine the larger company brands, as many memes like to point towards, who adopt Bitcoin.
Unfortunately, because there are no buyers and the sentiment towards the producer is hostile, they must venture to find a market; in this case towards shitcoins.
This could have been Bitcoin. It should have been Bitcoin.
With its decentralized and open nature, Bitcoin offers a unique opportunity not just for artists, but producers from all sectors, to sell their goods and services and reach a global market.
Also… let's not underestimate the value of art in shaping our culture and society. And let's support artists by creating a market for their work in the Bitcoin space. The more we embrace art and its role in our lives, the more vibrant and diverse our community will become.
Bitcoin needs to circulate
The scarcity of merchants who accept Bitcoin as a form of payment means that we have to rely on third party services. If producers don't see a demand for using Bitcoin as money, they will look for a different marketplace.
But it's not just the producers who are to blame for the slow adoption of Bitcoin as a currency. Bitcoiners who only hodl, without using it for commerce, also hinder the spread of adoption. There's a difference between hoarding and saving. Hoarding involves holding onto assets without putting them to use, while saving involves setting aside resources for future use.
When it comes to Bitcoin, hoarding only contributes to the problem of a lack of economic velocity. If there are only sellers and no buyers, or no sellers and only buyers, there is no market. For Bitcoin to truly flourish as a currency, it needs to be used and circulated in the real economy.
We need to encourage both merchants and individuals to adopt and use Bitcoin as a form of payment. This way, we can increase its demand and, in turn, increase its value in a voluntary way.
Governments looking to curb Bitcoin adoption
Governments around the world are looking to curb the adoption of Bitcoin. They're hitting service providers where it hurts, their wallets.
Blocking the fiat on and off ramps for the general public, but allowing accredited investors only, might deter the moon mission for Bitcoin. It's not too far a stretch to see the government pressure gift card providers and popular services such as Strike and Cash App in the future in order to push their Central Bank Digital Currency (CBDC) and curbing cash. This would make Bitcoin a one way street and not by choice. A parallel economy could, reluctantly, emerge.
But if there are no producers to sell their goods and services for Bitcoin because there's been no market for them, and there are no Bitcoin-to-fiat or Bitcoin-to-gift card providers due to ever more increasing Chokepoints; where do Bitcoiners go? This is a crucial question that needs to be answered.
We need to ensure that there are enough options and avenues for merchants and consumers to transact with Bitcoin, otherwise it will struggle to gain traction as a currency.
The path is clear
Actions we can take to support Bitcoin adoption are clear:
For those who are saving their Bitcoin, it's important to continue until you feel comfortable deploying capital.
But for those who are looking to actively support the spread of Bitcoin, it's important to start seeking out producers who do accept it and to show them support.
Ask merchants and vendors if they accept Bitcoin, and show that there's demand for it.
If you're still dollar cost averaging into Bitcoin, it might be time to reevaluate and consider that you may have too much fiat.
Going all in with Bitcoin is not for the faint of heart. It requires a level of commitment and dedication that not many are willing to make. It takes time, patience and practice to get comfortable with using Bitcoin and truly making it a part of your daily life.
Making the switch to using Bitcoin changes you. You stop thinking about the number going up and start thinking about the value that it holds. It forces you to become more familiar with the technology and how to use it in everyday situations. But for those willing to make the investment, it can lead to a deeper understanding and appreciation of Bitcoin and its potential.
Conclusion
The current state of Bitcoin commerce is facing challenges from governments and their efforts to curb its adoption. This is affecting service providers and leaving many Bitcoiners with limited options for using their Bitcoin. However, it’s important for the community to support producers who accept Bitcoin and continue to ask merchants and vendors if they accept it, in order to show there is demand for its use.
Ultimately, it is up to the community to drive the growth of Bitcoin's economy by supporting its use and promoting its acceptance.
Until next time…
Hi Rare passenger.
Why don’t you try this visa virtual card ?
https://getspendl.com/
It is a company based in Israel that issue a virtual credit card you can refill only via lighting network
It requires KYC but at least it work smoothly.
I’ve tried myself and it worked. Very good customer service also.