How Sound Money Made Me Think Differently About Everything
April 19, 2025 · 15 min read
I believe Bitcoin will transform society more fundamentally than the printing press. That sounds like hyperbole—I used to think so too. But after a decade of watching our monetary system slowly cannibalize itself, I've come to see Bitcoin not as speculation, but as the most important peacetime invention in human history.
I didn't always feel this way.
My first real encounter with Bitcoin came during my time in university in the summer of 2014—5 years after the initial white paper, when Bitcoin was trading around $300. Our instructor mentioned, almost as an aside, how the first Bitcoin transaction was a purchase of two pizzas for 10,000 Bitcoin. The absurdity of realizing those pizzas were now worth roughly $3 million immediately made me dismiss Bitcoin as a funny speculative internet thing that would eventually go away. We all laughed at what seemed like an absurd exchange—digital money "mined" on a computer for actual food? It sounded like a strange techno-barter system, not the future of finance.
When I became a software engineer later that year, Bitcoin lingered in my peripheral vision. Over the following years, I studied its underlying technology—the blockchain, public-private key cryptography, the consensus mechanism. By 2018, I understood how Bitcoin worked on a technical level, but I completely missed its elegance and significance as a profound society-changing invention.
For the next two years, I watched Bitcoin's price swing wildly while dismissing it as speculation. I understood the technology but missed the economics. Then 2020 arrived, and I watched the Federal Reserve create more dollars in three months than had existed in the first 200 years of America. That's when I finally understood what I'd been looking at—not a get-rich-quick scheme, but a get-poor-slowly prevention system.
Beyond the code lay something revolutionary: a game-theoretic incentive system creating the first truly scarce digital property—an incorruptible store of value beyond the reach of any institution, grounded in the laws of physics. A decentralized peer-to-peer digital cash system with perfect audit-ability. What I had initially dismissed as mere clever engineering was actually a profound breakthrough in human coordination and trust.
The Wake-Up Call: Discovering the Disappearing Dollar
What truly opened my eyes was understanding what's happening to our money. Since the Federal Reserve was created in 1913, the U.S. dollar has lost over 96% of its purchasing power. Let that sink in: $100 back then had the buying power of more than $3,000 today.
In 1913, $100 had the buying power of more than $3,000 today.
This isn't just an abstract statistic—it's a reality that reshapes lives across generations. My grandparents could buy a beautiful Craftsman home—built to last, with hardwood floors and a spacious backyard—for about $5,000. Today? That same amount might cover a couple months of rent or furnish half a living room.
The more I researched, the more unsettled I became. This isn't a design flaw in our monetary system. It's policy. The Fed targets a minimum 2% inflation rate every year. That might sound insignificant, but over decades, it compounds into massive erosion of savings and wealth.
Inflation incentivizes spending over saving
The message became clear to me: don't save—spend. Chase yield. Stay on the treadmill. Keep the debt engine running. .
Why Every Fiat Currency Eventually Fails
The Dollar's fiat status
As of 1971 (likely earlier, the US Dollar officially became fiat after Nixon removed the gold standard. Dollars became paper. With fiat, printing becomes possible and the incentives are just too tantalizing for those in power.
As I dug deeper into monetary history, I realized this pattern isn't accidental—it's inevitable. Every government faces the same impossible choice: they can tax their citizens (unpopular), cut spending (unpopular), or print money (invisible to most voters until it's too late).
The Politician's Impossible Choice
The incentive structure foreshadows the outcome. Printing money lets politicians spend without the immediate political cost of taxation. The bill comes later, paid by everyone who holds the currency, but "later" is often after the next election. This isn't corruption—it's rational political behavior within a broken system.
Even well-intentioned leaders face this dilemma: let the economy crash now with responsible monetary policy, or print money to postpone the crisis and hope someone else deals with it later. The power to print money is the power to tax without legislation. No political system has ever permanently resisted that temptation because the incentives make resistance irrational.
Rome diluted its denarius with base metals until coins contained 5% silver instead of 83%. Weimar Germany's inflation peaked at 29,500% per month—people needed wheelbarrows of cash to buy bread. Zimbabwe printed 100 trillion dollar notes. Venezuela, Argentina, Turkey—the list reads like a countdown to our future.
"But the dollar is different," people say. "It's the reserve currency."
So was the British pound. So was the Dutch guilder. Reserve currencies last 80-100 years on average. The dollar's run started in 1944. Do the maths.
When money itself is compromised, everything downstream inherits the distortion.
When storing wealth in the dominant currency guarantees its erosion, we're all pushed toward increasingly speculative investments just to stay afloat. I watched friends and family pour money into assets they barely understood, take on excessive debt, and live paycheck to paycheck despite growing incomes. I used to think I was on a ship of fools, but I realized the system wasn't encouraging prudence or delayed gratification—it was penalizing it.
The Ripple Effects: Society Under Unsound Money
The consequences of compromised money extend far beyond our bank accounts—they reshape our entire society in profound and often invisible ways.
When money consistently loses value, our time preference shifts dramatically. We become present-oriented, discounting the future in favor of immediate consumption and gratification. This isn't just personal psychology—it's reflected in our institutions, our markets, and our culture.
Companies prioritize quarterly profits over decade-long innovation. Politicians focus on election cycles and fundraising rather than generational challenges. Even our art and architecture become temporary and disposable rather than built to inspire centuries from now. An economy of plastic solutions with short expiration dates.
Unsound money doesn't just change what we can afford—it changes who we become.
I've observed this in our decreased ability to build ambitious infrastructure, in the shortening CEO tenures, in the explosion of consumer debt, and in the frenetic pace of our digital culture. When money can't reliably store value across time, we struggle to think and plan across time.
In my tenure as a software professional, I've witnessed five layoffs firsthand, saying goodbye to beloved colleagues after years of close collaboration by finding their Slack profiles deactivated without notice. Technology companies over the past decade have seen the greatest amount of speculative malinvestment. Zero-percent interest money distorts capital markets and perpetuates bad ideas without letting them die naturally. This allows companies to bloat, expand, contract, and wither, all in the same breath.
Perhaps most concerning is how monetary inflation silently transfers wealth from savers to asset holders, widening the gap between generations and social classes. Those closest to the money printer benefit, while those furthest away pay the invisible tax of devaluation.
Inflation is legalized counterfeiting. Counterfeiting is illegal inflation.
For a society to function well, we need mechanisms that align short-term actions with long-term flourishing. Sound money is foundational to this alignment—and its absence creates distortions that no amount of regulation or good intentions can correct.
Bitcoin: Finding a Lifeboat
The elegance of Bitcoin's design hit me like a wave: there will only ever be 21 million bitcoins. No central bank can create more. No inflation target erodes its value. No money printer goes "brrr" in the night.
This is a groundbreaking and completely novel innovation—perfect scarcity achieved through mathematics, grounded in physics and protected by incentives. If this doesn't make immediate sense, consider gold, humanity's monetary standard for millennia.
Gold became money (amongst other things) because it's the hardest asset to produce on mass. The cost of mining an ounce closely reflects the energy required to extract it. This creates what economists call a high "stock-to-flow ratio"—the existing supply (stock) divided by annual production (flow). Gold's stock-to-flow ratio of roughly 25 meant it took 25 years of mining to double the existing supply, making it resistant to sudden debasement.
Bitcoin fundamentally changed this equation. With its fixed supply cap of 21 million and predictable issuance schedule, Bitcoin achieves what was previously impossible: perfect scarcity. While gold's stock-to-flow ratio fluctuates with mining technology and new discoveries, Bitcoin's ratio increases methodically with each halving event and will eventually approach infinity as new issuance stops completely around 2140.
There will only ever be 21 million bitcoins. No central bank. No inflation target. No money printer.
That hard cap completely flipped my time horizon. Where the fiat system punishes patience, Bitcoin rewards it. It encourages long-term thinking, delayed gratification, and genuine capital preservation.
But how do mathematical rules enforce themselves without human enforcers? This is where Bitcoin's design becomes genuinely revolutionary—it created the first system where the incentives align so perfectly that good behavior emerges automatically and necessarily.
The Game That Governs Itself
Game theory sounds academic, but it's just the study of how people behave when their decisions affect each other. Think poker, think dating, think international diplomacy. The key insight: if you design the rules right, self-interested actors will naturally do what's best for the system—even if they don't care about the system at all.
This is Bitcoin's breakthrough.
Traditional money requires someone to enforce the rules. Central banks, governments, armies. Bitcoin flipped this: instead of relying on human institutions to behave well, it created a game where bad behavior is economically impossible.
The Miners' Dilemma: Bitcoin miners compete to validate transactions and earn rewards. To cheat the system—say, by approving fake transactions—a miner would need to control more computing power than the rest of the network combined. The energy cost of assembling that much hardware and electricity? More than the value of whatever they could steal.
The 51% Problem That Solves Itself: Theoretically, if someone controlled 51% of Bitcoin's mining power, they could manipulate the network. But here's the beautiful part: if you have enough resources to attack Bitcoin, you have enough resources to profit from protecting it instead. Attacking the network would crash the price of Bitcoin, making your massive investment in mining equipment worthless. You'd be paying billions to destroy billions of your own wealth.
The Nakamoto Consensus: Every ten minutes, miners compete to solve a mathematical puzzle. Winner gets to add the next block and claim the reward. But here's the catch—if other miners detect any cheating, they simply ignore that block and build on the previous valid one. The cheater gets nothing, while the honest miners move forward.
It's like a democracy where every vote costs real money, lying is expensive, and telling the truth pays. The system assumes everyone is selfish and designs the incentives so that selfish behavior produces honest outcomes.
This isn't just academic theory—it's why Bitcoin has operated flawlessly for 16 years without a CEO, without a headquarters, and without a single day of downtime. The game runs itself.
Every participant is simultaneously the enforcement and the enforced.
Beyond Currency: A New Framework for Freedom
The more I thought about Bitcoin, the more I saw connections to deeper principles of liberty. In 1776, the Founders of the United States drafted a framework to protect individuals from the unchecked power of kings and tyrants. They encoded freedom in parchment, courts, and constitutions.
But parchment can be amended. The Constitution wasn't strong enough to prevent the erosion of sound money—we went off the gold standard in 1971, and the printing press has been running ever since.
Bitcoin doesn't fight for freedom in courtrooms—it enforces it through code.
Bitcoin doesn't rely on human restraint or good intentions. It relies on thermodynamics and game theory incentives. The energy required to corrupt the system exceeds the benefit of corrupting it. While fiat money is backed by promises, Bitcoin is backed by provable work—the only backing that can't be printed, voted away, or defaulted on.
What excites me most is how Bitcoin shapes behavior through incentives rather than regulations or mandates. In my engineering work, I've learned that incentives ultimately drive human action more effectively than rules ever could. Money shapes society from the root, and Bitcoin realigns those incentives toward patience, preservation, and voluntary exchange.
Addressing the Critics: Energy, Volatility, and Reality
I used to share the common criticisms of Bitcoin. The energy use seems wasteful. The volatility appears unsustainable. How could this ever be practical money?
Energy as Digital Physics
My perspective shifted when I understood that Bitcoin's energy use isn't overhead—it's the feature that makes digital scarcity possible. Before Bitcoin, anything digital could be copied infinitely. Bitcoin solved this by making digital assets expensive to create and impossible to counterfeit.
Bitcoin's energy use isn't a bug—it's a critical feature.
The energy cost is what anchors Bitcoin to physical reality. You can't fake thermodynamic work—either you expended the electricity or you didn't. This transforms Bitcoin from "just code" into something governed by the laws of physics, not human whims.
Bitcoin doesn't just consume energy randomly—it seeks the cheapest, most abundant sources. This often means renewable energy that would otherwise be curtailed: solar farms producing more than the grid can handle, hydroelectric plants with excess capacity, geothermal sources in remote locations. Bitcoin miners become "buyers of last resort" for stranded energy, actually improving grid efficiency.
Yes, Bitcoin uses about as much energy as Argentina. But Argentina's banking system, plus the military that backs its currency, uses far more energy while serving 45 million people instead of Bitcoin's 400 million users globally. The difference is that Bitcoin's energy cost is transparent and voluntarily maintained, while the traditional system's costs remain hidden in military budgets and regulatory overhead.
Volatility as Feature, Not Bug
The dollar appears "stable" compared to Bitcoin like the Titanic appeared stable compared to a speedboat—right up until it wasn't. The dollar seems stable because its debasement is gradual and measured against other depreciating assets. But measured against real goods—houses, education, healthcare—the dollar has been highly volatile for decades.
Bitcoin's volatility follows the classic pattern of transformative technologies. The internet was "volatile" in the 1990s—websites crashed, companies went bust, the whole sector collapsed in 2000. But the underlying technology was sound, and volatility decreased as adoption matured.
Bitcoin's speculative premium exists precisely because people recognize its potential as a hedge against fiat debasement. As dollars inflate, people bid up scarce assets. Bitcoin volatility isn't random—it's price discovery for the first truly scarce digital asset in history.
I've watched my own holdings swing by over 50% in weeks. But I've come to see that volatility as the natural price of adopting transformative technology, not a flaw in the system. It's still finding its footing as the world learns what it means to have truly digital property rights without needing permission from a central authority.
The Personal Choice: Exit vs. Reform
My journey with Bitcoin has taught me something profound: you don't need to change the system to escape its consequences. Bitcoin isn't about overthrowing institutions—it's about transcending them. It offers a quiet rebellion, a parallel path.
It's not left vs. right. It's top-down vs. peer-to-peer. Not control vs. chaos—but coercion vs. consent.
What I find most empowering is that the door is open to everyone. The protocol doesn't care who you are, where you're from, or what you believe. It only requires that you play by the same rules as everyone else—because for once, the rules apply equally to all participants. There is no elite class that can game this system, other than early adopters making a strategic bet on the future value of this asset.
This realization has shifted my perspective from trying to reform broken systems to simply building better alternatives alongside them.
Conclusion: An Invitation, Not a Prediction
I don't know exactly how the Bitcoin story will unfold. Volatility will continue. Regulatory challenges will emerge. The path forward won't be straight.
Bitcoin transforms electricity into trust. It anchors digital value and ownership to physical cost.
But I've come to believe deeply in Bitcoin's fundamental properties: its fixed supply, its resistance to censorship, its transparent rules, and its alignment of incentives that reward verification over trust for all participants.
As I've watched fiat currency erode, Bitcoin has offered me a digital store of value anchored in code and economics. It's not magic—it's sound money built on sound principles. Your grandparents could save money and trust it would be worth something later. You can't—unless you change what money you're saving.
My journey began with skepticism and has led to conviction. It started with a simple choice: to remain a passenger in a system I increasingly distrusted or to become an architect of my own financial—and frankly—political future.
Ten thousand Bitcoin for two pizzas. In 2010, that seemed insane. Today, that choice represents something profound: someone saw Bitcoin's true purpose before the rest of us caught up. We're not choosing between safe and risky. We're choosing between guaranteed erosion and possible preservation.
I invite you to explore this path for yourself. Not because I can predict the outcome, but because the principles behind Bitcoin have fundamentally transformed how I think about money, time, and freedom. Perhaps they might do the same for you.