There is a small island in the Pacific that has used huge stone wheels as currency for hundreds of years.

These stones had to be mined by risking their lives to row 400 kilometers, which was super difficult, so the economy on the island has always been quite good.

In 1871, an American captain easily brought a pile of stones using explosives and modern ships. The wealth accumulated by the islanders over hundreds of years instantly went to zero.

This is the core of the book (The Future of Money): There are good and bad kinds of money, and the only criterion for judgment is the stock-to-increment ratio.

1️⃣ Stock = Total amount that is already available now

2️⃣ Increment = Amount that can be newly produced within a year

3️⃣ The higher the ratio = the harder it is to inflate = the harder it is = good money.

4️⃣ The lower the ratio = the easier it is to dilute = the softer it is = bad money.

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Why has gold dominated for thousands of years?

Because its stock-to-flow ratio is the highest:

↪️ Almost never destroyed.

↪️ Extremely rare, high mining costs

↪️ Cannot be artificially synthesized

↪️ Annual inflation is always only 1.5%-2%.

So no matter how high the gold price rises, production cannot increase in the short term.

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More importantly: the hardness of currency directly determines the rise and fall of civilizations.

➡️ Hard currency → People are willing to plan for the future → Long-term investment → Technological explosion → Civilization prosperity.

➡️ Soft currency → Live for today, drink for today → Short-sighted consumption → Civilization decline.

The Roman Empire diluted gold in coins; once the currency softened, the empire collapsed.

The 'good old days' of the late 19th century, international gold standard, fixed exchange rates, breakthroughs in electricity, cars, planes, telephones all emerged in those decades.

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In 1971, Nixon decoupled the dollar from gold, and humanity entered the pure fiat currency era.

Result:

⏩️ Governments can print money at will, wealth is hiddenly taxed.

⏩️ World War I could have ended in months, but they fought for 4 years because they could print money.

⏩️ Unlimited expansion of government power.

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\u003cc-124/\u003e What gives you the right to say it's harder than gold?

Three trump cards:

1️⃣ A total supply cap of 21 million, hardcoded.

2️⃣ Must consume real electricity to mine; can't just print out of thin air.

3️⃣ Difficulty adjusts automatically (genius design).

No matter how many people mine, the output speed is always stable.

If the price rises by 10 times, production won't increase; it will only make the network more secure.

Gold cannot do this. When the gold price rises, miners scramble to mine, and supply will increase.

Bitcoin solved the fatal flaw of gold:

⤵️ Gold: heavy, must be stored in banks → centralization → ultimately confiscated by the government.

⤴️ Bitcoin: digital, private keys in hand, almost impossible to confiscate.

Who controls Bitcoin?

No one.

Miners may seem to have computing power, but if they cheat (like changing the block reward to 100 coins), the whole network will reject them, and their electricity costs will be wasted.

The only rational choice: work honestly.

Computing power is used to serve the network, not to control it.

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Why is it expensive and slow now?

Because it is now in the 'digital gold' stage, not a payment tool.

The positioning of the Bitcoin main chain: large final settlements between countries and central banks, like how central banks used to settle with gold in the past.

Daily coffee purchase? Layer 2 network Lightning Network can handle it.

The 'slow' and 'expensive' nature of the main chain is for ultimate security; it is a feature, not a bug.

But this is not investment advice. Understanding it does not mean you have to buy it.

Humanity's 5000-year lesson: the harder the money, the longer it lasts.

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