Why Investing in Bitcoin is Different to the Dot-Com Era
Many people liken investing in Bitcoin to the early dot-com era, but buying into the early tech companies back in nineties or the early noughties is completely different to investing in Bitcoin.
If you’re in your thirties now, you’ll likely remember the boom and bust of the early dot-com websites and platforms.
There were many unicorn dot-com ventures that went stratospheric before quickly ending up in the gutter. And no doubt there are many shitcoins that will end up the same way.
Bitcoin (BTC) is different, however, and investing in Bitcoin is completely different to anything from the dot-com era, and arguably different from every asset that has gone before it.
Investing in Bitcoin is Completely Different to Investing in Dot-Com Firms
Comparing Bitcoin to even tech giants like Amazon and Google adulterates the possibilities of the leading blockchain and cryptocurrency.
Both Amazon and Google have done extremely well, and if you’d invested in those in the early years, you’d have made a nice return.
However, the thing about Amazon and Google, and every other Internet company, is that you’re investing in that product, application or company.
And no matter how good and useful they are, they cannot compare to the possibilities Bitcoin is creating.
Investing in The Protocol Not The Application
Investing in Bitcoin is investing in the protocol – the code the laws the system. And every single transaction needs the Bitcoin protocol and in doing so creates value for the coin.
So, if we’re going to compare Bitcoin to the dot-com era, it would be better to compare it to Internet protocols like TCP/IP or SMTP.
TCP/IP is a set of communication protocols that governs how information on the Internet is moved around. Like Bitcoin, it provides end-to-end data communication and ensures that everything in the network runs smoothly and securely.
SMTP is another base protocol for the Internet. A protocol which email applications use. It uses TCP/IP to send information around the Internet, but every email sent needs the SMTP protocol to verify its validity.
So every transaction that goes through these Internet protocols makes them valuable, and the more they’re used the more valuable they are to society.
The problem is, these early Internet protocols weren’t monetized. In fact all value was created on top of the protocols at the application level: think Facebook, Amazon, Apple, Google, and Pets.com for a short while.
With Bitcoin and other blockchains the roles are reversed: the applications built on the protocol provide value to the protocol. And as we already know: we can invest in Bitcoin.
How Much Would TCP/IP or SMTP Be Worth If One Could Invest?
Of course it’s impossible to know the value Internet protocols would be. But the fact that some of the biggest tech companies that rely on the Internet’s base protocols have market caps at over a trillion dollars.
These companies would have created so much value for Internet protocols if they had been tokenized back then.
There are over a 500 million blogs, and bloggers post over 2 million blog posts every single day. Every single post, tweet, and email sent are transactions on the Internet protocols.
It’s impossible to quantify the value of what Internet protocols would have been, but it’s fair to say it would exceed all Internet-based companies’ value by a long way.
Everyone missed out on investing in Internet protocols, but investing in Bitcoin is very accessible.
Bitcoin Is The Biggest Innovation of Our Lifetime
Bitcoin is a peer-to-peer money that allows anyone to send value to anyone else without the need of a trusted third party. And while not many people use Bitcoin to buy things just yet, they will in the future.
For now, Bitcoin is digital gold. It’s a store of value and a hedge against all the government printing. This year alone, the US has created 22% of all the USD issued since the birth of the nation.
And it’s not just America, the global economy is a mess and every nation is racing to devalue its money. They are deliberately trying to inflate their fiat currencies and making them more worthless.
Savvy investors know this and that is why they never keep much value in cash. They store value in things like equities, gold, and real estate.
Now they have another option, they can now invest in Bitcoin.
Bitcoin is a decentralized network of trust. It is the most secure network ever created.
There is a limited supply of 21 million, and that can never change. It is the only provably scarce asset, and it isn’t controlled by any central entity.
It is consensus driven and any changes have to be voted on by the Bitcoin community, which is made up of thousands of nodes and millions of miners, all wanting what is best for the protocol.
It is hard coded, and nothing in the protocol can change without 51% backing of the nodes.
It has an almost 100% uptime, and the market never shuts. It’s highly liquid and anyone wanting to buy or sell Bitcoin can do so at any minute of the year.
It doesn’t need a third party to verify a transaction, and any transaction will definitely go the address intended. It cannot be stopped and Bitcoin cannot be confiscated.
No government or any entity can take them off you as long as you don’t give away your private keys.
Investing In Bitcoin Is Different to Everything Else
Most people missed out on the early dot-com boom, but the lucky ones who had the foresight are quids in.
We rarely get second chances at investing in the next tech boom, and investing in Bitcoin isn’t a second chance. It’s much bigger.
Now we can invest in the protocol. The governing code that rules every single transaction that will take place on the Internet of Money.
It’s not TCP/IP, SMTP or even the Industrial Revolution. Bitcoin is programmable money built on the most secure network ever created.
It does the same and more as early Internet protocols, and they helped shape today’s world in a way we could never imagine.
The Internet disrupted all corners of the globe, but I believe Bitcoin will disrupt and bring together parts of the globe the Internet neglected. It is the money of the Internet and the best thing is we can invest in Bitcoin.
Author: Tommy Limpitlaw
What is the point of Bitcoin?
Bitcoin is a decentralized money. A money that nobody can control or manipulate, and a money that nobody can print and devalue. It’s also not necessary for any third party to verify transactions, so it makes it much faster and cheaper to send value. It’s also money built on the Internet: a society of almost 5 billion people.
Why should I buy Bitcoin?
Bitcoin is a peer-to-peer money that nobody can manipulate. It’s all set in the Bitcoin codebase which is secured by hundreds of thousands of computers all around the world. Bitcoins can be sent by anybody and no third party is need to verify the transactions, and nobody can stop Bitcoins being sent.
How many Bitcoins are left?
There can only ever be 21 million bitcoins. At the time of writing, there are 18,162,756 bitcoins in circulation. There are 6.25 bitcoins minted roughly every 10 minutes, so that’s 900 every day. The amount of newly minted bitcoins is cut in half roughly every 4 years, in what is known as the halvening. The halvening will continue to take place until the last fraction of Bitcoin is minted in around the year 2140.
Can I start Bitcoin with no money?
Absolutely! Bitcoin is like other investments and currencies. If you have some money to invest, you can make more faster. You can lose more faster, as well if you don’t know what you’re doing. But if you don’t have any money to invest you can earn free bitcoins from playing games, learning about cryptocurrencies, or offering your skills for Bitcoin.
A Bitcoiner since 2017 and a Bitcoin Maximalist since 2018, Tommy is our main writer and editor at Bitcoin Maximalist. Other than researching and writing about Bitcoin, Tommy loves spending time with his family and supporting his beloved Leeds United.