Why I've changed my view on Bitcoin.
A thread.

A long-term blockchain skeptic, some may be surprised that I've started arguing that bitcoin has the potential to become a store of wealth in the long term.

In fact, I've written in the past that bitcoin's supply dynamics - which Satoshi modeled on gold - aren't sufficient to stop a decline to zero.

To be clear, I never said bitcoin WAS going to zero, simply that what was unclear was the demand schedule.

Bitcoin isn't used for anything, in the traditional sense. While it can be used as a means of exchange, it seldom is.

It is often bought on the assumption that it will someday be sold for more money.
That's called the greater-fool strategy of investing.
More elegantly, its based on the assumption that someone will pay a higher price for the good than me.

Problem is, this type of demand center is notoriously fickle.
Historically, from limited edition baseball cards to ponzi schemes, there have been thousands of failed bubbles based on artificially constricted supply.

What usually happens, is that when a bubble forms in such a scheme, and it inevitably bursts, it returns to zero, and never rises again.

That has not happened in bitcoin.

Instead, what we've seen is that, following each collapse, which was then followed by an algorithmically designed supply constriction, demand recovered.

On that basis, we've now had three two manias, followed by pops. Then constriction. And then a repeat.
And a third cycle is forming before our eyes.

When something we don't expect happens once, it can be dismissed as an anomaly. If it happens twice, it might be a coincidence. If it happens a third time, we have to address out assumptions.

So, what's changed?
Ive watched, and written about, bitcoin since 2012. I've watched three cycles play out. I now accept that demand for this asset class is not fleeting, but has longevity.
Betting that it will be gone in a a decade is betting against the evidence of history.

That does not mean that bitcoin is a store of value alongside gold yet.
It's still too volatile and has an unproven link with inflation.

Right now, my assumption is that bitcoin is a viable, but speculative play, on an asset with fixed supply that may someday be a store of value.
And that's a powerful premise.
/ends.
....for now.