They enable us to do things we previously couldn’t and they change our behavior. This resource can be used as a guide to better understand the multitude of way in which bitcoin can be useful to us and as a basis for considering all the industries, systems and assets that could be disrupted by bitcoin in some way

WEALTH PROTECTION

Bitcoin is a permissionless global network enabling wealth to exit jurisdictions/regimes without the threat of arbitrary confiscation. This ability to flee persecution or dictatorship with one’s savings intact gives leverage back to the individual, incentivizing states dependent upon taxation to act with integrity and justice.

CALL on a OPTION NEW SYSTEM

Owning bitcoin today is owning a non-dilutive share of all the base money in the new digital world before the full transition has taken place. Part of bitcoin’s price today represents the likelihood that it will eventually become the native money of the Information Age.

DETECT CAPITAL CONTROLS

“Bitcoin can approximate unofficial exchange rates which, in turn, can be used to detect both the existence and the magnitude of the distortion caused by capital controls & exchange rate manipulations.” -Dr. Gina Pieters

MONETIZATION of STRANDED ENERGY ASSETS

The potential for monetization of stranded energy assets has emerged with the rise of bitcoin mining operations. These operations have a location-agnostic approach to energy buying, making previously uneconomical energy resources worth re-evaluating under this new market dynamic.

UNCORRELATED ALPHA

“Bitcoin’s correlation to other assets from January 2015 to September 2020 is an average of 0.11, indicating there is almost no relationship between the returns of bitcoin and other assets.” -Fidelity Digital Assets: Bitcoin Investment Thesis Report (2020)

HIGH-VALUE SETTLEMENT

The bitcoin network enables moving a billion dollars worth of value across the world, securely and in minutes, for less than a few dollars. It’s becoming a more attractive method of final settlement for high-value transactions than traditional financial infrastructure.

LIQUID to ALTERNATIVE PHYSICAL SoV ASSETS

One of the main issues with many physical assets that are used as a store of value (such as fine wine, vintage cars, and high-end art) is the cost associated with storing, maintaining, and authenticating them. However, digital assets like Bitcoin offer many advantages in this regard. Since Bitcoin is digital and publicly auditable, it doesn’t require any storage or maintenance costs. Additionally, it offers much greater liquidity, as it can be traded 24/7 in a global market.

COLLATERAL for LENDING

The credibility of bitcoin’s scarcity (independently verifiable via a full node) as a bearer asset makes it an ideal form of collateral in transactions. We are now seeing an explosion in fiat-denominated lending due to its tax advantages. Additionally, the programmable nature of bitcoin (i.e. multi-signature custody schemes) add a layer of flexibility to loan agreements.

CREDIT CARD REWARDS

Rewards & cash-back programs are dependent on having attractive incentives to encourage membership. Currently, centralized arbitrary point systems are the norm, where conversion calculations are difficult and terms & conditions opaque. Bitcoin, as a globally recognizable money, reduces friction and improves redemption optionality for consumers. Additionally, the feature of long-term increases in purchasing power are proving to be desirable.

TREASURY RESERVE STANDARD

“Traditional treasury strategies no longer work to preserve shareholder value. Corporations need new techniques to manage the dilutive impact of monetary inflation on their balance sheet. The best idea is Bitcoin.” -Michael Saylor (CEO, Microstrategy)

UNIT of ACCOUNT

One of the key advantages of Bitcoin is its fixed terminal supply, which makes it an ideal unit of account for value exchange. By using Bitcoin as a denominator for goods, services, assets, or investments, it provides a consistent and unchanging point of reference for measuring purchasing power over time. This uniformity in measurement can help to eliminate fluctuations and uncertainty in value exchange, making it a valuable tool for financial transactions.

INVESTMENT BENCHMARK

Bitcoin’s rise over more than a decade has proven to have been a phenomenal long-term passive investment strategy. As liquidity becomes less of a risk, capital allocators are now forced to justify their active strategies if returns fail to outperform simply holding bitcoin.

CENSORSHIPRESISTANT TRANSACTIONS

The decentralized and permissionless nature of the Bitcoin network means no single entity can exclude participants or censor valid transactions.

MICRO PAYMENTS

A single bitcoin can currently be divided into 100,000,000 smaller units (satoshis), with further divisibility down to 1/1000th of a satoshi supported by Lightning. This enables a level of granularity that fiat currencies cannot match at bitcoin’s current unit price and opens up entirely new markets and business models.

REMITTANCE and FX EXCHANGE

Bitcoin is a universal network and consensus rules do differ base on geographical location. The combination of bitcoin’s fixed terminal supply and a secondary layer such as Lightning allows for instant and cost-efficient transfer of funds, making it a suitable option for remittances.

TIME-LOCKED CONTRACTS

The combination of cryptography, digital signatures and hash functions allows us to create time-based escrows. Hashed Time Lock Contracts (HTLCs) are conditional payments that require the recipient to acknowledge they’ve received a payment by a set deadline or forfeit the right the claim it.