In this article, Ketan describes what we're trying to achieve with Bitcoin. The mission.
Articles December 5, 2022
First, let's understand what we're trying to achieve here. The mission.
The current world's financial system relies on trust. There are two entities we trust with our money. We have no choice but to trust these two entities.
1. We trust banks to hold our money and give it to us when we need it.
2. We trust central banks to not print infinite supplies of money.
On January 3rd, 2009, mankind solved #2 with Bitcoin. Bitcoin has a fixed supply of 21 million coins. This cannot be changed without overwhelming consensus. We've taken money away from government and put it back in the hands of the people who use it. "The separation of money and state".
For point #1, this is where we, as users of money, need to do something different so that we do not fall victim to the abuse again. We need to learn and take steps to become our own independent bank. We need to become responsible for our money. No more blaming others.
What does it mean to be your own bank?
1. Managing private information
Your Bitcoin is only yours if you (and only you) have the private key to spend it. This gives rise to the popular saying "Not your keys, not your coins".
When you set up a bitcoin wallet, you will be given a series of randomly generated words. You may be given the opportunity to add your own word, called a passphrase. Guard these words (in order) with your life. Like, I'm dead serious here. This is called self custody.
Here are some buzzwords you might want to research into to help you with this:
- Hardware wallets (trezor, ledger, coldcard)
- Steel plates to store your words on (cryptosteel, billfodl, cyphersafe)
- Backup/recovery procedures
- Multi-signature wallets (take care with this one)
Before you do anything, read. Read the guides, read the documentation, watch the videos. Find the pros and cons. Conduct your own research. Be diligent. Put time and effort into this. It matters and it's incredibly important. Then make a plan. Nothing too complex. Keep it simple.
2. Managing fake bitcoin detection
When someone sends you bitcoin, how do you know you've actually received bitcoin? The only way to independently verify that your coins are actually bitcoin, included as part of the 21 million coins on issue, is to run a full Bitcoin node.
With these two responsibilities taken care of, it is much more difficult to fall victim to the abuse of banks and government. Your money is yours, and yours only. You can take it with you to the grave if you so wish and it will remain there for all eternity.
If you are trusting someone else with your bitcoin, all you are doing is replacing one set of thugs with another. The thug can feed you fake information, block or censor you. There is no perfect solution, so be aware of the trade offs you're making. This comes down to research.
Notice I have not said a word about the price of Bitcoin. It will do what it does. The important thing is to invest in yourself and level up your education so that you participate in the full benefits of financial self sovereignty in ways that have never been experienced before.