Is spending the only thing money is good for? What about saving? Saving used to be encouraged. When my generation grew up we were told that saving up money for later use was the way to go. You were supposed to have a savings account with a good interest rate in a large bank. In Sweden, this meant a bank more or less controlled by the government. No one said anything about stocks or bonds back then and I can’t recall ever hearing the word inflation. These concepts weren’t for the ordinary citizen. We kids were supposed to grow up, decide what we wanted to do, educate ourselves and get a steady day job. Then the internet happened.
Nowadays no one seems to use savings accounts anymore. Interest rates are low and we’re told to lend and spend as much as we can. We’re bombarded with ads for mortgages and financial services. A wise man once said that compound interest is the most powerful force there is but to the average person today this seems like even more of a mystery than it did in his day and age. The following might come as a surprise to some but saving for later actually still pays off. If you save something that increases in value that is. Your nation’s currency does not. This fact has skewed our attitude towards saving. In the old days, us scandinavians had to save in order to prepare for the long winter. We chopped wood and salted meat in order to survive. In the age of consumerism however, we’ve forgotten all of that and we pilgrim to the shopping malls as much as everyone else. Why? Because of the very nature of money and our inability to understand its mechanics. Inflation is the underlying force that makes us squander rather than save. Bitcoin reverses this narrative.
In the Bitcoin space, and even more so in the cryptocurrency space on the whole, there’s a lot of talk about usage and adoption. We’re shown metrics of trading volumes and merchant acceptance and we’re lead to believe that these correlate with the short and long term value of Bitcoin in one way or another. While there might be some truth to be found in some of these theories, the most basic function of a deflationary asset is lost and almost never mentioned. The elephant in the room so to speak — that the best use case for a commodity that is as scarce as Bitcoin is not to spend it or even to trade it. It is to hoard, to save and hodl it for as long as you can. The more people that do this the more valuable it will become. It is truly a self fulfilling prophecy. Nothing on earth is as scarce as Bitcoin. That’s right, nothing on earth. Nothing is as irreplicable, as immutable and at the same time portable as Bitcoin. It’s unique history and resistance to change has already proven this over and over. This is what gives it value and, ironically enough, this seems to be the hardest thing for people to understand.
Keynesian economic theory has poisoned our thoughts about money so much that saving money is seen as the opposite of using it. Money should be able to store value! I hereby therefore suggest the new hashtag #hodlingisusing when faced with the arguments of nocoiners, quacks or charlatans. Your Bitcoin is more scarce than everything else you own and therefore your Bitcoin will appreciate in value faster than everything else you own. Saving is using. HODLing is using.