"It’s about multiplayer games where people respond based on what they think the other person’s response will be." -Naval Ravikant
The Language of Value
Money is the language we use to communicate value with each other. The more people that speak our language- the more trading partners we have, the wider choice of goods and services, and the more competitve the prices.
"everyone agrees on a single monetary good through which to express value because it is in their individual and collective interests to do so"
Convergence in the Digital Age
In the physical world, sovereign money is largely bound by national borders and capital controls. Hence, we have hundreds of fiat currencies.
The digital world, however, has no such restrictions. Jurisdictional boundaries lack defintion, opening up a single global market for the dominant internet-native money.
"The internet will have a single currency. I personally believe that it will be bitcoin."
Everyone wants to hold the thing that best protects their purchasing power over time. It's a decision that rewards pragmatism and penalizes ego. There are no other prizes.
"Diversification makes no sense when there’s a cracked answer to an engineering problem.. Money is a winner-take-all competition. There is an answer. Choosing the wrong answer has dire consequences."
If the past several years have taught us anything, it's that the opportunity cost for going against what the majority naturally converge on is indeed costly. Slight advantages in monetary properties compound, leading to massive divergence over time.
Balaji Srinivasan | Tech is internationalist, capitalist, decentralized, hyperdeflationary, networked, encrypted, digital, volatile, and ambitious. So is Bitcoin.
Nick Szabo | The precursors of money, along with language, enabled early modern humans to solve problems of cooperation that other animals cannot..