Bitcoin is an Investment in Time

Bitcoin is an Investment in Time

As the wise Benny once said, "lost time can never be found."

That's Benjamin Franklin by the way. He and I are tight like that.

This week is about time and its importance in our life. Financially speaking, this means investing while using a low-time preference lens will be more beneficial in the long term.

Does that mean I should invest in Rolex watches?

No silly goose.  Low-time preference means thinking long-term and valuing the future over the present. Inversely, high-time preference would mean making decisions for the here and now.

You can trace these two terms back to the classic debate of inflation vs deflation, which is better for an economy?

Rather than deciding what's better for an entire economy, let's discuss what's better for you.

Inflation is when the money supply expands, and the value or purchasing power of that money is eroded over time. Did you know Chevrolet once sold a car cheaper than a PlayStation 5 costs today?

If you budget well and put away money from every paycheck into savings, the amount and quality of goods that you can buy with your savings over time become less and less as the money is inflated. This is the story for the US Dollar, Euro, Peso, or any government-controlled currency.

Deflation on the other hand is where money retains its purchasing power and preserves wealth.

As the US Dollar money supply is expanded, finite assets in high demand increase in value because you have more dollars chasing less inventory.

Gold has been a deflationary staple in investor portfolios for thousands of years, but as of 2009, there is a new kid in town. That little whipper snapper's name is Bitcoin.

Bitcoin is the most pristine deflationary asset humans have ever known. 

Looking specifically at the deflationary properties, Bitcoin has a programmatic monetary policy that cannot be altered by any one person or group which guarantees there will be less and less Bitcoin added to the circulating supply until we reach 21 million around the year 2140. At this point, the supply will be capped FOREVER.

This means that the rate at which the dollar supply increases will be exponentially greater than Bitcoin year over year.

Put $100 in a savings account today, and you MIGHT be able to buy a 16 oz. coke in 20 years. Put $100 in Bitcoin and retain the full value of your purchasing power for your future self.

The only chart you need to see.

The takeaway.

Instead of saving in US dollars, save in Bitcoin.

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