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The fraction of the pie is the only sensible way to measure wealth
2516 sats \ 23 comments \ @SpaceHodler 24 Aug 2023 bitcoin
When you have 1 BTC, you have 1/21m of the total supply. That's your share of the pie and if you do nothing, it will remain constant forever.
Everything else changes. Prices of things change in relation to the prices of other things. The price of BTC in USD or whatever shitcoin you fancy. The amount of beef 1 BTC can buy. The number of eggs 1 BTC can buy. And the number of eggs a pound of beef can buy. Out the window go the baskets of goods used in CPI indices... Economic growth is variable too. BTC's market share changes too and it's hard to make any predictions. The only thing that can be constant is the share of the pie of a money with a fixed supply.
In this unpredictable world, it's strangely comforting to have a money that at least offers some certainty. Even if that certainty doesn't tell you how much beef or how many eggs you'll be able to buy tomorrow - which is impossible under any money anyway.
It doesn't make sense to measure one's wealth in how much beef one can afford, because one day we may discover a new way of growing beef, which may make it as abundant and cheap as air, and people will trade tons of it for an egg just to have some variety.
It looks like the only sensible way to measure one's wealth is the percentage share of the pie represented by a fixed-supply currency. The same share will likely buy more stuff in the future simply because - due to economic growth - there will be more stuff out there. The pie may grow, but at least you can be sure x% of it is yours, forever.
And this feature will be key to Bitcoin's success if it succeeds.
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192 sats \ 5 replies \ @kepford 24 Aug 2023
This really hits people when they see it. I remember asking my family to set down and watch one of BTC Session's videos on why it isn't to late to buy bitcoin. He used several illustrations but how many satoshis are there per person in the world? really seemed to make an impression.
∞/21m
Powerful concept.
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21 sats \ 1 reply \ @kepford 24 Aug 2023
Lol, set down. I meant sit down. One day I will learn to type.
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50 sats \ 0 replies \ @nemo 24 Aug 2023
deleted by author
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0 sats \ 2 replies \ @quark 24 Aug 2023
That counter. Is strange. There are no decimal satoshis, right? For now 😃
I got anxiety watching the world population number grow in real-time
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10 sats \ 0 replies \ @nullama 25 Aug 2023
In lightning you can use millisats, which is 1 sat divided by 1000.
It's rounded to the nearest sat when it goes on-chain
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0 sats \ 0 replies \ @kepford 24 Aug 2023
Its math so yeah there are, we just ignore them for now.
Its funny how we've been taught to feel bad about new life. Imagine the opposite. How would it feel if the number were going down. Thats another topic though.
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31 sats \ 1 reply \ @SatoshisSkeleton 25 Aug 2023
There's degrees of subjectivity to measuring wealth but I agree that comparing your amount to the overall supply is an objective measure
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10 sats \ 0 replies \ @Undisciplined 25 Aug 2023
It's a narrow view of wealth, but it's a useful way to contextualize personal stacks.
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52 sats \ 1 reply \ @TwoLargePizzas 24 Aug 2023
I completely agree.
We measure everything else on a fixed scale. Height, weight, speed, time, volume, temperature.
But wealth? For some stupid reason people insist on measuring their wealth in a money with an elastic supply.
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0 sats \ 0 replies \ @nullama 25 Aug 2023
But it's all relative.
You can be the tallest person in one country, and be average at another.
Same with wealth.
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40 sats \ 3 replies \ @Michelson_Morley 25 Aug 2023
Counterpoint: That just adds complexity without providing any actual benefit.
What do you do if tomorrow 50% of BTC is accidentally sent to an unrecoverable address, do you still own 1/21m ? No, you own 1/10.5m.
Or, in both cases, you own 1 BTC.
I don't see the point.
It doesn't make sense to measure one's wealth in how much beef one can afford
Sure it does. :) Why wouldn't it
It looks like the only sensible way to measure one's wealth is the percentage share of the pie represented by a fixed-supply currency.
And when this currency is forgotten about and discarded, does it still provide a yardstick for your personal wealth? Not really.
I'm not really getting your point at all, if that wasn't clear. Feel free to make me a belieber!
</negative-nancy>
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0 sats \ 1 reply \ @SpaceHodler OP 25 Aug 2023
It doesn't make sense to measure one's wealth in how much beef one can afford
Sure it does. :) Why wouldn't it
Why beef? What's so unique about it? The prices of beef vary geographically, it's costly to transport and store.
What do you do if tomorrow 50% of BTC is accidentally sent to an unrecoverable address, do you still own 1/21m ? No, you own 1/10.5m.
If the fraction is not constant, it can only go up. That's even better.
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0 sats \ 0 replies \ @Michelson_Morley 25 Aug 2023
Sees overly complicated to me but whatever roasts your rump!
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0 sats \ 0 replies \ @nullama 25 Aug 2023
And when this currency is forgotten about and discarded, does it still provide a yardstick for your personal wealth? Not really.
Money is a human invention.
You need to have people accepting that something is the proxy for value. This something can be anything, and over time it has been shells, gold, dollar bills, etc. Now it is also Bitcoin.
Now, because of the properties of Bitcoin, it is very attractive to basically almost everyone on the world right now, and increasingly into the future with technology advancing and connecting more and more people to the Internet.
It was almost a miracle that Bitcoin started having any kind of monetary value. But now, it would be difficult to remove that property as it's already spread all around the world.
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50 sats \ 0 replies \ @cyberpunk02 24 Aug 2023
Your average share will be 262500 sats if the "population" is 8 billion and we exclude lost coins etc.
As a fraction you can make that 2/21Billion? i'm not sure then it all gets strange. Please correct ....1.25e-10? average wealth = 1/10B 0.0000001% of btc
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1 sat \ 0 replies \ @TheWildHustle 24 Aug 2023
It is comforting, even when your stack is at .1 btc
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0 sats \ 2 replies \ @drdoom 26 Aug 2023
The problem is the pie, despite capped, is still incredibly large.
100 million satoshis in 1 BTC means 21 million BTC = Two quadrillion, one hundred trillion satoshis.
If every satoshi was worth 1 penny the total BTC supply would be worth $21 trillion dollars.
Comparing to US dollars, current estimate is $2.38 trillion worldwide circulation.
I fail to see how $21 trillion dollar cap is better than $2.38 ? Actually the US dollar wins here in this example; it appears there are less dollars than Bitcoin thus dollars are actually more scarce.
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0 sats \ 1 reply \ @SpaceHodler OP 26 Aug 2023
What do you mean? The size of every pie is 1, which, being the multiplicative identity (https://en.wikipedia.org/wiki/Identity_element), is neither large nor small. Your share is a number in [0, 1].
Here are the market caps of fiat currencies: https://fiatmarketcap.com/ . The USD market cap is much higher than what you stated, but it has no relevance whatsoever.
How can dollars be more scarce? A scarce money is a money that's hard to create more of. The nominal values of the circulating supply have no effect on scarcity. The only thing they indicate is the market share, which tells us where we are on the adoption curve and how much upside it still has - which is not the topic being discussed here, but if we are to go into that, Bitcoin is not only a currency, it's also a store of value; it can grab the market share of not only the USD, but also other fiat currencies and assets, including gold, stocks, real estate, etc.
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0 sats \ 0 replies \ @drdoom 28 Aug 2023
Duly noted, good points.
However, the main dillemma I'm trying to highlight is the lowest denomination ie- unit is a satoshi and therefore the pie is measured in that unit. Since even this lowest unit can still represent any arbitrary amount of value you have basically an unlimited supply of units.
The premise of this argument is thus Bitcoin's fixed/finite supply is irrelevant when there are multiple trillions available of the base unit. Like saying we have a cap but that cap is equivalent to the number of grains of sand in the world.
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0 sats \ 2 replies \ @CoachSiim 25 Aug 2023
If
All value of the world = all bitcoin in the world
(Round numbers to simplify:)
21M - 4M lost already - 2M to be mined = 15M currently,
ownership of 1 BTC = 1/15,000,000 of all the value in the World?
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0 sats \ 0 replies \ @Undisciplined 25 Aug 2023
That's correct and the first point demonstrates how lacking this idea is.
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0 sats \ 0 replies \ @CoachSiim 25 Aug 2023
I mean currently
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0 sats \ 0 replies \ @BlokchainB 25 Aug 2023
Thanks for this. It’s hard to escape the fiat mindset when your bills and debts are all in fiat. But a post like this puts things in perspective all the sats you acquire are yours! The fiat debt I find myself in can fluctuate tremendously. But 1BTC is a piece of the pie
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