I am excited by the prospect that housing would be demonetized by Bitcoin.
Bitcoiners like to talk about 1971 as a turning point, which, I agree is a thing, but I there is more to the story. Since the creation of the Mortgage Backed Security in 1981, the west has struggled decade over decade with rising costs of housing. It was the financialization of housing, and with it the constant bleed of fiat value, that got the west into this situation.
China rapidly emulated this from 00's, and is now struggling under the weight of real estate as a 'monetary savings vehicle' as it grows beyond the ability to service the debt, lower demand and a decreasing population base. Excessive debt must lead to expansion of the monetary base to service it, and with it, everyone takes the loss. Population decay will always lead to inflation, as there is more money supply and less people to use it.
Jimmy, it sounds like one could build a house for a few million sat. I look forward to the day that housing costs are insignificant, and humanity can concentrate on more productive economic output, rather than rent seeking.
Treating housing as money concentrates wealth in the hands of those wish to extort their fellow humans. We just need to keep the selfish people from gobbling up the supply, seeking rent, and let folks build value and increase their economic output. Bitcoin is the solution.
I am becoming more convinced by the idea that Bitcoin is not digital gold, but digital real estate.
Housing has some value because people need a roof over their heads, but that doesn't explain why there are empty apartments in London and ghost cities in China. Real estate attracts a premium because a) The S2F ratio is higher than any other trad-fi asset in NIMBY zones (including gold) and b) It is excellent collateral for taking out loans against debasing currency because houses aren't easily lost, destroyed or stolen -- you simply cannot take out a $500k loan against a pile of gold with a 10% deposit.
So what you have with Bitcoin is an asset with a superior S2F as we all know, but also an asset that has pristine collateral properties. It cannot be lost or destroyed, and contracts can be settled unambiguously on-chain via multi-sig. The big players will start to exploit that by following the Saylor playbook and borrow against Bitcoin until there's no more fiat left to milk, and most value gets absorbed by the superior money.
I can’t wait until MSTR gets added to the S&P500 index funds, and suddenly everyone has 1% Bitcoin exposure in their 401ks. Coming late 2024-2025!