Bitcoin is an asset , It is also a kind of network .

Original title :《 From the evolution of gold BTC The double application curve of 》
writing :Michael Levin
translate :harris

Bitcoin is one of the most fascinating innovations of the past decade . For critics , Bitcoin is a confusing product . No matter how confused they are , By understanding bitcoin's dual application curve , Can explain the application of bitcoin . Bitcoin is an asset , And bitcoin is a network .

In this article , As the first part of a two-part series , I will explain bitcoin's dual application curve in the context of innovation diffusion theory . then , In the second part , I'm going to delve into the fast approaching 「 Bridging the gap 」 moment , And put forward a hypothesis about the super power of bitcoin across the chasm .

The human response to innovation

The rise of human status in the species hierarchy , It's directly due to its ability to use raw materials to invent innovative technologies . From fire to wheel , The power of human invention paves the way for the highest quality of life of any species in the history of the world . Given this evolutionary background , Humans seem to be obsessed with the next new thing , The most advanced technological innovation , It's not surprising . Usually , This obsession will boil into speculation and fanaticism , Because humans try to imagine and pre manage the future . however , Regardless of the speculative cycle , The application of high-tech innovation follows a predictable and transparent application curve .

In the last 12 years , Bitcoin has captured the human imagination . The story of bitcoin may be more appealing than any previous high-tech innovation . It brings the most cutting-edge innovation to one of the fundamental layers of humanity : currency . In view of the possibility of completely changing such a basic concept , Bitcoin has gone through several speculative cycles in its short history . However , If you use these cycles as a reason to deny bitcoin , That would be a serious mistake . These cycles are a fully understood psychological phenomenon , It's caused by people's fascination with new things . Besides , Any way to overemphasize bubbles is to see no trees . because , In a short time 12 In the year , Bitcoin has developed to 1.35 Billion users , Its application rate is higher than that of the Internet 、 Mobile phones or virtual banking tools ( namely PayPal) The application rate is faster in comparable period . According to the current application rate , Bitcoin will 4 Reach within the year 1 0 Billion users . The currency , Just like all previous innovations , Following a predictable and transparent application curve , Even though it's speeding up .

 Read bitcoin dual application curve : Value storage and transaction media

Innovation diffusion theory

1962 year , Everett - Rogers put forward the theory of innovation diffusion , To explain how new ideas and technologies 、 Why and at what speed . The theory explains that over time , How does a product or technology gain momentum and spread among specific groups of people . The end result is , People use a product 、 Technology or ideas . One of the key revelations is , The application of a new technology to people doesn't happen at the same time . contrary , Some people and groups are more likely to apply technology at different times , It's consistent with certain psychological and social characteristics . For new ideas or products , There are five established categories of users . These categories are defined as follows .

 Read bitcoin dual application curve : Value storage and transaction media

* innovator **.「 Innovators are adventurous , Willing to take risks . They basically want to be the first to try something new . Their goal is to explore new technology or innovation , And look for opportunities to be a change agent .」

* Early adopters **.「 Once the benefits of a new innovation start to become apparent , Early adopters will be eager to try . Early adopters bought new technology to make a revolutionary breakthrough , So that they have a huge competitive advantage in their industry . They like to get more advantages than their peers , And they seem to have the time and money to invest .」

* The early majority **.「 In the early days of the mainstream, most people usually focus on innovation to solve specific problems . They're looking for complete products , These products are fully tested , Comply with industry standards , And used by other people they know in the industry . They are looking for gradual 、 Proven ways to do what they're already doing .」

* The late majority **.「 Most of the latecomers are risk averse , Apply only new innovations , To avoid the embarrassment of being left behind .」

* Laggard **.「 The laggards stick to the end . They value the traditional way of doing things , Refuse to apply new technology , Until they were forced to do so by the old system .」

Bitcoin's dual application curve

When evaluating bitcoin within the framework of this established application curve , First of all, we need to recognize and distinguish the dual application curve that promotes the overall application of bitcoin . These two curves can be summarized as . Bitcoin assets and bitcoin networks .

 Read bitcoin dual application curve : Value storage and transaction media

Bitcoin assets , It's the value storage part of bitcoin . Bitcoin assets , It's an investment , The basic argument is that bitcoin will become a store of global value similar to gold . Many factors make bitcoin an extraordinary potential store of global value , Including but not limited to its persistence 、 Scarcity and verifiability . however , Someone will say , Bitcoin has not proven itself to be a store of value for a long time ( See established history ). So bitcoin , This asset is an investment , I believe it will eventually become a global store of value .

Bitcoin network , It's the medium part of bitcoin . The currency , The Internet , Realized the Internet native currency or currency . Make bitcoin network , Become an incredible potential currency or currency factor , Unlike the factors that make it a compelling store of value . The currency , The network , Global... For anyone connected to the Internet 、 Without permission 、 Programmable currency . The use case of this currency or medium of exchange does depend in part on the power of bitcoin as an asset . however , The two technologies and application curves are still independent .

Given the importance of value storage and money in human history , Their creation and evolution have been extensively studied .Vijay Boyapati stay 《 The case of bullish bitcoin 》 neutralization Nick Szabo stay 《Shelling Out: The origin of money 》 I talked about this process in . Even as early as 19 century , William - Stanley - Jevons is in his 《 Money and trading mechanisms 》 It's explained in a book that 「 historically ...... Gold seems to be first and foremost a commodity of ornamental value ; Second, as a store of wealth ; The third is as a medium of exchange ; Finally, as a measure of value .」

To further explain how money evolved , We can directly quote Vijay stay 《 The bullish case of bitcoin 》 Explanation in ... Using modern terminology , Money always evolves in the following four stages .

* Collectability **. In the first stage of its evolution , People's demand for money is entirely based on its special properties , Often the whimsy of its owner . shell 、 Beads and gold are collectibles , It was only later that I moved to a more familiar role of currency .

* Value storage **. Once enough people need it to be special , Money would be seen as a means of preserving and storing value over a long period of time . When a commodity is considered by more and more people as an appropriate means of value storage , Its purchasing power will rise , Because more people need it to achieve this goal . When a value store is widely held , And new people who want to use it as a store of value come in , Its purchasing power will eventually stabilize .

* The medium of exchange **. When money is fully established as a store of value , Its purchasing power will stabilize . After purchasing power stabilizes , The opportunity cost of using money to complete a transaction will be reduced to a level suitable as a medium of exchange .

* Account unit **. When money is widely used as a medium of exchange , Goods will be priced in currency . namely , Exchange rates for currencies will be available for most commodities .

Within the framework of this proposed evolution of monetary assets , Bitcoin seems to be moving from a collector's status to a more acceptable store of value . Some people think that , in the past , These monetary stages are continuous in chronological order , An asset before it has fully completed its value storage application curve , There will be no shift from value storage to the medium of transaction . Why? ? The assumption above is , People don't want to wait for a rising value store before it stabilizes , Fear that they will lose value . Although this is a perfectly reasonable explanation , But it may not fully explain this phenomenon .

Another factor may be , In the application of gold , Existing communications and transportation technologies are costly , Slow speed , And it's limited by geography . therefore , The stage of currency application is severely limited , Moving slowly through a homogeneous audience . In the process , You can imagine , Some people in a nuclear family started collecting gold . then , They convinced the rest of their family , And then they convinced their tribe , They pushed the rest of the town , Then there's the region 、 Country and so on . In the process , A new store of value , Like any new technology , Experienced the application curve from innovator to early adopter , But it's severely limited by geography . Subject to cost 、 Speed and geographical constraints , The application of value storage moves at snail's speed between geographically similar groups . In view of this slow 、 Local application process , These initial users may have very similar money needs and ideas . The homogeneity of this idea may have contributed to the limited use of value storage for a long time , This forces the application curve to unfold in chronological order .

contrary , Today's communications and transportation technologies are the opposite : free 、 Instant and global . Bitcoin is not limited to slow places , It's a global application curve . Bitcoin can be used by anyone , As long as there's an Internet connection . therefore , Bitcoin can follow a different currency application path from the historical example . Given its global application curve , The user will have different needs or ideas compared with the token . It can be applied by investors who believe that it will become a global store of value . and , As more and more investors use bitcoin as an asset , It can also be used by those with special socioeconomic 、 Geographic or entrepreneurial needs of the audience as a better programmable currency applications .

in general , Bitcoin assets and bitcoin networks , Is different , But the interrelated technology application curve . Both have very important and ambitious end states . For an asset like bitcoin , The final state is that bitcoin becomes a global store of value . For bitcoin , The Internet , The final state is bitcoin as the native currency of the global Internet . As discussed above , These application curves don't have to be as continuous and chronological as the historical example of gold . contrary , These two application curves can happen at the same time , Bitcoin is an asset that starts the application process , Help bitcoin network finally send and receive value . As shown in the figure below , It's not so much continuous that the application curves don't overlap , Rather, these curves look more like interconnected waves , Mutual promotion , Driving the whole application of bitcoin . Besides , The whole bitcoin application curve is reaching a critical moment . and , The interaction of these two curves is crucial for bitcoin to enter the mainstream market .

 Read bitcoin dual application curve : Value storage and transaction media

Status quo of bitcoin application

Bitcoin as an asset , In the application S The first part of the curve . It depends on which target market is used as denominator , There's a slight difference in its exact position on this curve right now . For the sake of simplicity , Let's use about 1.35 100 million current bitcoin users . then , For an asset like bitcoin , Let's start with Croseus The way to start , He's looking at the number of people who have some wealth to store or invest in bitcoin . He used 22 Hundreds of millions of people , This is what the world has 1 The number of people with a net worth of $10000 . Considering this denominator , The current penetration rate of bitcoin is 6.1%, Or in the early adopter part of the application curve . however , There are far fewer people in the world who are really actively investing . The number of investors worldwide is hard to determine . In the U.S. ,52% Most families have direct or indirect contact with the stock market . The United States is recognized as the country with the highest proportion in the world . however , For the sake of conservatism , Let's take this 52% The number of inserted into the whole world 22 One hundred million people 1 Million dollars of investment , So there is 11.4 Hundreds of millions of people . Given this conservative denominator of the investor base , The utilization rate of bitcoin is 11.8%, Or on the edge of the early majority .

For the bitcoin network , In an ideal final state , Anyone with an Internet connection can and should use a better currency . therefore , We will use a more active target market , The total number of active Internet users ,466 Billion . For molecules , For the sake of simplicity , We will keep ~1.35 Billions of dollars . If we can distinguish between the user who invests in the asset and the user who purchases the asset as a fund , So much the better . because , Probably at this point , Most of these users invest in bitcoin as an asset , Instead of using it as money , But to distinguish reliably , It's very difficult ( There will be more to come ). With this denominator , The currency , The network , Yes 2.8% The permeability of , Or in the innovator section of the application curve .

The currency , This asset , Probably entering the early majority of , And bitcoin , The network , Is on the verge of moving from innovator to early adopter . therefore , Overlap the two , The currency , Overall speaking , Still in the early stages of applying the curve , It could be somewhere in the early adopter phase .

To understand how we got to this point in the overall application , It's important to realize that , The narrative and positioning around bitcoin is evolving . In their work 《 The vision of bitcoin 》 in ,Nic Carter and Hasu In the past 12 The narratives surrounding bitcoin over the years . They identified seven major ideological narratives , These narratives have dominated bitcoin's history . They explored how these schools of thought describe bitcoin users , as time goes on .

 Read bitcoin dual application curve : Value storage and transaction media

In the early days of bitcoin , Proof of concept for e-cash 、 Anti censorship e-gold and cheap payment networks are the mainstream among users . At this stage , Innovators use bitcoin . As mentioned above , Innovators want to be the first to try new ideas . They're technical experts , therefore , It doesn't take much work to position an innovative technology for them . Innovators use it just because they're curious about the technology .

As bitcoin began to spread to early adopters , Positioning and narration naturally begin to change . Early adopters are rare visionaries , They have insight , Match an emerging technology to a strategic opportunity . These visionary people promote the development of high-tech innovation , Because they see the potential for an order of magnitude of change . With the addition of early adopters , The buzzword around bitcoin has shifted to censorship resistant e-gold 、 Cryptocurrency reserve currency and unrelated financial assets . Early adopters saw the potential of bitcoin as an asset , And push the narrative to focus on this potential use case . These early adopters' beliefs and narratives brought bitcoin as an asset from the innovator stage to the early adopter stage . In view of this narrative shift , In the past few years , Most bitcoin users buy bitcoin as an investment asset , It's not surprising .

LendEDU stay 2017 A survey in asked bitcoin owners :「 Which of the following best explains why you invest in bitcoin ?」 21.81% Of the respondents answered 「 Bitcoin is a long-term store of value , Like gold or silver 」.2021 year Surveymonkey A survey of bitcoin owners shows similar results . Most people who own bitcoin say , They personally own bitcoin is 「 As a growth investment 」(67%). Less cited ,30% People who say they have it are 「 To hedge against the collapse of traditional assets 」,29% People who say they have it are 「 As a store of value 」. meanwhile , For the bitcoin network , This survey shows that , Only 13% People who buy it 「 As a currency for purchasing goods and services 」. therefore , At present, the overall application of bitcoin shows that , Most people buy bitcoin as an asset . and , As discussed earlier , When comparing , The application curve of bitcoin as an asset is better than that of bitcoin as a network ( Probably still in the innovator stage ) go further ( Comfortable in the early adopter phase ).

Bitcoin's current position and track in the overall application curve is mainly due to its smooth transition from an innovator to an early user , They accepted the idea of assets and value storage . In view of the current points on the overall application curve and the expected application rate , Obviously , some time 10 year , Bitcoin will enter the early majority stage .