Bitcoin Understanding

Value of bitcoin
Need to assign a value to enable funds transfer. Wont any low value do? Why is the value increasing?

If there are limited bitcoin, i could just use a lesser amount of bitcoin to represent my value. So i say $100=0.01 bitcoin, plenty of bitcoin for everyone. But, this values each limited bitcoin at $10,000 per coin.

So i say $100=100 bitcoin, $1 per coin, but only limited bitcoins exist so i need to buy from the open market. Creating demand.

Can i say? $perBitcoin = ( 'total bitcoins' - 'bitcoins held or lost' ) / 'the number of dollars in regular bitcoin transactions' ok what is regular, its not definable.

If i store my funds, i need to know the value will remain the same or better. Not guaranteed

Bitcoin is not money or currency it is a divisible agreed store of value. Like a property has agreed value.

The value is what I can confirm with my node, as can every other node who wants to be part of the agreement process. The value only truly exist on every node running bitcoin, as a formal agreement that the value exists. Value has a relationship to the number of node owners on the network, network effect.

Bitcoin has creation value, and speculative value.
The creation value of a bitcoin is how much a miner commits to spending on electricity and hardware to compete and mine a Bitcoin first. Value realised when they sell to make profits from the mining operation.
The speculative value of Bitcoin is driven by traders and investors competing to be the earliest to realises the scarcity of bitcoin in the 'future'

The word 'future' is key, mining gives the illusion of bitcoin abundance. But halving events show a glimpse of the future scarcity when one day there will be no more coins generated by the system. Halving's are the wake up call.

Recently miners have stopped selling, many are now holding btc in trust for investors in the mining company. Will this have a similar price effect as selling? Or does it decrease supply? Selling tickets in bitcoin instead of the bitcoin.

Contradictions, I believe there is no 'time' the future is now and before, yes quantum time exists, but for our small scale light is effectively instant so its not a factor. Bitcoin is called a time based system, but perhaps it is more accurately an 'event completed' system or 'anti-disentanglement' system.

Bitcoin is a decentralised persistent disentanglement resistant value ledger, with programmatic reward functions for enhanced self network propagation.

It's alive, and a lot of energy is going into feeding it. But it's not bad, it's a more efficient and fair life form than the one we currently live with, one that was already created by economists and governments and wealthy to effectively manage large growing populations of independent thinkers.

Nov 2022:
Proof of work had become an enormous factor in my understanding of the value of bitcoin. Will elaborate further.

The only digitally scarce public asset embodies as one of its traits proven effort in its creation, that sets a bar so high that any competitor would never overcome the energy requirements

Mar 2023:
The fact that energy was used to create each Bitcoin is provably locked into each Bitcoin at the time of its discovery, this proof of work is unforgeable, making it a fair tradable commodity, fairly tradable for goods requiring equivalent energy to produce.

Over time scarcity is programmed to increase until ultimate scarcity is achieved when no further bitcoin are ever produced. This newly discovered ultimate scarcity will make all bitcoin the new denominator in any value calculation equation. Ie the final value of one bitcoin is the value of absolutely everything tradable, divided by 21million.

This scarcity was only ever known by smaller human groups, these groups were always outperformed and eventually absorbed by groups with superior monetary technologies. As a planet we will be just like these early groups, we will have no choice but to align towards the ultimate monetary technology, and work together for the reward of the scarcest commodity ever to have been known.

Price leading up to absolute scarcity. The fixed mining reward schedule is the value suppression system which allows for organic growth within existing market. The constant release of new bitcoins ensures the value will not get too high, but as the schedule halves the reward every four years, then every four years the suppression value halves, and we are one step closer on the 32step value path to absolute scarcity calculation.

Mar 2024:
Bitcoin as a better metaphor for value storage. A move more into how the mind interacts with bitcoin, I assume breedlove was influential here.

A speaker is a transducer, it converts electrical energy into sound.
We use metaphor as a transducer to convert perceived value into stored value, and #Bitcoin is the best metaphor for value storage.

As understanding of this improved metaphor spreads so does the bitcoin value.

Apr 2024:
It's the most useful metaphor because is is a metaphor tied to reality with energy.

Not a metaphor.

The world we live in is simplicity releasing into complexity; that's entropy increasing. Humans control and work against this high entropy and form less complex areas in our lives. We build systems and engines to generate extra low entropy areas where we want or need them.

A refrigerator lowers the entropy of the inside of a box for us, but as an overall system it increases entropic complexity with heat waste and sound.

Bitcoin is a similar system where miners lower entropy in pockets within a digital system, overall releasing heat waste but the low entropy output remains. Although low entropy is already easy to achieve in digital systems, the solution Bitcoin provided was creating low entropy digital units that are also secure, unique, and counterfeit resistant, within a high-entropy environment.

Bitcoins are not stored energy or time; they are stored low digital entropy in a high digital entropy environment. They were created with energy over time. The system they were created in ensures that they will remain in this perfect state forever.

Newly mined bitcoins have more value because they are harder to mine, representing even lower entropy units. This raises the value of all existing bitcoins, as the average entropy of the entire system decreases. When existing bitcoins are sold, they have gained value because their average entropy has decreased over time, releasing more stored potential than they originally had.

An example, using air pressure as an analogy:
The Bitcoin generated after a halving are harder to mine so are lower entropy. These new lower entropy bitcoins enter the Bitcoin system (pressure vessel) as low pressure areas, acting on all existing bitcoin (air atoms) to move and equalise (trade) to the current pressure (price).

When you buy bitcoin, that bitcoin immediately aligns with the current market forces, entering a state of equilibrium within the system. When someone sells their bitcoin, it releases its stored potential, which has increased due to the overall decrease in system entropy.

Why bother breaking it down like this? It allows us to mentally model and act on known changes caused by halvings and mining as it is viewed by an insightful praxeologist (one who studies human action). And it allows us to appreciate the beauty of the overall system design.

Bitcoin is human engineered to be perfect money. (see previous)

I can explain the energy, entropy, and self propagating reasoning now.

Now I know, what's most important now is what having perfect money means to our world