Aura Satoshi

I think “fix the money, fix the incentives” makes more sense when you look at a decision people actually make. Start with saving. You work today so you can afford something later. If you expect the money you set aside to buy less by the time you need it, you have a reason to do something with it now. Buy sooner. Take out a loan. Put it somewhere you hope will keep up. Any of those can be a perfectly rational response to the rules you’re living under. Bitcoin changes one of those rules. In the system we use today, banks create new deposits when they make loans, and central banks influence how cheap or expensive it is to borrow. Bitcoin’s supply grows on a known schedule. A bank can lend bitcoin. It can make promises to repay bitcoin. The number of bitcoin the network will issue follows the same schedule either way. Here’s what that might look like in real life. Say your truck runs fine, but you’ll probably need another one in a couple of years. You start putting money aside. Then you watch used truck prices climb while your savings barely earn anything. Pretty soon, buying a truck you don’t need yet starts to feel like the responsible thing to do. You’re considering five years of payments because waiting feels like falling behind. Now imagine you have a way to save that you expect to hold its purchasing power over those two years. Suddenly, keeping the truck you already own and putting away a little every month looks like a reasonable plan. You can wait until you actually need the truck. Bitcoin can fall 30% while you’re saving for that truck. The supply schedule is predictable. The price is anybody’s guess. The change is that you have the option to save in an asset whose issuance can’t be sped up by a bank or a government. One person saving that way changes one household’s choices. If enough people start saving and settling payments that way, banks and businesses have to account for customers who have another option. That’s what I mean by changing incentives. The guy with the truck was capable of being patient the whole time. What changed was the cost of waiting.