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Time and time again, we realize that forcing people to do good or to change their behavior does not lead to meaningful results. Human beings are stubborn and don’t want to change for various reasons. Most importantly, humans can be selfish and are not willing to alter themselves in any way unless there is a personal gain to be earned. On the other hand, incentivizing people to behave in a particular way by rewarding them with something they value consistently produces the intended result.

Alignment of incentives is one of the most important phenomena that make up Bitcoin.

Incentives as a force behind Bitcoin’s success

Apart from being a technological breakthrough, Bitcoin is a psychological and social phenomenon. Bitcoin takes human greed and turns it on its head. Bitcoin is fueled by human greed. Bitcoin uses human greed and the natural desire to better one’s financial standing to ensure the integrity of the system. …

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Exploring market share capture in cryptocurrencies.

By Misir Mahmudov and Yassine Elmandjra

This series will explore how the winner-takes-all or winner-takes-most notion applies to the cryptocurrency market. In Part I, we will provide a high-level overview on the evolution of monetary systems up to the inception of cryptocurrencies, shedding light on the limitations of previous forms of money. In Part II, we will explain why the clear winner, likely Bitcoin, should capture most, if not all cryptocurrency market share. …


Misir Mahmudov

Austrian Economics. Previously @Columbia

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