Lawrence Stoican
Aug 24, 2017 · 3 min read

Hey!

Thank you for your response.

Yes, I am a student. Most of the work presented is based off of theories from New Classical and Keynesian economics.

You are completely right, and I do see now that I might’ve misrepresented how our actual economy works.

Thanks for your input on money printing as a driver of inflation, I will do some further research on that.

In this article I merely tried to apply some in-class theory to cryptocurrency. Obviously, I did not do thorough enough research, and I will keep that in mind for future reference.

Now, to clear up a few things:

The problem presented in this article was that money printing is causing inflation. When inflation occurs, Central Banks raise interest rates, which slows down inflation, but instead causes unemployment.

The solution here would obviously be Bitcoin, since it cannot be artificially inflated. It is clear that in today’s world, no one would be able to repay their debts. If all governments were to repay their debts, there would simply be no money in circulation!

Bitcoin, as a deflationary currency would never lead to that raise in interest rates and unemployment in the long run.

And to answer your question of “With Bitcoin’s value rising why would I buy something with Bitcoin today when it will cost less tomorrow?

The point of the article was not to tell people to go out there, purchase bitcoins, and go shopping.

The point here is “invest in bitcoin”. Hold Bitcoins for a while, buy whenever you can. The more the value of Bitcoin goes up, the more media coverage it will get. The more media coverage it will get, the more people will start to learn about it, and learn more about blockchain.

After having held for a couple of years, your then-candy-bar has just turned into a Lambo! Congratulations!

Blockchain you say?
Bitcoin uses “blockchain” technology, which is also where the digital ledger is kept (a ledger keeps track of all transactions). With such a ledger, banks are unnecessary when performing transactions. There is simply no need for a 3rd party to look over transactions, and approve them, which usually can take at least one working day, due to SWIFT/BIC technology. Banking methods are clearly outdated, in the age of information. This kind of new technology would allow people 100% control over their money. There is no need to trust that the money you put into your bank will still be there the next day. There is (comparably) no waiting time in the transfer of cryptocurrencies through the blockchain. There are no fees for sending money abroad. All transactions are treated equally. Your crypto wallet does not need to know any information about you in order to allow transactions.

I feel as if this diagram explains it quite well:

With such technology, other things can be built on top of it. Bitcoin is just the first “product” of blockchain technologies.

There are many pros to utilising such technology, such as smart contracts and decentralised exchanges.

The value of Bitcoin will most probably increase. Storing savings or assets in it is no different than any other investment.
This is now dependent on what kind of person you are. If you’re looking for a safe and secure way to store value, and will assure you that in 10 years its value would not fluctuate by much, gold is for you.

If you’re looking for an investment which can provide ROIs of 100% and over (depending on how long you can hold out for) Bitcoin is for you.

As always, never invest more than what you can afford to lose. That goes without saying, almost.

However, don’t just take my word for it. Do your own research and see what you make of it!

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    Lawrence Stoican

    Written by

    Copywriting | Social Marketing | Blockchain is my city

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