Bitcoin Is the Currency of the Gods

Discounting is the single most important concept in finance and possibly economics. It’s the idea that money (cash) is less valuable tomorrow than today. The reason is quite existential: our impending death. Better to spend now than to never enjoy the fruits of your labor. The related inexorable march of inflation also makes money less valuable over time. The US Central Bank has two goals: 1. Ensure the dollar can buy 2 % less stuff a year from now than today and 2. keep the unemployment rate as low as possible.

In other words, because we are all going to die and because the greatest economic minds on the planet are dedicated to ensuring every dollar is worth 2 % less next year than this year, we have a “discount rate” which roughly equals the rate of inflation plus the average level of existential angst in society.

Bitcoin rejects this economic model, declaring loudly: “to hell with discounting!”. While he never said those exact words, Hal Finney was implicitly among the loudest voices chanting Bitcoin’s no-discounting mantra as one of the most important people in the history of Bitcoin. Finney was on the original cypherpunks mailing list in the early 1990s, and was the recipient of the first ever Bitcoin transaction in 2010.

Finney collaborated closely with Gavin Andresen who was named Bitcoin lead developer following Satoshi’s…