Bitcoin’s Use Case and It’s Future

It's all about adoption...

Bitcoin’s Use Case and It’s Future

Just like the majority of people I wish I had seen the value of the use case for Bitcoin in the very beginning. But I was difficult to convince. Then in the last two years I spent quite some time and energy reading several books on Bitcoin and Cryptos. The book that clearly opened my eyes the most to its utility was The Bitcoin Standardby Saifedean Ammous.

This book spent quite some time discussing our current monetary instruments and their flaws. Essentially, the problem with our existing money system is that it is credit based. Because it is so the issuer can debase the currency based on their credit strength, but the holder of the instrument itself is eventually penalized through devaluation which are always occurring.

Just think about the Federal Reserve Bank and what they publicly acknowledge. As recently as this past week, on January 29, 2025, in the first paragraph of their FOMC Statement they go on to state; “The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run”. The word inflation means they are purposely taking 2% of your money on an annualized basis against other goods and services. As kindly as you want to frame this statement, and though it is much better than the inflation which the populace has suffered over the last four years, which has been as high as 8% or more according to other analysts, they are taking money out of our pockets.

Enter Bitcoin, which is totally decentralized and no one agency has control over its existence or value. The idea being that if people assign it a value it will become our money and an acceptable form of payment for goods and services. However, one downside is the managing of the BTC and your wallet.

At this moment, people have been buying it and holding on for no other basis than that it will go up in value. I don’t know about you but that is not what I look for in my money. I want the money to be liquid, transparent value and easy to handle. Of course, I am not saying early adopters should not rewarded but only that at this juncture its use case is not the driver of this assets value.

It’s first problem is the speed of money. It needs to be able to be exchanged quickly at the counter for it to become acceptable. I need to go into a coffee shop and be able to pay and walk out without standing around minutes to see if the transactions are completed. For this problem there is the Lightning Network which is supposed to make the payment process lighting fast. It breaks down your BTC into Satoshis so you may be able to pay for things with speed. I have a lightning wallet and from my experience though it may be fast transactionally, it is not universal, and I have no way to carry it around with me easily and pay someone or give a tip. The technology is still not exactly user friendly.

Don’t get me wrong. I love the technology, and I truly believe in its use case. However, the market needs more adoption. My concern at this juncture is people are focused on the wrong objective. Though the acceptance of BTC and ETH (Ethereum) for the issuance of exchange traded funds was a good step in increasing liquidity and pricing transparency it’s still only in its infancy phase.

The most recent activity around BTC is the promotion of it to Central Banks. In fact, there is legislation being introduced by Senator Cynthia Lummis from the great State of Wyoming for the USA to establish a strategic Bitcoin reserve. This would be a good event for BTC market as an asset for the interim but from what I understand it is unlikely to pass. Think of it, BTC is supposed to be currency to displace all Fiat currencies in use. Why would the enterprise (the federal government) which issues the competing currency want to enable the competitor?

Though other digital assets can be and are created to compete with BTC, it is currently the only one, as secure and decentralized. Other attempts at digital currency that exist, technologically have some tradeoffs which expose the holder of those assets to risk. Hence BTC appears to be secure in its uniqueness and position.

Yet we must return to its use case. BTC is supposed to be a currency as such the focus of the market participants should not be buy and hold. But to increase its use in the marketplace, we must not place it under the bed where it is hidden for none to see. If that is what this is built on, then us true believers are living a lie. It then means we are just holding it waiting for the right moment to jump.

Unlike BTC, gold has a use case for many different markets such as jewelry, electronics and financial markets. Gold has the advantage of being around as a human tool of exchange for over 5,000 years and counting. BTC has only just come on the scene, it needs to create its usage demand, and it cannot be only as a long-term investment. Because then what are you investing in? I can’t paint my walls with it, I can’t hang it around my neck, and I can’t pump it into my engine and make my car go.

The market needs to make BTC readily acceptable in all the largest retail markets in the world. A good step would be to get Amazon, Walmart and Costco to accept the digital currency for transactions. Their argument will be that they can’t work with the volatility of its value vis-à-vis the USD dollar. But if the computer technology is here to have lighting transactions, why can’t they have lighting exchange to USD while the BTC builds its market penetration?

What I am saying is something most people know. Bitcoin still has a significant way to go before it bears real fruit. Right now, it is a baby and just beginning to crawl. Though, it is real, it is alive and will grow. It is very exciting to be here at this stage I hope I get to see the day when I can pay my dry-cleaner with it and the governments are removed from the currency manipulation game.