10 Aug 2019
This myth is often phrased as "Bitcoin is not backed by anything."
Unfortunately, many in the crypto community bite this by saying: "Well, fiat is not backed by anything either." Which is a wrong response because it makes you agree with the claim that there's no underlying value to Bitcoin.
First of all, we can't even say that fiat money isn't backed by anything. In fact, fiat money is backed by the economy (and also the political situation) in its country. If the economy and the political system are doing very poorly (like in Venezuela), its fiat currency loses value.
Bitcoin, on the other hand, does not have any government or country behind it. But this is exactly where its value comes from. Because Bitcoin is open-source and decentralized, we can trust that it's fair, independent, and truly scarce.
By fair, we mean that it treats everyone equally. Bitcoin does not care what nationality, race, gender, wealth status, etc. you are. In fact, it does not care whether you're even a human. Anyone (and anything) that can use the Bitcoin protocol can use it under the same rules.
By independent, we mean that no one can control Bitcoin. The network is decentralized. It can't just happen that you'd wake up someday to see that FBI raided the Bitcoin HQ and shut the network down. There's no Bitcoin HQ. No one can shut Bitcoin down. Nor can anyone change what's written in the blockchain.
By truly scarce, we mean that no one can just print a bunch of Bitcoin for themselves (outside of the Bitcoin protocol rules - block reward). We can be sure of this by reading the Bitcoin source code which is publicly available.
That's why people convert part of their wealth into Bitcoin. Because it's fair, independent, and truly scarce. And these are the fundamental values of Bitcoin.
(looking forward to your feedback via this Twitter thread)