This is an opinion editorial by Taimur Ahmad, a graduate student at Stanford University, focusing on energy, environmental policy and international politics.
Author’s note: This is the first part of a three-part publication.
Part 1 introduces the Bitcoin standard and assesses Bitcoin as an inflation hedge, going deeper into the concept of inflation.
Part 2 focuses on the current fiat system, how money is created, what the money supply is and begins to comment on bitcoin as money.
Part 3 delves into the history of money, its relationship to state and society, inflation in the Global South, the progressive case for/against Bitcoin as money and alternative use-cases.
Bitcoin As Money: Progressivism, Neoclassical Economics, And Alternatives Part II
*The following is a direct continuation of a list from the previous piece in this series.
3. Money, Money Supply And Banking
Now onto the third point that gets everybody riled up on Twitter: What is money, what is money printing and what is the money supply? Let me start by saying that the first argument that made me critical of the political economy of Bitcoin-as-money was the infamous, sacrilegious chart that shows that the U.S. dollar has lost 99% of its value over time. Most Bitcoiners, including Michael Saylor and co., love to share this as the bedrock of the argument for bitcoin as money. Money supply goes up, value of the dollar comes down — currency debasement at the hands of the government, as the story goes.
Source: Visual Capitalist
I have already explained in Part 1 what I think about the relationship between money supply and prices, but here I’d like to go one level deeper.
Let’s start with what money is. It is a claim on real resources. Despite the intense, contested debates across historians, anthropologists, economists, ecologists, philosophers, etc., about what counts as money or its dynamics, I think it is reasonable…
