My thoughts on bitcoins

Bigi Lui
7 min readApr 27, 2021

I recently tried to think about bitcoins a little more, a little deeper than the surface level. On any day there is typically a wide range of opinions about bitcoins. It could go to $1m USD per bitcoin, it could go to $0. It’s useful, it’s useless. Because I’m trying to invest in bitcoins a little more seriously now, I want to think about it deeper.

It’s a store of value

I have both personally spoken to a lot of bitcoin critics/doubters, and read a lot of opinions online about why they don’t believe in bitcoins. Right off the bat, let’s get through some critics’ arguments and look at what bitcoin is not:

  • Bitcoin is not a commodity with intrinsic value (like gold is, for example). When anyone suggests to keep some percentage of one’s assets in bitcoins, critics like to immediately bring up that it isn’t like gold because gold has practical applications. I fully acknowledge that.
  • Bitcoin is not a currency for transaction (at least, there are better cryptocurrencies for that like bitcoin cash or others). Although one of bitcoin’s original feature was transfer of value, the speed and fees make it unfeasible for either daily consumer uses (fees) or backbone infrastructure money transfers (speed/scale). Critics love to point this out, and how bitcoin is not truly a currency because of this. I also fully acknowledge that.
  • Bitcoin is not a stock (even though it is often traded like one). The stock price of a company is tied to how well the company makes money. Critics of investing in bitcoins would point out that the price of bitcoin is not tied to anything like that. Again, I fully acknowledge this.

In my opinion, this is actually what makes bitcoin interesting — it’s categorically a different thing than everything we’ve known about before (which might be why it’s so hard for people to wrap their head around, or to accept what it is). It’s a pure store of value.

There are lots of arguments related to this, from proponents and critics. Because it’s a store of value, various arguments about inflations, USD risks, etc. typically come up. I just want to talk about it at the most fundamental level (without speaking about what factors may contribute to or act against its use as a store of value) — the fact that it is a store of…

Bigi Lui

Lead Engineer @knockdotcom. Previously, Principal @drop, CTO @CoinTent, Architect @Zynga.