I stumbled on this passage by Michael Saylor in an interview where he's asked his take on the most important thing to know about Bitcoin. Saylor talks about Bitcoin as digital property. By comparison 100x more valuable than digital retail like Amazon, digital info like Google and Youtube, digital connection like Facebook and Instagram. By making this comparison, he's suggesting a massive disruption of how economics operates in the world.
See the snippet here at (41:47):
I've transcribed this passage here so it's readable and easier to review.
Question: Is there an under-appreciated aspect about Bitcoin that should be talked about more?Is there a question that people are not asking about Bitcoin that needs to be asked?
I think the single most important thing to understand about Bitcoin is, Bitcoin the first decentralized, truly digital property in the history of the human race".
- If you want to give music to 8 billion people you got to give them digital music [Spotify, Apple Music, YouTube]
- If you want to give education to 8 billion people you have to give them digital books and digital education [YouTube/Google]
- If you want to give wealth to 8 billion you have to give them digital property [Bitcoin]
Bitcoin is profound in the same way that streaming music and YouTube is profound and iBooks is profound.
Except those things that I just named created trillion dollar companies. Facebook Google, Amazon, Apple all became trillion dollar companies because of digital books, digital education (Google/YouTube), and digital music.
Digital property is 100x more important than digital books, digital music, digital friendships, digital relationships [Facebook/Instagram], digital retail [Amazon]
The under appreciated aspect here is we have the ability to give 8 billion people digital property in the palm of their hands with a $50 android phone and you can program it with the next Apple chip or Samsung chip to a million transactions a second and you can move it at the speed of light.
And people don’t get that. They keep thinking “Oh well, it’s slow. There’s only 300,00 transactions a day on the block chain”
Well duh, that’s the settlement layer.
If you go to Lightning, PayPal, Square, CashApp and all the layer 2 and layer 3’s you’re going to get a billion transactions an hour.
And so Bitcoin is the ability to move [digital] property at the speed of light. A billion times an hour to 8 billion people and with Moore’s Law. Upgrade it as fast as you can upgrade chip sets.
If people started thinking about that a bit and they realized that the alternative is what?
- Ship everybody an ounce of gold?
- How are you going to give 8 billion people property?
- You going to give them $287 dollar of land in California?
- How are you going to program that and one that at the speed of light?
- How are you going to flash loan that to 100,000 counter parties on a Saturday afternoon?
So digital property is the way we make everybody on Earth wealthy.
In the same way that YouTube, iBooks, Google Maps, or digital books and digital information is the way that you make everybody on Earth intelligent.
It’s a pretty big deal.
And I think everybody is still stuck in this…
Most institutional investors just thinking of this as another type of gold
- “Oh I can buy some gold I can buy some commodities (stocks), I can buy some Bitcoin”
- “It’s an uncorrelated speculative asset “
- And the crypto people are like “Oh well, it’s just one more crypto thing”
- Other people think “It’s just a way I can move something Peer 2 Peer”
What hasn’t registered in their minds is that the mobile phone is getting successfully more valuable.
- When we put photos on the mobile phone. Apple become worth an extra 100 billion dollars
- When we put videos on it, and when the iCloud is holding all your videos, all your photos, all your communications, and all your documents on it, Apple became a 2 Trillion Dollar company
And no one said to themselves “Heck, what if the iCloud had 50 trillion dollars of money in it. What if Apple becomes a 50 trillion dollar bank.”
If BTC is digital property then Google can be a 20 trillion dollar bank or Facebook can.
But if Facebook can become a 20-30 trillion dollar bank and Apple doesn’t, then isn’t that a threat to Apple?
If that’s a threat to Apple than Bitcoin becomes the technical imperative of the 21st century. And t rebuilds the banking industry, the power structure, the status quo.
Aren’t Google and Facebook and Twitter and Apple the most powerful companies in the world already?
And didn’t they already get that powerful through digital video, digital communications, digital retail.
Think about how powerful somebody becomes when we have digital property.
Because what we’re going to see is 200 trillion dollars of money drain out of land, stocks, bonds, currency and collectibles. And when we demonetize 400 trillion dollars worth of property and half of it flows out.
It’s just like how we took information out of the books and libraries. We took the music out of the orchestras, the pianos and the cds.
What happens when we take the money out of the property and we put it into the Bitcoin blockchain and then we hand that to technology companies to do it with as they will.
That’s an Earth-shattering big idea. It’s going to change the balance of power between nation states. It’s going to change the balance of power in the tech industry.
Someones going to do it and someone’s not going to do it.
And the company that does it is all of a sudden not going to be worth 1 trillion dollars anymore. They’re going to be worth 10 trillion dollars.
And there’s going to be another company that doesn’t do it and they’re going to be the Kodak of the Information Age. I don’t know which [company].
That’s what’s under-appreciated.
People are kind of screwing around debating over whether or not Bitcoin trades up or trades down in the next month or 2 months.
And they’re just thinking small right.
The right way to think about it is its electricity.
Every business in the world didn’t have electricity in 1900.
And ask yourself the question “what happened to the companies that adopted electricity and what happened to the companies that rejected electricity.
At 59:25, Saylor makes an interesting take that BTC will reach $1M+ because it’s a superior investment vehicle compared to any other asset class from their fundamental properties.
Cash: Your purchasing power declines every year because your money burns from money printing/inflation.
Bonds: 2-3% interest, you’re losing money every year from 7-10% asset inflation.
Real Estate: not easily transferable or liquid. Property tax/maintenance fees
Stocks: doesn’t make a good store of value over long term. e.g. companies go bankrupt.
BTC’s currently just under 1 Trillion Market Cap (at 49k a BTC) hits Gold’s 10 Trillion Market Cap that’s a BTC of 500k. Saylor says BTC should easily reach that 10 Trillion Dollar market cap because BTC is superior to gold.
e.g. You can’t transfer gold 1,000 miles away instantaneously, but you can with BTC.
Saylor adds beyond that, if BTC gets a fraction of global bonds ($119T market cap), global stocks ($56T) land/real estate ($217T) other asset classes, he sees BTC hitting $1M+ per BTC. just a waiting game of when.