Ok, strap in. This one is going to get deep. Bitcoin is digital property not cryptocurrency. There it is I said it, but Michael Saylor said it first. Let’s break this down. First, let’s look at how the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission’s (CFTC) classify Bitcoin. Both regulatory commissions have agreed that Bitcoin is a commodity. As a commodity, there are different regulatory enforcements from a stocks or a bonds. As a result of this classification, Bitcoin falls under the same category as gold and silver.
When I think of gold and silver, I think of gold coins and silver coins. I also think of these as physical property that I can control. However, since there is no physical Bitcoin to hold, your property is now digital. Listening to a recent Michael Saylor interview, he gave an example of buying the island of Manhattan. If you purchased Manhattan 200 years ago, the present day value, is probably 1,000,000,000x what was initially invested. So the value stored in the island of Manhattan has exponentially increased.
Are we really comparing Manhattan to Bitcoin?
Your damn right we are. The value you put into Bitcoin is subject to volatility. However, I’m sure that swampy island of Manhattan went through it’s ups and down before it became what it is today. Saylor has pointed out in interviews that Bitcoin is able to give billions of people worldwide digital property rights. It’s property that has no property lines other than how much you own. Their digital Manhattan that can go with them anywhere. Let’s dig deeper.
So I never get to enjoy my digital property?
This is truly the beauty of what’s to come for bitcoin. As of right now, you can put your Bitcoin on exchanges and gain yield on your coins. There are also exchanges that you can put your Bitcoin up as collateral and take out loans. If this is a new concept, Robert Kiyosaki talks about how the rich don’t own anything and don’t pay taxes or at least not as much as you would think. The rich leverage their assets to buy more assets. Take out loans and use them to buy assets, that is tax free money you gain from owning digital property.
In conclusion, at first this was a difficult concept for me to understand. Regulators have given us a win in regard to Bitcoin. Bitcoin has been called digital gold, gold 2.0, and a store of value. All of these things are true at the same time. Property. We are moving into a new age; and we have to unlearn the traditional routes we have learned. Out.