3 Things that will Lead to Bitcoin Mass Adoption
CBDCs | Africa | Math
Today I was asked what my “Bitcoin thesis” was. The question struck me as sort of odd because to me, there is no thesis. Bitcoin is cut and dry. Case closed. But nonetheless, I appreciated the prompt to articulate my rationale and what I am expecting bitcoin to do in the future. Although there are more than three things that I think will greatly influence and trigger the mass adoption of Bitcoin, I’ve decided to focus on just three things for the purpose of keeping this letter somewhat short and succinct.
1. Central Bank Digital Currencies
Do I think the government will eventually step in and create a “competitor” to Bitcoin? Yes. Do I think it will actually compete? No.
Central bank digital currencies will be fundamentally different than bitcoin, although they will share the same virtual space. People will no doubt lump them into the same category and confuse one for the other. But once CBDC’s get ramped up and are being fully used throughout society, it won’t be hard to tell the difference between Bitcoin (Freedom Money) and CBDCs (Authority and Censorship Money).
I think as the use of CBDCs is mandated and enforced anywhere and everywhere they are implemented, we will see a corresponding increase in demand for Bitcoin. Although physics is not directly at play here, I like to think that markets subscribe to the law “Every action has an opposite and equal reaction”. When a government imposes the use of a restrictive currency, we will see ample demand for a currency that is the opposite of what is being mandated. i.e. a currency that is free, open, and restriction-less.
Many of us are not familiar with what CBDCs might (*will*) look like when they enter our society. Here are a few examples of “features” that will be built into our future money.
Money that expires: Use this money within 7 days, or it expires and cannot be used.
Condition Spend: This money can only be used at grocery stores
At Source Tax Deductions: Your bank account is subject to addition tax because you
Own a Hummer / Truck / SUV
Eat Meat
Make too much money
Make money in ways that the current regime might not like
Social Credit = Financial Credit: Your social interactions may become tied with your financial interactions. i.e. You say something on social media, and your credit score goes down. Your browser history may be required to be submitted when going through a credit check.
Universal Basic Income: You will get ‘x’ amount of money per month if you meet certain criterium. ( — This will make it easier to print money, ever-accelerating inflation)
If someone were given the choice to use a kind of currency I described above, or Bitcoin with all of its flaws and volatility, I honestly think at least 20% of people would choose Bitcoin.
2. The African Continent
Those with the most to gain, and the least to lose will be the first to adopt Bitcoin. Those with the least to gain, and the most to lose will be the last to adopt Bitcoin. Make no mistake, we will all eventually adopt Bitcoin.
I make the argument that the continent of Africa and the 54+ countries that exist there are the bedrock for global bitcoin adoption. It is the testing grounds, the expansion grounds, and home base for global bitcoin infrastructure moving forward. That is unless an already developed country decides to pay more attention than the Nigerian, Ethiopian, Kenyan, and West-African populace already steamrolling their way towards Bitcoin adoption.
Here are some general stats that I’m tracking in order to bolster some of the later statements and assumptions that I’ll be making.
Share of population living in extreme poverty expected to drop from 31% to 18% between 2026 and 2035 - [ source ]
Median age… [ source ]
Liberia: 18
Nigeria: 18.6
Guinea: 19.1
Senegal: 19.4
Median Age is Increasing across the continent 2000 - Present Day - [ source ]
Life expectancy has rapidly increased from 1950-2020 and is expected to continue - [ source ]
What do these things say to me?
Generally speaking, people in Africa are currently young, living better lives year over year, and expected to live until at least 65 or older. The fact that they’re young now means a few things. It means that they’re primed and ready to try new things and adopt technologies that solves their problems. In particular, many of the African countries have an authoritarian regime problem.
There never really has been a tool as potent as bitcoin for fighting back against authoritarian regimes. I’m a subscriber to the belief that we vote with our dollar, or… rather we vote with our satoshi.
If you give a man gun he can rob a bank; if you give man a bank he can rob the world.
Countries are run by those who control the currency of the nation as much as they are controlled by the military or authoritarian government in charge. But what happens when you give a resourceful, thrifty, well-educated, population of young folks an open-source banking technology called Bitcoin? You do the math.
3. Math
Speaking of math. Bitcoin is mathematically designed to increase in value over time, as long as its user base either stays the same or grows. It is simple supply and demand. Limited supply (21 million coins) + ever increasing demand as
Population increases
More and more people pile into bitcoin (i.e. African Youth)
The math really isn’t that hard to do, but I’ve come across countless people that try to make the math harder than it needs to be. So in the spirit of entertaining these folks, here is some math describing Bitcoin’s upward trajectory.
Bitcoin’s current inflation rate is 1.71% and dropping [ source ]
The lowest inflation rate in 2022 was China at 1.8% [ source ]
Bitcoin’s inflation rate will drop by a factor of 2 sometime in May 2024
There are currently about 200M people using bitcoin (5% of world population)
This number is growing every day and is expected to increase along a similar trajectory as the internet
The world population is expected to expand to 10 billion by 2050
Wealth Transfer is taking place RIGHT NOW [ source ]
Generational (Old to Young)
Geographical (Developed to Underdeveloped)
Technological (Those who use tech to their advantage and those who do not)
I don’t know how bitcoin goes down against these trends. If you can tell me how this happens, please do as it’ll invalidate my thesis. Leave your comments!
Money in Circulation
I believe that the math behind printing money alone is enough to drive the perpetual increase of Bitcoin. The next photo presents this fact beautifully.
In the case of the USD, an ever expanding supply of money causes the value of the units to go to zero. In the case of Bitcoin, a static money supply causes the value of the thing we use to measure value to go to infinity over time. As the productive capacity of the globe increases, so too does the monetary instrument that we use to measure value, i.e. Bitcoin.
So…
as the supply of BTC remains fixed
and the supply of the USD continues to increase
and the population of the earth continues to expand
and technology continues to make us better, faster, smarter, more efficient and productive
Then it stands to reason that “math” is going to continue to “happen” to the respective money that we choose to use. I choose Bitcoin. What about you?
It’s just a matter of time.