Phase 1 Complete

Thirty days. One complete picture.

Here is what has been built, piece by piece, over the past month:

Money is a technology. It evolved from barter to commodity money to paper to digital — each step solving the limitations of the one before. Good money needs to be durable, portable, divisible, fungible, scarce, and accepted. Most forms of money fail on at least one.

The gold standard kept money honest for centuries by tying supply to something finite. Nixon ended it in 1971. Since then, every major currency in the world has been fiat — backed by nothing except collective belief and government decree.

Banks create money through loans. The total money supply expands and contracts with credit. Fractional reserve banking means your deposits are not sitting in a vault — they are out in the world, working, lending, multiplying.

Inflation is not neutral. It is a transfer of purchasing power from savers to debtors, from wage earners to asset owners, from the end of the money chain to the beginning. The Cantillon Effect runs quietly in the background of every monetary expansion.

2008 showed what happens when the system is pushed past its limits. The losses were socialised. The gains had been private. Trust collapsed.

Satoshi Nakamoto read all of this, built a response, and then disappeared — leaving behind a system designed to need no one.

Starting tomorrow, Phase 2. What Bitcoin actually is, how it works, and why its design choices are answers to everything covered in the past 30 days.

If you want to go deeper on Phase 1 before moving on, the book linked below covers Bitcoin from first principles — written for exactly where you are right now.

— The Daily Bit