Bitcoin is Information Asymmetry

Bitcoin is a pure expression of information asymmetry, both in that it is not well understood by the market and represents a great asymmetric trade, but in that the value is contained purely in the zeros and ones of the data. If you don’t have the data or information, you don’t have the value. With nearly all speculative trade focused on the ability to gain an edge over the assumptions of Perfect Information, by buying Bitcoin you can begin to get an edge.

While this principle of economics is usually used to understand market inefficiency, applying ideas about Information Asymmetry to Bitcoin can help us think about economic distribution as information. The more information you have about an investment or an economic activity, the more likely it will work out in your favor or that you will be satisfied in trading. The more Bitcoin you have, the more economic information you’ve learned.

Owning Bitcoin and the amount you own, demonstrates you’ve accumulated both the financial resources and economic understanding necessary to own Bitcoin. While the previous statement is tautological, accumulating Bitcoin does not happen accidentally. Those that do not do the diligence or homework required to understand or grok Bitcoin, may soon part with their holdings.

As a Bitcoin holder, you’ve taken on board the history of money, the history of banking, the history of technology, and technological adoption. You have a fundamental knowledge of politics, economics, law, accounting, and computer science. Game theory, human psychology, motivation, media, information, and technoculture are your morning readings.

Now, combine all of that expertise with a bit of financial purchasing power, and you get exposure to pure economic power in the form of monetized digital energy. In essence, you’ve beaten the game and are ready for the next chapter, or to play on difficult mode. By buying Bitcoin, you’re doing a Prestige lap.

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