Bitcoin: the best store of value humanity has ever known
Why scarcity, time, and energy make Bitcoin the ultimate form of money
What is money, really?
Before we can understand why Bitcoin may be the greatest store of value (SoV) we've ever had, we need to revisit a fundamental question: What is money?
Definitions vary:
A tool for transferring value across time and space.
A widely accepted medium of exchange (as per the Austrian School of Economics).
A store of human effort and productivity.
A ledger to track ownership.
Across history, from rai stones in Yap, to aggry beads in Africa, to gold-backed currencies, humans have continually sought out commodities with scarcity, durability, and trustworthiness to function as money.
Until 1971, when the US dollar was decoupled from gold, money retained its store-of-value properties by being linked to something scarce. Since then, with the Fiat Standard, money has become untethered, and easily inflated.
The three functions of money
Traditionally, money serves three purposes:
Store of Value (SoV): Retains purchasing power over time.
Medium of Exchange (MoE): Facilitates transactions.
Unit of Account (UoA): Measures the value of goods and services.
Historically, monetisation of an asset follows four stages:
Collectible.
Store of Value.
Medium of Exchange.
Unit of Account.
As economist William Jevons put it, even gold became money first as a store of wealth, not as a medium of exchange. Bitcoin is currently in the SoV stage, arguably the most critical moment in its monetisation journey.
Why we need a better store of value
Since abandoning the gold standard, fiat currencies have become poor stores of value. Central banks print money to stimulate economies, but this increases inflation, erodes purchasing power, and exacerbates wealth inequality.
🧾 In the United States, for example:
The cost of living has far outpaced wage growth since the 1970s.
The bottom 50% of wealth holders have seen little improvement, while the top 0.1% have tracked closely with money supply (M2).
This is the hidden tax of inflation, a burden that hits the working class hardest.
The result? People seek alternative SoVs: property, stocks, gold, art, and now...Bitcoin.
Time, energy, and value
Money, when used as a store of value, is essentially a store of time and energy. You earn it through labour and creativity. When you save it, you expect to be able to redeem it later for goods and services of equal or greater value.
Storing that time in an inflationary currency is like putting water into a leaking bucket. Your effort evaporates.
Bitcoin fixes this.
Why Bitcoin is the ultimate store of value
Unlike any asset before it, Bitcoin has both programmed scarcity and finite supply:
The supply is hard-capped at 21 million coins.
The issuance rate halves every four years (the halving).
As of May 2024, Bitcoin’s annual inflation rate is just 0.8%, officially making it scarcer than gold (which inflates at ~1.5–2% per year).
In fact, by 2032, 99% of all Bitcoin will be mined. Its supply is immutable, no central authority can change it. This is unprecedented. No physical resource, no matter how rare, can match this level of enforced scarcity.
Most assets inflate with demand. When gold prices rise, mining increases. But Bitcoin's supply cannot be increased beyond its pre-set schedule. That means the only way to meet higher demand is through price appreciation.
Volatility is a feature, not a bug
Critics argue that Bitcoin is too volatile to be a safe investment.
But volatility is a natural part of monetisation. Every asset on its journey to becoming a global standard experiences turbulence. Over time, this volatility decreases, but even now, Bitcoin has a reliable pattern.
If you had held Bitcoin for any four-year period since its inception, you'd be in profit. The 200-week moving average shows a steady upward trend.
The key is long-term conviction, what Bitcoiners call HODLing. Yes, there have been crashes of 30%, 50%, even 80%. But those who understood the fundamentals and stayed the course have been rewarded.
A once-in-a-generation opportunity
Bitcoin is not just a store of value, it’s the most asymmetric investment opportunity of our time. Most people still don't understand it. Some see it as speculative, risky, or “just for criminals.” But that’s changing, especially after the January 2024 approval of Bitcoin Spot ETFs in the US. This marked the end of Bitcoin’s first era (2009–2024) and the beginning of its financial mainstreaming.
🚀 Now, institutional money, pension funds, mutual funds, and retirement plans, can flow into Bitcoin via regulated ETFs. This creates the potential for a massive capital inflow, even if just 1–2% of global asset allocations shift towards Bitcoin.
Gradually, then suddenly
The institutional phase has only just begun. Due diligence, internal approvals, and regulatory compliance take time, but they’re happening.
As governments are now becoming involved we will tip into from the “gradual” phase into the “sudden” one, possibly triggering a supply shock and a price movement that history books will remember.
Estimating Bitcoin’s true potential
Global asset value is around $900 trillion. Bitcoin’s market cap is currently ~$1.64 trillion. If Bitcoin captures just 5% of global wealth, a reasonable SoV allocation, it could reach $2 million per coin in today's dollars.
At today’s price (~$82.5k), as of 29/03/2025, that’s a 24.22x return in real terms. Possibly more in nominal terms, as fiat currencies continue to depreciate.
Conclusion: the internet of money
Bitcoin is the digital apex of thousands of years of monetary evolution. It's the first asset engineered to store value forever, immune to inflation and manipulation.
It is:
Scarce.
Durable.
Portable.
Divisible.
Verifiable.
Immutable.
Decentralised.
Yet, despite all this, most people still don’t get it. Just like the early internet, Bitcoin is misunderstood, until one day, it’s simply part of everyday life.
Final word
“Everyone gets Bitcoin at the price they deserve.”
Bitcoin rewards curiosity, patience, and understanding. It punishes those who rely on mainstream media headlines and fail to do the work.
You don’t need to become a tech expert. But you do need to study money, understand time preference, and realise that Bitcoin is more than just a price chart.
This isn’t just an investment. It’s a revolution in value itself.
The train is boarding. You decide when to get on.
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