# Bitcoin — Bart Lorang

Source: https://bartlorang.com/bitcoin

# Bitcoin ₿

I get asked about Bitcoin a lot, so here's the primer I share with friends: where money came from, what makes money good, how Bitcoin works, how to get started, and the best stuff to watch and read if you want to go deeper.

[First principles](#first-principles) · [History of money](#history) · [Perfect money](#perfect-money) · [Bitcoin basics](#basics) · [Risks](#risks) · [Get started](#get-started) · [Watch](#watch) · [Read](#read) · [Resources](#resources)

## First principles of Bitcoin

1.  In a truly free market, where participants are allowed to choose, the best money naturally emerges over time.
2.  Money is a tool for moving value across time and space. The better it holds value, the better it does both.
3.  The hardest money wins. Money that is costly to produce and hard to inflate keeps its value; everything else gets debased.
4.  Whoever can create money at will taxes everyone who holds it. Inflation quietly transfers wealth from savers to the issuer.
5.  Money is a social consensus: a shared ledger of who is owed what.
6.  Bitcoin’s 21 million supply cap is enforced by code and by every node that runs it, not by anyone’s promise.
7.  Don’t trust, verify. Anyone can check the rules and the entire ledger for themselves.
8.  Not your keys, not your coins. If someone else holds your keys, you hold an IOU.
9.  Proof of work ties digital money to real-world energy. Creating a new block has a real cost that can’t be faked.
10.  Decentralization is what makes the rules credible. No single party can change them.
11.  A ledger anyone can join without permission is neutral. It doesn’t care who you are or where you live.
12.  Money that can’t be censored or seized protects the people who need it most.
13.  Sound money lowers time preference. When savings hold their value, people save more and think long term.

## A brief history of money

1.  **Barter.** Direct exchange of goods and services. Inefficient, not divisible, hard to store value.
2.  **Commodity money.** Gold, silver, shells, tobacco, cigarettes, beans, pelts. Intrinsic value and widely accepted, but heavy, hard to divide and not always portable.
3.  **Paper money.** Introduced as receipts for gold. Lightweight and easier to trade, but requires trust in the issuer.
4.  **Fiat money.** Government-issued money with no intrinsic value (e.g., USD). Convenient and widely accepted, but unlimited supply means inflation, debasement and dilution, and trust breaks down in crises.
5.  **Digital fiat money.** Bank transfers, credit cards, mobile payments. Instant and global, but centralized control, privacy concerns, and governments can still print and debase.

## Characteristics of perfect money

-   **Scarcity**: limited supply to retain value over time.
-   **Durability**: long-lasting and resistant to wear.
-   **Divisibility**: easily split into smaller units.
-   **Portability**: easy to carry and transfer globally.
-   **Fungibility**: each unit is identical and interchangeable.
-   **Security**: resistant to counterfeiting and theft.
-   **Decentralization**: no central authority controlling issuance or value.
-   **Global accessibility**: usable by anyone, anywhere, without intermediaries.

### Bitcoin vs. gold vs. USD

Bitcoin

Gold

USD

Scarcity

✅ Fixed supply (21M)

✅ Limited by nature

❌ Unlimited (inflationary)

Durability

✅ Digital, can't degrade

✅ Durable, can wear

✅ Durable paper/plastic

Divisibility

✅ 100M satoshis per coin

❌ Hard to divide

✅ To the cent

Portability

✅ Global via the internet

❌ Heavy in quantity

✅ Physical and digital

Fungibility

⚠️ Traceable; tainted coins

✅ By weight/purity

✅ Interchangeable

Security

✅ Decentralized + cryptography

✅ Can't counterfeit; can be stolen

❌ Counterfeiting, inflation

Decentralization

✅ No central authority

✅ Naturally occurring

❌ Central banks

Global access

⚠️ Needs internet and know-how; fees vary

❌ Not easily accessible

✅ Widely accepted

## Bitcoin basics

### What is Bitcoin?

-   An ideology, a protocol, a network, and a digital commodity.
-   Best thought of as "digital gold" and a store of value.
-   A decentralized network not controlled by governments, corporations or banks. Open source, no governing body, no issuer.
-   Limited supply: only 21 million coins, mined by the year 2140 (about 19.9M exist today).
-   Created by Satoshi Nakamoto, an anonymous creator who has since disappeared and was clearly extremely well versed in cryptography, economics, mathematics and operational security.

### How does it work?

-   Transactions are recorded on a public ledger called the blockchain (or timechain).
-   Miners and nodes validate transactions and secure the network, earning new coins and transaction fees.
-   You store bitcoin in wallets using private and public keys.
-   The network is millions of times more powerful than the world's best supercomputer, with 10,000x more computing power than all of Google.

### Why is it valuable?

-   Scarcity: the 21 million cap makes it a strong store of value.
-   Fast, low-cost global transactions (about 10 minutes to full confirmation and settlement).
-   Secure, with no reliance on intermediaries.
-   Cost of production: mining takes serious computing power, electricity and specialized equipment, much like mining gold, which acts as a kind of price floor. Energy and compute tie Bitcoin to the laws of physics and the real world.

## What are the risks?

-   Price is volatile measured in USD, though it's expected to become less volatile as it matures with each 4-year halving cycle.
-   Wallets and private keys must be kept secure: "Not your keys, not your coins."
-   Some countries regulate or restrict it, since it threatens government control of money.

## How to get started

### Ways to use Bitcoin

-   Buy it on an exchange (Coinbase, Gemini, Strike) or earn it by mining.
-   Buy it through ETFs (BlackRock, Fidelity, Grayscale, Franklin Templeton, etc.).
-   Store it in a digital wallet (hot or cold).
-   Spend it with merchants or send it anywhere in the world.
-   The Lightning "Layer 2" network is emerging for instant payments.

### Next steps and self-custody

1.  Create a Strike or Coinbase account and buy some bitcoin.
2.  Set up a non-custodial wallet (e.g., [BlueWallet](https://bluewallet.io)).
3.  Send bitcoin to, and from, your non-custodial wallet.
4.  Store your seed words somewhere safe!

## Long-form viewing & videos

-   [What's the Problem? Demystifying Why We All Need Bitcoin](https://youtu.be/YtFOxNbmD38) (39m)
-   [Michael Saylor – Bitcoin 2024 Keynote](https://youtu.be/mOne66vv2QU) (37m)
-   [The Saylor Series w/ Robert Breedlove](https://youtube.com/playlist?list=PL2jAZ0x9H0bQFY6wIbQfnrnIlqMcSHd6X) (18 videos, 25h; first-principles answer to "What is money?"). **Amazing.**
-   [Michael Saylor – 21 Truths of Bitcoin](https://x.com/DocumentingBTC/status/1902882826682261582) (35m)
-   [Michael Saylor / Strategy (MSTR) – 2025 Q1 Earnings](https://www.youtube.com/watch?v=dXk6H1efCsM) (2h)
-   [Michael Saylor – Bitcoin for Corporations 2025 Keynote](https://www.youtube.com/watch?v=3-vBBYEXv6M) (1h)
-   [Michael.com](http://michael.com): archive of Saylor media
-   [God Bless Bitcoin](https://youtu.be/oksraL7wN6Q) (documentary, 1.5h)
-   [Jesse Myers – 4th Halving Presentation @ MIT](https://x.com/Croesus_BTC/status/1914692297071190251) (15m)

## Recommended books

-   [_The Bitcoin Standard_](https://www.amazon.com/dp/1119473861) by Saifedean Ammous
-   [_Broken Money_](https://www.amazon.com/dp/B0CG8985FR) by Lyn Alden
-   [_Bitcoin One Million: The Final Chapter of Fiat_](https://www.amazon.com/dp/B0FTWLF781) by Fred Krueger and Ben Sigman
-   [_Bitcoin Is for Everyone_](https://www.amazon.com/dp/1804091138) by Natalie Brunell
-   [_The Treasury of Michael Saylor_](https://treasuryofsaylor.com/) by Anil Patel
-   [_The Big Print_](https://www.amazon.com/dp/B0DWKLX9J7) by Lawrence Lepard
-   [_The Price of Tomorrow_](https://www.amazon.com/dp/1999257405) by Jeff Booth
-   [_The Creature from Jekyll Island_](https://www.amazon.com/dp/0912986212) by G. Edward Griffin
-   [_Gradually, Then Suddenly_](https://academy.saifedean.com/product/gradually-then-suddenly-hardcover/) by Parker Lewis
-   [_A History of Money and Banking in the United States_](https://www.amazon.com/dp/0945466331) by Murray Rothbard
-   [_The Fiat Standard_](https://academy.saifedean.com/product/tfs-hardcover/) by Saifedean Ammous
-   [_The Bitcoin Dollar: An Economic Monomyth_](https://www.amazon.com/dp/B0CGG64YSM) by Mark Goodwin

## More resources

### Papers & reports

-   [What's Driving Bitcoin Adoption in 2025?](https://river.com/learn/files/river-bitcoin-adoption-report-2025.pdf) by [River](https://river.com/)
-   [Bitcoin Price and Its Marginal Cost of Production](https://arxiv.org/pdf/1805.07610) (paper on mining)

### Websites

-   [Bitcoin for Corporations](https://b.tc/corporations)
-   [Priced in Gold](https://pricedingold.com/) (e.g., home prices in sound money)
-   [Bitbo](https://charts.bitbo.io/price-prediction/) (tons of Bitcoin analytics)
-   [Bitcoin Reserve Monitor](https://bitcoinreservemonitor.com/)
-   [The Saif House](https://thesaifhouse.com/) (Bitcoiner's bookshop)
-   [Porkopolis Economics](https://www.porkopolis.io/)
-   [Bitcoin One Million](https://b1m.io/) and its [retirement calculator](https://b1m.io/calculator)

### Podcasts

-   [The Bitcoin Standard Podcast](https://saifedean.com/podcast) with Saifedean Ammous
-   [What Is Money? Show](https://whatismoneypodcast.com/) with Robert Breedlove

### Bitcoin heating

-   [Exergy](https://exergyheat.com/): Denver Bitcoin heating startup
-   [Bitcoin Mining Heat Reuse](https://braiins.com/books/bitcoin-mining-heat-reuse) by Tyler Stevens
-   [Bitcoin heat reuse (thread)](https://x.com/thetrocro/status/1893550107670519942)
-   [Constellation Heating](https://constellationheating.com/)
-   [Canaan Home](https://www.canaan.io/) and the [Avalon Mini 3](https://www.canaan.io/mini3) space heater
-   [Heatpunk Summit](https://denver.space/heatpunk_summit) (2025, Denver)

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