Recently I was talking with a few friends all of whom were into cryptocurrencies. But when I changed the discussion a bit and asked which one is actually using Bitcoin as a payment method, I only got blank stares.

So all of them were buying and selling, following news and technology development but no one was making crypto payments and doing real life transactions. To be honest I was a bit disappointed.

Hodl

The general mood — among them and among the crypto community is that the Bitcoin price will rise. Yes, undeniably, there have been periods of bear markets, low interest and lowered prices (like in 2018, 2014 and multiple times before) but in the long term, the trend is clearly upwards. And everybody believes that trend will continue. Hence the “hodl” mentality — if I spend $10 in BTC now, those $10 could become $100 in an year if the BTC value increases 10 times and I would end up losing the opportunity to have $90 more. And this kind of increase has already happened multiple times.

“Hodl” comes from “hold” but written with a typo. Somehow it became popular in the crypto community and is often used instead of its original form when talking about holding or spending BTC.

But if everybody thinks so, then everybody will only stash those precious coins and will never make a purchase with them. They will use Fiat money only. Which will only make the Fiat money more valuable because that’s what is used daily. Which basically renders Bitcoin useless as a money and we only end up with a very expensive store of value. This is still not bad if the price somehow increases, but we’d lose much more — to have a decentralized money system that is not run by banks and governments — money, that is immune to inflation and hyperinflation and that can be easily sent everywhere, across borders and continents without intermediaries and without anyone being able to stop the transaction.

What if we could have both?

Spend and replace

We all know that the real value of any asset comes from adoption. I’m not in any way against holding Bitcoin long term. Of course, we could have a few million people that are holding a few Bitcoins and that will give them some value. But that value can be multiplied if those few million people are still holding but are also buying stuff with Bitcoin.

Some would say that this contradicts the hodl mentality and we’ll only get lost potential gains in the future. But this is not the case.

For easier calculation, lets assume that at the time of purchase 1 BTC = $10,000 and 0.01 BTC = $100 respectively.

If we have 1 BTC and what to buy something for $100, we can of course keep the Bitcoin and pay with dollars. The end result would be that we still have 1 BTC, $100 less and the merchant has $100 more. The Bitcoins that are kept in user wallets are still 1 BTC and nothing changed in that regard.

But instead, we can play this differently.

If we buy the product with 0.01 BTC and then immediately buy another 0.01 BTC with our $100 (to restore the spent amount), the end result for us will be the same but it won’t be the same for Bitcoin. We’ll still have 1 BTC and $100 less. But the merchant will have 0.01 BTC more and the Bitcoins that are kept in wallets will be 1.01. Effectively we have removed 0.01 BTC from the open market and moved it to someone else that might also hold it.

Of course, some merchants are automatically selling the Bitcoin they receive for Fiat but some are keeping parts of it. And some are keeping them all.

The more purchases people make with Bitcoin, the more coins will be off the market which will increase the price organically. This will make more merchants to keep the coins they receive and this will increase the price even more. Which will make more merchants to know about accept cryptocurrencies and so on.

If we use Fiat money for purchases, we give Fiat money value. If we use cryptocurrencies for purchases, we give cryptocurrencies value. Every time we spend some Bitcoins (no matter how small fraction of it) and we rebuy that amount with Fiat, we help the network evolve and grow. Without losing BTC, without losing potential gains, without losing money, without losing anything.

Do we want a digital gold which price is only determined by speculation or do we want an amazing form of money which we can keep AND also help grow in popularity and price?

If you agree or want to read more in the future consider donating some BTC to 31qz4FdkfFrBWQ1KbSNN2aCa9GADcfpctT.