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Blink 3 of 8 - The 5 AM Club
by Robin Sharma
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The Bitcoin Standard summary
Saifedean Ammous
The Decentralized Alternative to Central Banking
27 mins
Brief summary
The Bitcoin Standard by Saifedean Ammous is a comprehensive history of money and its flaws, with a focus on the potential of Bitcoin as a secure, decentralized currency that could revolutionize the financial system.
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The Bitcoin Standard
Summary of 9 key ideas
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Key idea 1 of 9
Money was first used as a medium of exchange.
How does an economy work without money? Simple, you swap stuff. Call it barter, or direct exchange. You could trade two pigs for a cow, or for a haircut – it all depends on what you have and what your neighbor needs, or vice versa. But here’s the problem: sometimes those things don’t align. Don’t have anything to tempt your would-be trading partner? Well, tough luck – you won’t get what you want, either! That’s where money comes in. Because everyone wants it, you can use it for any transaction. That’s known as indirect exchange.
Early money wasn’t anything like the stuff you keep in your wallet today, though.
Take the inhabitants of Yap Island in the Federated States of Micronesia. Well into the nineteenth century, they used “Rai stones” for their trading. These stones came in all shapes and sizes, the largest weighing a staggering four tons! When a new stone was ready, it was dragged up a hill so that everyone could see it. Its owner would then exchange ownership or part-ownership of the stone for goods and services. Every transaction was announced to the whole community, which in turn acknowledged the exchange.
This kind of money worked for so long because it was salable. The Yap Islanders knew that if they owned Rai stones, they could also sell them. The added boon was that they could be used around the whole island since the stones were visible from any point. They were also divisible. If you wanted something small like a basket of fruit, you sold a small part of your stone; if you wanted something bigger like a raft, you sold a larger piece, or even the whole stone.
So if Rai stones worked so well, why don’t the Islanders still use them today? Well, there was a snag: they didn’t retain their value, or salability over time. Initially, that hadn’t been an issue. Quarrying and moving them from nearby islands was such a difficult business that the supply of stones was limited and their value remained stable. That changed in the late nineteenth century with the arrival of David O’Keefe, an Irish-American captain who’d been shipwrecked on the island. O’Keefe started importing Rai stones in large numbers using modern technology to exchange for coconuts. Soon enough, they were so commonplace that they no longer worked as money – they had been transformed back into mere stones!
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What is The Bitcoin Standard about?
The Bitcoin Standard (2018) traces the story of money, from the very first rock currencies to the Victorians’ love affair with gold and today’s new kid on the block – digital cryptocurrency. Saifedean Ammous, an economist convinced that we need to embrace the forgotten virtues of sound money, believes Bitcoin might just be the future. Like yesteryear’s gold reserves, it has unique properties that mean it’s ideally placed to act as a medium of exchange that can’t be manipulated by bumbling governments. And that’s great news if we want to return our economies to stability and growth and put the cycle of boom and bust behind us.
The Bitcoin Standard Review
The Bitcoin Standard (2018) is an insightful exploration of the history, economics, and societal impact of Bitcoin. Here's why this book is worth reading:
- With in-depth analysis and historical context, it helps readers understand the origins and potential of Bitcoin, making it a valuable resource for anyone interested in cryptocurrency.
- The book challenges conventional wisdom about money and central banking systems, offering fresh perspectives that provoke critical thinking and stimulate intellectual curiosity.
- Supported by thorough research and a clear, coherent writing style, this book avoids jargon and effectively communicates complex concepts, ensuring that it remains engaging and accessible throughout.
Best quote from The Bitcoin Standard
The Yap stones today play only a ceremonial and cultural role on the island of Yap.
—Saifedean Ammous
Who should read The Bitcoin Standard?
- People interested in the history of money
- Economists and business buffs
- Anyone with an eye on the future
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The Bitcoin Standard FAQs
What is the main message of The Bitcoin Standard?
The main message of The Bitcoin Standard is the importance of understanding the principles, benefits, and potential of Bitcoin as a decentralized currency.
How long does it take to read The Bitcoin Standard?
The estimated reading time for The Bitcoin Standard is several hours. The Blinkist summary can be read in a matter of minutes.
Is The Bitcoin Standard a good book? Is it worth reading?
The Bitcoin Standard is a worthwhile read for anyone interested in Bitcoin. It provides valuable insights on the history, economics, and implications of this digital currency.
Who is the author of The Bitcoin Standard?
The author of The Bitcoin Standard is Saifedean Ammous.
What to read after The Bitcoin Standard?
If you're wondering what to read next after The Bitcoin Standard, here are some recommendations we suggest:
- Blockchain Revolution by Don Tapscott and Alex Tapscott
- Cryptoassets by Chris Burniske and Jack Tatar
- The Promise of Bitcoin by Bobby C. Lee
- Digital Gold by Nathaniel Popper
- The AI-fication of Jobs by Huy Nguyen Trieu
- Who Can You Trust? by Rachel Botsman
- Ethereum by Henning Diedrich
- 12 Rules For Life by Jordan B. Peterson
- Hope by Pope Francis
- Make Today Count by John C. Maxwell
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