Bitcoin or Crypto: What's Better for Business?

When deciding whether your business should get involved with bitcoin or crypto, not understanding the fundamentals of each can lead to lost time, lost money, and a sour taste in your mouth for both.

The revelation that bitcoin presents to the world is that we’ve never had absolutely scarce, truly hard money before bitcoin. 

We’ve never experienced an asset whose supply was intentionally hard-coded to be fixed for both holders and producers alike. We’ve never had money that could transfer infinite value across time and space in a fraction of a second. And we’ve never had money that entirely sidesteps manipulation through debasement or confiscation.

For businesses, such an innovation should fundamentally reshape how they operate.

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Why do so many consider bitcoin and crypto a scam?

For the uninitiated, bitcoin may seem like nothing more than “tulip mania,” wishful thinking, naive speculation, or a futile use of people’s time and energy. They rightfully identify the general crypto space as a haven for scammers, thieves, rug pulls, and fraudulence, but make the critical mistake of grouping bitcoin together with that realm. 

What has followed bitcoin’s 2009 launch is a wave of speculative cryptocurrencies aiming to make improvements on bitcoin’s design, or attempt differentiation by “not competing” but offering “novel” utility.

What undermines every other cryptocurrency’s cause, however, stems from the fact that without standalone monetary properties, such a currency will fail to retain network effects, and thus usefulness in an economy, over the long term. 

You don’t even need to look at the millions of failed cryptocurrency launches over the past decade—look at the history of the how long the world’s reigning fiat currencies lasted:

• Florin (Fiorino) – Florence, Italy (circa 1252–1400s) (~150 years)
• Ducat – Venice, Italy (circa 1300s–1500s) (~200 years)
• Portuguese Cruzado – Portugal (1450s–1550s) (~100 years)
• Spanish Real de a Ocho (Piece of Eight) – Spain (1500s–early 1800s) (~300 years)
• Dutch Guilder (Gulden) – Netherlands (1600s–early 1800s) (~120 years)
• French Livre – France (1700s–early 1800s) (~80 years)
• British Pound Sterling – United Kingdom (1815–1944) (~130 years)
• US Dollar – United States (1944–present) (~81 years and counting)

The Spanish Real sits at the top of the leaderboard, maintaining 300 years of dominance in the past millennia. However, as is baked into every fiat currency and cryptocurrency besides bitcoin, their inflationary design—or necessitated trust not to inflate—mathematically, inevitably erases their reliability, and thus the network of users relying on them.

Money is unique in that its monetary premium is the foundation for its long-term reliability. Sufficient network effects can only be achieved through reasonable expectation that value stored in a given money will last into the future. Money’s network effects stand in stark contrast to the network effects of social media, device manufacturers, or software platforms because the latter three do not need inherent monetary premium; they only need a useful product.

In the game of money, its usefulness is derived through its monetary premium. All cryptocurrencies besides bitcoin make the mistake of inverting the premise, assuming that premium is derived through its usefulness and not the other way around. 

Most notably, Ethereum, the second-largest cryptocurrency by market cap, underwent a significant protocol update in 2023 known as the “Merge,” which transitioned the token from a proof-of-work consensus mechanism to a proof-of-stake mechanism, and touted a new supply issuance mechanism that suggested a net deflationary token, provided that gas fees burned on the network sufficiently offset new token issuance.

But there’s one major problem: instigating such a shift in monetary policy sets the precedent for trust, just as is required by traditional fiat currency. 

As a result, Ethereum’s supply has already increased since the Merge, solidifying the requirement of trust to prevent inflation and uphold integrity of its network. The need for trust means less users, less users means less burned gas fees, and less burned gas fees means more tokens in circulation.

Even if this trend were to reverse again, the damage has already been done: How can one reasonably expect that supply inflation won’t return in the future?

Ironically, as bitcoin’s protocol nullifies the need for trust—established by an anonymous founder, relying on verifiable cryptographic consensus instead of trusted third parties, acquired via real-cost mining with no preferential distribution, all of which are enforced through an unchanging proof-of-work consensus mechanism—it sets the precedent for a currency that individuals, businesses, and the world can finally trust in. Bitcoin’s fundamentals create a monetary premium worth paying for.

If we look more closely at the fruits of each system, what we identify is:

• A single currency that’s cultivating stronger and stronger network effects, increasingly equitable distribution, and proving its integrity to countless businesses and thousands of individuals who have relied on it to keep wealth safeguarded from unpredictable political and economic dynamics.
• An exponential expansion of tokens cannibalizing the hot ball of money speculating on which one is best. Disingenuous revolutions, memecoins, and government-endorsed pump and dumps disintegrate public wealth and trust as a result.

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What should business owners understand?

“Bitcoin is a discovery on par with that of the wheel, the number zero or the ability to start a fire, mistaken for a gimmick by the masses.” – Knut Svanholm

Business owners must realize that the discovery of absolute scarcity is something that cannot be replicated. It’s a one-time improvement; there was a world before absolute scarcity, and a world after it.

Beyond the crypto noise is a new paradigm that bitcoin represents—a seismic monetary shift happening on a global scale. Such a grand movement is attractive to conniving opportunists who want to ride bitcoin’s coattails and make easy money off the backs of innocent but ill-informed people.

The reality is that bitcoin resulted from a rich playground of ideas coming together to address the inflationary virus plaguing business growth worldwide.

“The idea of online cash was among the first ideas emerging on top of the internet since the dawn of this new telecommunication protocol’s first iteration. The idea being, allowing citizens of the world to send, receive, and store value in a digital way. In fact, hundreds if not thousands of cryptographers have tried inventing digital money. The path to bitcoin is littered with the corpses of failed attempts. 

I’ve compiled a list of about a hundred cryptographic payment systems, both e-cash and credit card-based technologies, that are notable in some way. Some are academic proposals that have been well cited while others are actual systems that were deployed and tested.” – Arvind Narayanan

Just as the internet became essential to operating in a 21st century economy, just as social media became essential to effective marketing in the 21st century economy, bitcoin is becoming essential for financial stability in the 21st century economy.

Your business’s greatest innovation probably won’t come from a new product offering or a new brand identity—it likely stems from a fundamental overhaul to the lubricant fueling your business’s engine. Capital reserved in cash bleeds away, undermining your long-term growth efforts. You need to store your capital in an asset that:

• offsets increasing operational costs
• sustains incoming revenue as long as possible
• redirects your time, focus, and energy away from capital preservation and back onto providing the very best service to your customers.

Bitcoin is the only asset on the planet able to guarantee all three. Crypto is merely a distraction that keeps your business running on the hamster wheel. Bitcoin frees you from the wheel entirely and puts you out on the open road so you can truly make progress.

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Take the leap to a Bitcoin Business Standard

As accelerating inflation eats away at business growth, bitcoin is a truly novel software update to an insidious virus in modern money’s programming.

Adopting the Bitcoin Business Standard goes far beyond mere capital allocation; it’s a holistic approach that revitalizes your business’s financial, cultural, and philosophical outlook. To get started, schedule a consultation with our team today, and we’ll earn you back the time spent learning how bitcoin is best for your business.