A very excellent essay, especially about how bitcoin creates a self-funding, self-extending network. I’m reminded of some work on self-extending networks from earlier this century.
The market clearly finds bitcoin acceptable, and acceptability would seem to be essential feature that makes a medium of exchange workable. Various fiat currencies are accepted for tax payments, which makes them useful to merchants, and therefore acceptable. Bitcoin has found ways of being acceptable without first being used for tax payments, which is a substantial plus, possibly all the more so for those of us who don’t want to finance the warfare state.
To paraphrase a speech I heard Doug Casey give many years ago, money has value because it is convenient, consistent, divisible, durable, and accepted. Bitcoin is convenient because of its widespread availability and because of the very large number of applications and platforms developed for its use. It is consistent because of the large number of implementations of its open source code for mining, payment processing, and payment confirmation. It is divisible into small amounts. It is durable because of the very large number of computers processing the Bitcoin core software, where the bitcoins exist in enormously redundant databases that are mutually consistent and synchronised. Bitcoin has value because it is accepted by merchants and individuals as a medium of exchange.