🎯 Core Question: In today's world where mobile payments are so convenient, we seem to have no shortage of payment tools. So why do we still need a brand new, intangible 'digital currency' like Bitcoin?

📚 Key Knowledge Points:

  • Key Point One: [The Essence of Money]
    Regardless of whether the form is shells, gold, or paper currency, the core functions of money always remain three points:Store of value(can save money),Medium of exchange(can spend money) andUnit of account(can price). The evolution of money is the process by which humanity seeks better mediums to achieve these three functions. Paper money (fiat money) has prevailed in modern times due to its portability and standardization, but it also brings a fatal weakness.

  • Key Point Two: [The 'Centralized' Dilemma of Fiat Currency]
    The currency we use today derives its value from the credit endorsement of the government and the central bank. This 'centralized' issuance mechanism grants the central bank the power to print unlimited money. When the economy needs stimulation, the central bank can increase the money supply, but this dilutes the purchasing power of every penny you hold, which isinflation.Your wealth is eroded without you even realizing it, and you have almost no ability to resist it.

  • Key Point Three: [The Birth of Decentralized Currency]
    The emergence of Bitcoin is precisely to solve this 'centralized' problem. It does not rely on any government or bank for issuance but operates through a publicly transparent mathematical algorithm (blockchain technology). Its total supply has been capped from the very beginning (21 million coins), and no one can issue more. This gives it the potential to counter inflation, becoming an asset that truly returns ownership to individuals.

💡 Investor's Perspective:
A smart investor should first understand what problem any asset 'solves' before purchasing it. The starting point for investing in cryptocurrency should not be 'how much it can increase,' but rather understanding the inherent risks of centralization and inflation in the fiat currency system. Once you grasp this, you can understand why the market needs a 'decentralized' alternative and maintain a fundamental belief in holding assets amid market fluctuations.

Terminology Classroom:

  • Fiat Currency: Refers to currency mandated by national law, which has no intrinsic value itself; its value comes from the government's credit endorsement. For example: US dollar, Chinese yuan, euro, etc.


Besides inflation, what other inconveniences or injustices have you encountered while using current banks or payment systems?
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