The Point of No Return

Some of you probably saw a post here the other day. Something like "hyperbitcoinization happens when 1 BTC can buy a house". It's a nice thought, but it's superficial. It's a comparison of prices, and prices are just noise.

The real point of no return is not about price. It's about proof of work. It's the moment our civilization decides it is more important to expend the energy to create one new Bitcoin than it is to expend the energy to build one new house.

To build a house, you need a certain amount of energy. You need energy to forge the steel, mix the concrete, cut the lumber, and power the tools that put it all together. This is the proof of work for a physical home. This cost is relatively stable.

To create a Bitcoin, you need a certain amount of energy. You need electricity to power the ASICs that guess trillions of hashes per second. This is the PoW for absolutely scarce money. This cost is designed to do one thing: go up forever. Why?

2 reasons: 1, the difficulty adjustment means that as more people compete to mine, the work gets harder. And 2, the halving means that every 4 years, the reward for the same amount of work gets cut in half.

The trajectory is set. The cost of building a house is a flat line. The cost of mining a Bitcoin is a line on an unstoppable, exponential ascent. These two lines are on a collision course. I don't know exactly when, since I don't know how to track global housing construction costs and global bitcoin mining costs. But I know it's very near. The "point of no return" is the moment those two lines cross. It's the moment that the real world energy cost to secure one new block on the chain becomes greater than the real world energy cost to build a new home for a family.

When that day comes, it's not a matter of market sentiment or speculation. It is a fundamental, physical signal from the global economy. Like myself, construction workers won't be able to track the exact date, but the free market will tell them where to find work. There will be a lot more jobs in the bitcoin mining industry. Everything will slowly lead to the moment when market forces recognize that the most important thing we can build is not another physical structure, but another immutable block of truth on a new, incorruptible monetary network.

We are near the dawn of The Bitcoin Standard (shout out to Saifedean Ammous).