Saifedean Ammous considers that Bitcoin has the strongest currency in world history. The economist believes that a company can invest its surplus in the pioneering cryptocurrency.
Institutional Bitcoin (BTC) adoption has reached unexpected levels since 2020, as companies and countries like El Salvador have accumulated the crypto asset. Economist Saifedean Ammous, the author of The Bitcoin Standard, recently explained why the interest in the pioneering cryptocurrency grew so much.
Ammous stated that at least two main attractions lead companies to include BTC in their accounting books. He believes that it has been the fastest and strongest currency in world history.
The economist considers that the limited supply of Bitcoin and the difficulty of creating more coins make Bitcoin superior to any other currency. In that regard, he said that the cryptocurrency is resistant to inflation without depending on a trusted third party.
The Limited Supply of Bitcoin Makes It a Deflationary Currency
According to Ammous, the rate of increase in the supply of Bitcoin is slower than with any other known currencies. He pointed out that this feature makes it the least inflationary money worldwide.
He commented that anything could serve as money, but people will only issue more if it is easy to create. He warned that something too simple to make would no longer be a currency as it would lose its value.
The educator also considers the speed of Bitcoin as a cross-border settlement asset crucial for institutions to use it. He argued that options to move large amounts of money across borders always include trusted third parties such as banks and governments. He highlighted that this process takes longer than the roughly 10 minutes per confirmation that the Bitcoin network requires.
Additionally, he said that a block adds to the Bitcoin accounting ledger every 10 minutes, making it a secure tool. A security layer protects it against fraudulent transactions and prevents the reversal of transactions.
The Amount of Money that Companies Can Allocate to Bitcoin
The writer gave his opinion about how much money a company can bet on the pioneering cryptocurrency. He stated that its income should grow faster than the rate of money printing not to lose capital and wealth as an institution. For that reason, it makes sense for it to have the strongest currency in history on its balance sheets.
Ammous finds it reasonable to guarantee the expenses for a range between 24 and 36 months. He believes that it can invest its entire surplus in the crypto asset.
The economist explained that the constant increase in the value of BTC guarantees protection against inflation. That has driven many leading companies to invest in it to keep it in their coffers.
In that regard, he noted that Bitcoin has never generated losses in a range of four years. Therefore, he thinks it is safe for companies to invest in it to prevent losing capital with fiat money. For example, Jesse Powell recently said that the US dollar is undergoing devaluation.
By Alexander Salazar
