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Executive summary: Debunking The Bitcoin Nation-State Theory

Bitcoiners love the idea that governments will buy BTC with fiat currency. But under what circumstances could that happen and which governments are likely to do so? I explore the ideas behind the Bitcoin nation-state theory and point out flaws in its reasoning.
Executive summary: Debunking The Bitcoin Nation-State Theory

Executive summary:

  • Bitcoin nation-state theory is the idea that nations will FOMO into BTC.
  • They might do so because BTC is harder money than fiat and because they want to get off the dollar.
  • The current system is debt-based. In crypto terms, the central banks can mint unlimited fiat tokens to finance their debt.
  • Bitcoin is a decentralized alternative without a central bank. Nation-states might become interested in using it.
  • All countries except for the financial hegemons have a degree of interest in using alternative currencies and payment ledgers.
  • As a digital collateral, Bitcoin is an interesting alternative, particularly for weaker currencies excluded from the current system.
  • The nation-state theory is based on several unrealistic assumptions, which often revolve around a faulty profit motive of governments. Therefore, it is unlikely to play out in its entirety.

Full article:

Debunking the Bitcoin Nation-State Theory | CoinMarketCap
There’s a lot of enthusiasm and hype about it in the Bitcoin community, particularly when Bitcoin-related news on the national level breaks — but is it all smoke and mirrors?